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Supplemental Equity and Comprehensive Income Information
 6 Months Ended
Jun. 30, 2014
Supplemental Equity and Comprehensive Income Information  
Supplemental Equity and Comprehensive Income Information

NOTE 4. Supplemental Equity and Comprehensive Income Information

Consolidated Statement of Changes in Equity

Three months ended June 30, 2014   3M Company Shareholders  
(Millions) Total Common Stock and Additional Paid-in Capital Retained Earnings Treasury Stock Accumulated Other Comprehen-sive Income (Loss) Non-controlling Interest
Balance at March 31, 2014 $ 17,924 $ 4,554 $ 33,312 $ (16,577) $ (3,841) $ 476
                    
Net income    1,283      1,267         16
Other comprehensive income (loss), net of tax:                  
Cumulative translation adjustment   127            123   4
Defined benefit pension and post-retirement                  
 plans adjustment   60            60   ―
Debt and equity securities - unrealized gain (loss)    1            1   ―
Cash flow hedging instruments - unrealized                  
 gain (loss)    (9)            (9)   ―
Total other comprehensive income (loss), net                  
 of tax    179               
Dividends declared   (556)      (556)         
Purchase of subsidiary shares   (5)   (1)            (4)
Stock-based compensation, net of tax impacts    97   97            
Reacquired stock    (1,382)         (1,382)      
Issuances pursuant to stock option and                  
 benefit plans    306      (187)   493      
Balance at June 30, 2014 $ 17,846 $ 4,650 $ 33,836 $ (17,466) $ (3,666) $ 492
                    
Six months ended June 30, 2014    3M Company Shareholders  
(Millions) Total Common Stock and Additional Paid-in Capital Retained Earnings Treasury Stock Accumulated Other Comprehen-sive Income (Loss) Non-controlling Interest
Balance at December 31, 2013 $ 17,948 $ 4,384 $ 32,416 $ (15,385) $ (3,913) $ 446
                    
Net income    2,508      2,474         34
Other comprehensive income (loss), net of tax:                  
Cumulative translation adjustment   147            131   16
Defined benefit pension and post-retirement                  
 plans adjustment   121            121   ―
Debt and equity securities - unrealized gain (loss)    2            2   ―
Cash flow hedging instruments - unrealized                  
 gain (loss)    (7)            (7)   ―
Total other comprehensive income (loss),                  
 net of tax    263               
Dividends declared   (555)      (555)         
Purchase of subsidiary shares   (5)   (1)            (4)
Stock-based compensation, net of tax impacts    267   267            
Reacquired stock    (3,155)         (3,155)      
Issuances pursuant to stock option and                  
 benefit plans    575      (499)   1,074      
Balance at June 30, 2014 $ 17,846 $ 4,650 $ 33,836 $ (17,466) $ (3,666) $ 492

Three months ended June 30, 2013   3M Company Shareholders  
(Millions) Total Common Stock and Additional Paid-in Capital Retained Earnings Treasury Stock Accumulated Other Comprehen-sive Income (Loss) Non-controlling Interest
Balance at March 31, 2013 $ 18,528 $ 4,188 $ 31,073 $ (12,178) $ (5,001) $ 446
                    
Net income    1,213      1,197         16
Other comprehensive income (loss), net of tax:                  
Cumulative translation adjustment   (279)            (260)   (19)
Defined benefit pension and post-retirement                  
 plans adjustment   91            91   ―
Debt and equity securities - unrealized gain (loss)    (4)            (4)   ―
Cash flow hedging instruments - unrealized                  
 gain (loss)    8            8   ―
Total other comprehensive income (loss), net                  
 of tax    (184)               
Dividends declared   (436)      (436)         
Stock-based compensation, net of tax impacts    64   64            
Reacquired stock    (1,232)         (1,232)      
Issuances pursuant to stock option and                  
 benefit plans    366      (118)   484      
Balance at June 30, 2013 $ 18,319 $ 4,252 $ 31,716 $ (12,926) $ (5,166) $ 443
                    
Six months ended June 30, 2013   3M Company Shareholders  
(Millions) Total Common Stock and Additional Paid-in Capital Retained Earnings Treasury Stock Accumulated Other Comprehen-sive Income (Loss) Non-controlling Interest
Balance at December 31, 2012 $ 18,040 $ 4,053 $ 30,679 $ (12,407) $ (4,750) $ 465
                    
Net income    2,360      2,326         34
Other comprehensive income (loss), net of tax:                  
Cumulative translation adjustment   (677)            (620)   (57)
Defined benefit pension and post-retirement                  
 plans adjustment   176            176   ―
Debt and equity securities - unrealized gain (loss)    (4)            (4)   ―
Cash flow hedging instruments - unrealized                  
 gain (loss)    32            32   ―
Total other comprehensive income (loss),                  
 net of tax    (473)               
Dividends declared   (876)      (876)         
Sale of subsidiary shares    8   7            1
Stock-based compensation, net of tax impacts    192   192            
Reacquired stock    (2,039)         (2,039)      
Issuances pursuant to stock option and                  
 benefit plans    1,107      (413)   1,520      
Balance at June 30, 2013 $ 18,319 $ 4,252 $ 31,716 $ (12,926) $ (5,166) $ 443

3M has historically declared and paid dividends in the same quarter. In December 2013, 3M's Board of Directors declared a first-quarter 2014 dividend of $0.855 per share (paid in March 2014). This reduced 3M's stockholders equity and increased other current liabilities as of December 31, 2013 by $567 million. This resulted in total year 2013 declared dividends of $3.395 per share, with $2.54 per share paid in 2013 and the additional $0.855 per share paid in March 2014.

Changes in Accumulated Other Comprehensive Income (Loss) Attributable to 3M by Component   
                   
Three months ended June 30, 2014               
(Millions) Cumulative Translation Adjustment Defined Benefit Pension and Postretirement Plans Adjustment Debt and Equity Securities, Unrealized Gain (Loss) Cash Flow Hedging Instruments, Unrealized Gain (Loss) Total Accumulated Other Comprehen-sive Income (Loss)
Balance at March 31, 2014, net of tax $ (180) $ (3,654) $ (1) $ (6) $ (3,841)
Other comprehensive income (loss),                
 before tax:               
 Amounts before reclassifications   128   ―   1   (21)   108
 Amounts reclassified out   ―   92   ―   5   97
Total other comprehensive income (loss),                
 before tax   128   92   1   (16)   205
Tax effect   (5)   (32)   ―   7   (30)
Total other comprehensive income (loss),                
 net of tax   123   60   1   (9)   175
Balance at June 30, 2014, net of tax $ (57) $ (3,594) $ ― $ (15) $ (3,666)
                 
Six months ended June 30, 2014               
(Millions) Cumulative Translation Adjustment Defined Benefit Pension and Postretirement Plans Adjustment Debt and Equity Securities, Unrealized Gain (Loss) Cash Flow Hedging Instruments, Unrealized Gain (Loss) Total Accumulated Other Comprehen-sive Income (Loss)
Balance at December 31, 2013, net of tax $ (188) $ (3,715) $ (2) $ (8) $ (3,913)
Other comprehensive income (loss),                
 before tax:               
 Amounts before reclassifications   134   ―   3   (12)   125
 Amounts reclassified out   ―   183   ―   (1)   182
Total other comprehensive income (loss),                
 before tax   134   183   3   (13)   307
Tax effect   (3)   (62)   (1)   6   (60)
Total other comprehensive income (loss),                
 net of tax   131   121   2   (7)   247
Balance at June 30, 2014, net of tax $ (57) $ (3,594) $ ― $ (15) $ (3,666)

Three months ended June 30, 2013               
(Millions) Cumulative Translation Adjustment Defined Benefit Pension and Postretirement Plans Adjustment Debt and Equity Securities, Unrealized Gain (Loss) Cash Flow Hedging Instruments, Unrealized Gain (Loss) Total Accumulated Other Comprehen-sive Income (Loss)
Balance at March 31, 2013, net of tax $ (130) $ (4,870) $ (2) $ 1 $ (5,001)
Other comprehensive income (loss),                
 before tax:               
 Amounts before reclassifications   (260)   ―   (6)   (79)   (345)
 Amounts reclassified out   ―   144   ―   91   235
Total other comprehensive income (loss),                
 before tax   (260)   144   (6)   12   (110)
Tax effect   ―   (53)   2   (4)   (55)
Total other comprehensive income (loss),                
 net of tax   (260)   91   (4)   8   (165)
Balance at June 30, 2013, net of tax $ (390) $ (4,779) $ (6) $ 9 $ (5,166)
                   
Six months ended June 30, 2013               
(Millions) Cumulative Translation Adjustment Defined Benefit Pension and Postretirement Plans Adjustment Debt and Equity Securities, Unrealized Gain (Loss) Cash Flow Hedging Instruments, Unrealized Gain (Loss) Total Accumulated Other Comprehen-sive Income (Loss)
Balance at December 31, 2012, net of tax $ 230 $ (4,955) $ (2) $ (23) $ (4,750)
Other comprehensive income (loss),                
 before tax:               
 Amounts before reclassifications   (584)   ―   (6)   (114)   (704)
 Amounts reclassified out   ―   287   ―   164   451
Total other comprehensive income (loss),                
 before tax   (584)   287   (6)   50   (253)
Tax effect   (36)   (111)   2   (18)   (163)
Total other comprehensive income (loss),                
 net of tax   (620)   176   (4)   32   (416)
Balance at June 30, 2013, net of tax $ (390) $ (4,779) $ (6) $ 9 $ (5,166)

Income taxes are not provided for foreign translation relating to permanent investments in international subsidiaries, but tax effects within cumulative translation does include impacts from items such as net investment hedge transactions. Reclassification adjustments are made to avoid double counting in comprehensive income items that are also recorded as part of net income.

 

The previously reported before-tax amounts of other comprehensive income before reclassifications and amounts reclassified out of other comprehensive income for the three and six months ended June 30, 2013 relative to foreign currency forward contracts in the table above and below were impacted by the immaterial revisions discussed in Note 9.

Reclassifications out of Accumulated Other Comprehensive Income Attributable to 3M
                
    Amount Reclassified from  
   Accumulated Other Comprehensive Income  
(Millions) Three months ended June 30, Six months ended June 30, Location on Income Statement
Details about Accumulated Other Comprehensive Income Components 2014 2013 2014 2013 
Gains (losses) associated with, defined benefit pension and postretirement plans amortization              
 Transition asset $ ― $ ― $ ― $ 1 See Note 8
 Prior service benefit   15   20   30   40 See Note 8
 Net actuarial loss   (107)   (164)   (213)   (328) See Note 8
Total before tax   (92)   (144)   (183)   (287)  
Tax effect   32   53   62   111 Provision for income taxes
Net of tax $ (60) $ (91) $ (121) $ (176)  
                
Debt and equity security gains (losses)              
 Sales or impairments of securities $ ― $ ― $ ― $ ― Selling, general and administrative expenses
Total before tax   ―   ―   ―   ―  
Tax effect   ―   ―   ―   ― Provision for income taxes
Net of tax $ ― $ ― $ ― $ ―  
                
Cash flow hedging instruments gains (losses)              
 Foreign currency forward/option contracts $ (6) $ (3) $ (2) $ (9) Cost of sales
 Foreign currency forward contracts   ―   (89)   ―   (155) Interest expense
 Commodity price swap contracts   1   1   3   ― Cost of sales
Total before tax   (5)   (91)   1   (164)  
Tax effect   2   32   ―   59 Provision for income taxes
Net of tax $ (3) $ (59) $ 1 $ (105)  
Total reclassifications for the period, net of tax $ (63) $ (150) $ (120) $ (281)  

Purchase and Sale of Subsidiary Shares

 

In April 2014, 3M purchased the remaining noncontrolling interest in a consolidated 3M subsidiary for an immaterial amount, which was classified as other financing activity in the consolidated statement of cash flows.

 

In March 2013, 3M sold shares in 3M India Limited, a subsidiary of the Company, in return for $8 million. The noncontrolling interest shares of this subsidiary trade on a public exchange in India. This sale of shares complied with an amendment to Indian securities regulations that required 3M India Limited, as a listed company, to achieve a minimum public shareholding of at least 25 percent. As a result of this transaction, 3M's ownership in 3M India Limited was reduced from 76 percent to 75 percent. The $8 million received in the first quarter of 2013 was classified as other financing activity in the consolidated statement of cash flows. Because the Company retained its controlling interest, the sales resulted in an increase in 3M Company shareholder's equity of $7 million and an increase in noncontrolling interest of $1 million.

 

In July 2014, 3M announced that it will acquire (via Sumitomo 3M Limited) Sumitomo Electric Industries, Ltd.'s 25 percent interest in 3M's consolidated Sumitomo 3M Limited subsidiary for 90 billion Japanese Yen (approximately $885 million at announcement date exchange rates). Upon completion of the transaction, 3M will own 100 percent of Sumitomo 3M Limited. The transaction is expected to close on September 1, 2014 and will be reflected as a financing activity in the consolidated statement of cash flows.