Cummins reports 311% increase in North American sales for the second quarter

CumminsThe second-quarter results for 2023 have recently been announced, with North AmericaSales growth31%. 

Second-quarter revenue reached $8.6 billion, representing a 311% increase compared to the same quarter in 2022. Driven by the addition of Meritor and robust demand across most global markets, North Americasales revenueGrowth of 311 TP3T, with international revenue increasing by 321 TP3T.

Chairwoman and Chief Executive Officer Jennifer Rumsey stated: “Robust demand across most of our key markets and regions enabled the company to achieve record revenue and stable profitability in the second quarter of 2023.” “We remain committed to delivering cyclical improvement in financial performance, returning cash to shareholders, and prioritising investments to continue building our portfolio and powering the success of our global customers. I would like to thank our Cummins employees, who continue to work tirelessly to meet customer needs, ensuring product excellence, strengthening our customer relationships, and addressing ongoing challenges."Supply chainRestrictions to cope with robust demand levels.”

Cummins' attributable net profit for the second quarter was US$720 million, representing diluted earnings per share of US$5.05, compared to US$702 million, or diluted earnings per share of US$4.94, in 2022. This performance included US$23 million in costs related to the separation from Atmus, equivalent to diluted earnings per share of US$0.13. For the second quarter of 2023, this amounted to $29 million, or $0.16 per diluted share, compared to $29 million in the second quarter of 2022.

The second quarter of 2022 also included a benefit of $47 million, or $0.33 per diluted share, arising from a reserve adjustment related to the indefinite suspension of Russian operations. The effective tax rate for the quarter was 22.31%, which included an adverse discrete tax item of $3 million, or $0.02 per diluted share.

Second-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA) amounted to $1.3 billion, representing 15.11% of sales, compared to $1.1 billion, or 16.01% of sales, in the same period last year. Second-quarter 2023 EBITDA included costs associated with the Atmus separation, whilst second-quarter 2022 EBITDA included the release of provisions related to the indefinite suspension of operations in Russia and costs associated with the aforementioned Atmus separation. The decrease in the second-quarter EBITDA percentage was primarily attributable to the dilutive impact of Meritor, whose current gross margin percentage is below our company's average.

Based on current projections, Cummins maintains its full-year 2023 revenue guidance at a growth rate of 15.0% to 15.7%, underpinned by robust demand across most markets, particularly in North America. EBITDA is projected to remain at 15.0% to 15.7% of sales.

“Although we anticipate demand to remain robust through 2023 and maintain our guidance for revenue and profitability, we will continue to monitor global economic indicators closely. Should economic momentum slow, Cummins will maintain its strong position, continuing to invest in future growth, delivering new technologies to customers while advancing our Zero Destination strategy, and returning cash to shareholders.“