By Angela Chen
Manufacturing company Cummins Inc. said its first-quarter
revenue grew 7% largely because of demand in North America.
Results were in line with expectations.
Cummins had benefited from steady, if lukewarm, economic growth,
as it has gained share in key markets such as buses and medium-duty
trucks. Still, it has remained cautious about its margin outlook,
particularly as international sales have been dragging on
results.
Cummins's power-generation equipment business has continued to
face weak demand. It had earlier prompted the company to consider a
cost-cutting plan for the current quarter, with potential
reductions pegged to a range of $15 million to $40 million. In the
recently ended quarter, power-generation sales rose 6% to %680
million as higher revenue in Asia, Africa and the Middle East
offset weaker demand in Eastern Europe.
Overall, for the period ended March 29, the company posted
earnings of $387 million, or $2.14 a share, up from $338 million,
or $1.83 a share, during last year's period.
Revenue improved 7% to $4.7 billion, even though currency
headwinds hurt sales by 3%.
Analysts surveyed by Thomson Reuters projected per-share
earnings of $2.14 and revenue of $4.55 billion.
Cummins said international sales fell 6% despite growth in
China. The North American market posted a 17% sales gain.
Engine sales rose 1% to $2.6 billion.
Shares of Cummins, inactive premarket, have been down about 3.4%
this year through Monday's close.
Write to Angela Chen at angela.chen@wsj.com
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