Inc. today released its expectation for improved profitability despite essentially flat revenues for 2002. Cummins Chairman and CEO, Tim Solso
, said, "continuing efforts to reduce costs will enable Cummins to achieve a profitability improvement over 2001 with little to no improvement in revenue."
During the October 11th teleconference on third quarter earnings Solso noted that rapid market changes in the U.S. and around the world following the September 11th terrorist attacks caused Cummins to revisit its 2002 planning process. Solso stated that, "a public outlook on 2002 would be delayed until the end of November when market visibility and economic direction may be clearer."
Based on recently completed plans, the company is forecasting a 2002 PBIT in the range of $155 to $165 million, with net earnings of $35 to $45 million, resulting in diluted earnings per share of approximately $1 per share. Solso stated, "The completion of our restructuring actions combined with indirect and direct material cost initiatives and Six Sigma improvement projects will result in a net savings of $75 million.
"Despite depressed market conditions around the world, Cummins expects to be modestly profitable in the fourth quarter of 2001. We expect to deliver a profit in three out of four quarters during terrible market conditions," said Solso. "Cummins will continue to do what it takes to cut costs, improve performance and maintain profitability."