Cummins Inc. powered to its most profitable quarter ever, with strong sales across the entire business and the company’s gross margins at their highest levels in more than eight years.
“We continued to deliver on our commitments to our customers and shareholders in the third quarter,” says Tim Solso, Cummins chairman and chief executive officer. “Our business outlook remains positive, and our focus on execution has significantly improved margins and strengthened the bottom line.”
Cummins’ third-quarter profit rose 25 percent. In a press release Thursday, Oct. 27, the engine maker also raised its forecast for the full year.
For the quarter ended Sept. 25, Cummins earned $145 million, or $2.90 a share, up from $116 million, or $2.40 a share, a year earlier. The average analyst forecast, as compiled by Thomson First Call, was for $2.60 a share.
Third-quarter revenue rose 12 percent to $2.47 billion from $2.19 billion a year earlier. Sales at the Columbus, Ind.-based company’s engine segment, the largest by revenue, rose 18 percent to $1.67 billion from $1.42 billion.
Cummins also increased its full-year earnings forecast to $10.70 to $10.80 a share from its July guidance of $10.10 to $10.30 a share. The Wall Street forecast is for earnings of $10.36 a share. For 2004, the company earned $7.39 a share.
The new range calls for fourth-quarter earnings of $3 to $3.10 a share, up from $2.41 a share a year earlier. Analysts expect, on average, a profit of $2.95 a share.
