Cummins Shares Plans to Deliver Long-term Growth and Increased Profitability
November 21 2019 - 7:30AM
Business Wire
- Launching New Power business which includes existing
electrification business as well as fuel cell and hydrogen
production technologies
- Company shares plans to effectively manage through cyclical
downturn by lowering structural costs by $250 million to $300
million in 2020
- Cummins has the financial strength to invest through the
cycle and return cash to shareholders
At a meeting with analysts and shareholders today, members of
the leadership team of Cummins Inc. (NYSE: CMI), a global power
leader, shared the Company’s plans to generate profitable growth
driven by leadership in the design, manufacture, and support of
powertrain technology.
“Our leadership in powertrain technology has been instrumental
in driving strong returns for Cummins shareholders,” Tom
Linebarger, Chairman and CEO, said at the meeting. “Cummins has
continued to advance its diesel and natural gas powertrains while
we have increased our focus on battery and fuel cell technologies,
providing customers with the products and support for all of their
powertrain needs.”
The Company shared its plans to leverage its customer
relationships and application knowledge to support OEMs and end
users as they broaden the number of powertrains in their vehicles
and equipment. In his remarks, President and COO Tony Satterthwaite
reiterated that while battery and fuel cell technologies have been
a clear focus of Cummins, its investments in diesel and natural gas
platforms would continue in order to achieve improved fuel economy
and lower emissions.
“While we do anticipate a shift towards electrification in some
markets over the coming years, diesel will be the primary source of
energy in commercial vehicles for many years to come,” Mr.
Satterthwaite said. “Cummins will continue to lead the way in
developing cleaner and more fuel-efficient diesel engines, such as
the recently announced and industry leading 2020 ISX15 Efficiency
Series, for the North American heavy-duty truck market, which is 5%
more fuel efficient than its 2019 counterpart.”
At the meeting, Chief Financial Officer Mark Smith reminded
investors that Cummins has a strong track record of improving
cycle-over-cycle profitability and cash flow and that the Company
is prepared for a cyclical slowdown in 2020. “Cummins has the
financial strength to keep investing through the cycle and return
cash to shareholders”, Mr. Smith stated. “We are taking steps to
lower our cost base, while continuing to invest in the new products
and services that will position the Company for a stronger future,
when markets recover.”
Webcast information
A copy of the presentation used in the meeting and a replay of
the webcast is available at investor.cummins.com.
About Cummins
Cummins Inc., a global technology leader, is a corporation of
complementary business segments designing, manufacturing,
distributing and servicing a broad portfolio of power solutions.
The company’s products range from diesel and natural gas engines to
hybrid and electric platforms, as well as related technologies,
including transmissions, battery systems, fuel systems, controls,
air handling, filtration, emission solutions, and electrical power
generation systems. Headquartered in Columbus, Indiana (U.S.),
since its founding in 1919, Cummins employs approximately 62,600
people committed to powering a more prosperous world through three
global corporate responsibility priorities critical to healthy
communities: education, environment and equality of opportunity.
Cummins serves customers in approximately 190 countries and
territories through a network of approximately 600 company-owned
and independent distributor locations, and over 7,600 dealer
locations. In 2018, the company earned about $2.1 billion on sales
of $23.8 billion. See how Cummins is powering a world that’s Always
On by accessing news releases and more information at
https://www.cummins.com/always-on. Follow Cummins on Twitter at
www.twitter.com/cummins and on YouTube at
www.youtube.com/cumminsinc.
Forward-looking disclosure statement
Information provided in this release that is not purely
historical are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including
statements regarding our forecasts, guidance, preliminary results,
expectations, hopes, beliefs and intentions on strategies regarding
the future. These forward looking statements include, without
limitation, statements relating to our plans and expectations for
our revenues and EBITDA percentage for the full year of 2019. Our
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: any adverse results of our internal
review into our emissions certification process and compliance with
emissions standards; a sustained slowdown or significant downturn
in our markets; changes in the engine outsourcing practices of
significant customers; the development of new technologies that
reduce demand for our current products and services; increased
scrutiny from regulatory agencies, as well as unpredictability in
the adoption, implementation and enforcement of emissions standards
around the world; product recalls; policy changes in international
trade; the United Kingdom's (U.K.) decision to end its membership
in the European Union; lower than expected acceptance of new or
existing products or services; a slowdown in infrastructure
development and/or depressed commodity prices; supply shortages and
supplier financial risk, particularly from any of our
single-sourced suppliers; exposure to potential security breaches
or other disruptions to our information technology systems and data
security; a major customer experiencing financial distress; the
actions of, and income from, joint ventures and other investees
that we do not directly control; our plan to reposition our
portfolio of product offerings through exploration of strategic
acquisitions and divestitures and related uncertainties of entering
such transactions; failure to realize expected results from our
investment in Eaton Cummins Automated Transmission Technologies
joint venture; competitor activity; increasing competition,
including increased global competition among our customers in
emerging markets; foreign currency exchange rate changes;
variability in material and commodity costs; political, economic
and other risks from operations in numerous countries; changes in
taxation; global legal and ethical compliance costs and risks;
aligning our capacity and production with our demand; product
liability claims; increasingly stringent environmental laws and
regulations; future bans or limitations on the use of
diesel-powered products; the price and availability of energy; the
performance of our pension plan assets and volatility of discount
rates; labor relations; changes in accounting standards; our sales
mix of products; protection and validity of our patent and other
intellectual property rights; the outcome of pending and future
litigation and governmental proceedings; continued availability of
financing, financial instruments and financial resources in the
amounts, at the times and on the terms required to support our
future business; and other risks detailed from time to time in our
SEC filings, including particularly in the Risk Factors section of
our 2018 Annual Report on Form 10-K and Quarterly Reports on Form
10-Q. Shareholders, potential investors and other readers are urged
to consider these factors carefully in evaluating the
forward-looking statements and are cautioned not to place undue
reliance on such forward-looking statements. The forward-looking
statements made herein are made only as of the date of this press
release and we undertake no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise. More detailed information about factors
that may affect our performance may be found in our filings with
the SEC, which are available at http://www.sec.gov or at
http://www.cummins.com in the Investor Relations section of our
website.
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version on businesswire.com: https://www.businesswire.com/news/home/20191121005059/en/
Jon Mills Director, External Communications 317-658-4540
jon.mills@cummins.com
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