Cummins Inc.'s (CMI) fourth-quarter profit rose 51% as the company's North American market continued to show strength.
Shares were up 2.5% at $108.50 in premarket trading on much stronger-than-expected results.
Cummins' earnings have soared over the past two years as stronger demand for truck engines and parts in North America and other key markets drives stronger sales.
The maker of truck engines and power generation systems has also earned a string of credit upgrades from bond-rating agencies as its debt metrics and profitability improve.
Cummins reported a profit of $548 million or $2.86 a share, up from $362 million, or $1.84 a share, a year earlier. Excluding gains from business sales and insurance recovery, per-share earnings rose to $2.56 in the latest quarter as revenue rose 19% to $4.92 billion.
Analysts polled by Thomson Reuters expected $2.23 a share and $4.71 billion, respectively.
Gross margin widened to 25.2% from 23.8%.
Sales in the engines business, the company's largest top-line contributor, climbed 23% on strong demand for oil and gas engines in North America and expanding mining engine use around the world. Revenue from components was up 19%, also on demand from North America.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com