Cummins reported first quarter revenues of $6.4 billion increased 5% from the same quarter in 2021. Sales in North America increased 12% while international revenues decreased 3% driven primarily by a slowdown in China.
“Demand for our products remains strong across many of our key markets and regions, resulting in record revenues in the first quarter of 2022,” said Chairman and CEO Tom Linebarger. “We have implemented pricing actions to counter rising input costs, which contributed to solid profitability in the first quarter. Supply chain constraints continue to be a challenge and are limiting growth in our industry.”
Earnings before interest, taxes, depreciation and amortization (EBITDA) in the first quarter were $755 million (11.8% of sales), compared to $980 million (16.1% of sales) a year ago.
Based on the current forecast, Cummins is raising its full year 2022 revenue guidance to up 8%, an increase from up 6% due to stronger demand in North America and other markets. Full-year 2022 EBITDA is expected to be approximately 15.5%, in line with our previous guidance. The company plans to return approximately 50% of Operating Cash Flow to shareholders in the form of dividends and share repurchases.
First Quarter 2022 Detail
The Engine, Distribution, Components and Power Systems results were all impacted by costs associated with the indefinite suspension of our operations in Russia.
- Sales: $2.8 billion, up 12%
- Segment EBITDA - $392 million, or 14.2% of sales, compared to $354 million or 14.4% of sales. EBITDA includes $32 million of costs related to the indefinite suspension of our operations in Russia
- On-highway revenues increased 14% driven by pricing actions and strong demand in the North American truck markets, and recovery in the bus market which was severely impacted by Covid-19. Off-highway revenues increased 5%
- Sales increased 15% in North America and 4% in international markets
- Sales: $2.1 billion, up 15%
- Segment EBITDA - $110 million, or 5.2% of sales, compared to $160 million or 8.7% of sales. EBITDA includes $100 million of costs related to the indefinite suspension of our operations in Russia
- Revenues in North America increased 17% and international sales increased by 13%
- Higher revenues were primarily driven by increased demand for parts and whole goods
- Sales: $2 billion, down 8%
- Segment EBITDA - $320 million, or 16.1% of sales, compared to $421 million or 19.6% of sales. EBITDA includes $6 million of costs related to the indefinite suspension of our operations in Russia
- Revenues in North America increased by 8% and international sales decreased by 21% due to lower demand in India and China from record demand in the first quarter of 2021
Power Systems Segment
- Sales: $1.2 billion, up 14%
- Segment EBITDA - $90 million, or 7.8% of sales, compared to $126 million, or 12.3% of sales. EBITDA includes $20 million of costs related to the indefinite suspension of our operations in Russia
- Power generation revenues increased by 9% driven by strong demand in China. Industrial revenues increased 21% due to stronger demand in mining and oil and gas markets
New Power Segment
- Sales: $31 million, down 11%
- Segment EBITDA loss - $67 million
- Revenues decreased due to timing of commissioning electrolyzer projects and shipments of fuel cell systems to the rail market in 2021
- Costs associated with the development of fuel cells and electrolyzers as well as products to support battery electric vehicles are contributing to EBITDA losses