The accelerating global economy lifted 3M Co.'s sales and profits past expectations, and executives on Thursday raised their outlook for 2018, in part because of future savings that are expected from the new federal tax law.

The Maplewood conglomerate's fourth-quarter profit fell, however, as it accounted for the revaluation of taxes it previously deferred. Not counting that expense, 3M's fourth-quarter profits rose 12 percent as it saw improvements from all five of its businesses.

"3M had a strong finish to 2017, delivering robust organic growth across all business groups and all geographic areas," Chief Executive Inge Thulin told investors during a conference call Thursday.

The company's shares, which have played a big role in powering the Dow Jones Industrials index higher over the past year, jumped nearly 2 percent to a new record. 3M and Caterpillar stocks were among manufacturers driving up the Dow Thursday.

3M said its tax rate under the new "Tax Cuts and Jobs Act" will fall to 20 percent to 22 percent in 2018, down from a prior rate of 26 percent to 27 percent. Executives said they will use the savings to boost returns for shareholders, increase pension reserves and to invest in the company.

With the savings, executives said the company's 2018 full-year profit will be in a range of $10.20 to $10.70 a share, up from its prior guidance of $9.60 to $10. The company finished 2017 with a full-year profit of $7.93 a share, or $9.17 a share excluding the tax-related charge.

The company's board approved a 16 percent increase in shareholder dividends for the first quarter of 2018. During the fourth quarter of 2017, 3M paid shareholders $699 million in dividends and repurchased $504 million of its own shares. 3M also contributed $600 million to its U.S. pension plan.

"Over the last several years, we have accelerated investments in the business, including stepping up research and development and our commercialization efforts, which is evident in our strong results," Thulin said.

The company invested 6 percent of sales, or $1.9 billion, in R&D in 2017 and "will increase investments further" in 2018, Thulin said.

3M said it earned $525 million, or 85 cents a share, in the last three months of 2017. That's down from $1.2 billion, or $1.88 a share, in the same period a year ago. Not counting the tax expense, the company earned $2.10 a share in the latest period, beating analysts' forecast average of $2.03.

Fourth-quarter sales rose 9 percent to $7.99 billion, also exceeding analysts' forecast of $7.88 billion.

The company's biggest unit, Industrial, posted sales of $2.7 billion that rose 7 percent, and operating income of $527 million, which was down 5.5 percent. Thulin noted that the unit benefited from strong demand from auto, aerospace and industrial adhesives customers.

The company's star performer during the quarter, however, was the Safety and Graphics division. Its sales jumped 15 percent to $1.5 billion, while operating profits surged 50 percent to $406 million.

Health Care quarterly sales rose 6 percent to $1.5 billion with input from food safety and medical-records systems.

3M's once ailing Electronics and Energy business saw sales rise 12.5 percent to $1.3 billion amid growing demand for electronics and display material products. 3M's Consumer unit saw sales rise 7 percent to $1.2 billion.

3M bought Scott Safety during the fourth quarter for $2 billion and divested four "non-core" businesses, moves expected to strengthen future performance.

While the new change in tax law will also help future results, it caused 3M to record a "net tax expense" in the fourth quarter of $762 million, or $1.25 per share. The expense included a "one-time transition-tax on unremitted foreign earnings as well as true ups of tax deferred assets and liabilities," CFO Nick Gangestad explained to analysts on Thursday's conference call.

Jim Corridore, analyst at CFRA Research, boosted his 3M earnings estimate for 2018 but maintained his "hold" rating of the stock. He acknowledged 3M's "accelerating revenue growth," but said he believed 3M's stock was already at a "premium valuation."

Dee DePass • 612-673-7725