Revenue moved higher by 5% compared to the second quarter of 2014 to $5 billion while net income grew 6% to $471 million or from $2.43 per diluted share to $2.62 per diluted share.
Earnings before interest and taxes (EBIT) increased to $721 million for the second quarter or 14.4% of sales, up from $657 million or 13.6% of sales a year ago. Based on the current forecast, Cummins expects full year 2015 revenues to grow between 2% and 4% percent, and EBIT to be in the range of 13.5% to 14% of sales.
“We delivered strong results in the second quarter, despite challenging economic conditions in a number of international markets, and we increased cash returned to shareholders,” said Cummins Chairman and CEO Tom Linebarger. “Earnings improved as a result of good performance by our manufacturing and supply chain organizations and solid execution on material cost reduction initiatives.”
Cummins says the higher revenue was driven by stronger demand in on-highway markets and distributor acquisitions in North America. However, currency negatively impacted revenues by 4% compared to last year, primarily due to a stronger U.S. dollar.
Revenues in North America increased 12% while international sales declined by 6%.
In the company’s engine segment, sales increased 2% to $2.8 billion with EBIT of $341 million, or 12.2% of sales, compared to $311 million or 11.3% of sales a year earlier. Strong demand in North American truck and bus markets was partially offset by weaker demand in global industrial markets and lower truck demand in Brazil, according to Cummins.
In its components segment, sales increased 9% to $1.4 billion with EBIT of $223 million, or 16% of sales, compared to $185 million or 14.5% of sales during the same time last year. Here, stronger demand in on-highway markets in North America, Europe, and China more than offset weakness in Brazil, according to the company.
Sales in Cummins components business increased 9%, while it saw a 1% increase in its power generation segment.
You can find more details on the Cummins website.
Also, on Tuesday, Paccar Inc. (PCAR) said it achieved record quarterly net income in the second quarter of the year as it reported financial results.
The parent company of Peterbilt and Kenworth earned $447.2 million or $1.26 per diluted share, an increase of 40% compared to $319.2 million or 90 cents per diluted share a year earlier.
Second quarter net sales and financial services revenues were $5.08 billion, an 11% increase from the 2014 second quarter.
Sales in Paccar’s truck segment increased to $3.983 billion from $3.455 billion a year earlier.
“Our customers are benefiting from strong freight tonnage, good freight rates and the excellent operating efficiency of Kenworth and Peterbilt trucks,” said Dan Sobic, Paccar executive vice president. “Industry truck demand is being driven by economic growth and expansion of fleet capacity.”
Paccar Parts generated record quarterly pre-tax profit of $145.7 million in the second quarter of 2015, a 15% increase. Second quarter 2015 revenues were $776.5 million, compared to the $778 million achieved in the second quarter of 2014.
Second quarter Paccar Financial Services pre-tax income in 2015 was $90.8 million compared to $91.7 million earned in the second quarter of 2014. Second quarter 2015 revenues were $293.8 million compared to $302.6 million a year earlier.
More details are on the Paccar website.