Cummins reported third quarter revenues of $5.1 billion decreased 11 percent from the same quarter in 2019. Sales in North America declined by 18 percent while international revenues were flat. Currency negatively impacted revenues by 1 percent primarily due to a weaker Brazilian Real, according to the company.
Net income attributable to Cummins in the third quarter was $501 million compared to $622 million in 2019. The tax rate in the third quarter was 26.5 percent and was negatively impacted by $31 million of discrete tax items.
The company currently expects fourth quarter revenues to be similar to third quarter levels, with higher demand in North America truck markets and improvement in aftermarket sales, partially offset by lower demand in China.
On October 1st, the company ended temporary salary reductions that began in April. Compensation expense is projected to increase by approximately $90 million dollars in the fourth quarter due to the end of these salary reductions.
Third Quarter 2020 Highlights:
- The company completed an aggregate $2 billion debt offering of 5, 10, and 30-year maturities. The company’s long-term credit ratings remain unchanged at A+ from Standard & Poor’s and A2 from Moody’s with stable outlooks
- A collaboration with the Department of Energy’s Oak Ridge National Laboratory (ORNL) has resulted in the ability to produce enough filter media to supply more than a million face masks and respirators per day to U.S. healthcare facilities
- Cummins was awarded over $12 million of funding for five separate Department of Energy projects related to PEM and Solid Oxide fuel cell and electrolyzer technologies