Cummins Inc. today reported results for the second quarter of 2013. The company said they expect full year revenues to be in line with 2012.
Second quarter revenues of $4.5 billion increased 2% from the second quarter of 2012. Revenues in North America increased by 7% and international revenues declined by 4%. 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% of sales, compared to $663 million or 14.9% 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% from the first quarter of 2013 and EBIT improved to 13.7% of sales from 11.1%.
"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% 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)
Engine Segment
•Sales - $2.7 billion, down 7%
•Segment EBIT - $339 million, or 12.8% of sales, compared to $376 million or 13.2% 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
Components
•Sales - $1.1 billion, an increase of 8%
•Segment EBIT - $136 million, or 12.2% of sales, compared to $116 million or 11.2% of sales
•Higher revenues primarily related to higher on-highway demand in Brazil, China and North America
Power Generation
•Sales - $814 million, down 10%
•Segment EBIT - $76 million, or 9.3% of sales, compared to $94 million or 10.3% of sales
•Weaker demand in most international markets offsetting stronger revenues in North America
Distribution
•Sales - $954 million, up 1% excluding acquisitions
•Segment EBIT - $100 million, or 10.5% of sales, compared to $92 million or 11.6% of sales
•Higher power generation and parts sales in North America offset by lower power generation sales in Europe and the Middle East
