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Mar 31, 2024
Solventum Q1 2024 Earnings Report
Reported sales increased slightly, organic sales saw a modest rise, and GAAP EPS reached $1.37.
Key Takeaways
Solventum reported its first quarter 2024 financial results, marking its first quarter as an independent company after the spin-off from 3M on April 1, 2024. Sales increased by 0.2% to $2.016 billion, with organic sales up by 0.9%. The company reported GAAP EPS of $1.37 and adjusted EPS of $2.08. Solventum generated $442 million in cash from operations and $340 million in free cash flow. The company reaffirms its full-year 2024 guidance.
Completed spin-off from 3M and began trading on April 1, 2024.
Reported sales increased 0.2% to $2.016 billion, organic sales increased 0.9%.
GAAP Earnings Per Share (EPS) of $1.37; adjusted EPS of $2.08.
Generated $442 million of cash from operations; free cash flow of $340 million.
Revenue by Segment
Forward Guidance
Solventum reaffirms its full-year 2024 guidance.
Positive Outlook
- Organic revenue growth of -2% to 0%
- Adjusted EPS of $6.10 to $6.40
- Free cash flow of $700M to $800M
Challenges Ahead
- Solventum expects a waning benefit from pricing for the remainder of 2024 and a return to a normalized pricing environment.
- The SKU rationalization project discussed at Investor Day is expected to begin impacting financials in the second half of 2024 and continue into 2025 and 2026.
- Solventum now expects an unfavorable impact from foreign exchange of ~50bps on reported sales for the full year 2024.
- 3M supply agreement mark-up started on April 1, 2024, and Solventum anticipates impact to the income statement to begin largely in the second half of 2024.
- Stand-up functional expenses are expected to ramp up for the remainder of 2024.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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