Chair and CEO Jennifer Rumsey highlighted Cummins’ third-quarter success, noting strong sales and profitability, primarily from improvements in Power Systems and Distribution segments. “We’ve revised our full-year EBITDA projection to the upper range, driven by our Destination Zero strategy, which strengthens our market position and financial performance,” she stated.
Q3 2024 Financial Summary:
Cummins reported third-quarter revenues of $8.5 billion, steady compared to Q3 2023. North American sales decreased by 1%, while international sales rose by 2%.
Net income rose to $809 million, or $5.86 per diluted share, from $656 million, or $4.59 per share, in 2023. The quarter’s effective tax rate was 19.2%, including favorable tax items of $36 million, or $0.26 per share. Last year’s third quarter included separation costs for Atmus totaling $26 million, or $0.14 per share.
EBITDA reached $1.4 billion, representing 16.4% of sales, up from 14.6% last year.
2024 Full-Year Outlook:
Cummins expects 2024 revenue to remain between flat and down 3%, with EBITDA at approximately 15.5%, marking the high end of previous projections. The company plans to sustain strong cash flows, return 50% of operating cash to shareholders, and focus on reinvestment, debt reduction, and dividend growth.
“We have firmed up our profitability expectations for 2024, propelled by Power Systems and Distribution. While demand for North American heavy-duty trucks has softened and may continue into Q4, Cummins is well-prepared to maintain strong financial results and deliver returns to shareholders,” Rumsey added.
Q3 2024 Business Highlights:
- Dividend Increase: Cummins raised its quarterly dividend from $1.68 to $1.82 per share, marking 15 consecutive years of increases.
- Production Milestone: Full-scale production of the X15N™ natural gas engine began at the Jamestown Engine Plant, celebrating its 50th anniversary.
- IAA Transportation Showcase: Cummins highlighted decarbonization technologies, including Euro-7-ready X10 and hydrogen internal combustion engines, lithium-iron phosphate batteries, eAxles, and hydrogen fuel solutions.
- Accelera™ Plant Expansion: The new electrolyzer plant in Spain began production, with an annual capacity of 500 MW, scalable to 1 GW.
- Industry Recognition: Cummins was named among the 2024 100 Best Companies by Seramount, recognized as a Veteran Friendly Employer by U.S. Veterans Magazine, and ranked #55 on Glassdoor’s Best Places to Work in 2024.
Segment Details (compared to Q3 2023):
- Components: Sales at $2.7 billion, down 16%; EBITDA at 12.9%.
- Engine: Sales at $2.9 billion, down 1%; EBITDA at 14.7%.
- Distribution: Sales at $3.0 billion, up 16%; EBITDA at 12.5%.
- Power Systems: Sales at $1.7 billion, up 17%; EBITDA at 19.4%.
- Accelera: Sales at $110 million, up 7%; EBITDA loss due to R&D investments.
