Recently, Cummins’ foreign official website announced the results for the first quarter of 2021. The results showed that Cummins achieved revenue of US$6.1 billion in the first quarter, an increase of 22% over the same period in 2020. Sales in North America increased by 7%, while international revenue increased by 45%, which was attributed to strong demand in the global market and new product sales in China and India.
"With the continuous improvement of the global economy, demand accelerated in the first quarter, which drove strong sales growth in most companies and regions and brought considerable profitability. The strength and breadth of the demand rebound exceeded our initial expectations. , We have raised our expectations for the whole year." Chairman and CEO Tom Linebarger said. "Although we are encouraged by the growing demand, the pace of recovery has put pressure on the global supply chain, which has led to increased costs and challenges in meeting end-user needs. The shortage of key components such as semiconductor chips has been a major challenge. The severe weather conditions have affected the United States, and the bottleneck of global logistics has further aggravated the backlog of orders. Supply capacity is our focus now, and we are doing everything possible to mitigate the impact.
Earnings before interest, taxes, depreciation and amortization (EBITDA) for the first quarter was US$980 million (16.1% of sales), compared with US$846 million (16.9% of sales) in the same period last year.
Cummins net income in the first quarter was 603 million U.S. dollars, and in 2020 it was 511 million U.S. dollars.
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Outlook for 2021:
According to current forecasts, Cummins will increase its revenue forecast for the full year of 2021 by 20% to 24%. As demand in all markets is growing, it will increase from 8% to 12%. EBITDA is expected to be in the range of 15.5% to 16.0%, an increase from the previous sales of 15.0% and 15.5%, which is mainly due to increased demand. The company expects to return 75% of its operating cash flow to shareholders in the form of dividends and stock repurchases by 2021.
"We are raising our expectations for revenue and profit margins in 2021. We continue to take the necessary precautions in all facilities to reduce the spread of COVID-19, and our focus remains on the health and safety of our employees. We are optimistic. It believes that continued vaccination on a global scale will reduce the impact of the virus in the second half of the year, but there is still a risk of increased cases, and new virus mutations may appear, thereby reducing customer demand. Cummins will maintain future growth Strong investment strength, bringing new technology to customers, and returning cash to shareholders." Chairman and CEO Tom Linebarger (Tom Linebarger) said.
Highlights of the first quarter of 2021:
? Cummins has been named to Ethisphere's "World's Most Ethical Companies" list for the 14th consecutive year.
? The company announced the establishment of a global strategic partnership with Daimler AG to provide medium-sized powertrain systems for Daimler trucks and buses, thereby making the two companies more competitive, promoting global innovation, and providing customers with more products and emission reduction.
? Cummins continues to work on gender equality on International Women's Day. In order to achieve a 24-hour non-stop gender equality dialogue, more than 5,000 employees participated in 47 dialogues held in 22 countries/regions around the world. The Cummins Women’s Rights Program also continues to make progress, establishing a new partnership with Promundo in Europe to prevent violence against women.
? Cummins Vice Chairman Tony Satterthwaite testified at the Congressional Transportation Technology Hearing, reiterating Cummins' commitment to achieve zero carbon net emissions in the future through continuous innovation in advanced internal combustion, battery and fuel cell technologies.
? The company announced that employees, temporary workers and their spouses and family members (over 16 years old) can receive Pfizer Biotech’s COVID-19 vaccine in multiple locations in the United States. Cummins continues to work with health officials around the world to provide employees with access to the COVID-19 vaccine.
Detailed report for the first quarter of 2021
Engine field
? Sales of 2.5 billion US dollars, an increase of 14%;
? Departmental EBITDA of US$354 million, accounting for 14.4% of sales, compared to sales of US$365 million, accounting for 16.9% of sales;
? Driven by strong demand in the North American truck and pickup truck market, road revenue increased by 15%, and driven by strong demand in the international construction market, off-highway revenue increased by 9%;
? Sales in North America increased by 10%, and in the international market increased by 24%;
Distribution area
? Sales of 1.8 billion US dollars, an increase of 1%;
? Departmental EBITDA-160 million US dollars, accounting for 8.7% of sales, while sales were 158 million US dollars, accounting for 8.7% of sales;
? Revenue in North America dropped by 6%, and international sales increased by 17%;
? Due to supply chain constraints, the decline in parts and services offset the increase in market demand for power generation and engines;
Parts field
? Sales of 2.2 billion US dollars, an increase of 43%;
? Departmental EBITDA was US$421 million, accounting for 19.6% of sales, while sales were US$279 million, accounting for 18.6% of sales;
? Due to increased demand in China and India, revenue in North America increased by 15%, and international sales increased by 82%;
Power system field
? Sales of 1 billion US dollars, an increase of 16%;
? Segment EBITDA of US$126 million, accounting for 12.3% of sales, compared to US$77 million in the same period last year, accounting for 8.7% of sales
? Due to the growth of the recreational vehicle and data center market, power generation revenue increased by 18%, and industrial revenue increased by 9% due to strong demand in the mining market;
New power field
? Sales of 35 million US dollars, an increase of 250%;
? Departmental EBITDA loss of 51 million US dollars;
? The increase in revenue is due to increased demand in the transportation and school bus markets, in addition to the commissioning of electrolyzer projects and the transportation of fuel cell systems to the railway market;
? Costs related to fuel cells and electrolyzers and products supporting battery electric vehicles are causing EBITDA losses;
