Adjustments

[Table of](#i7860c65eab2647ffbae7e3867c1cf525_7) [Contents](#i7860c65eab2647ffbae7e3867c1cf525_7)NOTE 5. Restructuring Actions2022 and 2021 Restructuring Actions: Operational/Marketing Capability Restructuring: As described in Note 5 to the Consolidated Financial Statements in 3M's Current Report on Form 8-K dated April 26, 2022 (which updated 3M’s 2021 Annual Report on Form 10-K), in late 2020, 3M announced it would undertake certain actions beginning in the fourth quarter of 2020 to further enhance its operations and marketing capabilities to take advantage of certain global market trends while de-prioritizing investments in slower-growth end markets. In 2021, management approved and committed to undertake additional actions under this initiative resulting in a 2021 pre-tax charge of $124 million. In the first quarter of 2022, management approved and committed to undertake the remaining actions under this initiative resulting in a pre-tax charge of $18 million. This initiative, begun in 2020 and ending with committed first quarter 2022 actions, impacted approximately 3,100 positions worldwide with a pre-tax charge of approximately $280 million over that period. The related restructuring charges for periods presented were recorded in the income statement as follows:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Nine months endedSeptember 30, |
| (Millions) |  | 2022 |  | 2021 |
| Cost of sales |  | $ | — |  | $ | 18 |
| Selling, general and administrative expenses |  | 12 |  | 74 |
| Research, development and related expenses |  | 6 |  | 15 |
| Total operating income impact |  | $ | 18 |  | $ | 107 |

The business segment operating income impact of these restructuring charges is summarized as follows:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Nine months endedSeptember 30, |
|  |  | Employee-Related |
| (Millions) |  | 2022 |  | 2021 |
| Safety and Industrial |  | $ | 2 |  | $ | 28 |
| Transportation and Electronics |  | 4 |  | 23 |
| Health Care |  | 2 |  | 18 |
| Consumer |  | 2 |  | 6 |
| Corporate and Unallocated |  | 8 |  | 32 |
| Total Operating Expense |  | $ | 18 |  | $ | 107 |

Restructuring actions, including cash and non-cash impacts, follow:

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| (Millions) |  | Employee-Related |
| Accrued restructuring action balance as of December 31, 2021 |  | $ | 87  |  |
| Incremental expense incurred in the first quarter of 2022 |  | 18  |  |
| Cash payments |  | (84) |  |
| Adjustments |  | (9) |  |
| Accrued restructuring action balances as of June 30, 2022 |  | $ | 12  |  |

Remaining activities related to this restructuring were largely completed in the third quarter of 2022. 13
