Cummins Records Lower Profit
Columbus-based Cummins Inc. (NYSE: CMI) is reporting second quarter net income of $414 million, compared to $465 million for the same period a year earlier. Despite the decrease, Chief Executive Officer Tom Linebarger says the company experienced a rise in demand for medium duty trucks in North America. July 30, 2013
COLUMBUS, Ind. - Cummins Inc. (NYSE: CMI) today reported results for the second quarter of
Second quarter revenues of $4.5 billion increased 2 percent from the second quarter of 2012.
Revenues in North America increased by 7 percent and international revenues declined by 4
percent. Within international markets, growth in Brazil and China was offset by weaker demand
in Europe, India and Mexico.
Earnings before interest and taxes (EBIT) were $621 million or 13.7 percent of sales, compared to $663 million or 14.9 percent of sales a year ago, excluding special items.
Net income attributable to Cummins in the second quarter was $414 million ($2.20 per diluted
share), compared to $465 million ($2.45 per diluted share) in the second quarter of 2012
excluding special items.
Second quarter revenues increased 15 percent from the first quarter of 2013 and EBIT improved to 13.7 percent of sales from 11.1 percent.
"Revenues increased primarily due to higher demand in North America, helped by market share gains in the medium duty truck market," said Chairman and CEO Tom Linebarger. "I am pleased with our execution this quarter and profitability improved significantly from first quarter levels. The recent increase in our dividend, coupled with our ongoing share repurchase
program, underscore our confidence in the Company's future."
Based on the current forecast, the Company expects full year revenues to be flat compared to 2012 and EBIT to be in the range of 13 to 14 percent of sales.
Recent highlights include:
-Cummins increased its dividend by 25%
-The Company repurchased 2.6 million shares of common stock
-Cummins was one of only two industrial companies to be ranked among Gartner’s Top 25 Supply Chain companies
-Cummins was named one of the Top 50 companies for diversity by DiversityInc for the seventh consecutive year Second quarter detail (all comparisons to same period in 2012)
-Sales – $2.7 billion, down 7 percent
-Segment EBIT – $339 million, or 12.8 percent of sales, compared to $376 million or 13.2 percent of sales
-Lower demand in stationary power, global mining and the heavy-duty truck market in North America were the most significant drivers of the lower revenues
-Demand increased for medium duty truck engines in North America and Brazil
-Sales - $1.1 billion, an increase of 8 percent
-Segment EBIT - $136 million, or 12.2 percent of sales, compared to $116 million or 11.2 percent of sales
-Higher revenues primarily related to higher on-highway demand in Brazil, China and North America
-Sales – $814 million, down 10 percent
-Segment EBIT – $76 million, or 9.3 percent of sales, compared to $94 million or 10.3
percent of sales
-Weaker demand in most international markets offsetting stronger revenues in North
-Sales – $954 million, up 1% excluding acquisitions
-Segment EBIT – $100 million, or 10.5 percent of sales, compared to $92 million or 11.6
percent of sales
-Higher power generation and parts sales in North America offset by lower power
generation sales in Europe and the Middle East
Cummins Inc., a global power leader, is a corporation of complementary business units that design, manufacture, distribute and service diesel and natural gas engines and related technologies, including fuel systems, controls, air handling, filtration, emission solutions and electrical power generation systems.
Headquartered in Columbus, Indiana, (USA) Cummins currently employs approximately 46,000 people worldwide and serves customers in approximately 190 countries and territories through a network of approximately 600 company-owned and independent distributor locations and approximately 6,500 dealer locations. Cummins earned $1.65 billion on sales of $17.3 billion in 2012. Press releases can be found on the Web at www.cummins.com. Follow Cummins on Twitter at @Cummins and on YouTube at CumminsInc.
Source: Cummins Inc.