01—Abstract
Summary
Summary of the 10-K filed February 18, 2014. Cited figures are marked; the original filing is the authoritative source.
Cummins Inc. (CMI) in its 2013 10-K filing presents a strong, diversified business with a global presence, primarily focused on the design, manufacture, sale, and service of diesel and natural gas engines, as well as related technology and equipment.
The company operates through distinct segments including Engines, Components, Power Generation, and Distribution, serving a wide range of markets such as heavy-, medium-, and light-duty trucks, construction, agriculture, mining, marine, rail, and power generation. The filing highlights the company's commitment to research and development, environmental sustainability, and robust supply chain management. Investors should note the company's significant exposure to global economic conditions and specific industry cycles impacting demand for its products.
02—Key points
Key Highlights
- Diversified business across four key operating segments: Engines, Components, Power Generation, and Distribution, indicating resilience and broad market reach.
- Global operational footprint with a significant international presence, suggesting exposure to various economic cycles and growth opportunities worldwide.
- Emphasis on research and development (R&D) demonstrates a commitment to innovation and technological advancement, crucial for maintaining competitive advantage in the engine and power solutions market.
- Commitment to environmental sustainability and compliance is highlighted, reflecting increasing importance for corporate social responsibility and long-term operational viability.
- The company serves a wide array of end markets, from heavy-duty trucking and construction to agriculture and power generation, showcasing a diversified customer base and reduced reliance on any single industry.
- Acknowledged seasonality in certain business lines, which investors should consider when evaluating quarterly performance and trends.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2013, Cummins Inc kept $0.09.
- Revenue$17.30B100.0%
- Cost of revenue−$13.02B75.3%
- Gross profit$4.28B24.7%
- Operating costs−$2.18B12.6%
- Operating income$2.10B12.1%
- Interest, other & tax−$618.0M3.6%
- Net income$1.48B8.6%
04—Financials
Financial Highlights
Figures from 10-KFY2013filed February 18, 2014Financial Statements
FY2013 against FY2012
| Line item | FY2013FY2012 | Change |
|---|---|---|
| Revenue | $17.30B$17.33B | −0.2% |
| Cost of Revenue | $13.02B$12.92B | +0.8% |
| Gross Profit | $4.28B$4.42B | −3.1% |
| R&D Expenses | $713.00M$728.00M | −2.1% |
| SG&A Expenses | $1.82B$1.81B | +0.5% |
| Operating Income | $2.10B$2.25B | −6.8% |
| Interest Expense | $41.00M$32.00M | +28.1% |
| Net Income | $1.48B$1.65B | −9.8% |
| EPS (Basic) | $7.93$8.69 | −8.7% |
| EPS (Diluted) | $7.91$8.67 | −8.8% |
| Shares Outstanding (Basic) | 186.99M189.29M | −1.2% |
| Shares Outstanding (Diluted) | 187.42M189.67M | −1.2% |
05—Questions
Frequently Asked Questions
What are Cummins Inc.'s primary business segments and how do they contribute to revenue?
Cummins Inc. operates through four main segments: Engines (design, manufacture, sale, and service of diesel and natural gas engines), Components (emission control systems, filtration, turbochargers, etc.), Power Generation (power systems for standby, prime, and emergency power), and Distribution (sales and service of Cummins products and other related lines).
What are the key risks and uncertainties facing Cummins Inc. as outlined in the filing?
Key risks include the cyclical nature of the industries served (e.g., construction, automotive), global economic conditions, currency fluctuations, intense competition, reliance on key suppliers, and regulatory changes, particularly related to emissions standards.
How does Cummins Inc. approach research and development and environmental sustainability?
The company invests significantly in research and development to drive innovation in engine technology, emissions control, and alternative fuels. It also emphasizes environmental sustainability through product design, manufacturing processes, and compliance with environmental regulations.
What is the company's exposure to international markets?
Cummins Inc. has a substantial global presence, with operations and sales across numerous countries. This international exposure provides diversification but also subjects the company to risks associated with different economic conditions, geopolitical events, and currency exchange rates.
06—Continue