Cummins's performance in the third quarter climbed again, and the international market was growing rapidly, effectively offsetting the impact of weak markets in North America and Europe. The annual sales and profits are expected to hit a record for the fifth consecutive year...
November 4th, 2008 - Cummins Corporation released its third quarter financial communique, with new sales and profits. The favorable situation in the third quarter was mainly attributed to the strong growth of international business, which effectively offset the negative impact of the continuous decline of the North American consumer goods market and the weakness of the European market.
Cummins’ sales in the third quarter was US$3.69 billion, an increase of 10% over the same period of last year. Net income increased by 24% to US$229 million, equivalent to US$1.17 per share (US$0.92 in the same period of last year). Earnings before interest and tax increased by 24%. , for 380 million US dollars.
Overseas operations outside the United States accounted for 61% of Cummins’ global sales this quarter, an increase of 9 percentage points compared to 52% in the same period of last year. Among them, the sales growth of power and distribution markets outside the United States was particularly strong, up by more than the same period of last year29 And 28 percentage points.
Tim Solso, Cummins Chairman and Chief Executive Officer, said: “Even though the U.S. economy is facing great challenges, Europe is showing signs of weakness. Cummins’s global operating performance in the third quarter is still performing well. The business for the full year is expected to be reinvented for the fifth consecutive year. The new record of history shows that Cummins' long-term product line and regional market diversification strategy has achieved outstanding results."
Su Zhiqiang said that the overall pressure in the fourth quarter will be relatively large, especially in the United States and Europe, but Cummins is fully prepared to deal with the challenges and challenges of the economic crisis. Cummins currently has a total debt ratio of less than 15%, and the cash situation is also very good. Well, there is also a $1.1 billion credit line that can provide additional liquidity support.
Despite the pressure of continued weakness in the local market, Cummins expects that sales will continue to increase by 12% in 2008, and it is expected to reach US$14.6 billion. The pre-EBIT margin will remain at 10% of sales.
Talking about the impact of the global economic crisis, Cummins Chief Financial Officer Pat Ward said that Cummins has accumulated rich experience in dealing with cyclical fluctuations in the economy. While increasing control expenses, the company will continue to invest in new growth opportunities. Cummins's balance sheet is very solid, with good cash flow and available credit lines. We have sufficient confidence to survive the difficulties, provide customers with first-rate products, and create a stable return on investment for shareholders.
Cummins Global Highlights in the Third Quarter:
Cummins’ share in the heavy truck and passenger car markets in North America continues to climb, with Cummins North American heavy truck diesel engine market share reaching 45.2% between January and August.
The strong international demand for China Card engines, especially in Latin America
Compared with the same period of last year, Cummins’s electric power business grew rapidly in China, the Middle East and Latin America.
Significant increase in sales of post-discharge processor, especially in North America
Global joint venture revenue reached 66 million U.S. dollars, setting the highest record in the history of the third quarter
For the fourth consecutive year, it has been listed on the Dow Jones Sustainability Index. Among the 2500 largest companies in the world, only the top 10% of the key indicators of sustainable development can be selected on this list.
Buy back 1.4 million shares and increase quarterly dividend by 40%
The main highlights of Cummins China in the third quarter:
Sales and EBIT were both significantly higher than the same period of last year
Foton Cummins Signs Syndicated Loan Agreement with China Construction Bank and Minsheng Bank
In order to serve the Olympic Games, Cummins set up a special protection team to support Beijing Public Transport and won the praise of users with first-class service quality.
Cummins Generator Set Provides Standby Power Supply for New US Embassy in China
Xi'an Cummins has passed ISO9001 and ISO/TS16949 automotive industry standard certification
Foton Cummins Exhibits New ISF Series 2.8/3.8L Fully Electronically Controlled Light-duty Diesel Engine at Beijing International IC Engine Show
Xi'an Cummins Launches New Generation ISM11 Full Electronically Controlled Heavy-Duty Diesel Engine for National IV/European IV Emission Standards
Cummins in China
The history of Cummings and China dates back more than half a century to the 1940s. On March 11, 1941, the President of the United States, Franklin Roosevelt, signed the "Lending Act" to provide wartime assistance to 38 countries, including China. The "Lending Act" includes military defense patrol boats equipped with Cummins engines and military trucks.
At the end of 1944, a Chongqing company sent a letter to Cummins Corp. seeking to establish commercial ties and conduct localized production of Cummins engines in China. Then Erwin Miller, general manager of Cummins Engine Co., expressed great interest in this letter. It is hoped that Cummins will build a factory in China after the Sino-Japanese War. For reasons known to all, Mr. Miller's idea can only wait until the 1970s 30 years later. With the gradual relaxation of Sino-U.S. relations, it is expected to become a reality.
Cummins invests more than US$240 million in China. As the largest foreign investor in China’s diesel industry, Cummins’ business relationship with China began in 1975, when Cummins’s chairman, Irvine Miller, visited Beijing for the first time. One of the earliest US entrepreneurs to seek commercial cooperation in China. When China and the United States established diplomatic relations in 1979, China’s opening to the outside world began. The first Cummins China office was established in Beijing.
Cummins was one of the earliest western diesel engine companies to produce engines in China. In 1981, Cummins started to produce engines in the Chongqing engine plant. In 1995, Cummins' first Chinese joint venture engine factory was established. So far, Cummins has a total of 21 institutions in China, including 14 wholly-owned and joint ventures, and employs more than 5,400 employees. They produce engines, generator sets, alternators, filtration systems, turbocharger systems, and exhaust systems. Post-processing and fuel systems and other products have a service network of 12 regional service centers and more than 300 authorized dealers.
Cummins has long established a strategic alliance with large Chinese companies to achieve common development. As the earliest foreign-invested diesel engine company to come to China for local production, Cummins has established four engine joint venture plants with leading companies of commercial vehicles in China, including Dongfeng Motor, Shaanxi Automobile Group and Beiqi Foton, for more than two decades. Cummins 15 Eight of the eight engine families have been produced locally in China.
Cummins was the first foreign-owned diesel engine company to establish an R&D center in China. In August 2006, the engine technology R&D center set up by Cummins in cooperation with Dongfeng Corporation was officially opened in Wuhan, Hubei Province.
In 2007, Cummins sold more than US$1.7 billion in China, which was a 50% increase from 2006, accounting for nearly 10% of Cummins’ global sales, including joint ventures. China has become Cummins’ largest and fastest growing overseas market. .
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