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FINANCIAL
Key developments
FINANCIAL
Cummins records strong financial
performance over past year
A truly sustainable company must be successful financially.
Without financial success, it’s difficult, if not impossible,
to invest in building stronger communities, reducing a
company’s environmental footprint or the research and
development necessary to ensure a company’s future
financial success.
Highlights
»»
Cummins records
best year ever in 2011
with record revenue
of $18 billion.
»»
2012 growth driven in
part by higher demand in
truck, power generation
and construction markets
in North America.
»»
Credit agencies
upgrade Cummins’
ratings in 2011.
Cummins Chairman and
CEO Tom Linebarger and Anant
Talaulicar, President of Cummins’
Components Group, tour the
new Cummins Filtration facility in
Suwon, South Korea in February
2012. The nanotechnologyenabled
media produced at
the plant is able to filter debris
smaller than a red blood cell.
Cummins has enjoyed more than two years
of outstanding growth which continued in
2011 with record revenue of $18 billion and
a 54 percent increase in Earnings Before
Interest and Taxes (EBIT).
“Cummins had its best year ever in
2011, despite economic uncertainty in a
number of regions,” said Tom Linebarger,
the Company’s Chairman and Chief
Executive Officer. “We continue to benefit
from our leading position in a number
of end markets and geographies.
“Revenue in the United States grew
53 percent and international revenue
grew 27 percent year-over-year,” he said.
“In fact, we experienced record full-year
revenues in North America, Brazil,
China, India and a number of other
important markets.”
Overall revenue for 2011 increased
36 percent compared to 2010.
Net income attributable to Cummins for
the full year was $1.85 billion. Excluding
the benefit from the gains on divestiture
of two businesses within the Components
segment, and an insurance settlement
stemming from a flood in Columbus, Ind.
in 2008, the Company reported full-year
net income of $1.75 billion, up from
$1.04 billion in 2010.
Cummins will make a significant
investment back into the Company
in 2012.
The Company anticipates making
between $800 million and $850 million
in capital expenditures in 2012 and
Cummins’ joint ventures are expected
to invest another $550 million to
$600 million.
The Company expects to continue
investing around four percent of sales
back into the business in future years.
Cummins’ financial performance
has been recognized by several
outside entities including three
credit agencies that upgraded
the Company’s ratings in 2011.
2011 – A record year of Financial performance
2011* 2010 Change
Revenue $18.05 B $13.23 B Up 36%
EBIT $2.56 B $1.66 B Up 54%
Net Earnings $1.75 B $1.04 B Up 69%
EPS $9.07 $5.28 Up 72%
Cash Flow from Operations $2.07 B $1.01 B Up 106%
ROE 31% 20%
* EBIT, Net Earnings and EPS exclude the gains from
divestiture of two businesses and an insurance settlement.
102 SUSTAINABILITY REPORT 2011–2012 SUSTAINABILITY REPORT 2011–2012 103
April 2012
Cummins announces a major
expansion of its Seymour, Ind.
campus that includes investing
$219 million in new construction
and the addition of 290 jobs to
support the Company’s global
high horsepower engine business.
March 2012
Cummins announces the start
of development of a 15-liter
heavy-duty, spark-ignited natural
gas engine to meet demand for
on-highway applications.
March 2012
Company announces its engines
will meet North American 2014
fuel efficiency and greenhouse
gas standards beginning in
January 2013, delivering up to
2 percent greater fuel economy.
November 2011
Company unveils the new
QSK95 engine with over 4000-hp
(2983 kW) output as the world’s
most powerful high-speed diesel.
The 95-liter 16-cylinder engine is
nicknamed “Hedgehog.”
October 2011
Cummins Inc. and Guangxi
LiuGong Machinery Co. Ltd.
announce a joint-venture
partnership to manufacture
MidRange engines at a
new facility in southern
China starting in 2013.