Cummins has reported results for the first quarter of 2024.
The company says its first quarter revenues of $8.4 billion decreased 1% from the same quarter in 2023. Sales in North America were flat, and international revenues decreased 1% due to lower demand in China and Europe.
“We continued to see strong demand from customers in the first quarter of 2024, reflecting the quality and performance of our products,” says Jennifer Rumsey, Cummins chair and CEO. “We delivered solid profitability and also completed the separation of Atmus, allowing Cummins to continue its focus on advancing innovative power solutions and positioning Atmus to pursue its own plans for profitable growth. I am deeply appreciative of our Cummins employees across the globe, whose broad expertise and diverse perspectives are driving our ability to innovate for our customers and meet global demand.”
Cummins also reported its net income attributable to Cummins in the first quarter was $2.0 billion, or $14.03 per diluted share, compared to $790 million, or $5.55 per diluted share, in 2023. The results reflect the gain related to the separation of Atmus, net of transaction costs and other expenses, of $1.3 billion, or $9.08 per diluted share, and restructuring expenses of $29 million, or $0.15 per diluted share.
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Earnings before interest, taxes, depreciation and amortization (EBITDA) in the first quarter were $2.6 billion, or 30.6% of sales, compared to $1.4 billion, or 16.1% of sales, a year ago. EBITDA for the first quarter of 2024 and the first quarter of 2023 included the gain and costs noted above, the company says.
On a segment basis, Cummins states its component segment was down 6% and engine segment down 2%. The company's distribution segment faired better, up 5%, with its power systems also up 3% and accelera section up 9%.
Based on its current forecast, Cummins projects full year 2024 revenues to decline 2% to 5% on a year-over-year basis, and EBITDA to be in the range of 14.5% and 15.5% of sales. The prior guidance, Cummins says, which was also a decline of 2% to 5%, assumed the inclusion of the financial results of Atmus for the full year. Due to strong global demand, the revenue guidance is unchanged as compared to the prior guidance despite the separation of Atmus. The current EBITDA guidance is an increase from the prior guidance of between 14.4% and 15.4%, the company adds.
Cummins states it plans to continue to generate strong operating cash flow and returns for shareholders and is committed to our long-term strategic goal of returning 50% of operating cash flow back to shareholders. In the near term, we will focus on reinvesting for profitable growth, dividends and reducing debt, the company says.
“We have raised our expectations on revenue and profitability for 2024 due to continued demand for Cummins’ products and services. We do still expect slowing demand in some of our key markets in the second half of the year,” says Rumsey. “Despite lower sales, Cummins is in a strong position to keep investing in future growth, bringing new technologies to customers and returning cash to shareholders.”
