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3M (MMM -0.76%)
Q3 2017 Earnings Conference Call
Oct. 24, 2017, 9:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Ladies and gentleman, thank you for standing by. Welcome to the 3M's Third Quarter Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we'll conduct a question and answer session.
At that time, if you have a question, please press the one followed by the four on your telephone keypad. It is recommended that you use a landline phone if you're going to register for a question. As a reminder, this conference is being recorded Tuesday, October 24, 2017. I would now like to turn the call over to Bruce Jermeland, Director of Investor Relations at 3M.
Bruce Jermeland -- Director, Investor Relations
Thank you, and good morning, everyone. Welcome to our Third Quarter 2017 Business Review. On the call today are Inge Thulin, 3M's Chairman, President and CEO; and Nick Gangestad, our Chief Financial Officer. Each will make some formal comments, and then we'll take your questions.
Please note that today's earnings release and slide presentation accompanying this call are posted on our Investor Relations website at 3m.com under the heading Quarterly Earnings. Before we begin, let me remind you of the dates for our future investor events. Please turn to Slide two. First, starting with earnings.
Our Q4 Earnings Conference Call will be held on January 25. And second, our 2018 Outlook Meeting will take place in New York City on December 12 from 8:00 a.m. to noon. Invitations for this event will be sent this afternoon, so please RSVP as soon as possible.
We hope to see you there. Please take moment to read our forward-looking statement on Slide 3. During today's conference call, we'll make certain predictive statements that reflect our current views about 3M's future performance and financial results. These statements are based on certain assumptions and expectations of future events that are subject to risks and uncertainties.
Item 1A of our most recent form 10-K lists some of the most important risk factors that could cause actual results to differ from our predictions. Please turn to Slide four. I'll hand the call off to Inge.
Inge Thulin -- Chief Executive Officer, President and Chairman
Thank you, Bruce. Good morning, everyone, and thank you for joining us. Coming off a strong first half, our team delivered and even more robust performance in the third quarter. Organic growth accelerated to 7%.
We positive growth across all business groups and all geographic areas. We posted record sales and record earnings and idea and did so while continuing to invest for the future. Let me take you through the highlights. Total sales were $8.2 billion, an all-time high for our enterprise.
As I mentioned, we delivered a strong broad-based organic growth of 7%, led by Electronics and Energy at 13%. Health care grew 7% organically followed by 6% growth for both industrial and safety and graphics. All consumer businesses posted organic growth of 2%. Its second consecutive quarter of positive growth.
It was also good to see broad-based growth across all geographic areas. This was through in both developed and developing markets. Well long-standing precedents, market position and depth of capabilities enable us to win. Growth in developed markets was 4% with 14% growth in developing markets.
With respect to EPS, we increased earnings more than 8% to two dollars, $0.33 a share, which is a Q3 record companywide. We expanded margins to 25% with all business groups above 22%. Turning to free cash flow, we posted a good conversion rate to 100%. We continue to invest and rolled the business while also returning significant cash to our shareholders and ended quarter we returned $1.1 billion to dividends and share repurchases.
Please turn to Slide five. Beyond financial results, we are continuing to build an enterprise that these position for success both today and into the future. This includes executing our three key levers which are significant value creators. The first is portfolio management and earlier this month we finalized acquisition of Scott Safety.
This will complement organic growth and further enhance our position in the fast-growing global personal safety market. At the same time, we completed the sales of the electronic monitoring business which no longer aligned with our strategic objectives. Portfolio management, a process we have intensified over the last several years is strengthening our competitiveness and making us more relevant to our customers and the marketplace. Investing in innovation is the second lever.
Research and development is the heartbeat of 3M. It's how we deliver premium value to our customers and premium returns to our shareholders. This is why we continue to invest 6% to sales into research and development, which total $463million in the quarter. The third lever is business transformation which starts and ends with our customers.
The deployment of our European system remains on track with West Europe nearly complete. We have also started initial deployments in the United States, which you will hear more about that our outlook meeting on December 12. That concludes my remarks, and I will now turn the call over to Nick. Nick?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Thanks, Inge, and good morning everyone. I'll start on Slide six with a recap of our third quarter sales performance. We posted strong organic growth in the quarter of 6.6% as we continue to outgrow the markets we serve. Selling prices improved sequentially versus second quarter and were flat year-on-year.
Excluding electronics, price was up 20 basis points, which marks our strongest quarterly pricing performance this year. The divestiture of nonstrategic businesses over the last 12 months reduced sales in the quarter by 120 basis points. Conversely, foreign currency translation increased sales by 60 basis points. All in, third quarter sales in U.
S. dollars increased 6% versus last year. In the U. S., organic growth was 3.6% led by a high single-digit increase in Health Care and a mid-single-digit increase in Industrial.
Our Safety and Graphics and Consumer businesses also delivered positive growth in the quarter. Asia Pacific led the company with organic growth of 13% in Q3. All business groups within Asia Pacific continue to post strong growth in the quarter, including double-digit-increases in our Electronics and Energy business and in our Safety and Graphics business. Organic growth was 23% in China/Hong Kong and 5% in Japan.
Excluding electronics, China/Hong Kong grew in the mid-teens, and Japan was up 3%.Moving to an EMEA, Organic growth was 4% in Q3, with West Europe up 3%. Both the Safety in Graphics and Industrial businesses led to grow in an EMEA.Finally, Q3 organic growth in Latin America/Canada was 5%. All businesses posted positive growth, with Health Care leading the way, up high single digits. At a country level, Canada delivered strong organic growth of 14%, Mexico was up 5% while Brazil was flat.
We continue to generate broad-based growth across the globe giving us confidence in raising our full your expectations, which Inge will discuss later. Please turn to slide seven for the third quarter P&L highlights. Companywide, third quarter sales were $8.2 billion with net income of $1.4 billion, up 7.5%. On a GAAP basis, third quarter operating margins were 25%, which includes a 60 basis point impact from incremental strategic investments.
Let's take a closer look at the various components of our margin performance in the third quarter, gains from organic volume growth and productivity contributed 90 basis points to operating margins. Our continued focus on portfolio management is strengthening our enterprise in many ways including margins which improved by 40 basis points, due to the exit of nonstrategic businesses. The combination of lower raw material costs and selling price changes added another 30 basis points. Foreign currency net of hedging impacts brought margins down 40 basis points in the quarter, and higher year-on-year pension and OPEB expense decreased margins by 30 basis points.
Let's now turn to Slide eight for a closer look at earnings per share. Third quarter GAAP earnings were $2.33 per share, up 8.4% year-over-year. This result includes a $0.06 impact from incremental strategic investments. The combination of organic growth and productivity contributed $0.23 per share to Q3 earnings.
Organic growth was the predominant driver, along with raw material benefits and the continued positive impact business transformation is having on our productivity efforts. Acquisitions and divestitures added $0.01 to earnings year-over-year. Foreign currency, net of hedging reduced, earnings by $0.03 a share, and the slightly lower tax rate was a $0.01 benefit. Finally, lower shares outstanding net of higher interest expense was a $0.02 benefit to EPS.Please turn to Slide nine for a look at cash flow.
We continue to generate solid operating cash flow as a company, which allows us to consistently invest in the business and return cash to shareholders. Third quarter free cash flow was $1.4 billion with a conversion rate of 100%. For the full year, we expect free cash flow conversion in the range of 95% to 100%. Turning to CapEx.
We continue to be encouraged by the numerous opportunities to invest in both growth and disruptive technologies. Third quarter capital expenditures were $325 million, and we expect these investments to be approximately $1.4 billion for the year. In addition to investing in our businesses, we returned significant cash to shareholders in Q3, including $701 million in dividends, up $31 million. We also returned $380 million to shareholders through gross share repurchases or $1.6 billion year-to-date.
We now expect full year repurchases to be in the range a $2 billion to $2.5 billion versus $2 billion to $3.5 billion previously. Let's now review our performance by business group. Please turn to Slide ten. Industrial, our largest business group, continued its strong growth, up 6.1% organically in the third quarter.
Industrial's growth was once again broad-based across all geographic areas and all businesses. Our Heartland businesses within Industrial, namely industrial and adhesives and tapes, abrasives and automotive aftermarket, all delivered mid-single-digit-growth in the quarter. Our auto OEM business was up 6% outpacing global car and light truck builds by approximately 400 basis points. As we continue to drive increased penetration on the automotive OEM platforms across the globe.
Finally, advanced materials led the way with mid-teens growth in the quarter with strong performance across its portfolio well also benefiting from favorable year-on-year comps. One a geographic basis, organic growth was led by a high-single-digit increase in Asia Pacific, while all other areas grew mid-single-digits. Industrial delivered third quarter operating income of $614 million with an operating margin of 22%. Adjusting for incremental strategic investments.
Operating margins were 22.6%, a 110 basis point improvement from Q2 levels. Please turn to Slide 11. Third quarter safety in graphics sales grew 6% organically. Growth was led by our personal safety business which accelerated to double-digit growth in the quarter.
We continue to experience strong demand for our personal safety solutions and look to build on the strength with the integration of Scott Safety. Starting here in the fourth quarter. Our roofing granules business grew solidly, up mid-single-digits on top of a tough year-on-year comp. Lastly, transportation safety posted positive organic growth in Q3 as we continue to evolve as portfolio with the sale of electronic monitoring business earlier this month.
Geographically, Safety and Graphics grew organically across all areas, led by an 11% increase in Asia Pacific and an 8% increase in the media third quarter. Profits in safety and graphics were up 11% year-on-year to $410 million with operating margins of nearly 27%. Please turn to Slide 12. Our Health Care business in the 3rd quarter grew 6.9% organically.
Health Care delivered broad-based growth across all businesses and geographies. Our medical consumables businesses, which is our largest segment within Health Care, posted high single-digit-growth as worldwide demand for 3M's products and solutions remain strong. Oral care delivered 3% organic growth in the quarter as we continued to deliver strong international growth particularly in Asia Pacific, Latin America and West Europe. Organic growth in Health Care was led by a double-digit increase in our drug delivery business.
Geographically, organic growth was led by high single-digit growth in Asia Pacific, Latin America/Canada and the U. S.. We saw notable strength in Health Care across developing markets particularly in China/Hong Kong which was up double digits in the quarter. Health Care's operating income was $471 million and operating margins were 31.9%.
Please turn to Slide 13, Electronics and Energy third quarter organic sales growth was up 13% and it's up 11% year-to-date. We are on track to deliver 10% organic growth for the year. This business continues to benefit from our portfolio management efforts over the past few years to streamline the business, enhance customer relevance and drive improved efficiencies. The electronics side of the business grew 18% organically as our team continued to increase penetration on many OEM platforms globally, including semiconductor manufacturing, electronic assembly, data centers and automotive electrification.
Our energy-related businesses were up 2% organically, with electrical markets up mid-single digits, partially offset by a decline in telecom. On a geographic basis, organic growth was led by a 20% increase in Asia Pacific, while Latin America/Canada and EMEA also delivered positive growth. Third quarter operating income for Electronics and Energy was $394 million with operating margins of 27.9%. Please turn to Slide 14.
Third quarter sales in Consumer grew organically 1.9%, which was a continued improvement versus recent quarters. We saw a positive organic growth in three of our four consumer businesses, namely home improvement, home care and consumer healthcare well stationery and office declined. Category-defining brands in Consumer continue to be a strength for 3M. We delivered strong double-digit growth in both Command damage-free mounting products and ScotchBlue Painter's Tape.
Filtrete home filtration products grew mid-single digits globally. Geographically, organic growth in Consumer was led by Asia Pacific, up high single-digits while Latin America/Canada and the U. S. also delivered positive growth.
Finally, operating income was $307 million with an operating margin of 24.8%. Adjusting for strategic investments year on year operating margins were nearly 26%. Please turn to Slide 15. Before turning the call back over to Inge, I want to cover a few items that will impact the fourth quarter: First, the completed divestiture of the electronic monitoring business is expected to have a net positive impact of $0.12 to earnings in Q4.
Second, the Scott Safety income net of acquisition and integration costs is expected to reduce earnings per share by $0.08. Third, we recently close to death tender offer to retire some of our higher coupon debt. This will result in a non operating charge estimated to be an $0.11 impact to earnings per share in the fourth quarter. Lastly, as we have discussed throughout the year, we plan to continue to take actions in Q4 to strengthen our portfolio and better optimize our footprint.
We estimate that these incremental investments will negatively impact fourth quarter per-share earnings by approximately six to $0.10. Please turn to Slide 16, and I will now turn the call back over to Inge. Inge?
Inge Thulin -- Chief Executive Officer, President and Chairman
Thank you, Nick. As I look across all enterprise, I'm very pleased with our performance in the quarter and throughout the year. As a result today, we are increasing our expectation for 2017 in terms of both organic growth and earnings per share. We now anticipate organic growth of 4% to 5% versus a prior range of 3% to 5%.
With respect to EPS, we expect earnings of $9 to $9.10 per share versus the prior range of $8.80 to $9.05. This is a 10% to 12% increase year-on-year. And as you can see, we continue to expect strong performance in terms of both return on invested capital and free cash flow conversion. With that, I thank you for your attention, and we will now take your questions.
Questions and Answers
Operator
Ladies and gentlemen, if you would like to register a question using a landline phone, please press the one followed by the four on your telephone keypad. You'll hear three tone prompt to acknowledge your request. If your question has been answered and you would like to withdraw your registration, please press the one followed by the three. If you're using a speakerphone, please lift your handset before entering your request.
Please limit your participation to one question and one follow-up. One moment please while we compile the Q&A roster. And our first question comes from the line of Andrew Obin of Bank of America Merrill Lynch. Please proceed with your question.
Andrew Obin -- Bank of America / Merrill Lynch -- Analyst
Good morning, guys.
Inge Thulin -- Chief Executive Officer, President and Chairman
Good morning, Andrew.
Andrew Obin -- Bank of America / Merrill Lynch -- Analyst
Just a question, a sort of top-down question. Top line growth, 6.6%. As you think this economic environment, right, and as you overlay it over your longer-term framework, would you describe current economic environment as average relative to your 5-year framework, above average? And from that perspective, I'm just trying to think if 6.6% is something we can expect to achieve in this environment. Or is that a one-off?
Inge Thulin -- Chief Executive Officer, President and Chairman
Well, first of all, good morning. I think to talk about the 5-year plan is maybe difficult if that's the frame you put it into. But I will say that it's maybe on the high end versus what we thought when lay out the plan originally as we stand. You can also see that we have a range now that we moved from -- we've gone from 2% to 5%, then 3% to 5%.
Now we are 4% to 5% for the year. And we have very high confidence as we move into 2018, which we would talk more about in -- on December 12 in New York. But I will say that, generally speaking, the execution of our commercialization programs are going very well for us. And it's broad-based, which is very, very good.
So I think it's -- if you think about 4% to 5% for the remainder of this year, I would think more about on the high end of the 4% to 5%.
Andrew Obin -- Bank of America / Merrill Lynch -- Analyst
Okay, terrific. And just a follow-up question on the electronics growth. That has been very good. Can you just give us a little bit more color what specifically drives it? And I'm just trying to understand how much of it sort of increased content in mobile devices, particularly on adhesives or your participation in the Asian semiconductor cycle, if you could separate those two sources of growth.
Thank you.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes. Well, you know, first of all, we -- I think always on Electronic and Energy as a business group, we have just to take a step back and really understand what we have done from the portfolio perspective. And that is something that we all see as we take actions. What is not so visible, if you're not -- right in the industry day by day, is also how we have shifted and accelerated some investment to faster-growing segments.
So I think that's an important element for us to think about. Now on the platform for consumer electronics, we are very global. So for us, we are adding a penetration on a global base in most of those devices. And it's going very fast, I will say, specifically on the China OEM in terms of the pickup.
And if you think about that, demand there for performance, quality and functionality is exactly what we're all about. So that means that we are growing very fast on those platforms. So we are doing better than we had estimated, which is a positive thing. I think also in terms of growth, semiconductor, of course, we are part of that growth.
And I will also say the shift in terms of us focusing more now versus three years ago on data centers, on automotive electrification, on energy grids is driving this growth. So if you think about it, just to give you facts, the base where we came from was a market that had a size of $60 billion that had a growth of 1% to 3%. We're continuing there. But we have shifted during the last couple of years to market size that are $12 billion but has a growth rate to 10% to 15%.
So I think that is the answer to what we are doing there. And I will say the fact that the growth is coming, the marginal expansion -- expanding, we are more relevant to our customer is a big credit to that business group or what they have been doing.
Andrew Obin -- Bank of America / Merrill Lynch -- Analyst
But that would imply that electronics growth is sustainable into '18 as well because these are structural drivers.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes, I think so, it is. It is. But again, when you have technology conversion, you can have ups and downs in between quarters. But if you look upon the total business, we will continue to do well.
Andrew Obin -- Bank of America / Merrill Lynch -- Analyst
Thank you very much.
Operator
Our next question comes from the line of Julian Mitchell of Credit Suisse. Please proceed with your question.
Julian Mitchell -- Credit Suisse -- Analyst
Hi, good morning. Maybe just a first question around strategic investments. I think previously you talked about that being a step-up year-on-year of $0.20, $0.25 in the second half. Now it's looking somewhat less than that based on your guidance.
Maybe just give us some background as to why that's happening. And is it just a push-up into 2018? And what kind of returns -- how are returns on that investment to date coming through?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Yes, Julian, thanks for that question. I would call what we're doing in the third quarter as a really good example of our business model and action, where we have good organic growth, strong margins. And at the same time, we're taking actions to position 3M for future success. As you mentioned, earlier this year, we announced we expected to incur between $0.60 and $0.65 of strategic investments for the full year, and we're tracking right in that range.
And those strategic investments include things we talked about at the beginning of the year for core growth platforms, but also actions to be improving our footprint and addressing our portfolio. All of that part of the 4% to 5% organic growth outlook we now are seeing for this year. We are making good progress on that in 2017 to better optimize our manufacturing and supply chain footprint. And I'd point you back, Julian, to what we laid out when we -- in March of 2016 about a plan to be investing between $500 million and $600 million over the course of a few years to ultimately generate $125 million to $175 million in annual benefits by 2020.
So for the full year 2017, that $0.60 to $0.65 range does include the charge related to the debt tender that we'll be incurring in the fourth quarter. That has been part of our thinking, and we closed that tender in October. Hence, that charge coming in, in Q4.
Julian Mitchell -- Credit Suisse -- Analyst
Understood, thank you. And then just my second question. Price and raw materials in your operating margin bridge slightly picked up, a slightly larger tailwind in Q3 than in Q2. Within that, how much was the sort of raw materials portion? And do you view your current pricing trends as sustainable from here?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Most of that 30 basis points, Julian, is coming from raw materials. The pricing, as I mentioned, for the total company, flat or if I exclude electronics, up 20 basis points. We're seeing that core underlying price growth growing as the year goes on, excluding the electronics. So we're seeing Q3 as a quarter where our price strengthened.
But the majority of that 30 basis points is coming from raw materials. And let me just elaborate a little more on that, Julian. The core underlying market [indiscernible] materials are certainly toughening. We are not seeing the underlying market creating that 30 basis points of benefit.
That 30 basis points of benefit that we see hitting our financials are the result of work and projects that we're doing to take out raw material costs and the prices we're paying. So example, raw material substitutions or product reformulations to take out those raw material costs. That's the biggest thing driving that 30 basis points you're seeing.
Julian Mitchell -- Credit Suisse -- Analyst
Very helpful. Thank you.
Operator
Our next question comes from the line of Steve Tusa of JPMorgan. Please proceed with your question.
Steve Tusa -- JPMorgan Chase -- Analyst
Hey, guys, good morning. One point you are real, really good quarter. Just following up on the electronics commentary. You guided to kind of 10% for the year.
I guess that implies -- just making sure I get my math right here. That implies kind of 4Q at up high singles, kind of 7%, 8%. Is that correct from an organic perspective?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Yes, Steve, your math's pretty sound there.
Steve Tusa -- JPMorgan Chase -- Analyst
Okay. And I guess you talked about it as sustainable. I mean, you're not saying that the double-digit is sustainable, obviously. I mean, semiconductor sales this year are up pretty solidly double digits, so you guys -- it's not quite a surprise you guys are kind of doing well there.
So when you say it's sustainable, do you mean relative to kind of an index of the devices you're on or within the range that you talked about? Kind of the trend line rate of that business over the last several years, should it be more like mid-single digits? What did you kind of mean by sustainable?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
So Steve, when I say -- when we say sustainable for Electronics and Energy and the opportunities that we see there, we continue to see opportunities for penetration in consumer electronics. As Inge mentioned earlier, we continue to evolve our technologies to grow our relevance in consumer electronics. But even more importantly, we're repositioning our portfolio to be going after faster-growing market opportunities in Electronics and Energy. And those are places where we're seeing the results of our actions paying off, where we're seeing growth occurring there, places like automobile electrification.
So Inge said we'll -- a few minutes ago, we'll always see some ups and downs based on what's happening with underlying consumer demand for electronics. But what you're seeing now is our business model really working, of us going after the higher-growth markets.
Steve Tusa -- JPMorgan Chase -- Analyst
Okay. And then one more question just on kind of the investments and margins and how that's playing through. R&D was a little bit light. And anything going on there? I guess you're just kind of repurposing investments to more kind of commercial type of things.
Is that how we should think about it?
Inge Thulin -- Chief Executive Officer, President and Chairman
Well, there's nothing going on. As you know, we have made a commitment to increase investment in research and development from 5.5% historically closer to 6%. And we are normally just running at 6%. So there's nothing abnormal going on there.
But it's not a move to commercialization from those activities. We are very committed to research and development. And for us, science, technology, and sustainability is key driver for us as we move forward and as have been in the past. So there's no shift from R&D to commercialization.
Commercialization, that's what we invested on some additional $104 million for the year and we expected 50 to 100 basis point growth. And as you see, it's coming, so we're very pleased with that.
Steve Tusa -- JPMorgan Chase -- Analyst
Right . Thanks. Great quarter, congratulations. Thanks.
Inge Thulin -- Chief Executive Officer, President and Chairman
Thank you, Steve.
Operator
Our next question comes from the line of Andrew Kaplowitz of Citi. Please proceed to question.
Andrew Kaplowitz -- Citigroup -- Analyst
Morning guys, nice quarter, group.
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Hi, Andrew
Andrew Kaplowitz -- Citigroup -- Analyst
You had an easier growth comparison the Health Care, but the acceleration in growth really is notable. I know, you've been saying that you expect second half acceleration, but can you talk about whether this is simply your previous gross spending now really impacting the business? Or did you see an acceleration in Health Care markets? And can you tell the difference sustainability of mid-single-digit growth in this business moving forward?
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes. First of all, we have invested for quite some time in Health Care. And I think for Health Care specifically was the first business where we made additional investment that we broad-based call core search, and that's paying off. And a lot of those investment was, of course, in developing economies.
And we can see broad-based that that's paying off. And we had -- in the developing economy for the quarter, Health Care grew 12%. But you also grew in developed 6%. So our base is very strong in developed, specifically in the United States and in West Europe, and we continue to grow very, very well there.
And then you can see that the developing economy is coming as we plan. So I will say when we have talked about the range of 4% to 6%, that's a realistic 10%, and then we will be in that range as we move forward. I have no doubt about that.
Andrew Kaplowitz -- Citigroup -- Analyst
That's helpful. And then...
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Andrew, excuse me, I'll just add one thing. For the year, we're guiding Health Care 3% to 5%. And with the results, we're about 4% growth through the first 9 months of the year. We see ourselves solidly in the 3% to 5% range for 2017.
Now -- and of course, in the longer term, as Inge was just mentioning, the 4% to 6% is how we see growth in that business.
Andrew Kaplowitz -- Citigroup -- Analyst
Thanks for that, Nick. And then my follow-up is just on pricing again. You'd talked about U.S. pricing getting back closer to flat for the year, Nick, last quarter, which it does appear to be doing.
But how much of the better pricing performance in the U.S. was 3M pulling back on -- rebating or discounting versus just stronger overall industrial and consumer markets helping you? And do you think it's possible to get back to positive pricing in the U.S. in 2018?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Yes. Andrew, we have been seeing slight incremental improvements in pricing in the U.S., and we continue to see that improving into the future. I wouldn't call it any kind of pullback on our part that's causing that to happen. It's a pricing environment where we see our business model, one where we have increased ability for price growth there.
And as far as 2018, I'm not ready to declare an up or down on that one. We'll talk more about that on December 12.
Andrew Kaplowitz -- Citigroup -- Analyst
All right. Thanks, guys. pushing in this quarter if you can.
Operator
Our next question comes from the line of Robert McCarthy of Stifel. Please proceed with your question.
Robert McCarthy -- Stifel -- Analyst
Yes, I'll echo the xylophone of a solid, strong quarter. In any event -- and I want to follow-up on the pricing question as well. I mean, obviously, you've been fairly contrite about perhaps not getting as much price as you wanted to get in the back half -- or excuse me, the beginning part of the year, and you talked about catching up on that. You've cited the 20 basis points.
But could you talk maybe a little bit just structurally how you're thinking about your businesses, where you think you're going to see pricing pressure over the next two to three years? Obviously, the debate around kind of what is much more perceived as lending itself to transparency around Consumer and Industrial and then kind of the rubbers, meaning the road and safety. But could you talk about where your moats are and how you're feeling about it? Just maybe not in the context of what is a very strong kind of third quarter, fourth quarter right now, but just structurally down the road.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes. Well, you should think about 3M as the price leader in most, if not all, categories we are in. And if you look -- if you think about that historically and as we move ahead, it's very much based on our scientifically based business model. So for us, if you think about the new products, the new solution that we are providing, it's all in order to drive improved productivity and/or efficiency for our customers.
So our business model is about understanding our customers' business model. We are, by definition, not a commoditized company. So we don't go in and fight on businesses where price is the primary discussion. We try to win and make things different versus just making them better.
So you do things better, but where the real value is when you view it differently. That's also the time where you can drive price. So there is -- and as you can see, our commitment to science, technology, and sustainability is continuing that way forward. And you have also seen the portfolio work we have done here the last 3, 4, 5 years have been in businesses that are more commoditized.
We don't think that we can add as much value to them versus other companies. That's also why they have exited our portfolio. So I will say that there will be no change moving forward relative to our strategy around pricing. Now again, as you know and we know, things in between quarters can change slightly.
There is no big change relative to our strategy around pricing. It's very, very important for us, and it's important due to the fact that it's part of our business model.
Robert McCarthy -- Stifel -- Analyst
As a follow-up, Could -- as a follow-up, maybe you could just talk about, obviously, the messaging for kind of your growth initiatives and continued commercialization. I suppose your Outlook Meeting will be around electrification. But could you talk about -- maybe take us to the top of the portfolio where you see the most opportunities and how we should be thinking about kind of quantifying what the longer-term opportunity ramification is.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes, are you're talking electrification specifically?
Robert McCarthy -- Stifel -- Analyst
Yes, for autos, I mean.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes. If you think about that in terms of the mega trends and what we can do, we have three elements into that area specifically. We are very strong in automotive. We have showed that over time.
We are outperforming the automotive build quarter after quarter and year after year, and we did this quarter as well. So connection into automotive is very strong. We have a strong technology platform in our Electronic and Energy that we then utilize to those context in order to build our platforms. And then the other thing that is easy to forget is that we are a global leader in traffic safety.
And if you take those elements together, traffic safety, automotive electrification, and pull them together, that's exactly where the trends are going. And that is a big platform for us to capitalize as we move ahead. So think about it in that perspective of, I will say, a certain thing that will -- you and I will see today as we drive our cars, but also things that will come relative to the evolution of road safety in the automotive space.
Robert McCarthy -- Stifel -- Analyst
Thanks for squeezing in, man. Thank you.
Operator
Our next question constant a line of Scott Davis Melius Research. Please proceed.
Scott R. Davis -- Barclays Research -- Analyst
Hi, good morning, guys.
Inge Thulin -- Chief Executive Officer, President and Chairman
Scott, welcome back.
Scott R. Davis -- Barclays Research -- Analyst
Thank you. It's nice to be back. Appreciate it. Inge, you finally seem to crack the code on China.
That was a region that was tough for you guys for a while and well, you've had a couple pretty good years there. I mean, what do you attribute most to the success? I mean, I know you mentioned some of this earlier in the call, but have you changed up your sales and marketing? Does it just take time to get brand awareness? And is it pricing strategy? I mean, what -- outside of electronics, obviously, but if you can just talk through that.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes. So first of all, we've been in China for a long time, as you know. I think we started our wholly owned subsidiary in 1984 and have made investment over time. And we have good capabilities in terms of manufacturing there, and we have also a good research and development center there.
Now it looked like -- and as we had talked about before, there have been -- it's not a shift, but there have been additional investments in China for what we would call domestic markets. So that will, for us, then benefit Health Care and Consumer specifically. And I think what is happening as we speak is that the consumers in there and the OEMs, they're becoming more demanding on performance, on quality and functionality and brands, and that has gone right into our business model in order for us to be more relevant. So we are capitalizing on that.
We have also made additional investment in the domestic markets, right? So you think about it in terms of everything that is produced and commercialized there. And we grow 2x GDP and IPI in the last couple of quarters, and we have shifted the portfolio to more safety also and Health Care. So that's helping us in addition to our own initiative. So that's type of, I will say, Chinese mega trends if you like.
And then we, in addition, have made a lot of efforts on air quality, water quality, and automotive electrification. So you take that together, growth are coming, and it's very nice to see. So I think it's a focus -- a presence and a focus, a commitment under the long term that now start to pay off. I think very much because of demanding for performance quality and functionality -- and then, as you say, brands are becoming more and more important.
If you take air quality in China, it's equal to 3M. 3M stands for air quality in China. So that's actually our brand in China. And if you travel into China and you do some interviews, they would like to talk about respiratory products, about our things in filtration, et cetera.
So I think it's coming back to brand awareness and the quality and functionality we are able to provide in the company -- in the country.
Scott R. Davis -- Barclays Research -- Analyst
That makes sense. And just a follow-up on that. I mean, you -- one of the things you've been doing, Inge, is trying to get more locally designed products in each of the regions, whether it be U.S., Europe, Asia, Latin America. You've taken R&D up as a total spend, not just as a percent spend, but your revenues have grown, so you've taken them up meaningfully as a total spend.
And how do you manage that structure, whereby you make sure you don't have guys working on duplicate projects that -- for air quality. For example, you've got guys in China working on new developments. And at the same time, you got guys in the U.S. working on the same things.
I mean, how do you really manage that complexity?
Inge Thulin -- Chief Executive Officer, President and Chairman
Well, we have our Senior Vice President from Research and Development that are managing the overall structure relative to how we do things. And there is very little duplication. And if you think about the science base, I mean, research and development, you think about research, there's four centers around the world that are doing the research. There's only four of them.
Then you have -- locally, you will have capabilities for development. And that's a combination of the local business and the global division in order to manage that so there's not duplication. And sometimes -- to be honest, sometimes you can see duplication, but it's very, very seldom. And I think the advantage for us is sometimes when someone is on something and find a solution for a local market, we can replicate that on other places.
So will there be duplication some time? Yes, I'm sure there will, but it's not much at all. And I think the evidence is there in terms of the outcome or the result.
Scott R. Davis -- Barclays Research -- Analyst
Excellent, keep up the good work, guys. Thank you.
Operator
Our next question comes from the line of John Inch of Deutsche Bank. Please proceed with the question.
John G. Inch -- Deutsche Bank -- Analyst
Thank you. Good morning, everyone. So can we talk about investment spending in the quarter? I guess I thought you were going to be doing about $100 million and you did $48 million. But maybe that was $100 million over two quarters.
Maybe Nick could -- what's going on there?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Yes. For the total year, we're on track for the total investment spending. We ended up having 40 -- mid-$40 million for investment spending for the third quarter. It's roughly a 50-50 mix of some of our footprint actions and the accelerated growth investments.
And we're continuing to execute that plan. It's going according to the expectations we had for how this would play out for 2017. So I don't see it as -- I see it tracking just as we've planned it for the year.
John G. Inch -- Deutsche Bank -- Analyst
So, Nick, you didn't spend less than you had planned in the third quarter? And that's coming through in the fourth quarter or no?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
In the fourth quarter, we expect that to go up slightly to now to be -- I can -- I'll put it in cents, earnings per share terms. That will be $0.06 to $0.10 or roughly $70 million to $110 million of total incremental strategic investments. That will be more heavily focused on footprint than on growth. Because on the growth side, John, we're starting to lap ourselves with some of the growth investments that we started later in 2016.
John G. Inch -- Deutsche Bank -- Analyst
Okay. So $70 million to $100 million, that's incremental year-over-year, correct? That's what you mean?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
That is correct, John.
John G. Inch -- Deutsche Bank -- Analyst
It looks like inventory and receivables sort of sequentially as a function of sales maybe have moved up a little bit. Is that -- I'm presuming that's a -- as a short cycle company, this is a response to channel fill. What is that? Is that new products that you're pushing through? Or is that actual pull-through from [indiscernible] of sources. You're obviously a joint company, so it's hard to sort of parse that out.
But what, in fact, is going on there? Is that just reflective of the global economy actually picking up?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
There is part of that that's the economy. So from an accounts receivable perspective, certainly, our growth is the biggest driver of where we're seeing accounts receivable balances going up. On the inventory, that's also a function of the growth. The only thing on top of that I'd add is in the case of our business transformation effort, as we prepare to go live different geographies around the world, one of the things we typically do is build some inventory in advance for our customers to ensure we can have an undisrupted supply chain for them.
That's a little bit of what we're seeing right now.
Inge Thulin -- Chief Executive Officer, President and Chairman
But think import on drawn is best known what was not shown on the field by definition we don't see anything in the channel a normal for. So I think that's important to put in place as well.
John G. Inch -- Deutsche Bank -- Analyst
I think you're pointing consumer should have actually had channeled down, you know, down soul, right. So is that still going on and what was price in consumer by the way?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
We don't typically put our price out by business group. And in the case of channel, in the U.S. in the office supply channel, we are continuing to see contraction there, just not at the same level that we were seeing in the first half of this year, John.
John G. Inch -- Deutsche Bank -- Analyst
Okay. I'll just ask one more because that -- electrification of vehicle thing took up 17 questions. Gross margins. Why are they down again this year for the first three quarters versus last year? Like, what's ultimately going on in the gross margin complexion of 3M today based on your businesses you're spending versus last year? Why are they down? And do you think they will actually start to pick back up? Or is this all going to be about the OpEx management?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
John, I think you must be looking at our gross margin on an all-in published basis.
Part of what we've been doing this year is we have been doing a number of the supply chain footprint actions. Those costs are impacting our gross margin. When we strip that out, we are continuing to see us slightly improving gross margins for 3M.
John G. Inch -- Deutsche Bank -- Analyst
And that -- when does that alleviate, Nick? When do you start to look at kind of that trend?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
In terms of our view on supply chain footprint actions, we originally laid out 1.5 years ago that we expect between $500 million and $600 million of investments. We have done the majority, more than half of that, in 2017. So there will still be some footprint action expenses that we see in 2018. It will just be on a lower base than -- a lower level than what we've seen in 2017.
So it'll flip to become a tailwind for us from a margin perspective in 2018.
John G. Inch -- Deutsche Bank -- Analyst
Thanks very much. Appreciate it.
Operator
Our next question comes from the line of Joe Ritchie of Goldman Sachs. Please proceed.
Joe Ritchie -- Goldman Sachs -- Analyst
Thanks and good morning everyone. So maybe touching on organic growth. Clearly, really nice quarter and good acceleration. I guess if you look at the fourth quarter kind of implied guidance of, call it, like roughly 3.5% to 4%, a little bit of a deceleration, still good growth.
But I'm just wondering like maybe you guys can comment on exit rates through the quarter and whether you're seeing anything interesting in the current rates.
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Joe, in terms of trends that we saw throughout the third quarter and continuing into the first three weeks of the fourth quarter, we're seeing no change in trend. What you're maybe noticing in our guidance for the year is the fourth quarter will be our toughest comp for the entire year, but we're seeing no underlying deceleration in the trajectory of our sales revenue.
Joe Ritchie -- Goldman Sachs -- Analyst
Got it. And maybe just following on there, Nick. As the quarter progressed, was there any change throughout the quarter? Or is the quarter just pretty even throughout?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Joe, it was pretty strong throughout the quarter. It's -- there is no discernible trend between the different weeks or quarter -- months of the third quarter. It's -- it was very even and strong throughout the quarter.
Joe Ritchie -- Goldman Sachs -- Analyst
Got it. Okay, great. And then maybe just shifting gears a little bit to capital allocation. Clearly, Safety and Graphics over the last couple years has been an area where you guys have invested.
It looks like you're taking down the buyback a little bit this year. I'm just wondering, as you're thinking about M&A across the portfolio, perhaps maybe prioritize where you think you guys should be putting your M&A dollars moving forward.
Inge Thulin -- Chief Executive Officer, President and Chairman
Well, I think, first of all, the pipeline for all businesses is very good. And as you correctly have illustrated, as we have done acquisitions in Safety and Graphics specifically, but also in Health Care, even if they've been small, I'm now talking the last couple of years. I think Safety and Graphics as a business group now, with Capital Safety added in and now Scott Safety coming on the base that we have for our very strong franchise in personal safety, really good position there to continue to accelerate that growth. And I will say that we have interest in all five business groups in order to do some additional thing.
But as I said, we have now to make sure in Safety and Graphics that we focus everything in order to execute the implementation and integration of those businesses. But more than that, we are open to see where we can add businesses that is strategically important for us and that are aligned with our four fundamental strengths, which is technologies, manufacturing capabilities, geographic region and brand equity. So if we can drive a faster return and fast return for ourselves through those four fundamentals and they're on a strategically good position in our portfolio, we are very interested.
Joe Ritchie -- Goldman Sachs -- Analyst
Inge, maybe how -- how much of a limiting factor right now is valuation?
Inge Thulin -- Chief Executive Officer, President and Chairman
I think always -- it's not now. There's -- whenever you talk about that, there's always a limitation to it, right? There's -- and I think it's important for you to really decide on where would you like to make it strategically, right? So you can see some of the acquisitions we have made. We have looked upon the real value it can add to us. And then we have paid for it, right? We are -- in my mind, we are a world-class company.
We are interested to buy world-class companies that we can integrate and drive forward. So then you need to pay a little bit more, but not too much.
Joe Ritchie -- Goldman Sachs -- Analyst
Okay, thanks, guys.
Operator
Our next question comes from the line of Steven Winoker of UBS. Please proceed.
Steven E. Winoker -- UBS -- Analyst
Thanks. Good morning, guys. I'll just -- I'll keep it to two questions. The first one, Inge, you know 3M has faced, I think, a lot of skepticism around its ability to hold Health Care operating margins over time.
So far, you've proven that skepticism wrong and as we're facing yet another sort of high-level margin before the strategic investments for the quarter. So maybe comment a little bit on the pressures in Health Care globally and how you're withstanding that and your conviction going forward in the business' ability to continue to do that over time.
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes, I think you're right. That's -- first of all, we have been in this business for a long time. It's a very attractive business to be in for reasons that we all know, the aging population trend, et cetera. I think the important thing is that you're able to provide at least two things: One is a benefit for the patient and; second, a benefit for the provider.
And our portfolio is steered right into those two things. That is what we do. And when you can add value even in an area like Health Care, which is very different than Industrial, you will be able to win in those segments. I don't know if you know, but I know that I was part myself of Health Care back in Europe in the early '90s, '91 to '95 specifically.
And there was a lot of pressure then to the German healthcare act. And what we had to do then was, yes, again, to prove the value for patients and for the provider and ourselves to be very efficient in the model in terms of manufacturing capabilities and logistics, and that's what we are doing. So when you look upon that specific business in terms of our growth rate, our margins, our cost of goods sold or SG&A, it's almost a perfect model for how you should do business, in my mind. And you look upon that then you compare that to Safety and Graphics, they are soon at the same point.
Not that high margins, but you can see the growth rate and very respectable margins of 25-plus percentage. It's, again, businesses that are regulated. It's about safety. It's about making sure that the patient or the worker always get the best.
And people pay for that. And if you see Health Care, the acceleration we had in developing economy was 12%. The issue in developing economy is never quality. It's money.
And as soon as the money is becoming available, 3M is one of the first products they will purchase into the system based on key opinion leaders around the world writing papers on what is the best outcome in the treatment of patients.
Steven E. Winoker -- UBS -- Analyst
Okay, that's helpful. And then secondly, on -- I think a question also that you've tackled repeatedly. But given, once again, the strength in the quarter that's showing up, any thoughts going forward about revisiting, taking on incremental leverage for growth investments going forward? You're I think below onetime net debt-to-EBITDA.
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Yes. Steve, you know our guidance of what we laid out for leverage over the course of five years, that we expect to add between $10 billion and $15 billion of leverage over that time. We've made progress in '16 and progress on that in '17 on that path. There's nothing changing on that front.
I've seen the capacity we have for adding that leverage.
Steven E. Winoker -- UBS -- Analyst
Okay, great. Thank you.
Operator
Our next question comes from the line of Nigel Coe of Morgan Stanley. Please proceed.
Nigel Coe -- Morgan Stanley -- Analyst
A couple of grounds. I'll keep this very brief. So we've kind of had a question on sustainability of organic sales. And obviously, your 4Q guidance doesn't assume it continues.
But I'm just trying to understand what caused the acceleration. And I know that there were some timing differences on days in 2Q. But do you have any intelligence in terms of the broad portfolio in terms of sell-in, the sell-through? I know you can see -- you've got good data, but how about more broadly in Industrial and Health Care channel sell-in versus sell-through? And were there any pricing increases or rebate concessions that maybe might have distorted the quarter? Or was this really just good end-market demand?
Inge Thulin -- Chief Executive Officer, President and Chairman
This is good commercialization and market demand that we capitalize on. On sell-in and sellout, it's often talked about relative to the retail and consumer lines. And there was no difference in this quarter for us relative to sellout, and very much the same in terms of sell-in as well, specifically in the office supply channel. But there is nothing here in terms of us pushing something into the system in terms of any specific activities.
As I said earlier, we -- our business model is around creating value for the end customer and for the OEMs in the industry. So there's nothing else here that is pushing the growth up. And as you can see, it's broad-based. If you think about, we have EEBG of 13%.
We have Health Care, 7%. IBG and Safety and Graphics at 6%. And then Consumer, 2%. And you look upon geographically, APAC, 13%.
And if you take out electronics, it's still 8%. And then you have Latin America/Canada, 5%; United States, 4%; and Europe/Middle East/Africa, 4%. So it's broad-based, and it's all businesses, which is very, very encouraging for us.
Nigel Coe -- Morgan Stanley -- Analyst
No. No question. That's great detail. And then, Nick, on the raws, the $0.03 of benefit in 3Q.
Obviously, a great job by the team. What is your plan and bet for 4Q just given the inflation we've seen post-hurricane?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Nigel, could you repeat that that, $0.03 benefit from what?
Nigel Coe -- Morgan Stanley -- Analyst
Raw materials.
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Oh, from raw materials. Yes, we think that will be flat to some benefit for us in Q4 and probably a little bit of a mixed dynamic there. As I've said, we've seen pricing continuing to benefit. So from a price/raw material, I think we'll still see increasing benefit from our selling prices.
On the raw material benefit, we continue to see that as a tougher and tougher comp for us. Up until now, it's been offset by the projects we're doing, as I mentioned earlier. That will likely sustain, but I won't be surprised if the benefit from that came -- the net benefit came down slightly in the fourth quarter.
Nigel Coe -- Morgan Stanley -- Analyst
Got it. Okay, got it.
Operator
Our next question comes from the line of Deane Dray of RBC Capital Markets. Please proceed.
Deane Dray -- RBC Capital Markets -- Analyst
Thank you. Good morning, everyone. I know we're into overtime here, so I'll keep it to one question. Can you talk about oral care in the U.S.
and how were you impacted by the ongoing distributor changes that's been causing stocking and restocking? And might you have picked up any more market share during this commotion?
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Yes, Deane, I won't say that we're in a position where we're declaring that we've picked up market share in the recent months or quarters. I would say this is a strong global business for us. And we are -- we see lots of demand for our oral care solutions around the globe. The U.S.
is down slightly in our oral care business, and it's a business where -- we haven't seen quite the channel fluctuations that you might be talking about. It's been pretty stable for us. The biggest driver for us in our oral care business is our demand in emerging markets in other parts of the world.
Deane Dray -- RBC Capital Markets -- Analyst
Thank you.
Operator
Our next question comes to the line of Laurence Alexander of Jefferies. Please proceed with the question.
Laurence Alexander -- Jefferies -- Analyst
Good morning, guys. So two quick ones, if I may. The soft parts in your business, the stationery in the office and the commercial solutions in the safety and protection, to what extent are those still core? Or how do they fit in the macro-driven, mega trend-driven, science-based growth that you were describing earlier? And secondly, what are your criteria for adding new materials to your 46 technology platforms?
Inge Thulin -- Chief Executive Officer, President and Chairman
Yes. Well, if you -- relative to the two divisions, if you start with the division in Safety and Graphics, that's a division that has a very strong position with films that is one of our core technologies. You've got this -- in this case, it's filmed for decoration, for brand equity building. But it's also the same type of, I would say, equipment and asset we're using for all our light management businesses.
So that's a business that is very strong for us. And if you look upon the underlying capabilities in order to produce that product, that's core to 3M. So there is no question around that business. And there is no question about office and supply either.
That is where you have the Post-it. That's where we have the Scotch tape, et cetera. So those are brand equity, big businesses that we earn good money with. And our customers own very, very good margins with them as well.
So if you think about that from a perspective, also those businesses in stationery products, they are based on technologies that are very solid for 3M as an enterprise. So it's not even a question relative if they belong to 3M or not. So that's that answer. In terms of building out technology platforms, we have 46, as you said.
In some cases, if we need to build out something, we will look upon that. And I think the latest -- we have a couple of them during the last couple of years. One is the ceramic business, where we bought one company that, in effect, had a defense business of around $450 million. So we purchased that.
What we really purchased was actually a technology platform that will deepen and broaden what we already had ourselves in the ceramic and that could be used for many, many, many divisions. And we did one in Membrana. That is filter capabilities that we built into filtration and the non-woven capabilities, et cetera. So if we see a need to add something that we not -- can't do ourselves or take too long time for us, we will go out and look for that.
But again, it's built on the demand from the market and where the market's going for the future. It's not us sitting internally and look upon what we are doing and yes, try to see what we should add.
Laurence Alexander -- Jefferies -- Analyst
Thank you.
Operator
That concludes the question and answer portion of our conference call. How now called about turn the call back over to Inge Thulin for some closing comments.
Inge Thulin -- Chief Executive Officer, President and Chairman
Thank you. To wrap up, our team executed very well across the enterprise and delivered another strong performance in the third quarter, including robust organic growth, increased earnings per share and rising margins. The 3M playbook is working, and we are well positioned going into 2018. Thank you for joining us, and I look forward to seeing you all in New York on December 12 for our Outlook Meeting.
Have a great day.
Operator
Ladies and gentlemen, that does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines.
Duration: 69 minutes
Call participants:
Bruce Jermeland -- Director, Investor Relations
Nick Gangestad -- Chief Financial Officer and Senior Vice President
Inge Thulin -- Chief Executive Officer, President and Chairman
Andrew Obin -- Bank of America / Merrill Lynch -- Analyst
Julian Mitchell -- Credit Suisse -- Analyst
Steve Tusa -- JPMorgan Chase -- Analyst
Andrew Kaplowitz -- Citigroup -- Analyst
Robert McCarthy -- Stifel -- Analyst
Scott R. Davis -- Barclays Research -- Analyst
John G. Inch -- Deutsche Bank -- Analyst
Joe Ritchie -- Goldman Sachs -- Analyst
Steven E. Winoker -- UBS -- Analyst
Nigel Coe -- Morgan Stanley -- Analyst
Deane Dray -- RBC Capital Markets -- Analyst
Laurence Alexander -- Jefferies -- Analyst
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