Sales of power generation units in the Middle East helped US plant giant Cummins increase its quarterly sales by 45% in the second quarter, the company’s executive director has revealed.Â
Speaking at Cummins’ quarterly earnings meeting, Mark Smith said that the company’s results were well ahead of analyst estimates and that it earned $4.6 billion in sales. Its shareholders will also benefit from a record EBIT of $707 million. Â
Cummins impressive performance in the quarter included an increase of 26% in its distribution business which Smith said had gained from increased power generation sales in the Middle East.Â
Cummins’ CEO Tom Linebarger said that the commercial vehicles sector  had made the biggest impact in the surge in sales but the company had performed well over almost all its sectors.
“Our engine, components and distribution segments each reported record sales and record EBIT, and our power generation business also delivered strong growth and profitability,” said Linebarger. “Our engine business experienced strong growth in heavy- and medium-duty truck, bus, mining, oil and gas and construction markets. The components business increased revenues by 44%, and the power generation distribution businesses also enjoyed strong growth.”Â
Cummins’ partnerships with several machinery manufacturers in China has made the country an important focus for its revenue and Linebarger said that power shortages in the booming market had increased the demand for its power generation products, which saw a 56% increase year on year. However he said there was less good news for its excavator tie-ins.
“There are several reasons why our revenues in China continue to grow: increased demand for power generation; shared gains for our OEM customers in truck and construction; our JV with Foton; continued strength in the mining and marine markets,” he commented. “The decline in excavator equipment sales in the second quarter did not immediately impact our engine sales but will start to have an effect in third quarter.”
Â
Â
Â
