Cummins reported today a successful FY17 with total sales of US$20.4 billion compared to US$17.5 billion FY16, and a 24.9 percent grow margin. The company’s cashflow expanded, decreasing the debt of capital to 19.7 percent on FY17, compared with 20.6 percent FY16. The annual operating cash inflow was US$2.28 billion.
“The company delivered strong growth, solid profitability and record operating cash flow in 2017,” said Chairman and CEO Tom Linebarger. “We expect demand to remain strong in many of our core markets in 2018 and profitability to improve as a result of higher sales and continued execution of our cost reduction initiatives. The company again plans to return at least 50 percent of Operating Cash Flow to shareholders in 2018.”
All the company’s sectors–Engine, Distribution, Components, Power Systems and Intersegment Eliminations—saw a net sales growth above 10 percent compared to FY16. Distribution grew the least with a 14 percent hike, and the Components sector the most with 22 percent.
4Q17 was equally successful, improving total sales to US$5.48 billion from the US$4.5 billion seen in 4Q16. The dividends per share 4Q17 upgraded to US$1.08 compared to US$1.025 for 4Q16. For the quarter, Components was also the segment to experience the highest growth, with 32 percent compared to 4Q16, while the rest of sectors grew more than 15 percent.
Regarding 2018 guidance, the company expects a consolidated revenue up 4 to 8 percent and an interest expense of US$85 million. The Components sector is expected to continue growing the most.