Cummins Engine Reports Earnings of 63 Cents Per Share for Q1
15 April 1999
Cummins Engine Reports Earnings of 63 Cents Per Share for the First Quarter
COLUMBUS, Ind.--April 15, 1999--
CUMMINS ENGINE COMPANY, INC.
(Millions, except per share amounts)
FOR THE FIRST QUARTER ENDED March 28, 1999 March 29, 1998
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Net Sales $ 1,505 $ 1,500
Before special charge
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Earnings before income taxes -- $ 57
Net earnings -- 37
Basic earnings per share -- $ .97
Diluted earnings per share -- .96
As reported
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Earnings before income taxes $ 36 $ 14
Net earnings 24 7
Basic earnings per share $ .63 $ .18
Diluted earnings per share .63 .18
Weighted-average number of shares for EPS:
Basic 38.5 38.5
Diluted 38.5 38.9
As anticipated last week at its annual shareholders meeting, Cummins Engine Co. Inc. today reported first-quarter earnings of 63 cents per share, or $24 million profit after taxes, on sales of $1.5 billion, compared to the first quarter of 1998, when, after accounting for a special charge of $43 million, the company reported earnings of 18 cents per share, or $7 million profit after taxes on level sales. Excluding the charge, year-ago first quarter results were 96 cents per share or $37 million profit after taxes.
"Our revenues reflect strength in all of our North American automotive markets," said Chairman and Chief Executive Officer Jim Henderson. "This was offset by reduced demand in agricultural markets, weakness in Asia and Latin America, and seasonal fluctuations in our power generation and filtration markets."
"We are pleased with the significant progress we have made in reducing our selling, administrative, and research and engineering costs, which were $37 million lower than the year-ago quarter, and we are continuing to find ways to further reduce these costs," continued Henderson. "Costs for products introduced last year should also begin to improve as we ramp up production. These new products are being well received in the marketplace -- our Signature 600 engine won the Truck Writers of North America Technical Achievement Award and our ISM and ISL engines were selected for the "Nifty Fifty" award for new product excellence by the editors of Heavy Duty Trucking Magazine. During the second quarter, we will begin shipment of our new 60-85 horsepower 3.3 litre engine, designed for mobile industrial applications, further extending our popular mid-range product line."
Within the engine business, all North American automotive markets were strong. Sales of $412 million to the worldwide heavy-duty truck market were 8 percent higher compared to the first quarter of 1998, with sales in North America up 20 percent, offset by weakness in the U.K. and Mexico. In the medium-duty truck market, sales of $129 million were 14 percent higher than the year-ago quarter, and sales to the bus and light commercial vehicle market of $219 million were 15 percent higher. In the industrial business, sales of $240 million were down 11 percent compared to the first quarter of 1998 as a result of lower sales in agricultural markets in North America.
Power generation sales of $251 million were 14 percent lower than the year-ago quarter primarily due to reduced demand overseas.
Sales of filtration and other products of $254 million were flat compared to the first quarter of 1998.
Cummins, headquartered in Columbus, Ind., is the world's largest producer of diesel engines above 200 horsepower. The company provides products for customers in its key markets: engines, including automotive and industrial, power generation, and filtration. Press releases by fax may be requested by calling News on Demand (toll free) at 888-329-2305. Cummins' home page on the Internet can be found at http://www.cummins.com.
Certain information included in this press release is forward-looking and involves risks and uncertainties, including general economic and competitive conditions that could significantly affect expected results.