3M Co. affirmed its 2016 sales and earnings outlook, but set targets for the five-year period through 2020 slightly below its past five-year targets.  The St. Paul, Minn.-based maker of Post-it Notes, Ace bandages, Scotch-Brite cleaning pads and Filtrete furnace filters, said it expects sales gains, excluding revenue from acquisitions, to rise between 2% and 5% annually through 2020. That outlook is lower than the between 4% and 6%...  3M Co. affirmed its 2016 sales and earnings outlook, but set targets for the five-year period through 2020 slightly below its past five-year targets.  The St. Paul, Minn.-based maker of Post-it Notes, Ace bandages, Scotch-Brite cleaning pads and Filtrete furnace filters, said it expects sales gains, excluding revenue from acquisitions, to rise between 2% and 5% annually through 2020. That outlook is lower than the between 4% and 6% annual increases that it set through 2015.  Weaker demand from key overseas markets and slowing industrial activity are combining to restrain sales growth. It has been delivering about 3% a year sales growth.  3M shares declined 1.1%, or $1.89, to close at $164.39 at 4 p.m. in New York Stock Exchange trading on Tuesday.  The manufacturing giant also predicted earnings per share will increase at an annual rate of between 8% and 11% through 2020. Annual per-share profit has been growing at about 6%.  Chief Executive Inge Thulin described the latest targets as “aggressive, but realistic.”  “We have a playbook that’s working. We have a model where we’re winning with our customers,” Mr. Thulin said during a presentation on Tuesday to Wall Street analysts.  3M’s new-product strategies include expanding the market penetration of established products with new features and capabilities, such as Super Sticky Post-it Notes and water-resistant Ace-brand wrist braces.  Other new products are derived from adapting the company’s existing materials to new applications, including using of Thinsulate insulation to deaden noise in auto interiors and new abrasive products that feature the grit granules used in 3M’s sandpaper.  New industrial products last year accounted for $100 million in sales, propelling the industrial unit’s goal of adding $600 million in additional revenue from 2015 to 2017.  “Innovation is the heart beat of the company,” Chief Financial Officer Nick Gangestad said.  To stay ahead of sluggish demand from key end markets and geographic regions, Mr. Thulin is pushing a streamlined business structure with lower costs. 3M has realigned its businesses into five large groups focused on health care, consumer products, industrial, electronics, and safety and graphics.  3M’s overall operating margin for 2015 was 22.9% of revenue. The company, though, is doubling down on cost reductions to aid margin expansion.  3M is targeting between $500 million and $700 million in annual operating-expense reductions by 2020. As much as half of the savings would come from overhauling and simplifying the company’s supply chain.  Meanwhile, Mr. Thulin said he is mostly satisfied with the composition of the company’s business portfolio, after last year evaluating the potential sale of businesses accounting for $2.5 billion in annual revenue.  Mr. Thulin backed away from the sale of the health information unit last year, after concluding the business offered new investment opportunities  On Tuesday, company executives reiterated their 2016 sales-growth forecast of between 1% and 3% excluding acquisitions, and forecast earnings per share in a range between $8.10 and $8.45  Write to Bob Tita at robert.tita@wsj.com
3M Co. is counting on offsetting modest sales growth in the coming years with lower costs and hiving off new products from its well-known consumer brands and industrial materials.