- First quarter revenues of $8.4 billion; GAAP1 Net Income of
$2.0 billion
- EBITDA in the first quarter was 30.6% of sales; Diluted EPS
of $14.03
- First quarter results include a net gain of $1.3 billion, or
$9.08 per diluted share, related to the separation of Atmus and $29
million, or $0.15 per diluted share, of restructuring
expenses.
- The company is raising its guidance for full year 2024
revenue and EBITDA after adjusting for the separation of
Atmus.
- Full year revenues are expected to decline 2% to 5%; prior
guidance was also down 2% to 5% but assumed the inclusion of Atmus
revenues for the full year.
- EBITDA is now expected to be in the range of 14.5% to 15.5%;
an increase from previous guidance of 14.4% to 15.4% which also
included Atmus for the full year.
Cummins Inc. (NYSE: CMI) today reported results for the first
quarter of 2024.
“We continued to see strong demand from customers in the first
quarter of 2024, reflecting the quality and performance of our
products,” said Jennifer Rumsey, Chair and CEO. “We delivered solid
profitability and also completed the separation of Atmus, allowing
Cummins to continue its focus on advancing innovative power
solutions and positioning Atmus to pursue its own plans for
profitable growth. I am deeply appreciative of our Cummins
employees across the globe, whose broad expertise and diverse
perspectives are driving our ability to innovate for our customers
and meet global demand.”
First quarter revenues of $8.4 billion decreased 1% from the
same quarter in 2023. Sales in North America were flat, and
international revenues decreased 1% due to lower demand in China
and Europe.
Net income attributable to Cummins in the first quarter was $2.0
billion, or $14.03 per diluted share, compared to $790 million, or
$5.55 per diluted share, in 2023. The results reflect the gain
related to the separation of Atmus, net of transaction costs and
other expenses, of $1.3 billion, or $9.08 per diluted share, and
restructuring expenses of $29 million, or $0.15 per diluted share.
The first quarter of 2023 included costs related to the separation
of Atmus of $18 million, or $0.10 per diluted share. The tax rate
in the first quarter was 8.7%, primarily due to the nontaxable gain
on the separation of Atmus.
Earnings before interest, taxes, depreciation and amortization
(EBITDA) in the first quarter were $2.6 billion, or 30.6% of sales,
compared to $1.4 billion, or 16.1% of sales, a year ago. EBITDA for
the first quarter of 2024 and the first quarter of 2023 included
the gain and costs noted above.
2024 Outlook:
Based on its current forecast, Cummins projects full year 2024
revenues to decline 2% to 5% on a year-over-year basis, and EBITDA
to be in the range of 14.5% and 15.5% of sales. The prior guidance,
which was also a decline of 2% to 5%, assumed the inclusion of the
financial results of Atmus for the full year. Due to strong global
demand, the revenue guidance is unchanged as compared to the prior
guidance despite the separation of Atmus. The current EBITDA
guidance is an increase from the prior guidance of between 14.4%
and 15.4%.
Cummins plans to continue to generate strong operating cash flow
and returns for shareholders and is committed to our long-term
strategic goal of returning 50% of operating cash flow back to
shareholders. In the near term, we will focus on reinvesting for
profitable growth, dividends and reducing debt.
“We have raised our expectations on revenue and profitability
for 2024 due to continued demand for Cummins’ products and
services. We do still expect slowing demand in some of our key
markets in the second half of the year,” said Rumsey. “Despite
lower sales, Cummins is in a strong position to keep investing in
future growth, bringing new technologies to customers and returning
cash to shareholders.”
First Quarter 2024 Highlights:
- In March, Cummins finalized the separation of Atmus Filtration
Technologies Inc. through a share exchange offer in which
shareholders had the option to exchange their shares of Cummins
common stock for shares of Atmus. Following completion of the
exchange offer, Cummins did not retain any outstanding shares of
Atmus common stock.
- Accelera™ by Cummins, Daimler Trucks & Buses and PACCAR
selected Marshall County, Mississippi, as the future site of
advanced battery cell manufacturing for their planned joint
venture. The joint venture will localize battery cell production
for commercial electric vehicles and is expected to create more
than 2,000 U.S. manufacturing jobs, with the option for further
expansion as demand grows. The 21-gigawatt hour (GWh) factory is
expected to begin producing battery cells in 2027.
- Cummins re-introduced the fuel agnostic platforms with a name
that captures the innovation that powers the business forward, the
Cummins HELM™ platforms. With higher efficiency, lower emissions
and multiple fuels, the Cummins HELM™ platforms give customers
control of how they navigate their own journeys as part of the
energy transition. As the next product in the Cummins HELM™15-liter
platform, Cummins announced it will launch the next generation
diesel X15 in North America for the heavy-duty on-highway market
which will be compliant with U.S. EPA and CARB 2027 aligned
regulations at launch.
- In April, Cummins Power Generation introduced four new
generator sets to the award-winning Centum™ Series, two each
powered by Cummins’ QSK50 and QSK78 engines. In response to high
market demand, these new models have been engineered specifically
for the most critical applications such as data centers, healthcare
facilities and wastewater treatment plants. These products build on
decades of experience meeting our customers' needs and deliver a
step-change improvement in power density, assured reliability,
sustainability and low emissions.
- Cummins received several prestigious honors during the quarter
including being ranked in the Financial Times Diversity Leaders
list for the third consecutive year, winning the World 50 Inclusion
& Diversity Impact Award, and being named industry leader in
the Commercial Vehicle and Machinery category for America’s Most
JUST Companies list. Also, Cummins was named a 2024 Handshake Early
Talent Award winner for its role in shaping the workforce of the
future and was recognized as a 2024 Top Hispanic Employer by
DiversityComm Magazine.
1 Generally Accepted Accounting Principles in the U.S.
First quarter 2024 detail (all comparisons to same period in
2023):
Components Segment
- Sales - $3.3 billion, down 6%
- Segment EBITDA - $473 million, or 14.2% of sales, which
includes $21 million of costs related to the separation of Atmus
compared to $507 million, or 14.3% of sales, which includes $12
million of costs related to the separation of Atmus
- Revenues in North America decreased by 5% and international
sales decreased by 8% primarily due to lower demand in China and
Europe.
Engine Segment
- Sales - $2.9 billion, down 2%
- Segment EBITDA - $414 million, or 14.1% of sales, compared to
$457 million, or 15.3% of sales
- On-highway revenues increased 1% driven by continued strong
demand in the North American medium-duty truck market and pricing
actions.
- Sales were flat in North America and decreased 8% in
international markets due to lower demand in China and Europe.
Distribution Segment
- Sales - $2.5 billion, up 5%
- Segment EBITDA - $294 million, or 11.6% of sales, compared to
$335 million, or 13.9% of sales
- Revenues in North America increased 2% and international sales
increased by 14%.
- Higher revenues were driven by increased demand for power
generation products and pricing actions.
Power Systems Segment
- Sales - $1.4 billion, up 3%
- Segment EBITDA - $237 million, or 17.1% of sales, compared to
$219 million, or 16.3% of sales
- Power generation revenues increased 11% driven by increased
global demand, particularly for the data center market. Industrial
revenues decreased 8% primarily due to weaker demand in oil and gas
markets.
Accelera Segment
- Sales - $93 million, up 9%
- Segment EBITDA loss - $101 million
- Revenues increased due to increased electrolyzer
installations.
- Costs associated with the development of electric powertrains,
fuel cells and electrolyzers, as well as products to support
battery electric vehicles are contributing to EBITDA losses. The
company continues to make investments to support our customers
through the energy transition and deliver future profitable
growth.
About Cummins Inc.
Cummins Inc., a global power solutions leader, is comprised of
five business segments – Components, Engine, Distribution, Power
Systems and Accelera by Cummins – supported by our global
manufacturing and extensive service and support network, skilled
workforce and vast technological expertise. Cummins is committed to
its Destination Zero strategy, which is grounded in the company’s
commitment to sustainability and helping its customers successfully
navigate the energy transition with its broad portfolio of
products. The products range from advanced diesel, natural gas,
electric and hybrid powertrains and powertrain-related components
including, aftertreatment, turbochargers, fuel systems, valvetrain
technologies, controls systems, air handling systems, automated
transmissions, axles, drivelines, brakes, suspension systems,
electric power generation systems, batteries, electrified power
systems, hydrogen production technologies and fuel cell products.
Headquartered in Columbus, Indiana (U.S.), since its founding in
1919, Cummins employs approximately 75,500 people committed to
powering a more prosperous world through three global corporate
responsibility priorities critical to healthy communities:
education, environment, and equality of opportunity. Cummins serves
its customers online, through a network of company-owned and
independent distributor locations, and through thousands of dealer
locations worldwide and earned about $735 million on sales of $34.1
billion in 2023. See how Cummins is powering a world that's always
on by accessing news releases and more information at
https://www.cummins.com/.
Forward-looking disclosure statement
Information provided in this release that is not purely
historical are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including
statements regarding our forecasts, guidance, preliminary results,
expectations, hopes, beliefs and intentions on strategies regarding
the future. These forward-looking statements include, without
limitation, statements relating to our plans and expectations for
our revenues, EBITDA and Agreement in Principle to settle
regulatory proceedings regarding our emissions certification and
compliance process for pick-up truck applications. Our actual
future results could differ materially from those projected in such
forward-looking statements because of a number of factors,
including, but not limited to: any adverse consequences resulting
from entering into the Agreement in Principle, including required
additional mitigation projects, adverse reputational impacts and
potential resulting legal actions; increased scrutiny from
regulatory agencies, as well as unpredictability in the adoption,
implementation and enforcement of emission standards around the
world; evolving environmental and climate change legislation and
regulatory initiatives; changes in international, national and
regional trade laws, regulations and policies; changes in taxation;
global legal and ethical compliance costs and risks; future bans or
limitations on the use of diesel-powered products; failure to
successfully integrate and / or failure to fully realize all of the
anticipated benefits of the acquisition of Meritor, Inc. (Meritor);
raw material, transportation and labor price fluctuations and
supply shortages; aligning our capacity and production with our
demand; the actions of, and income from, joint ventures and other
investees that we do not directly control; large truck
manufacturers' and original equipment manufacturers' customers
discontinuing outsourcing their engine supply needs or experiencing
financial distress, or change in control; product recalls;
variability in material and commodity costs; the development of new
technologies that reduce demand for our current products and
services; lower than expected acceptance of new or existing
products or services; product liability claims; our sales mix of
products; climate change, global warming, more stringent climate
change regulations, accords, mitigation efforts, greenhouse gas
regulations or other legislation designed to address climate
change; our plan to reposition our portfolio of product offerings
through exploration of strategic acquisitions and divestitures and
related uncertainties of entering such transactions; increasing
interest rates; challenging markets for talent and ability to
attract, develop and retain key personnel; exposure to potential
security breaches or other disruptions to our information
technology environment and data security; political, economic and
other risks from operations in numerous countries including
political, economic and social uncertainty and the evolving
globalization of our business; competitor activity; increasing
competition, including increased global competition among our
customers in emerging markets; failure to meet environmental,
social and governance (ESG) expectations or standards, or achieve
our ESG goals; labor relations or work stoppages; foreign currency
exchange rate changes; the performance of our pension plan assets
and volatility of discount rates; the price and availability of
energy; continued availability of financing, financial instruments
and financial resources in the amounts, at the times and on the
terms required to support our future business; and other risks
detailed from time to time in our SEC filings, including
particularly in the Risk Factors section of our 2023 Annual Report
on Form 10-K and Quarterly Reports on Form 10-Q. Shareholders,
potential investors and other readers are urged to consider these
factors carefully in evaluating the forward-looking statements and
are cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements made herein are made
only as of the date of this release and we undertake no obligation
to publicly update any forward-looking statements, whether as a
result of new information, future events or otherwise. More
detailed information about factors that may affect our performance
may be found in our filings with the SEC, which are available at
http://www.sec.gov or at http://www.cummins.com in the Investor
Relations section of our website.
Presentation of Non-GAAP Financial Information
EBITDA is a non-GAAP measure used in this release and is defined
and reconciled to what management believes to be the most
comparable GAAP measure in a schedule attached to this release,
except for forward-looking measures of EBITDA where a
reconciliation to the corresponding GAAP measures is not available
due to the variability, complexity and limited visibility of the
non-cash items that are excluded from the non-GAAP outlook measure.
Cummins presents this information as it believes it is useful to
understanding the Company's operating performance, and because
EBITDA is a measure used internally to assess the performance of
the operating units.
Webcast information
Cummins management will host a teleconference to discuss these
results today at 10 a.m. EDT. This teleconference will be webcast
and available on the Investor Relations section of the Cummins
website at www.cummins.com. Participants wishing to view the
visuals available with the audio are encouraged to sign-in a few
minutes prior to the start of the teleconference.
CUMMINS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF NET INCOME
(Unaudited) (a)
Three months ended
March 31,
In millions, except per share
amounts
2024
2023
NET SALES
$
8,403
$
8,453
Cost of sales
6,362
6,424
GROSS MARGIN
2,041
2,029
OPERATING EXPENSES AND INCOME
Selling, general and administrative
expenses
839
753
Research, development and engineering
expenses
369
350
Equity, royalty and interest income from
investees
123
119
Other operating expense, net
33
19
OPERATING INCOME
923
1,026
Interest expense
89
87
Other income, net
1,387
90
INCOME BEFORE INCOME TAXES
2,221
1,029
Income tax expense
193
223
CONSOLIDATED NET INCOME
2,028
806
Less: Net income attributable to
noncontrolling interests
35
16
NET INCOME ATTRIBUTABLE TO CUMMINS
INC.
$
1,993
$
790
EARNINGS PER COMMON SHARE ATTRIBUTABLE
TO CUMMINS INC.
Basic
$
14.10
$
5.58
Diluted
$
14.03
$
5.55
WEIGHTED-AVERAGE COMMON SHARES
OUTSTANDING
Basic
141.3
141.5
Diluted
142.1
142.4
(a) Prepared on an unaudited basis in
accordance with accounting principles generally accepted in the
United States of America.
CUMMINS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited) (a)
In millions, except par value
March 31, 2024
December 31,
2023
ASSETS
Current assets
Cash and cash equivalents
$
2,541
$
2,179
Marketable securities
510
562
Total cash, cash equivalents and
marketable securities
3,051
2,741
Accounts and notes receivable, net
5,463
5,583
Inventories
5,758
5,677
Prepaid expenses and other current
assets
1,348
1,197
Total current assets
15,620
15,198
Long-term assets
Property, plant and equipment, net
6,011
6,249
Investments and advances related to equity
method investees
1,774
1,800
Goodwill
2,406
2,499
Other intangible assets, net
2,455
2,519
Pension assets
1,187
1,197
Other assets
2,374
2,543
Total assets
$
31,827
$
32,005
LIABILITIES
Current liabilities
Accounts payable (principally trade)
$
4,476
$
4,260
Loans payable
342
280
Commercial paper
609
1,496
Current maturities of long-term debt
113
118
Accrued compensation, benefits and
retirement costs
561
1,108
Current portion of accrued product
warranty
652
667
Current portion of deferred revenue
1,236
1,220
Other accrued expenses
3,697
3,754
Total current liabilities
11,686
12,903
Long-term liabilities
Long-term debt
5,771
4,802
Deferred revenue
1,061
966
Other liabilities
3,208
3,430
Total liabilities
$
21,726
$
22,101
EQUITY
Cummins Inc. shareholders’ equity
Common stock, $2.50 par value, 500 shares
authorized, 222.5 and 222.5 shares issued
$
2,557
$
2,564
Retained earnings
19,605
17,851
Treasury stock, at cost, 85.7 and 80.7
shares
(10,831
)
(9,359
)
Accumulated other comprehensive loss
(2,264
)
(2,206
)
Total Cummins Inc. shareholders’
equity
9,067
8,850
Noncontrolling interests
1,034
1,054
Total equity
$
10,101
$
9,904
Total liabilities and equity
$
31,827
$
32,005
(a) Prepared on an unaudited basis in
accordance with accounting principles generally accepted in the
United States of America.
CUMMINS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited) (a)
Three months ended
March 31,
In millions
2024
2023
CASH FLOWS FROM OPERATING
ACTIVITIES
Consolidated net income
$
2,028
$
806
Adjustments to reconcile consolidated net
income to net cash provided by operating activities
Gain related to divestiture of Atmus
(1,333
)
—
Depreciation and amortization
265
246
Deferred income taxes
(38
)
(38
)
Equity in income of investees, net of
dividends
(78
)
(67
)
Pension and OPEB expense
9
1
Pension contributions and OPEB
payments
(48
)
(92
)
Changes in current assets and liabilities,
net of acquisitions and divestitures
Accounts and notes receivable
(11
)
(621
)
Inventories
(354
)
(263
)
Other current assets
(175
)
(142
)
Accounts payable
327
381
Accrued expenses
(393
)
151
Other, net
77
133
Net cash provided by operating
activities
276
495
CASH FLOWS FROM INVESTING
ACTIVITIES
Capital expenditures
(169
)
(193
)
Acquisition of business, net of cash
acquired
(59
)
—
Investments in marketable
securities—acquisitions
(379
)
(326
)
Investments in marketable
securities—liquidations
431
345
Cash associated with Atmus divestiture
(174
)
—
Other, net
(56
)
(54
)
Net cash used in investing activities
(406
)
(228
)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from borrowings
2,398
43
Net payments of commercial paper
(887
)
(29
)
Payments on borrowings and finance lease
obligations
(748
)
(142
)
Dividend payments on common stock
(239
)
(222
)
Other, net
(25
)
(13
)
Net cash provided by (used in) financing
activities
499
(363
)
EFFECT OF EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS
(7
)
(25
)
Net increase (decrease) in cash and cash
equivalents
362
(121
)
Cash and cash equivalents at beginning of
year
2,179
2,101
CASH AND CASH EQUIVALENTS AT END OF
PERIOD
$
2,541
$
1,980
(a) Prepared on an unaudited basis in
accordance with accounting principles generally accepted in the
United States of America.
CUMMINS INC. AND
SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
In millions
Components
Engine
Distribution
Power Systems
Accelera
Total Segments
Intersegment Eliminations
(1)
Total
Three months ended March 31,
2024
External sales
$
2,842
$
2,240
$
2,529
$
708
$
84
$
8,403
$
—
$
8,403
Intersegment sales
490
688
6
681
9
1,874
(1,874
)
—
Total sales
3,332
2,928
2,535
1,389
93
10,277
(1,874
)
8,403
Research, development and engineering
expenses
84
154
14
60
55
367
2
369
Equity, royalty and interest income (loss)
from investees
26
57
24
19
(3
)
123
—
123
Interest income
8
7
11
3
—
29
—
29
EBITDA (2)
473
(3
)
414
294
237
(101
)
1,317
1,255
2,572
Depreciation and amortization (4)
125
58
31
34
14
262
—
262
EBITDA as a percentage of total sales
14.2
%
14.1
%
11.6
%
17.1
%
NM
12.8
%
30.6
%
Three months ended March 31,
2023
External sales
$
3,043
$
2,252
$
2,399
$
679
$
80
$
8,453
$
—
$
8,453
Intersegment sales
514
734
7
664
5
1,924
(1,924
)
—
Total sales
3,557
2,986
2,406
1,343
85
10,377
(1,924
)
8,453
Research, development and engineering
expenses
91
134
14
63
48
350
—
350
Equity, royalty and interest income (loss)
from investees
21
65
24
13
(4
)
119
—
119
Interest income
6
3
7
2
—
18
—
18
EBITDA (2)
507
(5
)
457
335
219
(94
)
1,424
(63
)
1,361
Depreciation and amortization (4)
123
51
28
29
14
245
—
245
EBITDA as a percentage of total sales
14.3
%
15.3
%
13.9
%
16.3
%
NM
13.7
%
16.1
%
"NM" - not meaningful information
(1) Included intersegment sales,
intersegment profit in inventory and unallocated corporate
expenses. The three months ended March 31, 2024, included a $1.3
billion gain related to the divestiture of Atmus and $14 million of
costs associated with the divestiture of Atmus. The three months
ended March 31, 2023, included $6 million of costs associated with
the divestiture of Atmus.
(2) EBITDA is defined as earnings or
losses before interest expense, income taxes, depreciation and
amortization and noncontrolling interests. We believe EBITDA is a
useful measure of our operating performance as it assists investors
and debt holders in comparing our performance on a consistent basis
without regard to financing methods, capital structure, income
taxes or depreciation and amortization methods, which can vary
significantly depending upon many factors.
(3) Included $21 million of costs
associated with the divestiture of Atmus for the three months ended
March 31, 2024.
(4) Depreciation and amortization, as
shown on a segment basis, excluded the amortization of debt
discount and deferred costs included in the Condensed Consolidated
Statements of Net Income as interest expense. The amortization of
debt discount and deferred costs was $3 million and $1 million for
the three months ended March 31, 2024 and 2023, respectively. A
portion of depreciation expense is included in research,
development and engineering expenses.
(5) Included $12 million of costs
associated with the divestiture of Atmus for the three months ended
March 31, 2023.
CUMMINS INC. AND SUBSIDIARIES SELECT
FOOTNOTE DATA (Unaudited)
EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES
Equity, royalty and interest income from investees included in
our Condensed Consolidated Statements of Net Income for the
reporting periods was as follows:
Three months ended
March 31,
In millions
2024
2023
Manufacturing entities
Dongfeng Cummins Engine Company, Ltd.
$
22
$
19
Chongqing Cummins Engine Company, Ltd.
15
9
Beijing Foton Cummins Engine Co., Ltd.
13
16
Tata Cummins, Ltd.
9
8
All other manufacturers
23
19
Distribution entities
Komatsu Cummins Chile, Ltda.
13
14
All other distributors
5
3
Cummins share of net income
100
88
Royalty and interest income
23
31
Equity, royalty and interest income from
investees
$
123
$
119
ATMUS DIVESTITURE
On March 18, 2024, we completed the divestiture of our remaining
80.5 percent ownership of Atmus common stock through a tax-free
split-off. The transaction involved the exchange of our shares in
Atmus for shares of Cummins stock with a 7.0 percent discount on
the exchange ratio for Atmus shares. The exchange ratio was
determined based on each entity's respective stock price using the
daily volume weighted-average stock price for three days preceding
the final exchange offer date. Based on the final exchange ratio,
we exchanged all 67 million of our Atmus shares for 5.6 million
shares of Cummins stock, which was recorded as treasury stock based
on the fair value of the Cummins shares obtained.
We evaluated the full divestiture of Atmus and determined the
transaction did not qualify for discontinued operation
presentation. We recognized a gain related to the divestiture of
approximately $1.3 billion (based on the difference between the
fair value of the Cummins shares obtained less the carrying value
of our Atmus investment), which was recorded as other income in the
Condensed Consolidated Statements of Net Income for the three
months ended March 31, 2024. Approximately $114 million of goodwill
was included in the carrying value of the Atmus investment for
purposes of calculating the gain. The operating results of Atmus
were reported in the Condensed Consolidated Financial Statements
through March 18, 2024, the date of divestiture.
INCOME TAXES
Our effective tax rate for 2024 is expected to approximate 24.0
percent, excluding any discrete items that may arise.
Our effective tax rates for the three months ended March 31,
2024 and 2023, were 8.7 percent and 21.7 percent, respectively.
The three months ended March 31, 2024, contained favorable
discrete tax items primarily due to the $1.3 billion non-taxable
gain on the Atmus split-off. Other discrete tax items were $21
million favorable primarily due to adjustments related to audit
settlements.
The three months ended March 31, 2023, contained favorable
discrete tax items of $3 million, primarily due to share-based
compensation tax benefits.
CUMMINS INC. AND SUBSIDIARIES
FINANCIAL MEASURES THAT SUPPLEMENT GAAP
(Unaudited)
Reconciliation of Non GAAP measures - Earnings before
interest, income taxes, depreciation and amortization and
noncontrolling interests (EBITDA)
We believe EBITDA is a useful measure of our operating
performance as it assists investors and debt holders in comparing
our performance on a consistent basis without regard to financing
methods, capital structure, income taxes or depreciation and
amortization methods, which can vary significantly depending upon
many factors. We believe EBITDA excluding special items is a useful
measure of our operating performance without regard to the impact
of the gain recognized and costs associated with the divestiture of
Atmus and restructuring actions. This statement excludes forward
looking measures of EBITDA where a reconciliation to the
corresponding accounting principles generally accepted in the
United States (GAAP) measures is not available due to the
variability, complexity and limited visibility of non-cash items
that are excluded from the non-GAAP outlook measure.
EBITDA is not in accordance with, or an alternative for, GAAP
and may not be consistent with measures used by other companies. It
should be considered supplemental data; however, the amounts
included in the EBITDA calculation are derived from amounts
included in the Condensed Consolidated Statements of Net Income.
Below is a reconciliation of net income attributable to Cummins
Inc. to EBITDA for each of the applicable periods:
Three months ended
March 31,
In millions
2024
2023
Net income attributable to Cummins
Inc.
$
1,993
$
790
Net income attributable to Cummins Inc. as
a percentage of net sales
23.7
%
9.3
%
Add:
Net income attributable to noncontrolling
interests
35
16
Consolidated net income
2,028
806
Add:
Interest expense
89
87
Income tax expense
193
223
Depreciation and amortization
262
245
EBITDA
$
2,572
$
1,361
EBITDA as a percentage of net sales
30.6
%
16.1
%
Less:
Gain related to the divestiture of
Atmus
1,333
—
Add:
Atmus divestiture costs
35
18
Restructuring actions
29
—
EBITDA, excluding the impact of gain
recognized and costs associated with the divestiture of Atmus and
restructuring actions
$
1,303
$
1,379
EBITDA, excluding the impact of gain
recognized and costs associated with the divestiture of Atmus and
restructuring actions, as a percentage of net sales
15.5
%
16.3
%
Net income and diluted earnings per share (EPS) attributable
to Cummins Inc. excluding the gain recognized and costs associated
with the divestiture of Atmus and restructuring actions
We believe these are useful measures of our operating
performance for the periods presented as they illustrate our
operating performance without regard to the gain recognized and
costs associated with the divestiture of Atmus and restructuring
actions. These measures are not in accordance with, or an
alternative for GAAP and may not be consistent with measures used
by other companies. This should be considered supplemental data.
The following table reconciles net income and diluted EPS
attributable to Cummins Inc. to net income and diluted EPS
attributable to Cummins Inc. excluding special items for the
following periods:
Three months ended March
31,
2024
In millions
Net Income
Diluted EPS
Net income and diluted EPS attributable to
Cummins Inc.
$
1,993
$
14.03
Less:
Gain recognized and costs associated with
the divestiture of Atmus, net of tax
1,291
9.08
Add:
Restructuring actions, net of tax
22
0.15
Net income and diluted EPS attributable to
Cummins Inc. excluding the gain recognized and costs associated
with the divestiture of Atmus and restructuring actions, net of
tax
$
724
$
5.10
CUMMINS INC. AND SUBSIDIARIES SEGMENT
SALES DATA (Unaudited)
Components Segment Sales by Business
Sales for our Components segment by business were as
follows:
2024
In millions
Q1
Q2
Q3
Q4
YTD
Axles and brakes
$
1,232
$
—
$
—
$
—
$
1,232
Emission solutions
971
—
—
—
971
Engine components
544
—
—
—
544
Atmus (1)
353
—
—
—
353
Automated transmissions
165
—
—
—
165
Software and electronics
67
—
—
—
67
Total sales
$
3,332
$
—
$
—
$
—
$
3,332
(1) Included sales through the March 18,
2024, divestiture.
2023
In millions
Q1
Q2
Q3
Q4
YTD
Axles and brakes
$
1,272
$
1,249
$
1,177
$
1,124
$
4,822
Emission solutions
1,056
964
893
922
3,835
Engine components
581
557
532
519
2,189
Atmus
417
417
396
399
1,629
Automated transmissions
179
179
187
169
714
Software and electronics
52
59
51
58
220
Total sales
$
3,557
$
3,425
$
3,236
$
3,191
$
13,409
Engine Segment Sales by Market and Unit Shipments by Engine
Classification
Sales for our Engine segment by market were as follows:
2024
In millions
Q1
Q2
Q3
Q4
YTD
Heavy-duty truck
$
1,059
$
—
$
—
$
—
$
1,059
Medium-duty truck and bus
995
—
—
—
995
Light-duty automotive
438
—
—
—
438
Off-highway
436
—
—
—
436
Total sales
$
2,928
$
—
$
—
$
—
$
2,928
2023
In millions
Q1
Q2
Q3
Q4
YTD
Heavy-duty truck
$
1,114
$
1,117
$
1,116
$
1,052
$
4,399
Medium-duty truck and bus
903
942
931
894
3,670
Light-duty automotive
439
445
455
423
1,762
Off-highway
530
484
429
410
1,853
Total sales
$
2,986
$
2,988
$
2,931
$
2,779
$
11,684
Unit shipments by engine classification (including unit
shipments to Power Systems and off-highway engine units included in
their respective classification) were as follows:
2024
Units
Q1
Q2
Q3
Q4
YTD
Heavy-duty
33,600
—
—
—
33,600
Medium-duty
75,800
—
—
—
75,800
Light-duty
54,800
—
—
—
54,800
Total units
164,200
—
—
—
164,200
2023
Units
Q1
Q2
Q3
Q4
YTD
Heavy-duty
34,700
36,400
36,300
34,500
141,900
Medium-duty
78,900
76,000
71,300
67,900
294,100
Light-duty
55,000
53,600
53,300
49,600
211,500
Total units
168,600
166,000
160,900
152,000
647,500
Distribution Segment Sales by Product Line
Sales for our Distribution segment by product line were as
follows:
2024
In millions
Q1
Q2
Q3
Q4
YTD
Parts
$
1,001
$
—
$
—
$
—
$
1,001
Power generation
707
—
—
—
707
Engines
421
—
—
—
421
Service
406
—
—
—
406
Total sales
$
2,535
$
—
$
—
$
—
$
2,535
2023
In millions
Q1
Q2
Q3
Q4
YTD
Parts
$
1,057
$
1,019
$
995
$
1,000
$
4,071
Power generation
492
614
606
797
2,509
Engines
456
531
511
499
1,997
Service
401
431
423
417
1,672
Total sales
$
2,406
$
2,595
$
2,535
$
2,713
$
10,249
Power Systems Segment Sales by Product Line and Unit
Shipments by Engine Classification
Sales for our Power Systems segment by product line were as
follows:
2024
In millions
Q1
Q2
Q3
Q4
YTD
Power generation
$
853
$
—
$
—
$
—
$
853
Industrial
420
—
—
—
420
Generator technologies
116
—
—
—
116
Total sales
$
1,389
$
—
$
—
$
—
$
1,389
2023
In millions
Q1
Q2
Q3
Q4
YTD
Power generation
$
770
$
854
$
850
$
866
$
3,340
Industrial
455
468
475
456
1,854
Generator technologies
118
135
119
107
479
Total sales
$
1,343
$
1,457
$
1,444
$
1,429
$
5,673
High-horsepower unit shipments by engine classification were as
follows:
2024
Units
Q1
Q2
Q3
Q4
YTD
Power generation
3,000
—
—
—
3,000
Industrial
1,300
—
—
—
1,300
Total units
4,300
—
—
—
4,300
2023
Units
Q1
Q2
Q3
Q4
YTD
Power generation
2,900
3,300
2,800
3,300
12,300
Industrial
1,500
1,600
1,800
1,800
6,700
Total units
4,400
4,900
4,600
5,100
19,000
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240501092828/en/
Jon Mills Director, External Communications Cummins Inc.
jon.mills@cummins.com
Cummins (NYSE:CMI)
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Cummins (NYSE:CMI)
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