TECHCET Comments – adding fuel to the fire about PFAS; following supply-chain issues caused by interruption of Fluorspar coming from Russia which is evidently in the US supply-chain for PFAS used for o-rings.
3M to Exit PFAS Manufacturing by the End of 2025
ST. PAUL, Minn.,Dec. 20, 2022/PRNewswire/ —3M(NYSE: MMM) today announced it will exit per- and polyfluoroalkyl substance (PFAS) manufacturing and work to discontinue the use of PFAS across its product portfolio by the end of 2025. 3M’s decision is based on careful consideration and a thorough evaluation of the evolving external landscape, including multiple factors such as accelerating regulatory trends focused on reducing or eliminating the presence of PFAS in the environment and changing stakeholder expectations.
“This is a moment that demands the kind of innovation3Mis known for,” said3Mchairman and chief executive officerMike Roman. “While PFAS can be safely made and used, we also see an opportunity to lead in a rapidly evolving external regulatory and business landscape to make the greatest impact for those we serve. This action is another example of how we are positioning3Mfor continued sustainable growth by optimizing our portfolio, innovating for our customers, and delivering long-term value for our shareholders.”
- Exit all PFAS manufacturing by the end of 2025:3Mwill discontinue manufacturing all fluoropolymers, fluorinated fluids, and PFAS-based additive products. We will help facilitate an orderly transition for customers.3Mintends to fulfill current contractual obligations during the transition period.
- Work to discontinue use of PFAS across our product portfolio by the end of 2025:We have already reduced our use of PFAS over the past three years through ongoing research and development, and will continue to innovate new solutions for customers.
With these two actions,3Mis committing to innovate toward a world less dependent upon PFAS. 3M’s products are safe for their intended uses.3Mwill continue to remediate PFAS and address litigation by defending ourselves in court or through negotiated resolutions, all as appropriate.
As noted above,3Mwill exit all PFAS manufacturing by the end of 2025. The current annual net sales of manufactured PFAS are approximately$1.3 billionwith estimated EBITDA margins of approximately 16%. In addition, as also noted above,3Mwill work to discontinue the use of PFAS across our product portfolio by the end of 2025, which represents a small portion of 3M’s overall revenue. Over the course of the exit from PFAS manufacturing,3Mexpects to incur related total pre-tax charges of approximately$1.3 billionto$2.3 billion, including the fourth quarter 2022 amount below. Approximately 70-80% of the total is expected to be non-cash.
The company expects to take an estimated fourth quarter 2022 pre-tax charge in a range of$0.7 billionto$1.0 billion, primarily non-cash and related to asset impairments.
3Mintends to reflect the fourth quarter 2022 costs as an adjustment in arriving at results, adjusted for special items. Beginning in 2023,3Malso expects to adjust for the results of manufactured PFAS in arriving at results, adjusted for special items.
PFAS are critical in the manufacture of many products that are important for modern life, including medical technologies, semiconductors, batteries, phones, automobiles, and airplanes. 3M’s products are safe and effective for their intended uses. Additional details are available on 3M’s website,www.3M.com/PFAS.