Cummins Caps Record 2005 with Its Highest Quarterly Earnings Ever.COLUMBUS Columbus. 1 City (1990 pop. 178,681), seat of Muscogee co., W Ga., at the head of navigation on the Chattahoochee River; settled and inc. 1828 on the site of a Creek village. , Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. . -- Cummins This article is about the diesel engine manufacturer. For other uses, see Cummins (disambiguation). Cummins Inc. (NYSE: CMI) is a maker of diesel and natural gas engines whose corporate headquarters is located in Columbus, Indiana. Inc. (NYSE NYSE See: New York Stock Exchange :CMI (Computer-Managed Instruction) Using computers to organize and manage an instructional program for students. It helps create test materials, tracks the results and monitors student progress. ) completed a record 2005 with its most profitable quarter ever, driven by continued strength in its engine segment, record performance from its distribution and power generation segments and growth in major markets around much of the world. For all of 2005, Cummins reported profits as measured by earnings before interest and taxes In financial and business accounting, earnings before interest and taxes (EBIT) is a measure of a firm's profitability that excludes interest and income tax expenses.[1] EBIT = Operating Revenue – Operating Expenses + Non-operating Income (EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). ) of $907 million, a 67 percent increase from 2004. Sales increased 18 percent to $9.92 billion, from $8.44 billion in 2004. Net income for 2005 was $550 million, or $11.01 a share, up 57 percent from $350 million ($7.39 a share) in 2004. The Company's strong operating performance in 2005 allowed it to improve its cash position by $168 million, while also reducing net debt by $259 million. In the fourth quarter of 2005, Cummins sales increased 17 percent to a record $2.75 billion from $2.35 billion in the same period in 2004. Net income rose 40 percent in the fourth quarter to $167 million, or $3.31 share, from $119 million, or $2.41 per share, during the same period in 2004. The Company's earnings before interest and taxes (EBIT) for the fourth quarter of 2005 of $269 million - or 9.8 percent of sales - were 56 percent higher than the same period in 2004. All four Cummins operating segments posted revenue and Segment EBIT increases. The Company's gross margin in the fourth quarter of 2005 was 22.5 percent compared to 20.1 percent during the same period in 2004. For all of 2005, gross margins were 22.0 percent - their highest level since 1997. Cummins fourth quarter of 2005 results include tax benefits of $13.5 million, or $0.26 per share, related to the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. resolution of prior year matters and additional benefits from repatriated dividends under the American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Jobs Creation Act of 2004. "Our results for both the fourth quarter and all of 2005 are outstanding," said Cummins Chairman and Chief Executive Officer Tim Solso. "This performance is evidence that we are transforming Cummins into a less cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. , more diversified company diversified company A company engaged in varied business operations not directly related to one another. A diversified company is less likely to suffer either a collapse or a spectacular gain in earnings compared with a firm concentrating its operations in a while converting a larger percentage of sales into profit." "As good as the last two years have been, we are expecting 2006 to be more profitable, even if growth in our end markets moderates," Solso added. "We have significant opportunities as a result of our product mix, our leading position in many of the markets we serve, our global network of plants, technical centers, distributors and first-rate partners as well as our commitment to being a low-cost producer." Based on its current plans and forecasts, the Company expects to earn between $2.50 and $2.60 a share in the first quarter and between $11.90 and $12.10 a share for all of 2006. The Company's North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. engine business remains very strong, but international sales growth was even better in 2005. For all of 2005, international sales represented 51 percent of the Company's total consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: sales and 55 percent in the fourth quarter. The Company saw significant EBIT gains in its Engine, Power Generation and Distribution businesses in 2005. For the year, Segment EBIT for the Engine business - the Company's largest - grew 77 percent to $582 million as sales rose 23 percent. Power Generation Segment EBIT more than doubled in 2005 to $145 million. The Company's Distribution business saw its Segment EBIT increase 35 percent in 2005 to $107 million. The Company's Components Segment reported a 6 percent increase in Segment EBIT to $89 million. Fourth-quarter of 2005 details Engine Segment Engine segment sales of $1.84 billion for the quarter were 22 percent higher than the same period in 2004, and Segment EBIT rose 56 percent to $156 million, or 8.5 percent of sales, compared to 6.6 percent of sales during the same period in 2004. Sales were strong across nearly all end markets, with on-highway revenues up 21 percent and off-highway revenues up 28 percent. Global shipments to the heavy-duty heav·y-dut·y adj. Made to withstand hard use or wear. heavy-duty Adjective made to withstand hard wear, bad weather, etc. Adj. 1. truck market rose 14 percent for the quarter, while shipments in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of increased 12 percent during the quarter. Medium-duty truck and bus market shipments increased 13 percent as the Company grew its market share in key North American OEMs and saw strong gains in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. .The Company also enjoyed solid growth in all major off-highway markets, with global construction market shipments up 30 percent, oil and gas shipments up 111 percent and marine shipments up 29 percent. Power Generation Segment Segment sales rose 11 percent from 2004 to $575 million in the quarter, while Segment EBIT more than doubled to $49 million, or 8.5 percent of sales. Commercial sales led the segment's strong performance, with sales up 11 percent over the same period in 2004. Brisk Brisk as a proper name may refer to:
alternator Source of direct electric current in modern vehicles for ignition, lights, fans, and other uses. The electric power is generated by an alternator mechanically coupled to the engine, with a rotor field coil sales improved 13 percent for the quarter, driven by rising volumes in all major regions except China and Southeast Asia Southeast Asia, region of Asia (1990 est. pop. 442,500,000), c.1,740,000 sq mi (4,506,600 sq km), bounded roughly by the Indian subcontinent on the west, China on the north, and the Pacific Ocean on the east. . Improved pricing accounted for much of the segment earnings growth and the Company expects to see further price realization (specification) realization - A UML semantic relationship between a classifier that specifies a contract and another classifier that guarantees to carry it out. [Handout by Mr. David Gillibrand]. through the first half of 2006. Distribution Segment This segment enjoyed a record quarter, both in terms of sales Terms of sale Conditions under which a firm proposes to sell its goods or services for cash or credit. and Segment EBIT. Sales rose 15 percent to $346 million and Segment EBIT increased 18 percent to $33 million, or 9.5 percent of sales over the same period in 2004. Sales were strong across all product categories, with engine and power generation sales accounting for more than 70 percent of the revenue growth. From a geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. perspective, increased business in Europe and the Middle East represented much of the sales growth. Joint venture income rose 57 percent in the quarter, contributing an additional $4 million to Segment EBIT when compared to the same period in 2004. Components Segment Segment revenues increased 12 percent during the quarter to $535 million, while Segment EBIT rose 85 percent to $24 million, or 4.5 percent of sales, compared to 2.7 percent during the same period in 2004. The Company's filtration filtration: see sewerage; water supply. Filtration The separation of solid particles from a fluidsolids suspension of which they are a part by passage of most of the fluid through a septum or membrane that retains most of the solids , turbocharger tur·bo·charg·er n. See turbosupercharger. tur  bo·charged adj. and fuel systems
businesses all reported revenue gains.The filtration business saw strong aftermarket Aftermarket See: Secondary market. aftermarket See secondary market. sales in North and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. , and higher OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and sales in Europe/Middle East/Africa. Fuel system shipments rose across most product lines, notably to the Cummins heavy-duty engine plant and to our joint venture partner Scania Scania: see Skåne, Sweden. in Europe. Presentation of Non-GAAP Financial Information EBIT is a non-GAAP financial measure used in this release. EBIT is defined and reconciled rec·on·cile v. rec·on·ciled, rec·on·cil·ing, rec·on·ciles v.tr. 1. To reestablish a close relationship between. 2. To settle or resolve. 3. to what management believes to be the most comparable GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). measure in a schedule attached to this release. Cummins presents this information as it believes it is useful to understanding the Company's operating performance, and because EBIT is a measure used internally to assess the performance of the operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon . Webcast information Cummins management will host a teleconference to discuss these results today at 10 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy (9 a.m. CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. ). This teleconference will be webcast and available on the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Cummins website at www.cummins.com. About Cummins Inc. Cummins Inc., a global power leader, is a corporation of complementary business units that design, manufacture, distribute and service engines and related technologies, including fuel systems, controls, air handling, filtration, emission EMISSION, med. jur. The act by which any matter whatever is thrown from the body; thus it is usual to say, emission of urine, emission of semen, &c. 2. solutions and electrical power generation systems. Headquartered in Columbus, Indiana Columbus (IPA: [kəˈlʌm.bəs]) is the county seat of Bartholomew County, Indiana. The population was 39,059 at the 2000 census. The current mayor is Fred Armstrong. , (USA) Cummins serves customers in more than 160 countries through its network of 550 Company-owned and independent distributor facilities and more than 5,000 dealer locations. Cummins reported sales of $9.9 billion in 2005. Press releases can be found on the Web at www.cummins.com. Information provided and statements on the webcast and in this release that are not purely historical are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, including statements regarding the company's expectations, hopes, beliefs and intentions on strategies regarding the future. It is important to note that the company's 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, general economic, business and financing conditions, labor relations, governmental action, competitor pricing activity, expense volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the and other risks detailed from time to time in Cummins Securities and Exchange Commission filings.
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited) (a)
Three Months Ended For the Years Ended
Millions, except per Dec. 31, Dec. 31, Sept. 25, Dec. 31, Dec. 31,
share amounts 2005 2004 2005 2005 2004
--------------------- -------- -------- --------- --------- ---------
Net sales $2,753 $2,349 $2,467 $9,918 $8,438
Cost of sales 2,134 1,876 1,906 7,732 6,758
-------- -------- --------- --------- ---------
Gross margin 619 473 561 2,186 1,680
Operating expenses and
income
Selling and
administrative
expenses 313 281 286 1,145 1,015
Research and
engineering expenses 71 66 71 278 241
Investee equity,
royalty and other
income (Note 2) (28) (40) (31) (131) (120)
Other operating
expense (income) (1) 1 (1) (4) (6)
-------- -------- --------- --------- ---------
Operating earnings 264 165 236 898 550
Interest income (9) (5) (6) (24) (12)
Interest expense 26 30 27 109 111
Other expense (income) 4 (2) 2 15 19
-------- -------- --------- --------- ---------
Earnings before income
taxes and minority
interests 243 142 213 798 432
Provision for income
taxes (Note 3) 63 12 61 216 56
Minority interests in
earnings of
consolidated
subsidiaries 13 11 7 32 26
-------- -------- --------- --------- ---------
Net earnings $167 $119 $145 $550 $350
======== ======== ========= ========= =========
Earnings per share
(Note 1)
Basic $3.75 $2.73 $3.27 $12.43 $8.30
Diluted $3.31 $2.41 $2.90 $11.01 $7.39
Cash dividends declared
per share $0.30 $0.30 $0.30 $1.20 $1.20
Weighted average shares
outstanding
Basic 44.5 43.6 44.4 44.2 42.2
Diluted 51.3 50.7 51.2 51.1 49.2
(a) Prepared on an unaudited basis in accordance with accounting
principles generally accepted in the United States of America. Certain
reclassifications have been made to 2004 amounts to conform to the
2005 presentation.
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited) (a)
Millions, except par value
----------------------------------------------------------------------
Dec. 31, 2005 Dec. 31, 2004
-------------- -------------
ASSETS
Current assets
Cash and cash equivalents $ 779 $ 611
Marketable securities 61 62
Receivables, net 1,423 1,160
Inventories 1,174 1,016
Deferred income taxes 363 301
Prepaid expenses and other
current assets 116 106
------------ -----------
Total current assets 3,916 3,256
Long-term assets
Property, plant and equipment, net 1,557 1,648
Investments in and advances to
equity investees 278 286
Goodwill 358 355
Other intangible assets, net 100 93
Deferred income taxes 500 689
Other assets 176 183
------------ -----------
Total assets $ 6,885 $ 6,510
============ ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings $ 154 $ 327
Accounts payable 904 823
Other accrued expenses 1,160 1,030
------------ -----------
Total current liabilities 2,218 2,180
Long-term liabilities
Long-term debt 1,213 1,299
Pensions 396 466
Postretirement benefits other
than pensions 554 570
Other liabilities and deferred revenue 415 386
------------ -----------
Total liabilities 4,796 4,901
Minority interests 225 208
Shareholders' equity
Common stock, $2.50 par value, 48.5
and 48.2 shares issued 121 121
Additional contributed capital 1,201 1,167
Retained earnings 1,360 866
Accumulated other comprehensive loss:
Minimum pension liability (523) (499)
Other components, net (80) (41)
Common stock in treasury, at cost, 2.0
and 2.2 shares (101) (88)
Common stock held in trust for
employee benefit plans, 2.0 and
2.2 shares (97) (104)
Unearned compensation (17) (21)
------------ -----------
Total shareholders' equity 1,864 1,401
------------ -----------
Total liabilities and shareholders'
equity $ 6,885 $ 6,510
============ ===========
(a)Prepared on an unaudited basis in accordance with accounting
principles generally accepted in the United States of America. Certain
reclassifications have been made to 2004 amounts to conform to the
2005 presentation.
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (a)
Millions For the Years Ended
-------- -------------------
Dec. 31, Dec. 31,
2005 2004
--------- ---------
Net cash provided by operating activities (1) $760 $614
Cash flows from investing activities
Capital expenditures (186) (151)
Investments in marketable securities - acquisitions (123) (122)
Investments in marketable securities - liquidations 126 149
Other, net (29) (57)
--------- ---------
Net cash used in investing activities (212) (181)
--------- ---------
Cash flows from financing activities
Proceeds from borrowings 84 13
Payments on borrowings and capital lease
obligations (378) (51)
Proceeds from issuing common stock 30 148
Dividend payments on common stock (56) (53)
Repurchases of common stock (38) -
Other, net (14) 9
--------- ---------
Net cash (used in) provided by financing activities (372) 66
--------- ---------
Effect of exchange rate changes on cash and cash
equivalents (8) 4
--------- ---------
Net increase in cash and cash equivalents 168 503
Cash and cash equivalents at beginning of the year 611 108
--------- ---------
Cash and cash equivalents at end of the year $779 $611
========= =========
(1) Includes non-cash addback: Depreciation and
Amortization $295 $272
========= =========
(a) Prepared on an unaudited basis in accordance with accounting
principles generally accepted in the United States of America. Certain
reclassifications have been made to the 2004 amounts to conform to
2005 presentation.
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
Power Compo- Distri- Elimi-
Millions Engine Generation nents bution nations Total
----------------------------------------------------------------------
Three Months Ended
December 31, 2005
Net sales $1,838 $575 $535 $346 $(541) $2,753
Investee equity,
royalty and other
income 13 3 1 11 -- 28
Segment EBIT 156 49 24 33 7 269
Net assets for
operating segments 1,518 718 944 299 -- 3,479
----------------------------------------------------------------------
Three Months Ended
December 31, 2004
Net sales $1,504 $520 $478 $300 $(453) $2,349
Investee equity,
royalty and other
income 27 4 2 7 -- 40
Segment EBIT 100 22 13 28 9 172
Net assets for
operating segments 1,282 717 896 256 -- 3,151
----------------------------------------------------------------------
Three Months Ended
September 25, 2005
Net sales $1,672 $504 $481 $295 $(485) $2,467
Investee equity,
royalty and other
income 17 2 3 9 -- 31
Segment EBIT 153 46 21 28 (8) 240
Net assets for
operating segments 1,343 688 965 316 -- 3,312
----------------------------------------------------------------------
For the Year Ended
December 31, 2005
Net sales $6,657 $1,999 $2,000 $1,191 $(1,929) $9,918
Investee equity,
royalty and other
income 80 9 8 34 -- 131
Segment EBIT 582 145 89 107 (16) 907
----------------------------------------------------------------------
For the Year Ended
December 31, 2004
Net sales $5,424 $1,842 $1,783 $973 $(1,584) $8,438
Investee equity,
royalty and other
income 80 6 9 25 -- 120
Segment EBIT 328 60 84 79 (8) 543
----------------------------------------------------------------------
The table below reconciles the segment information to the
corresponding amounts in the Consolidated Financial Statements.
Three Months Ended For the Years Ended
Dec. 31, Dec. 31, Sept. 25, Dec. 31, Dec. 31,
Millions 2005 2004 2005 2005 2004
-------- -------- -------- --------- --------- ---------
Segment EBIT $269 $172 $240 $907 $543
Less:
Interest expense 26 30 27 109 111
Provision for income
taxes 63 12 61 216 56
Minority interests in
earnings of
consolidated
subsidiaries 13 11 7 32 26
-------- -------- --------- --------- ---------
Net earnings $167 $119 $145 $550 $350
======== ======== ========= ========= =========
Net assets for
operating segments $3,479 $3,151 $3,312
Liabilities deducted in
computing net assets 3,354 3,168 3,421
Minimum pension
liability excluded
from net assets (837) (826) (826)
Deferred tax assets not
allocated to segments 863 990 928
Debt-related costs not
allocated to segments 26 27 27
-------- -------- ---------
Total assets $6,885 $6,510 $6,862
======== ======== =========
Certain reclassifications have been made to 2004 amounts to conform to
the 2005 presentation.
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
(Unaudited)
Earnings before interest, taxes and minority interests (EBIT)
We define EBIT as earnings before interest expense, provision for
income taxes and minority interests in earnings of consolidated
subsidiaries. We use EBIT to assess and measure the performance of our
operating segments and also as a component in measuring our variable
compensation programs. Below is a reconciliation of EBIT, a non-GAAP
financial measure, to our consolidated net earnings, for each of the
applicable periods:
Three Months Ended For the Years Ended
Dec. 31, Dec. 31, Sept. 25, Dec. 31, Dec. 31,
Millions 2005 2004 2005 2005 2004
-------- -------- -------- --------- ---------- --------
Earnings before
interest, income taxes
and minority interests $269 $172 $240 $907 $543
EBIT as a percentage of
net sales 9.8% 7.3% 9.7% 9.1% 6.4%
Less:
Interest expense 26 30 27 109 111
Provision for income
taxes 63 12 61 216 56
Minority interests
in earnings of
consolidated
subsidiaries 13 11 7 32 26
-------- -------- --------- ---------- --------
Net earnings $167 $119 $145 $550 $350
======== ======== ========= ========== ========
Net earnings as a
percentage of net
sales 6.1% 5.1% 5.9% 5.5% 4.1%
We believe EBIT is a useful measure of our operating performance
for the periods presented as it illustrates our operating performance
without regard to financing methods, capital structure or income
taxes. This measure is not in accordance with, or an alternative for,
accounting principles generally accepted in the United States of
America (GAAP) and may not be consistent with measures used by other
companies. It should be considered supplemental data.
CUMMINS INC. AND CONSOLIDATED SUBSIDIARIES
SELECTED FOOTNOTE DATA
(Unaudited)
NOTE 1. EARNINGS PER SHARE
The following is a reconciliation of net earnings and
weighted-average common shares outstanding for purposes of calculating
basic and diluted net earnings per share:
Three Months Ended For the Years Ended
Millions, except per Dec. 31, Dec. 31, Sept. 25, Dec. 31, Dec. 31,
share amounts 2005 2004 2005 2005 2004
----------------------------------------------------------------------
Net earnings for basic
EPS $166.8 $119.1 $145.3 $549.8 $350.4
Interest expense on
junior convertible
subordinated
debentures, net of
tax 3.2 3.2 3.2 12.9 13.0
----------------------------------------------------------------------
Net earnings for
diluted EPS $170.0 $122.3 $148.5 $562.7 $363.4
======================================================================
Weighted average shares
outstanding:
Basic 44.5 43.6 44.4 44.2 42.2
Dilutive effect of
stock compensation
awards 0.5 0.8 0.5 0.6 0.7
Dilutive effect of
junior convertible
subordinated
debentures 6.3 6.3 6.3 6.3 6.3
----------------------------------------------------------------------
Diluted 51.3 50.7 51.2 51.1 49.2
======================================================================
Earnings per share:
Basic $3.75 $2.73 $3.27 $12.43 $8.30
Diluted $3.31 $2.41 $2.90 $11.01 $7.39
NOTE 2. INVESTEE EQUITY, ROYALTY AND OTHER INCOME
Investee equity, royalty and other income included in our
Consolidated Statements of Earnings was as follows:
Three Months Ended For the Years Ended
Dec. 31, Dec. 31, Sept. 25, Dec. 31, Dec. 31,
Millions 2005 2004 2005 2005 2004
----------------------------------------------------------------------
Equity earnings:
Dongfeng Cummins
Engine Company, Ltd. $3 $18 $5 $36 $43
North American
distributors 10 5 8 30 22
Cummins Mercruiser 2 2 3 10 8
Chongqing Cummins 2 3 4 12 5
Tata Cummins 2 -- 1 5 4
Fleetguard Shanghai 1 1 1 4 5
All others 4 5 3 12 12
----------------------------------------------------------------------
Cummins share of equity
earnings 24 34 25 109 99
Royalty and other
income 4 6 6 22 21
----------------------------------------------------------------------
Investee equity,
royalty and other
income $28 $40 $31 $131 $120
======================================================================
NOTE 3. PROVISION FOR INCOME TAXES
Our income tax provision for the three and twelve months ended
December 31, 2005, was reduced by $13 million and $24 million for
certain tax benefits which included dividend distributions that
qualified for a special 85 percent deduction under The American Jobs
Creation Act of 2004 and a benefit for resolution of certain prior
year tax contingencies.
----------------------------------------------------------------------
Sales
$Millions Q1 Q2 Q3 Q4 YTD
-------- ------ ------- ------- --------
2005
Engine Business
Heavy-Duty
Truck 494 553 524 568 2,139
Medium Duty
Truck+Bus 191 228 238 261 918
Light Duty
Auto+RV 255 269 314 326 1,164
Industrial 399 458 427 507 1,791
Stationary
Power 141 159 169 176 645
----------------------------------------
TOTAL ENGINE
BUSINESS 1,480 1,667 1,672 1,838 6,657
Power Generation 427 493 504 575 1,999
Components 473 511 481 535 2,000
Distributors 253 297 295 346 1,191
Eliminations (425) (478) (485) (541) (1,929)
----------------------------------------
TOTAL 2,208 2,490 2,467 2,753 9,918
========================================
2004
Engine Business
Heavy-Duty
Truck 342 427 455 476 1,700
Medium Duty
Truck+Bus 145 164 182 202 693
Light Duty
Auto+RV 271 291 288 279 1,129
Industrial 273 360 350 397 1,380
Stationary
Power 96 132 144 150 522
----------------------------------------
TOTAL ENGINE
BUSINESS 1,127 1,374 1,419 1,504 5,424
Power Generation 369 460 493 520 1,842
Components 415 445 445 478 1,783
Distributors 171 253 249 300 973
Eliminations (311) (408) (412) (453) (1,584)
----------------------------------------
TOTAL 1,771 2,124 2,194 2,349 8,438
========================================
----------------------------------------------------------------------
----------------------------------------------------------------------
Engine Shipments
Units Q1 Q2 Q3 Q4 YTD
-------- ------ ------- ------- --------
2005
Midrange 90,900 101,800 106,100 120,400 419,200
Heavy-duty 24,900 27,500 26,300 28,900 107,600
High
Horsepower 3,100 3,800 3,300 4,200 14,400
----------------------------------------
TOTAL 118,900 133,100 135,700 153,500 541,200
========================================
2004
Midrange 79,700 98,300 94,000 96,700 368,700
Heavy-duty 15,900 22,100 23,200 26,000 87,200
High
Horsepower 2,200 3,100 3,200 3,600 12,100
----------------------------------------
TOTAL 97,800 123,500 120,400 126,300 468,000
========================================
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