Cummins Inc. (NYSE: CMI) today reported results for the fourth quarter and full year of 2012.
Fourth quarter revenue of $4.3 billion decreased 13 percent from the same quarter in 2011 reflecting weakness in most major markets and geographies. The decrease year-over-year was driven by weaker demand in truck, construction, and oil and gas markets in North America. The Company also experienced lower demand in international markets for power generation equipment and construction, truck and mining engines.
Earnings before interest and taxes (EBIT) were $552 million for the fourth quarter or 12.9 percent of sales, excluding $52 million of restructuring costs. This compares to $677 million or 13.8 percent of sales a year ago, excluding special items.
Net income attributable to Cummins in the fourth quarter was $381 million ($2.02 per diluted share). Results included restructuring costs of $0.19 per diluted share and one-time tax benefits of $0.21 per diluted share.Revenues for the full year were $17.3 billion, down 4 percent from 2011, with revenues in North America up 9 percent offset by international sales which declined by 15 percent, with the most significant declines in Brazil, China and Europe. EBIT for the year, excluding special items, was $2.37 billion or 13.7% of sales, compared to $2.6 billion or 14.2% of sales in 2011. Net income attributable to Cummins for the full year was $1.66 billion ($8.74 per diluted share), down from $1.85 billion ($9.55 per diluted share) in 2011. Excluding the costs of restructuring actions ($0.18 per diluted share), and the gain on the sale of the exhaust business ($0.02 per diluted share), the Company reported full year net income of $1.69 billion ($8.90 per diluted share). “After a strong start to the year, demand declined across most geographies and end markets in the second half of 2012 as the global economy slowed,” said Tom Linebarger, Chairman and Chief Executive Officer. “I am pleased that we were able to deliver improved gross margins in the fourth quarter and record gross margins for the full year despite the weakness in demand. The work we have undertaken to reduce costs and lower inventory should benefit the Company when the global economy improves, however there is uncertainty surrounding the timing and pace of improvement in end markets in 2013.”