Total Debt (Carrying Amount)

3M Co., Statement of Financial Position, Debt

USD $ in millions

 
Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014 Dec 31, 2013
Short-term borrowings and current portion of long-term debt 1,853  972  2,044  106  1,683 
Long-term debt, excluding current portion 12,096  10,678  8,753  6,731  4,326 
Capital lease obligations 60  45  46  59  58 
Total debt (carrying amount) 14,009  11,695  10,843  6,896  6,067 

Source: Based on data from 3M Co., Annual Reports

Item Description The company
Total debt (carrying amount) Sum of the carrying values as of the balance sheet date of all debt plus capital lease obligations. 3M Co.'s total debt increased from 2015 to 2016 and from 2016 to 2017.

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Total Debt (Fair Value)

 
Dec 31, 2017
Selected Financial Data (USD $ in millions)
Short-term borrowings and current portion of long-term debt, except Medium-term fixed rate note nad Eurobond securities 1,853 
Long-term debt, excluding current portion, except Medium-term fixed rate note nad Eurobond securities 12,535 
Medium-term fixed rate note
Eurobond securities
Total debt (fair value) 14,388 
Ratio
Debt, fair value to carrying amount 1.03

Source: Based on data from 3M Co., Annual Reports

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Weighted-average Interest Rate on Debt

Weighted-average effective interest rate on debt: 1.97%

Interest Rate Debt Amount1 Interest Rate × Debt Amount Weighted-average Interest Rate2
2.45% 9,681  237 
0.76% 3,517  27 
1.50% 745  11 
5.35%
Total 13,949  275  1.97%

Source: Based on data from 3M Co., Annual Reports

1 USD $ in millions

2 Weighted-average interest rate = 100 × 275 ÷ 13,949 = 1.97%

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Interest Costs Incurred

3M Co.

USD $ in millions

 
12 months ended Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014 Dec 31, 2013
Interest expense 322  199  149  142  145 
Capitalized interest 12  10  13  15  21 
Interest costs incurred 334  209  162  157  166 

Source: Based on data from 3M Co., Annual Reports

Item Description The company
Interest expense Represents the portion of interest incurred in the period on debt arrangements that was charged against earnings. 3M Co.'s interest expense increased from 2015 to 2016 and from 2016 to 2017.
Capitalized interest The amount of interest that was capitalized during the period. 3M Co.'s capitalized interest declined from 2015 to 2016 but then increased from 2016 to 2017 not reaching 2015 level.
Interest costs incurred Total interest costs incurred during the period and either capitalized or charged against earnings. 3M Co.'s interest costs incurred increased from 2015 to 2016 and from 2016 to 2017.

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Adjusted Interest Coverage Ratio

 
Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014 Dec 31, 2013
Selected Financial Data (USD $ in millions)
Net income attributable to 3M 4,858  5,050  4,833  4,956  4,659 
Add: Net income attributable to noncontrolling interest 11  42  62 
Add: Income tax expense 2,679  1,995  1,982  2,028  1,841 
Add: Interest expense 322  199  149  142  145 
Earnings before interest and tax (EBIT) 7,870  7,252  6,972  7,168  6,707 
 
Interest costs incurred 334  209  162  157  166 
Ratio With and Without Capitalized Interest
Interest coverage ratio (excluding capitalized interest)1 24.44 36.44 46.79 50.48 46.26
Adjusted interest coverage ratio (including capitalized interest)2 23.56 34.70 43.04 45.66 40.40

2017 Calculations

1 Interest coverage ratio (excluding capitalized interest) = EBIT ÷ Interest expense
= 7,870 ÷ 322 = 24.44

2 Adjusted interest coverage ratio (including capitalized interest) = EBIT ÷ Interest costs incurred
= 7,870 ÷ 334 = 23.56

Ratio Description The company
Adjusted interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments (including capitalized interest). 3M Co.'s adjusted interest coverage ratio deteriorated from 2015 to 2016 and from 2016 to 2017.

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