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Cummins plans job cuts as earnings dive

Cummins, a key Caterpillar competitor in diesel engines and power systems, reported today that its fourth quarter profit fell 55 percent and it plans to cut its workforce by 6 percent this quarter.

“We are in an extraordinarily challenging period,” Tim
Solso, chairman and chief executive, said in a statement.

Cummins reported a fourth-quarter profit of $89 million, or
45 cents a share, down from $198 million, or $1 a share, a year

Sales fell 6 percent to $3.29 billion.

Analysts on average expected a profit of 41 cents a share,
according to Reuters Estimates.

Layoffs should total about 800, the company said.

Cummins Engine earnings release here. From the release:

Cummins expects sales in 2009 to be approximately 20 percent lower than 2008, and to earn an EBIT margin of 6.5 percent of sales, excluding restructuring costs associated with the actions announced in the first quarter of 2009.

Sales are forecast to drop across all business segments, with the largest decline expected to come from the Components and Engine segments. All business segments, however, are expected to be profitable in 2009 and the Company will continue to aggressively reduce costs while investing in key growth opportunities.

Well, they’re keeping their chins up. Noteworthy tidbits from the release: sales to Chrysler for its pickup trucks are down 34 percent and sales to RV manufacturers are off 72 percent.

More on Cummins at Finviz.

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Tom Mangan posted at 7:03 am February 3rd, 2009 |

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