Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
cumminslogo.jpg
FORM 8-K
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report:  May 1, 2018
 
  CUMMINS INC.
(Exact name of registrant as specified in its charter)
Indiana
(State or other Jurisdiction of
Incorporation)
1-4949
 (Commission File Number)
35-0257090
 (I.R.S. Employer Identification No.)

500 Jackson Street
P. O. Box 3005
Columbus, IN  47202-3005
(Principal Executive Office)  (Zip Code)

Registrant's telephone number, including area code:  (812) 377-5000
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)

Emerging growth Company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
 

1


Item 2.02. Results of Operations and Financial Condition.
 
On May 1, 2018, Cummins Inc. (“Cummins,” “the Company,” “the registrant,” “we,” “our,” or “us”) issued the attached press release reporting its financial results for the first quarter of 2018, which is furnished herewith as Exhibit 99.

The information furnished pursuant to this Item 2.02, including Exhibit 99, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act.


Item 9.01. Financial Statements and Exhibits.
 
(d)
The following exhibit is furnished pursuant to Item 2.02 herewith: 
99-Press Release dated May 1, 2018


SIGNATURE

 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Date: May 1, 2018
 
CUMMINS INC.
 /s/ CHRISTOPHER C. CLULOW
Christopher C. Clulow
Vice President - Corporate Controller
(Principal Accounting Officer)

 

2

CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited) (a)



 
 
Three months ended
In millions, except per share amounts
 
April 1,
2018
 
April 2,
2017
NET SALES
 
$
5,570

 
$
4,589

Cost of sales
 
4,370

 
3,457

GROSS MARGIN
 
1,200

 
1,132

OPERATING EXPENSES AND INCOME
 
 
 
 
Selling, general and administrative expenses
 
577

 
547

Research, development and engineering expenses
 
210

 
158

Equity, royalty and interest income from investees
 
115

 
108

Other operating income (expense), net
 
2

 
5

OPERATING INCOME
 
530

 
540

Interest income
 
7

 
2

Interest expense
 
24

 
18

Other income, net
 
10

 
24

INCOME BEFORE INCOME TAXES
 
523

 
548

Income tax expense
 
198

 
143

CONSOLIDATED NET INCOME
 
325

 
405

Less: Net income attributable to noncontrolling interests
 

 
9

NET INCOME ATTRIBUTABLE TO CUMMINS INC.
 
$
325

 
$
396

 
 
 
 
 
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.
 
 
 
 
Basic
 
$
1.97

 
$
2.36

Diluted
 
$
1.96

 
$
2.36

 
 
 
 
 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
 
 

 
 
Basic
 
164.9

 
167.5

Diluted
 
165.7

 
168.0

 
 
 
 
 
CASH DIVIDENDS DECLARED PER COMMON SHARE
 
$
1.08

 
$
1.025

 
 
 
 
 
(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.






 




3

CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (a)


In millions, except par value
 
April 1,
2018
 
December 31,
2017
ASSETS
 
 
 
 
Current assets
 
 
 
 
Cash and cash equivalents
 
$
1,207

 
$
1,369

Marketable securities
 
180

 
198

Total cash, cash equivalents and marketable securities
 
1,387

 
1,567

Accounts and notes receivable, net
 
3,845

 
3,618

Inventories
 
3,411

 
3,166

Prepaid expenses and other current assets
 
558

 
577

Total current assets
 
9,201

 
8,928

Long-term assets
 
 
 
 
Property, plant and equipment, net
 
3,892

 
3,927

Investments and advances related to equity method investees
 
1,288

 
1,156

Goodwill
 
1,085

 
1,082

Other intangible assets, net
 
960

 
973

Pension assets
 
1,058

 
1,043

Other assets
 
908

 
966

Total assets
 
$
18,392

 
$
18,075

 
 
 
 
 
LIABILITIES
 
 
 
 
Current liabilities
 
 
 
 
Accounts payable (principally trade)
 
$
2,854

 
$
2,579

Loans payable
 
56

 
57

Commercial paper
 
593

 
298

Accrued compensation, benefits and retirement costs
 
361

 
811

Current portion of accrued product warranty
 
658

 
454

Current portion of deferred revenue
 
489

 
500

Other accrued expenses
 
764

 
915

Current maturities of long-term debt
 
57

 
63

Total current liabilities
 
5,832

 
5,677

Long-term liabilities
 
 
 
 
Long-term debt
 
1,571

 
1,588

Postretirement benefits other than pensions
 
284

 
289

Pensions
 
331

 
330

Other liabilities and deferred revenue
 
2,078

 
2,027

Total liabilities
 
$
10,096

 
$
9,911

 
 
 
 
 
EQUITY
 
 
 
 
Cummins Inc. shareholders’ equity
 
 
 
 
Common stock, $2.50 par value, 500 shares authorized, 222.4 and 222.4 shares issued
 
$
2,217

 
$
2,210

Retained earnings
 
11,641

 
11,464

Treasury stock, at cost, 57.6 and 56.7 shares
 
(5,061
)
 
(4,905
)
Common stock held by employee benefits trust, at cost, 0.5 and 0.5 shares
 
(6
)
 
(7
)
Accumulated other comprehensive loss
 
(1,397
)
 
(1,503
)
Total Cummins Inc. shareholders’ equity
 
7,394

 
7,259

Noncontrolling interests
 
902

 
905

Total equity
 
$
8,296

 
$
8,164

Total liabilities and equity
 
$
18,392

 
$
18,075

 
 
 
 
 
(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.



4

CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (a)


 
 
Three months ended
In millions
 
April 1,
2018
 
April 2,
2017
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
Consolidated net income
 
$
325

 
$
405

Adjustments to reconcile consolidated net income to net cash (used in) provided by operating activities
 
 
 
 
Depreciation and amortization
 
154

 
139

Deferred income taxes
 
(27
)
 
10

Equity in income of investees, net of dividends
 
(95
)
 
(83
)
Pension contributions under (in excess of) expense, net
 
13

 
(23
)
Other post retirement benefits payments in excess of expense, net
 
(5
)
 
(10
)
Stock-based compensation expense
 
9

 
7

Loss contingency payments
 
(65
)
 

Translation and hedging activities
 
38

 
11

Changes in current assets and liabilities
 
 
 
 
Accounts and notes receivable
 
(217
)
 
(205
)
Inventories
 
(259
)
 
(202
)
Other current assets
 
56

 
73

Accounts payable
 
246

 
296

Accrued expenses
 
(272
)
 
(90
)
Changes in other liabilities and deferred revenue
 
27

 
48

Other, net
 
(45
)
 
3

Net cash (used in) provided by operating activities
 
(117
)
 
379

 
 
 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
 
Capital expenditures
 
(72
)
 
(81
)
Investments in internal use software
 
(15
)
 
(27
)
Investments in and advances to equity investees
 
(16
)
 
(20
)
Investments in marketable securities—acquisitions
 
(67
)
 
(26
)
Investments in marketable securities—liquidations
 
82

 
147

Cash flows from derivatives not designated as hedges
 
27

 
(24
)
Other, net
 
25

 
4

Net cash used in investing activities
 
(36
)
 
(27
)
 
 
 
 
 
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
 
Net borrowings of commercial paper
 
295

 
62

Payments on borrowings and capital lease obligations
 
(16
)
 
(11
)
Distributions to noncontrolling interests
 
(11
)
 
(10
)
Dividend payments on common stock
 
(178
)
 
(171
)
Repurchases of common stock
 
(163
)
 
(51
)
Other, net
 
21

 
17

Net cash used in financing activities
 
(52
)
 
(164
)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
 
43

 
14

Net (decrease) increase in cash and cash equivalents
 
(162
)
 
202

Cash and cash equivalents at beginning of year
 
1,369

 
1,120

CASH AND CASH EQUIVALENTS AT END OF PERIOD
 
$
1,207

 
$
1,322

 
 
 
 
 
(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.

5

CUMMINS INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)

 
In millions
 
Engine
 
Distribution
 
Components
 
Power Systems
 
Electrified Power (1)
 
Total Segment
 
Intersegment Eliminations (2)
 
Total
 
Three months ended April 1, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
External sales
 
$
1,813

 
$
1,847

 
$
1,313

 
$
595

 
$
2

 
$
5,570

 
$

 
$
5,570

 
Intersegment sales
 
633

 
6

 
440

 
479

 

 
1,558

 
(1,558
)
 

 
Total sales
 
2,446

 
1,853

 
1,753

 
1,074

 
2

 
7,128

 
(1,558
)
 
5,570

 
Research, development and engineering expenses
 
79

 
5

 
62

 
57

 
7

 
210

 

 
210

 
Equity, royalty and interest income from investees
 
67

 
13

 
16

 
19

 

 
115

 

 
115

 
Interest income
 
2

 
2

 
1

 
2

 

 
7

 

 
7

 
Segment EBITDA
 
286

 
123

 
227

 
142

 
(10
)
 
768

 
(68
)
 
700

 
Depreciation and amortization (3)
 
49

 
27

 
46

 
30

 
1

 
153

 

 
153

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EBITDA as a percentage of total sales
 
11.7
%
 
6.6
%
 
12.9
%
 
13.2
%
 
NM

 
10.8
%
 
 
 
12.6
%
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three months ended April 2, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
External sales
 
$
1,457

 
$
1,637

 
$
980

 
$
515

 
$

 
$
4,589

 
$

 
$
4,589

 
Intersegment sales
 
566

 
8

 
364

 
367

 

 
1,305

 
(1,305
)
 

 
Total sales
 
2,023

 
1,645

 
1,344

 
882

 

 
5,894

 
(1,305
)
 
4,589

 
Research, development and engineering expenses
 
54

 
4

 
50

 
50

 

 
158

 

 
158

 
Equity, royalty and interest income from investees
 
72

 
11

 
13

 
12

 

 
108

 

 
108

 
Interest income
 
1

 
1

 

 

 

 
2

 

 
2

 
Segment EBITDA
 
273

 
130

 
216

 
85

 

 
704

 
1

 
705

 
Depreciation and amortization (3)
 
44

 
30

 
37

 
28

 

 
139

 

 
139

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EBITDA as a percentage of total sales
 
13.5
%
 
7.9
%
 
16.1
%
 
9.6
%
 
%
 
11.9
%
 
 
 
15.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
"NM" - not meaningful information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1
)
We formed the Electrified Power Segment effective January 1, 2018. Our Electrified Power segment provides fully electric and hybrid powertrain solutions along with innovative components and subsystems to serve all our markets as they adopt electrification, meeting the needs of our original equipment manufacturer partners and end customers.
(2
)
Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the three months ended April 1, 2018 and April 2, 2017.
(3
)
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 and less than $1 million for the three month periods ended April 1, 2018 and April 2, 2017, respectively.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

6

CUMMINS INC. AND SUBSIDIARIES
RECONCILIATION OF SEGMENT INFORMATION
(Unaudited)


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
In millions
 
April 1,
2018
 
April 2,
2017
Total EBITDA
 
$
700

 
$
705

Less:
 
 
 
 
Depreciation and amortization
 
153

 
139

Interest expense
 
24

 
18

Income before income taxes
 
$
523

 
$
548



7

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
In millions
 
April 1,
2018
 
April 2,
2017
Distribution entities
 
 
 
 
Komatsu Cummins Chile, Ltda.
 
$
7

 
$
7

Manufacturing entities
 
 

 
 
Beijing Foton Cummins Engine Co., Ltd.
 
21

 
33

Dongfeng Cummins Engine Company, Ltd.
 
17

 
22

Chongqing Cummins Engine Company, Ltd.
 
17

 
9

Cummins Westport, Inc.
 
6

 
1

Dongfeng Cummins Emission Solutions Co., Ltd.
 
5

 
3

All other manufacturers
 
25

 
20

Cummins share of net income
 
98

 
95

Royalty and interest income
 
17

 
13

Equity, royalty and interest income from investees
 
$
115

 
$
108



PENSIONS AND OTHER POSTRETIREMENT BENEFITS

On January 1, 2018, we retroactively adopted the new accounting standard related to the presentation of pension and other postretirement benefit costs, which resulted in the adjustment of prior period balances in the Condensed Consolidated Statements of Income by the following amounts:

 
 
Favorable / (Unfavorable)
 
 
2017
 
2016
 
In millions
Q1
 
Q2
 
Q3
 
Q4
 
Total
 
Total
 
Cost of sales
$
4

 
$
2

 
$
2

 
$
2

 
$
10

 
$
6

 
Selling, general and administrative expenses
(10
)
 
(10
)
 
(9
)
 
(10
)
 
(39
)
 
(53
)
 
Research, development and engineering expenses (1)

 
(1
)
 

 
(1
)
 
(2
)
 
(1
)
 
Total change in operating income
(6
)
 
(9
)
 
(7
)
 
(9
)
 
(31
)
 
(48
)
 
Other non operating income, net
6

 
9

 
7

 
9

 
31

 
48

 
Total change in income before income taxes
$

 
$

 
$

 
$

 
$

 
$

INCOME TAXES
 
Our effective tax rate for the year is expected to approximate 23.0 percent, excluding any discrete tax items that may arise.
Our effective tax rate for the three months ended April 1, 2018, was 37.9 percent and contained $78 million, or $0.47 per share, of unfavorable discrete tax items, primarily related to a 2017 Tax Cuts and Jobs Act (Tax Legislation) adjustment of $74 million. This includes $39 million associated with changes related to the Tax Legislation measurement period adjustment and $35 million associated with the one-time recognition of deferred tax charges at historical tax rates on intercompany profit in inventory.
Our effective tax rate for the three months ended April 2, 2017, was 26.1 percent and contained only immaterial discrete tax items.
The increase in the effective tax rate for the three months ended April 1, 2018, versus the comparable period in 2017, was primarily due to the unfavorable discrete changes associated with the Tax Legislation passed in December 2017.

8

CUMMINS INC. AND SUBSIDIARIES
SELECT FOOTNOTE DATA
(Unaudited)



ENGINE SYSTEM CAMPAIGN ACCRUAL
During 2017, the California Air Resources Board (CARB) and U.S. Environmental Protection Agency (EPA) selected certain of our pre-2013 model year engine systems for additional emissions testing. Some of these engine systems failed CARB and EPA tests as a result of degradation of an aftertreatment component. We have not been issued an official notice from the CARB or EPA regarding these particular engine systems. We continue to work with the agencies to develop a resolution of these matters. We are developing and testing a variety of solutions to address the technical issues, which could include a combination of calibration changes, additional service practices and hardware changes. We recorded a charge of $29 million to cost of sales in our Condensed Consolidated Statements of Income in the third quarter of 2017 for the then expected cost of field campaigns to repair some of these engine systems. We have concluded based upon additional emission testing performed, and further discussions with the agencies in the first quarter of 2018, that the field campaigns should be expanded to include a larger population of our engine systems that are subject to the aftertreatment component degradation, including our model years 2010 through 2015. As a result, we recorded an additional charge of $187 million, or $0.87 per share, to cost of sales in our Condensed Consolidated Statements of Income in the first quarter of 2018, to reflect our current estimated cost of these expanded campaigns.
For the engine populations under evaluation, we are in the process of finalizing the form and extent of solutions to address the technical matters. The accrual recorded in the first quarter of 2018 represents our current best estimate of the expected cost of our recommended courses of action to address these matters and is based upon certain assumptions about the effectiveness of our proposed solutions and the agencies' acceptance of those solutions. Since there are many variables with respect to these degradation issues, it is difficult to assess whether our future costs will be consistent with our current accrual for this matter. If, through the course of our ongoing internal work to develop and test our proposed solutions, it becomes apparent that more extensive repairs are required for certain populations of engine systems, or if the agencies do not accept our proposed solutions, then further charges may be recorded in the period in which our current assumptions change. It is reasonably possible that such changes in assumption could occur, with a range of zero, if our current proposed solutions are effective and approved, up to an incremental exposure of approximately $400 million above our recorded accrual at the end of the first quarter.
We do not currently expect any fines or penalties from the EPA or CARB related to this matter.



9

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

 
 
 
 
Reconciliation of Non GAAP measures - Earnings before interest, income taxes, noncontrolling interests, depreciation and amortization (EBITDA)

Effective January 1, 2018, we use EBITDA as a primary basis for the Chief Operating Decision Maker to evaluate the performance of each of our operating segments and our consolidated results. It is also a component in measuring our variable compensation programs. EBITDA assists investors and debt holders in comparing our performance on a consistent basis without regard for depreciation and amortization, which can vary significantly depending upon many factors. Our 2017 and 2016 EBITDA measures, as restated, were as follows:

In millions
 
Engine
 
Distribution
 
Components
 
Power Systems
 
Total Segment
 
Intersegment Eliminations
 
 
Total
2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Q1
 
$
273

 
$
130

 
$
216

 
$
85

 
$
704

 
$
1

 
 
$
705

Q2
 
323

 
127

 
228

 
90

 
768

 
(4
)
 
 
764

Q3
 
276

 
120

 
259

 
111

 
766

 
22

 
 
788

Q4
 
271

 
123

 
214

 
125

 
733

 
36

 
 
769

2017 Total
 
$
1,143

 
$
500

 
$
917

 
$
411

 
$
2,971

 
$
55

 
 
$
3,026

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2016 Total
 
$
849

 
$
508

 
$
774

 
$
378

 
$
2,509

 
$
17

 
 
$
2,526

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
    
EBITDA is not in accordance with, or an alternative for, accounting principles generally accepted in the United States (GAAP) and may not be consistent with measures used by other companies. It should be considered supplemental data; however, the amounts included in the EBITDA calculation are derived from amounts included in the Condensed Consolidated Statements of Income. Below is a reconciliation of “Net income attributable to Cummins Inc.” to EBITDA for each of the applicable periods:



10


 
 
Three months ended
In millions
 
April 1, 2018
 
April 2, 2017
Net income attributable to Cummins Inc.
 
$
325

 
$
396

 
 
 
 
 
Net income attributable to Cummins Inc. as a percentage of net sales
 
5.8
%
 
8.6
%
 
 
 
 
 
Add:
 
 
 
 
Net income attributable to noncontrolling interests
 

 
9

Consolidated net income
 
325

 
405

 
 
 
 
 
Add:
 
 
 
 
Interest expense
 
24

 
18

Income tax expense
 
198

 
143

Depreciation and amortization
 
153

 
139

EBITDA
 
$
700

 
$
705

 
 
 
 
 
EBITDA as a percentage of net sales
 
12.6
%
 
15.4
%
 
 
 
 
 
Add: Engine system campaign charge
 
187

 

 
 
 
 
 
EBITDA, excluding engine system campaign charge
 
$
887

 
$
705

 
 
 
 
 
EBITDA, excluding engine system campaign charge, as a percentage of net sales
 
15.9
%
 
15.4
%


 
Net income and diluted earnings per share (EPS) attributable to Cummins Inc. excluding discrete tax items

We believe these are useful measures of our operating performance for the periods presented as they illustrate our operating performance without regard to special items including tax adjustments. These measures are not in accordance with, or an alternative for GAAP and may not be consistent with measures used by other companies. This should be considered supplemental data. The following table reconciles net income attributable to Cummins Inc. to net income attributable to Cummins Inc. excluding discrete tax items for the following periods:

 
 
 
 
Three months ended
 
 
 
April 1, 2018
 
April 2, 2017
In millions
 
Net Income
 
Diluted EPS
 
Net Income
 
Diluted EPS
Net income attributable to Cummins Inc.
 
$
325

 
$
1.96

 
$
396

 
$
2.36

Add:
 
 

 
 

 
 

 
 

Discrete tax items
 
78

 
0.47

 

 

Net income attributable to Cummins Inc. excluding discrete tax items
 
$
403

 
$
2.43

 
$
396

 
$
2.36

 
 


11

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:
2018
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Heavy-duty truck
 
$
815

 
$

 
$

 
$

 
$
815

Medium-duty truck and bus
 
692

 

 

 

 
692

Light-duty automotive
 
402

 

 

 

 
402

Off-highway
 
537

 

 

 

 
537

Total sales
 
$
2,446

 
$

 
$

 
$

 
$
2,446

 
 
 
 
 
 
 
 
 
 
 
2017
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Heavy-duty truck
 
$
620

 
$
714

 
$
776

 
$
730

 
$
2,840

Medium-duty truck and bus
 
544

 
701

 
625

 
643

 
2,513

Light-duty automotive
 
423

 
429

 
452

 
423

 
1,727

Off-highway
 
436

 
463

 
483

 
491

 
1,873

Total sales
 
$
2,023

 
$
2,307

 
$
2,336

 
$
2,287

 
$
8,953

Unit shipments by engine classification (including unit shipments to Power Systems and off-highway engine units included in their respective classification) were as follows:
2018
 
 
 
 
 
 
 
 
 
 
Units
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Heavy-duty
 
26,600

 

 

 

 
26,600

Medium-duty
 
74,000

 

 

 

 
74,000

Light-duty
 
61,900

 

 

 

 
61,900

Total units
 
162,500

 

 

 

 
162,500

 
 
 
 
 
 
 
 
 
 
 
2017
 
 
 
 
 
 
 
 
 
 
Units
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Heavy-duty
 
19,200

 
24,100

 
28,100

 
24,500

 
95,900

Medium-duty
 
60,300

 
71,600

 
68,500

 
67,700

 
268,100

Light-duty
 
63,100

 
65,600

 
66,300

 
62,500

 
257,500

Total units
 
142,600

 
161,300

 
162,900

 
154,700

 
621,500


12

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


Distribution Segment Sales by Product Line
Sales for our Distribution segment by product line were as follows:
2018
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Parts
 
$
808

 
$

 
$

 
$

 
$
808

Engines
 
367

 

 

 

 
367

Service
 
352

 

 

 

 
352

Power generation
 
326

 

 

 

 
326

Total sales
 
$
1,853

 
$

 
$

 
$

 
$
1,853

 
 
 
 
 
 
 
 
 
 
 
2017
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Parts
 
$
745

 
$
759

 
$
768

 
$
768

 
$
3,040

Engines
 
275

 
314

 
342

 
438

 
1,369

Service
 
319

 
320

 
326

 
347

 
1,312

Power generation
 
306

 
329

 
317

 
385

 
1,337

Total sales
 
$
1,645

 
$
1,722

 
$
1,753

 
$
1,938

 
$
7,058

Component Segment Sales by Business
Sales for our Components segment by product line were as follows:
2018
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Emission solutions
 
$
775

 
$

 
$

 
$

 
$
775

Turbo technologies
 
340

 

 

 

 
340

Filtration
 
320

 

 

 

 
320

Electronics and fuel systems
 
201

 

 

 

 
201

Automated transmissions
 
117

 

 

 

 
117

Total sales
 
$
1,753

 
$

 
$

 
$

 
$
1,753

 
 
 
 
 
 
 
 
 
 
 
2017
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Emission solutions
 
$
616

 
$
674

 
$
696

 
$
689

 
$
2,675

Turbo technologies
 
287

 
307

 
297

 
288

 
1,179

Filtration
 
277

 
291

 
287

 
298

 
1,153

Electronics and fuel systems
 
164

 
182

 
184

 
188

 
718

Automated transmissions
 

 

 
69

 
95

 
164

Total sales
 
$
1,344

 
$
1,454

 
$
1,533

 
$
1,558

 
$
5,889


13

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


Power Systems Segment Sales by Product Line and Unit Shipments by Engine Classification
Sales for our Power Systems segment by product line were as follows:
2018
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Power generation
 
$
571

 
$

 
$

 
$

 
$
571

Industrial
 
414

 

 

 

 
414

Generator technologies
 
89

 

 

 

 
89

Total sales
 
$
1,074

 
$

 
$

 
$

 
$
1,074

 
 
 
 
 
 
 
 
 
 
 
2017
 
 
 
 
 
 
 
 
 
 
In millions
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Power generation
 
$
526

 
$
570

 
$
580

 
$
629

 
$
2,305

Industrial
 
275

 
353

 
385

 
386

 
1,399

Generator technologies
 
81

 
94

 
91

 
88

 
354

Total sales
 
$
882

 
$
1,017

 
$
1,056

 
$
1,103

 
$
4,058

High-horsepower unit shipments by engine classification were as follows: 
2018
 
 
 
 
 
 
 
 
 
 
Units
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Power generation
 
2,100

 

 

 

 
2,100

Industrial
 
1,700

 

 

 

 
1,700

Total units
 
3,800

 

 

 

 
3,800

 
 
 
 
 
 
 
 
 
 
 
2017
 
 
 
 
 
 
 
 
 
 
Units
 
Q1
 
Q2
 
Q3
 
Q4
 
YTD
Power generation
 
1,900

 
2,100

 
2,200

 
2,000

 
8,200

Industrial
 
1,300

 
1,700

 
1,600

 
1,800

 
6,400

Total units
 
3,200

 
3,800

 
3,800

 
3,800

 
14,600

 

14