3M to double its production of N95 respirators to meet the sharply rising demand

U.S
industrial giant, 3M (NYSE:MMM), has been actively producing face masks amidst
the Coronavirus emergency. The Minnesota-based conglomerate that is currently
valued at £64 billion is a leading manufacturer for N95 face masks that are the
most in need during the ongoing health emergency.

N95
respirators are named for their quality to filter as many as 95% of the small
and larger particles including a range of bacteria. The filtering face masks
are essential equipment for workers from multiple industries like construction
and medicine.

3M
Recently Doubled Production From 400 Million Masks To 1.1 Billion Per Year

With
Coronavirus spreading quickly in 2020, the global health workforce had
expressed concern about an expected shortage of such essential equipment. According
to a statement by the United States Department of Health and Human Services at
the start of March, the country needed 3.5 billion N95 masks if the pandemic
grew to its full potential while the U.S roughly had 35 million masks only at
the time.

3M
previously had its production capacity capped at 400 million N95
respirators annually. Owing to the sharply rising demand, 3M recently upgraded
its capacity to produce 1.1 billion masks per year. In its statement last week,
3M also highlighted its plans of doubling the production again to 2 billion
filtering masks in the upcoming 12 months.

Analysts
Expect An Additional £242 Million Of Masks Sales Due To The Increased Demand

According
to the analysts, the rising demand for N95 face masks can result in a small
increase in 3M’s financial performance. The company had recorded £25.88 billion
in sales in 2019. While the official figure from the industrial giant isn’t
available, experts estimate that the company sold £80.88 million to £262.87
million of masks before the Coronavirus pandemic. They expect another £242 million
generated from the sales of face masks due to the health crisis.

All
in all, however, the increment still makes up a very small portion of 3M’s
overall sales from its businesses.

At
the time of writing, 3M is exchanging hands at £111.40 per share in the stock
market that translates to a little
under 25% decline in 2020 so far. 3M had also struggled in 2019 with an
annual decline of around 8%. Compared to its record-high in January 2018, the
stock is currently trading around 50% down. 3M has a price to earnings ratio of
17.63.