Cummins Announces Second Quarter Results; Raises Outlook for 2017

COLUMBUS, Ind.

  • Second quarter revenues of $5.1 billion, GAAPNet Income of $424 million
  • EBIT of 12.2 percent of sales, Diluted EPS of $2.53
  • The company expects stronger sales growth with full year 2017 revenues to be up 9 to 11 percent, compared to prior guidance of up 4 to 7 percent
  • EBIT expected to be in the range of 11.75 to 12.5 percent, unchanged from prior guidance

Cummins Inc. (NYSE: CMI) today reported results for the second quarter of 2017.

Second quarter revenues of $5.1 billion increased 12 percent from the same quarter in 2016. Higher demand for trucks and construction equipment in North America and China, and stronger sales to mining, and oil & gas customers were the main drivers of revenue growth. Currency negatively impacted revenues by approximately 1 percent compared to last year, primarily due to the appreciation of the US dollar. Revenues in North America increased 13 percent and international sales grew 11 percent due to strong demand in China and India.

Net income attributable to Cummins in the second quarter was $424 million ($2.53 per diluted share), compared to $406million ($2.40 per diluted share) in the same quarter a year ago. The tax rate in the second quarter of 2017 was 26.4 percent.

Earnings before interest and taxes (EBIT) was $620 million, or 12.2 percent of sales, compared to $591 million or 13.1 percent of sales a year ago.

“We delivered strong revenue growth in all four operating segments in the second quarter due to improving conditions in a number of important markets where we also have leading share. Earnings increased due to solid operational performance, partially offset by higher warranty costs that resulted in second quarter EBIT that was below our expectations” said Chairman and CEO Tom Linebarger. “As a result of stronger than expected orders in truck and construction markets in North America andChina, and improving demand from global mining customers we have raised our 2017 full year outlook.”

Through the end of the second quarter, the Company has returned $463 million to shareholders in the form of dividends and share repurchase and recently raised its quarterly cash dividend by 5.4 percent. Cummins plans to return 50 percent of its Operating Cash Flow to shareholders in 2017.

The Company continues to execute its strategy to be the leading global powertrain supplier. Cummins and power management company Eaton (NYSE:ETN) have successfully completed the formation of the Eaton Cummins Automated Transmission Technologies joint venture that was announced on April 10, 2017. Cummins and Eaton each own 50 percent of the global joint venture which will design, manufacture, sell and support all future medium-duty and heavy-duty automated transmissions for the commercial vehicle market. Eaton’s current medium-duty automated transmission, Procision®, and next generation heavy-duty automated transmissions, will be part of the business which will also market, sell, and support Eaton’s current generation of automated heavy-duty transmissions to OEM customers in North America. Today marks the first day of operations for the joint venture and the financial results will be consolidated within Cummins’ Components Segment. We are still in the process of completing the purchase accounting associated with our investment in this new venture, as required by GAAP1, but we do not currently expect the joint venture to have a material impact on Cummins’ financial results in 2017.

Based on the current forecast, Cummins expects full year 2017 revenues to be up 9 to 11 percent, higher than the prior forecast of up 4 to 7 percent. EBIT is expected to be in the range of 11.75 to 12.5 percent of sales, unchanged from prior guidance. This forecast excludes the impact of our new Eaton Cummins Automated Transmission Technologies joint venture.

Other recent highlights:

  • Cummins announced the election of two new members to its Board of Directors - Karen Quintos, Chief Customer Officer, Dell Technologies and Rich Freeland, Cummins President and Chief Operating Officer
  • DiversityInc named Cummins one of the Top 50 Companies for Diversity for the eleventh consecutive year. Cummins ranked No. 21 on the 2017 annual list, which included more than 1,000 participating companies
1 Generally Accepted Accounting Principles
 

Second quarter 2017 detail (all comparisons to same period in 2016)

Engine Segment

  • Sales - $2.3 billion, up 15 percent.
  • Segment EBIT - $277 million, or 12 percent of sales, compared to 206 million or 10.3 percent of sales a year ago
  • On-highway revenues increased by 14 percent, and off-highway revenues increased 20 percent primarily due to increased demand in global truck and construction markets

Distribution Segment

  • Sales - $1.7 billion, up 12 percent
  • Segment EBIT - $96 million, or 5.6 percent of sales, compared to $87 million or 5.6 percent of sales
  • Organic sales increased 7 percent and revenue from the acquisition completed in the fourth quarter of 2016 added 6 percent with a negative foreign currency impact of 1 percent

Components Segment

  • Sales - $1.5 billion, up 14 percent.
  • Segment EBIT - $190 million , or 13.1 percent of sales, compared to $190 million or 14.9 percent of sales
  • EBIT in the second quarter of 2017 reflects a $26m unfavorable change in estimate of warranty liability
  • International revenue increased 25 percent, primarily due to China and India, in addition to a 6 percent sales increase in North America due to higher heavy and medium-duty truck production

Power Systems Segment

  • Sales - $1.0 billion, up 10 percent
  • Segment EBIT - $61 million, or 6 percent of sales, compared to $90 million, or 9.8 percent of sales
  • EBIT in the second quarter of 2017 reflects a $31 million accrual for the estimated costs of a quality campaign
  • Increased demand in mining and oil & gas markets was the primary driver of revenue growth

About Cummins

Cummins Inc., a global power leader, is a corporation of complementary business units that design, manufacture, distribute and service diesel and natural gas engines and related technologies, including fuel systems, controls, air handling, filtration, emission solutions and electrical power generation systems. Headquartered in Columbus, Indiana, (USA) Cummins currently employs approximately 55,400 people worldwide and serves customers in approximately 190 countries and territories through a network of approximately 600 company-owned and independent distributor locations and approximately 7,400 dealer locations. Cummins earned $1.39 billion on sales of $17.5 billion in 2016. Press releases can be found on the Web at www.cummins.com. Follow Cummins on Twitter at www.twittter.com/cummins and on YouTube at www.youtube.com/cumminsinc.

Forward-looking disclosure statement

Information provided in this release that is not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our forecasts, guidance, preliminary results, expectations, hopes, beliefs and intentions on strategies regarding the future. These forward looking statements include, without limitation, statements relating to our plans and expectations for our revenues for the full year of 2017. Our actual future results could differ materially from those projected in such forward-looking statements because of a number of factors, including, but not limited to: the adoption and implementation of global emission standards; the price and availability of energy; the pace of infrastructure development; increasing global competition among our customers; general economic, business and financing conditions; governmental action; changes in our customers’ business strategies; competitor pricing activity; expense volatility; labor relations; and other risks detailed from time to time in our Securities and Exchange Commission filings, including particularly in the Risk Factors section of our 2016 Annual Report on Form 10-K. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this press release and we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. More detailed information about factors that may affect our performance may be found in our filings with the Securities and Exchange Commission, which are available at http://www.sec.gov or at http://www.cummins.com in the Investor Relations section of our website.

Presentation of Non-GAAP Financial Information

EBIT is a non-GAAP measure used in this release, and is defined and reconciled to what management believes to be the most comparable GAAP measure in a schedule attached to this release. Cummins presents this information as it believes it is useful to understanding the Company's operating performance, and because EBIT is a measure used internally to assess the performance of the operating units.

Webcast information

Cummins management will host a teleconference to discuss these results today at 10 a.m. EST. This teleconference will be webcast and available on the Investor Relations section of the Cummins website at www.cummins.com . Participants wishing to view the visuals available with the audio are encouraged to sign-in a few minutes prior to the start of the teleconference.

     
CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited) (a)
     
    Three months ended
In millions, except per share amounts  

July 2,
2017

  July 3,
2016
NET SALES   $ 5,078     $ 4,528
Cost of sales   3,829     3,331
GROSS MARGIN   1,249     1,197
OPERATING EXPENSES AND INCOME        
Selling, general and administrative expenses   596     524
Research, development and engineering expenses   174     155
Equity, royalty and interest income from investees   98     88
Loss contingency       39
Other operating income (expense), net   18    
OPERATING INCOME   595     567
Interest income   5     6
Interest expense   21     16
Other income (expense), net   20     18
INCOME BEFORE INCOME TAXES   599     575
Income tax expense   158     148
CONSOLIDATED NET INCOME   441     427
Less: Net income attributable to noncontrolling interests   17     21
NET INCOME ATTRIBUTABLE TO CUMMINS INC.   $ 424     $ 406
         
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.        
Basic   $ 2.53     $ 2.41
Diluted   $ 2.53     $ 2.40
         
WEIGHTED AVERAGE SHARES OUTSTANDING        
Basic   167.3     168.8
Diluted   167.8     169.0
         
CASH DIVIDENDS DECLARED PER COMMON SHARE   $ 1.025     $ 0.975
         
(a)   Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.
     
 
    Six months ended

In millions, except per share amounts

  July 2,
2017
  July 3,
2016
NET SALES   $ 9,667     $ 8,819  
Cost of sales   7,290     6,566  
GROSS MARGIN   2,377     2,253  
OPERATING EXPENSES AND INCOME        
Selling, general and administrative expenses   1,133     1,014  
Research, development and engineering expenses   332     321  
Equity, royalty and interest income from investees   206     160  
Loss contingency       39  
Other operating income (expense), net   23     (2 )
OPERATING INCOME   1,141     1,037  
Interest income   7     12  
Interest expense   39     35  
Other income (expense), net   38     26  
INCOME BEFORE INCOME TAXES   1,147     1,040  
Income tax expense   301     280  
CONSOLIDATED NET INCOME   846     760  
Less: Net income attributable to noncontrolling interests   26     33  
NET INCOME ATTRIBUTABLE TO CUMMINS INC.   $ 820     $ 727  
         
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.        
Basic   $ 4.90     $ 4.27  
Diluted   $ 4.88     $ 4.26  
         
WEIGHTED AVERAGE SHARES OUTSTANDING        
Basic   167.4     170.3  
Diluted   167.9     170.5  
         
CASH DIVIDENDS DECLARED PER COMMON SHARE   $ 2.05     $ 1.95  
         
(a)   Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.
     
         
CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (a)
         
In millions, except par value   July 2,
2017
  December 31,
2016
ASSETS        
Current assets        
Cash and cash equivalents   $ 1,293     $ 1,120  
Marketable securities   174     260  
Total cash, cash equivalents and marketable securities   1,467     1,380  
Accounts and notes receivable, net   3,553     3,025  
Inventories   2,982     2,675  
Prepaid expenses and other current assets   600     627  
Total current assets   8,602     7,707  
Long-term assets        
Property, plant and equipment   7,804     7,635  
Accumulated depreciation   (4,017 )   (3,835 )
Property, plant and equipment, net   3,787     3,800  
Investments and advances related to equity method investees   1,162     946  
Goodwill   488     480  
Other intangible assets, net   339     332  
Pension assets   852     731  
Other assets   1,030     1,015  
Total assets   $ 16,260     $ 15,011  
         
LIABILITIES        
Current liabilities        
Accounts payable (principally trade)   $ 2,300     $ 1,854  
Loans payable   54     41  
Commercial paper   134     212  
Accrued compensation, benefits and retirement costs   475     412  
Current portion of accrued product warranty   392     333  
Current portion of deferred revenue   520     468  
Other accrued expenses   974     970  
Current maturities of long-term debt   45     35  
Total current liabilities   4,894     4,325  
Long-term liabilities        
Long-term debt   1,564     1,568  
Postretirement benefits other than pensions   318     329  
Pensions   327     326  
Other liabilities and deferred revenue   1,335     1,289  
Total liabilities   $ 8,438     $ 7,837  
         
EQUITY        
Cummins Inc. shareholders’ equity        
Common stock, $2.50 par value, 500 shares authorized, 222.3 and 222.4 shares issued   $ 2,184     $ 2,153  
Retained earnings   11,517     11,040  
Treasury stock, at cost, 54.7 and 54.2 shares   (4,586 )   (4,489 )
Common stock held by employee benefits trust, at cost, 0.6 and 0.7 shares   (7 )   (8 )
Accumulated other comprehensive loss   (1,615 )   (1,821 )
Total Cummins Inc. shareholders’ equity   7,493     6,875  
Noncontrolling interests   329     299  
Total equity   $ 7,822     $ 7,174  
Total liabilities and equity   $ 16,260     $ 15,011  
         
(a)   Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.
     
     
CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (a)
     
    Six months ended
In millions   July 2, 2017   July 3, 2016
CASH FLOWS FROM OPERATING ACTIVITIES        
Consolidated net income   $ 846     $ 760  
Adjustments to reconcile consolidated net income to net cash provided by operating activities        
Depreciation and amortization   284     259  
Deferred income taxes       2  
Equity in income of investees, net of dividends   (132 )   (87 )
Pension contributions in excess of expense   (44 )   (82 )
Other post-retirement benefits payments in excess of expense   (8 )   (17 )
Stock-based compensation expense   23     20  
Restructuring payments       (42 )
Loss contingency       39  
Translation and hedging activities   31     (45 )
Changes in current assets and liabilities        
Accounts and notes receivable   (488 )   (252 )
Inventories   (264 )   (101 )
Other current assets   21     189  
Accounts payable   403     143  
Accrued expenses   132     (209 )
Changes in other liabilities and deferred revenue   103     129  
Other, net   (81 )   32  
Net cash provided by operating activities   826     738  
CASH FLOWS FROM INVESTING ACTIVITIES        
Capital expenditures   (182 )   (189 )
Investments in internal use software   (40 )   (27 )
Investments in and advances to equity investees   (64 )   (17 )
Investments in marketable securities—acquisitions   (69 )   (379 )
Investments in marketable securities—liquidations   162     237  
Cash flows from derivatives not designated as hedges   19     (21 )
Other, net   14     5  
Net cash used in investing activities   (160 )   (391 )
CASH FLOWS FROM FINANCING ACTIVITIES        
Proceeds from borrowings   2     109  
Net (payments) borrowings of commercial paper   (78 )   200  
Payments on borrowings and capital lease obligations   (29 )   (133 )
Distributions to noncontrolling interests   (10 )   (24 )
Dividend payments on common stock   (343 )   (333 )
Repurchases of common stock   (120 )   (695 )
Other, net   34     (20 )
Net cash used in financing activities   (544 )   (896 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS   51     (117 )
Net increase (decrease) in cash and cash equivalents   173     (666 )
Cash and cash equivalents at beginning of year   1,120     1,711  
CASH AND CASH EQUIVALENTS AT END OF PERIOD   $ 1,293     $ 1,045  
         
(a)   Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.
     
                         
CUMMINS INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
                         
In millions   Engine   Distribution   Components  

Power
Systems

 

Intersegment
Eliminations (1)

  Total
Three months ended July 2, 2017                        
External sales   $ 1,711     $ 1,716     $ 1,064     $ 587     $     $ 5,078  
Intersegment sales   596     6     390     430     (1,422 )    
Total sales   2,307     1,722     1,454     1,017     (1,422 )   5,078  
Depreciation and amortization (2)   46     31     38     29         144  
Research, development and engineering expenses   63     4     57     50         174  
Equity, royalty and interest income from investees   56     13     15     14         98  
Interest income   2  

 

1     1     1         5  
Segment EBIT   277     96     190     61     (4 )   620  
                         
Segment EBIT as a percentage of total sales   12.0 %   5.6 %   13.1 %   6.0 %       12.2 %
                         
Three months ended July 3, 2016                        
External sales   $ 1,504     $ 1,538     $ 933     $ 553     $     $ 4,528  
Intersegment sales   498     6     346     368     (1,218 )    
Total sales   2,002     1,544     1,279     921     (1,218 )   4,528  
Depreciation and amortization (2)   41     29     32     29         131  
Research, development and engineering expenses   53     3     51     48         155  
Equity, royalty and interest income from investees   46     19     12     11         88  
Loss contingency   39                     39  
Interest income   3     1     1     1         6  
Segment EBIT   206     87     190     90     18     591  
                         
Segment EBIT as a percentage of total sales   10.3 %   5.6 %   14.9 %   9.8 %       13.1 %
                         
(1)   Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the three months ended July 2, 2017 and July 3, 2016.
(2)   Depreciation and amortization as shown on a segment basis excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Income as "Interest expense."
     
                         
In millions   Engine   Distribution   Components  

Power
Systems

 

Intersegment
Eliminations (1)

  Total
Six months ended July 2, 2017                        
External sales   $ 3,168     $ 3,353     $ 2,044     $ 1,102     $     $ 9,667  
Intersegment sales   1,162     14     754     797     (2,727 )    
Total sales   4,330     3,367     2,798     1,899     (2,727 )   9,667  
Depreciation and amortization (2)   90     61     75     57         283  
Research, development and engineering expenses   117     8     107     100         332  
Equity, royalty and interest income from investees   128     24     28     26         206  
Interest income   3     2     1     1         7  
Segment EBIT   506     196     369     118     (3 )   1,186  
                         
Segment EBIT as a percentage of total sales   11.7 %   5.8 %   13.2 %   6.2 %       12.3 %
                         
Six months ended July 3, 2016                        
External sales   $ 2,993     $ 2,996     $ 1,830     $ 1,000     $     $ 8,819  
Intersegment sales   985     11     686     729     (2,411 )    
Total sales   3,978     3,007     2,516     1,729     (2,411 )   8,819  
Depreciation and amortization (2)   80     57     63     58         258  
Research, development and engineering expenses   110     7     107     97         321  
Equity, royalty and interest income from investees   82     37     20     21         160  
Loss contingency   39                     39  
Interest income   5     2     2     3         12  
Segment EBIT   403     174     353     136     9     1,075  
                         
Segment EBIT as a percentage of total sales   10.1 %   5.8 %   14.0 %   7.9 %       12.2 %
                                   
(1)   Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the six months ended July 2, 2017 and July 3, 2016.
(2)   Depreciation and amortization as shown on a segment basis excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Income as "Interest expense." The amortization of debt discount and deferred costs was $1 million for both of the six months ended July 2, 2017 and July 3, 2016.
     

A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidated Statements of Income is shown in the table below:

         
    Three months ended   Six months ended
In millions   July 2,
2017
  July 3,
2016
  July 2,
2017
  July 3,
2016
Total segment EBIT   $ 620     $ 591     $ 1,186     $ 1,075
Less: Interest expense   21     16     39     35
Income before income taxes   $ 599     $ 575     $ 1,147     $ 1,040
                               

CUMMINS INC. AND SUBSIDIARIES
SELECT FOOTNOTE DATA
(Unaudited)

EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES

Equity, royalty and interest income from investees included in our Condensed Consolidated Statements of Income for the reporting periods was as follows:

         
    Three months ended   Six months ended
In millions   July 2,
2017
  July 3,
2016
  July 2,
2017
  July 3,
2016
Distribution entities                
Komatsu Cummins Chile, Ltda.   $ 8     $ 8     $ 15     $ 18
North American distributors       6         11
All other distributors       1         1
Manufacturing entities                
Beijing Foton Cummins Engine Co., Ltd.   22     22     55     40
Dongfeng Cummins Engine Company, Ltd.   19     15     41     22
Chongqing Cummins Engine Company, Ltd.   10     9     19     17
All other manufacturers   27     16     51     32
Cummins share of net income   86     77     181     141
Royalty and interest income   12     11     25     19
Equity, royalty and interest income from investees   $ 98     $ 88     $ 206     $ 160
                               

CUMMINS INC. AND SUBSIDIARIES
FINANCIAL MEASURES THAT SUPPLEMENT GAAP
(Unaudited)

Earnings before interest, income taxes and noncontrolling interests

We define EBIT as earnings before interest expense, income tax expense and noncontrolling interests in income of consolidated subsidiaries. We use EBIT to assess and measure the performance of our operating segments and also as a component in measuring our variable compensation programs. This measure is not in accordance with, or an alternative for, accounting principles generally accepted in the United States and may not be consistent with measures used by other companies. It should be considered supplemental data. Below is a reconciliation of “Net income attributable to Cummins Inc.” to EBIT for each of the applicable periods:

    Three months ended   Six months ended
In millions  

July 2,
2017

 

July 3,
2016

 

July 2,
2017

 

July 3,
2016

Net income attributable to Cummins Inc.   $ 424     $ 406     $ 820     $ 727  
                 
Net income attributable to Cummins Inc. as a percentage of net sales   8.3 %   9.0 %   8.5 %   8.2 %
                 
Add                
Net income attributable to noncontrolling interests   17     21     26     33  
Consolidated net income   441     427     846     760  
                 
Add                
Interest expense   21     16     39     35  
Income tax expense   158     148     301     280  
Earnings before interest expense and income taxes   $ 620     $ 591     $ 1,186     $ 1,075  
                 
EBIT as a percentage of net sales   12.2 %   13.1 %   12.3 %   12.2 %
                         

CUMMINS INC. AND SUBSIDIARIES
BUSINESS UNIT SALES DATA
(Unaudited)

Engine Segment Sales by Market and Unit Shipments by Engine Classification

Sales for our Engine segment by market were as follows:

                     
2017                    
In millions   Q1   Q2   Q3   Q4   YTD
Heavy-duty truck   $ 620     $ 714     $     $     $ 1,334
Medium-duty truck and bus   544     701             1,245
Light-duty automotive   423     429             852
Off-highway   436     463             899
Total sales   $ 2,023     $ 2,307     $     $     $ 4,330
                     
2016                    
In millions   Q1   Q2   Q3   Q4   YTD
Heavy-duty truck   $ 631     $ 622     $ 625     $ 565     $ 2,443
Medium-duty truck and bus   549     600     517     606     2,272
Light-duty automotive   433     394     345     409     1,581
Off-highway   363     386     372     387     1,508
Total sales   $ 1,976     $ 2,002     $ 1,859     $ 1,967     $ 7,804
                                       

Unit shipments by engine classification (including unit shipments to Power Systems and off-highway engine units included in their respective classification) were as follows:

                     
2017                    
Units   Q1   Q2   Q3   Q4   YTD
Heavy-duty   19,200     24,100             43,300
Medium-duty   60,300     71,600             131,900
Light-duty   63,100     65,600             128,700
Total units   142,600     161,300             303,900
                     
2016                    
Units   Q1   Q2   Q3   Q4   YTD
Heavy-duty   19,700     20,700     20,100     18,500     79,000
Medium-duty   55,400     62,300     53,400     58,000     229,100
Light-duty   61,700     57,100     49,800     60,000     228,600
Total units   136,800     140,100     123,300     136,500     536,700
                             

Distribution Segment Sales by Product Line

Sales for our Distribution segment by product line were as follows:

                     
2017                    
In millions   Q1   Q2   Q3   Q4   YTD
Parts   $ 745     $ 759     $     $     $ 1,504
Service   319     320             639
Power generation   306     329             635
Engines   275     314             589
Total sales   $ 1,645     $ 1,722     $     $     $ 3,367
                     
2016                    
In millions   Q1   Q2   Q3   Q4   YTD
Parts   $ 648     $ 642     $ 643     $ 694     $ 2,627
Service   299     297     299     320     1,215
Power generation   275     326     291     347     1,239
Engines   241     279     271     309     1,100
Total sales   $ 1,463     $ 1,544     $ 1,504     $ 1,670     $ 6,181
                                       

Component Segment Sales by Business

In the first quarter of 2017, our Components segment reorganized its reporting structure to move an element of the emission solutions business to the fuel systems business to enhance operational, administrative and product development efficiencies. Prior year sales were reclassified to conform with this change.

Sales for our Components segment by product line were as follows:

                     
2017                    
In millions   Q1   Q2   Q3   Q4   YTD
Emission solutions   $ 616     $ 674     $     $     $ 1,290
Turbo technologies   287     307             594
Filtration   277     291             568
Fuel systems   164     182             346
Total sales   $ 1,344     $ 1,454     $     $     $ 2,798
                     
2016                    
In millions   Q1   Q2   Q3   Q4   YTD
Emission solutions   $ 589     $ 603     $ 522     $ 524     $ 2,238
Turbo technologies   265     276     241     254     1,036
Filtration   252     262     244     252     1,010
Fuel systems   131     138     136     147     552
Total sales   $ 1,237     $ 1,279     $ 1,143     $ 1,177     $ 4,836
                     
2015                    
In millions   YTD                
Emission solutions   $ 2,449                  
Turbo technologies   1,141                  
Filtration   1,010                  
Fuel systems   572                  
Total sales   $ 5,172                  
                         

Power Systems Segment Sales by Product Line and Unit Shipments by Engine Classification

In the first quarter of 2017, our Power Systems segment reorganized its product lines to better reflect how the segment is managed. Prior year sales were reclassified to reflect these changes.

Sales for our Power Systems segment by product line were as follows:

                     
2017                    
In millions   Q1   Q2   Q3   Q4   YTD
Power generation   $ 526     $ 570     $     $     $ 1,096
Industrial   275     353             628
Generator technologies   81     94             175
Total sales   $ 882     $ 1,017     $     $     $ 1,899
                     
2016                    
In millions   Q1   Q2   Q3   Q4   YTD
Power generation   $ 518     $ 602     $ 543     $ 593     $ 2,256
Industrial   215     236     235     255     941
Generator technologies   75     83     78     84     320
Total sales   $ 808     $ 921     $ 856     $ 932     $ 3,517
                     
2015                    
In millions   YTD                
Power generation   $ 2,588                  
Industrial   1,121                  
Generator technologies   358                  
Total sales   $ 4,067                  
                         

High-horsepower unit shipments by engine classification were as follows:

                     
2017                    
Units   Q1   Q2   Q3   Q4   YTD
Power generation   1,900     2,100             4,000
Industrial   1,300     1,700             3,000
Total units   3,200     3,800             7,000
                     
2016                    
Units   Q1   Q2   Q3   Q4   YTD
Power generation   1,800     2,200     2,000     1,900     7,900
Industrial   1,000     1,100     1,000     1,300     4,400
Total units   2,800     3,300     3,000     3,200     12,300
                             

 

Cummins Information

 

 

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Carole Casto
Vice President - Marketing and Communications
(317) 610-2480
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