Action Reflects Confidence in Future Operating Results
COLUMBUS, IND., March 8 /CNW/ - The Cummins Board of Directors today
declared a two-for-one split of Cummins Inc. (NYSE: CMI) stock, payable April 9
to shareholders of record as of March 26, 2007.
As a result of the stock split, each Cummins' shareholder will receive
one additional share of stock for each share owned on the record date. Since
there will be twice as many shares after the split, each share will be worth
half of what it was worth immediately prior to the split, while the overall
value of a stockholder's investment remains the same.
The total amount of cash dividend payments with respect to the shares
will remain unchanged as a result of the split, but the dividend will be
proportionately adjusted to half the pre-split amount on a per-share basis.
"Cummins is a stronger, more diversified and more global company than at
any time in our history, and we have set the stage for a period of sustained
growth," said Tim Solso, Cummins Chairman and CEO. "This action today reflects
our confidence in the future operating results of the company, as well as our
continued commitment to creating value for our shareholders. We are also
reaffirming our annual EPS guidance of $11 - $11.50 a share announced on
"The Board of Directors also decided to split the common stock to bring
the Company's share price back into a trading range comparable with its peers
and to make Cummins stock more accessible to a broader range of investors,"
Cummins' average total return to shareholders for the last four years was
approximately 46 percent a year - well above the performance of the S&P 500
and the Company's peer group average.
In 2006, the Company increased its quarterly dividend by 20 percent, and
continued to repurchase its stock, with more than one million shares being
Cummins had approximately 52 million shares of common stock outstanding
as of Feb. 4, 2007. Upon completion of the split, the Company will have
approximately 104 million shares of common stock outstanding.
The Company also reiterated its positive outlook for 2007 - despite an
expected drop in the North American Heavy-duty truck engine market of nearly
50 percent related to the 2007 EPA emissions changes.
"Cummins is well-positioned to grow profitably in other parts of the
business, such as medium-duty truck and bus; high horsepower engine markets;
its Distribution and Power Generation segments and emission critical
subsystems in the Components segment. As a result, 2007 still should be among
the strongest years in our history," Solso said.
Cummins Inc., a global power leader, is a corporation of complementary
business units that design, manufacture, distribute and service engines and
related technologies, including fuel systems, controls, air handling,
filtration, emission solutions and electrical power generation systems.
Headquartered in Columbus, Indiana, (USA) Cummins serves customers in more
than 160 countries through its network of 550 Company-owned and independent
distributor facilities and more than 5,000 dealer locations. Cummins reported
net income of $715 million on sales of $11.4 billion in 2006. Press releases
can be found on the Web at www.cummins.com.
Information provided in this release that is not purely historical are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, including statements regarding the company's
expectations, hopes, beliefs and intentions on strategies regarding the
future. It is important to note that the company's actual future results could
differ materially from those projected in such forward-looking statements
because of a number of factors, including, but not limited to, general
economic, business and financing conditions, labor relations, governmental
action, competitor pricing activity, expense volatility and other risks
detailed from time to time in Cummins Securities and Exchange Commission
For further information:
For further information: Cummins Inc. Mark Land, 317-610-2456 Director
of Public Relations firstname.lastname@example.org