Cummins Inc. Holds Annual Meeting; Announces Appointment of PricewaterhouseCoopers LLP as New External Auditor.Business Editors COLUMBUS, Ind.--(BUSINESS WIRE)--April 2, 2002 Speaking at the annual shareholders meeting today Cummins Chairman and Chief Executive Officer Tim Solso announced the selection of a new auditor, reviewed Cummins Inc. (NYSE NYSE See: New York Stock Exchange :CUM) business results for 2001, and outlined the opportunities for the company in 2002. In response to recent events surrounding Arthur Andersen For the U.S. Supreme Court case commonly known as Arthur Andersen, see . Arthur Andersen LLP, based in Chicago, was once one of the "Big Five" accounting firms (the other four are PricewaterhouseCoopers, Deloitte Touche Tohmatsu, Ernst & Young and KPMG), performing LLP LLP - Lower Layer Protocol , the Cummins Board of Directors has voted to rescind To declare a contract void—of no legal force or binding effect—from its inception and thereby restore the parties to the positions they would have occupied had no contract ever been made. rescind v. the appointment of Andersen and, instead, has appointed PricewaterhouseCoopers LLP as the Company's external auditor The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. . This change will be effective immediately. PricewaterhouseCoopers will assume all external auditing responsibilities. Moving into the review of business performance in 2001, Mr. Solso stated that "last year was the most difficult and demanding year for Cummins that I can remember. Virtually all of Cummins markets have been in a recession for the past twenty months." Cummins sales in 2001 were five point seven billion dollars; almost a billion dollars lower than sales in 2000. This represents a fourteen percent decrease in overall revenue. Engine Business sales accounted for fifty-two percent of Cummins gross revenue. Twenty-four percent of Cummins sales came from Power Generation Business. Cummins Filtration Business accounted for fifteen percent of Cummins total sales in 2001. Our International Distributors represented nine percent of the company's total business unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. in 2001. Domestic sales were down nineteen percent from 2000, representing fifty-four percent of Cummins total revenue in 2001. This unprecedented sales reduction resulted from recessionary market conditions that began in the middle of 2000 and were further impacted by the September 11th terrorist attacks. International revenue decreased seven percent in 2001 versus 2000, representing forty-six percent of Cummins total sales. In 2001, Cummins reported a loss for the year of $18 million, or $.47 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , excluding a pre-tax charge of $125 million for costs associated with restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). in the second quarter. Including the charge, Cummins lost $102 million, or $2.66 per share for the full year 2001. Despite the loss, Cummins reported profits in each of the last three-quarters of 2001 on substantially lower sales. "Despite the severe conditions in 2001, we were able to meet our financial commitments and deliver an operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. in the last three quarters," said Solso. "This represents a significant improvement in performance by historical standards and is the result of improvements in our cost structure and the change to a performance ethic eth·ic n. 1. a. A set of principles of right conduct. b. A theory or a system of moral values: "An ethic of service is at war with a craving for gain" among all employees." Cummins expects that the business environment in 2002 will not be significantly better than last year. Cummins will continue its relentless cost reduction and cash management throughout 2002. However, Cummins is well positioned and prepared to take advantage of a rebound in the economy. In closing, Mr. Solso shared his reasons for remaining confident in Cummins future. "We did the hard work to lower our cost structure and we will continue to do so. Therefore, we are positioned to take advantage of an economic upturn in each of our markets," he said. "In addition to the potential for market rebounds, Cummins has significant new growth opportunities. Five, exciting growth opportunities for Cummins in 2002 are; international distributors and service, light duty automotive, high-horsepower engines, power generation, and the recently announced Emission Solutions business of Fleetguard." A global power leader, Cummins Inc., is a corporation of complementary business units that design, manufacture, distribute, and service electrical power generation systems, engines, and related technologies, including fuel systems, controls, air handling, filtration, and emissions solutions. 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 its customers through more than 500 company-owned and independent distributor locations in 131 countries and territories. With 24,900 employees worldwide, Cummins reported sales of $5.7 billion in 2001. Press releases by fax can be requested by calling News On Demand (toll free) at 888-329-2305. Cummins home page can be found at www.cummins.com. |
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