Several equipment makers released their latest financials this week, with some showing signs of slowing sales and concerns about the future and others at the opposite end of the spectrum. That was the sentiment coming from Cummins, Wabash National, Daimler and Volvo.


Cummins reported fourth quarter revenue of $4.3 billion, down 13% from the same quarter in 2011, reflecting weakness in most major markets and geographies. Weaker demand in truck, construction, and oil and gas markets in North America drove the decrease in year-over-year performance. The company also experienced lower demand in international markets for power generation equipment and construction, truck and mining engines.

Earnings before interest and taxes were $552 million for the fourth quarter or 12.9% of sales, excluding $52 million of restructuring costs. This compares to $677 million or 13.8% of sales a year ago, excluding special items.

Net income attributable to Cummins in the fourth quarter was $381 million. Results included restructuring costs.

Revenues for the full year were $17.3 billion, down 4% from 2011. Higher revenues in North America, up 9%, were offset by international sales, which declined by 15%, with the most significant declines in Brazil, China and Europe.

Earnings before interest and taxes (EBIT) for the year, excluding special items, was $2.37 billion or 13.7% of sales, compared to $2.6 billion or 14.2% of sales in 2011.

Net income attributable to Cummins for the full year was $1.66 billion, down from $1.85 billion in 2011. Excluding the costs of restructuring actions, and the gain on the sale of the exhaust business, the company reported full year net income of $1.69 billion.

“After a strong start to the year, demand declined across most geographies and end markets in the second half of 2012 as the global economy slowed,” said Tom Linebarger, chairman and CEO.  “I am pleased that we were able to deliver improved gross margins in the fourth quarter and record gross margins for the full year despite the weakness in demand. The work we have undertaken to reduce costs and lower inventory should benefit the company when the global economy improves, however there is uncertainty surrounding the timing and pace of improvement in end markets in 2013.”

In the Cummins Engine Segment, sales were $2.5 billion, down 18% from the year before. with earnings before interest and taxes of $272 million, or 10.9% of sales, compared to $368 million or 12% of sales.

Officials said strong demand for bus and light-duty engines in North America was more than offset by reduced demand in the truck market in Brazil, the North American heavy-duty truck, global construction, as well as North American oil and gas and international mining markets.


Daimler AG, the parent to Daimler Trucks North America which makes Freightliner and Western Star, reported overall it had another strong year in 2012 with its best figures for unit sales and revenue, due in part to its growth in trucks along with its Mercedes-Benz cars.

Daimler Trucks was able to further increase its unit sales and revenue, with particularly strong growth in the NAFTA region and Asia, selling 462,000 vehicles during in 2012, which is 9% more than in the prior year. Revenue for Daimler Trucks in the fourth quarter fell 6% to $10.5 billion while earnings before interest and taxes declined 29% to a little more than $400 million. For all of 2012, revenue was up 9% to $42.5 billion while earnings before interest and taxes fell to $2.3 billion, both compared to 2011.

The company said worldwide demand for medium and heavy trucks can be expected to increase perceptibly in 2013. However, this will mainly be driven by the significant recovery in China, which was responsible for a large proportion of the global drop in demand last year.

In North America, a decline of 5% to 10% is anticipated as a result of uncertainty about the country's fiscal problems. For the European truck market, demand is expected to fall by up to 5% due to the ongoing weak economic environment. The Japanese market should be at about the prior-year level, following the expiry of certain special effects in connection with the reconstruction there. A significant recovery of up to 10% is expected for the Brazilian market thanks to better economic prospects and the continuation of favorable financing conditions.

Daimler Trucks said it anticipates a slight increase in unit sales in the year 2013 and further growth in 2014, although the development in 2013 will at first be rather moderate or even negative in some key markets due to the ongoing difficult economic situation. The introduction of stricter emission limits in 2014 is expected to cause some purchases to be brought forward to 2013.

It said sales should benefit from the complete availability of the Actros and Antos models and from other new models such as the Arocs for the construction sector and the new Atego, sold outside North America. North American products like the new Freightliner Cascadia Evolution in combination with the Detroit components should also make an important contribution to further growth.


Volvo struck a cautious tone due to a sharp fall in quarterly profits on weaker sales in key markets, but did express some optimism about the future.

It said it made $125 million in net profits during the last quarter of 2012, down more than 80% from $745.4 million a year earlier. The company also reported a 17% decline in quarterly sales totaling $11.34 billion down from $13.66 billion a year ago. In North America, orders fell by 21%.

"Profitability will be affected by low capacity utilization, high spend levels in research and development and costs associated with the launch of new products," Chief Executive Olof Persson said in a statement. "However, we expect market conditions to gradually improve during the course of 2013 when economic growth across the world gains momentum."

"North American customers have remained cautious because of uncertainty about the future economic development," the company said. Still, it maintained its forecast that the market for heavy trucks in 2013 would reach about 250,000 in North America and 230,000 in Europe.

Last month, Volvo announced it would buy a 45% stake in China's Dongfeng Motor Group Co., a deal it said would make it the world's largest heavy truck maker.

Wabash National

Trailer maker Wabash National sounded a more positive tone, reporting net income of $80.2 million for the fourth quarter of 2012 on net sales of $416 million. For all of 2012 it reported net income of $105.6 million on net sales of $1.46 billion, compared to net income of $15.0 million on net sales of $1.19 billion for same period a year earlier.

Results for the 12 months included one-time charges of $18.2 million related to the acquisitions of Walker and certain assets of Beall.

For the second consecutive quarter, the Wabash reported a record level of income from operations, totaling $29.2 million for the fourth quarter of 2012, compared to income from operations of $8.4 million for the fourth quarter of 2011.

Dick Giromini, president and chief executive officer said, “new trailers shipments of 45,600 for the year were slightly below our prior guidance of 46,000 to 48,000 units. which was partially mitigated by the continued strong demand for our non-trailer products during the quarter.

"As we look forward to 2013 with a healthy backlog of orders totaling $666 million, a trailer demand forecast above replacement levels for the second consecutive year driven by key drivers such as fleet age and size, customer profitability, used trailer values and regulatory compliance, a full year of Walker, [which makes engineered products and tanks for transporting liquids] in the portfolio as well as our continued efforts to optimize our manufacturing processes while also remaining selective in our order acceptance, we believe 2013 has the potential to be another record year for Wabash National.”