SEC Filings


8-K
CUMMINS INC filed this Form 8-K on 02/06/2018
Entire Document
 
CUMMINS INC. AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
In millions
 
Engine
 
Distribution
 
Components (1)
 
Power Systems
 
Total Segment
 
Intersegment Eliminations (2)
 
Total
 
Year ended December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
External sales
 
$
6,661

 
$
7,029

 
$
4,363

 
$
2,375

 
$
20,428

 
$

 
$
20,428

 
Intersegment sales
 
2,292

 
29

 
1,526

 
1,683

 
5,530

 
(5,530
)
 

 
Total sales
 
8,953

 
7,058

 
5,889

 
4,058

 
25,958

 
(5,530
)
 
20,428

 
Depreciation and amortization (3)
 
184

 
116

 
163

 
117

 
580

 

 
580

 
Research, development and engineering expenses
 
279

 
19

 
240

 
214

 
752

 

 
752

 
Equity, royalty and interest income from investees (4)
 
219

 
44

 
40

 
54

 
357

 

 
357

 
Interest income
 
6

 
6

 
3

 
3

 
18

 

 
18

 
EBIT
 
959

 
384

 
754

 
294

 
2,391

 
55

 
2,446

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EBIT as a percentage of total sales
 
10.7
%
 
5.4
%
 
12.8
%
 
7.2
%
 
9.2
%
 
 
 
12.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year ended December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
External sales
 
$
5,774

 
$
6,157

 
$
3,514

 
$
2,064

 
$
17,509

 
$

 
$
17,509

 
Intersegment sales
 
2,030

 
24

 
1,322

 
1,453

 
4,829

 
(4,829
)
 

 
Total sales
 
7,804

 
6,181

 
4,836

 
3,517

 
22,338

 
(4,829
)
 
17,509

 
Depreciation and amortization (3)
 
163

 
116

 
133

 
115

 
527

 

 
527

 
Research, development and engineering expenses
 
226

 
13

 
208

 
189

 
636

 

 
636

 
Equity, royalty and interest income from investees
 
148

 
70

 
41

 
42

 
301

 

 
301

 
Loss contingency
 
138

 

 

 

 
138

 

 
138

 
Interest income
 
10

 
4

  
4

 
5

 
23

 

 
23

 
EBIT
 
686

 
392

(5) 
641

 
263

(6) 
1,982

 
17

 
1,999

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EBIT as a percentage of total sales
 
8.8
%
 
6.3
%
 
13.3
%
 
7.5
%
 
8.9
%
 
 
 
11.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1
)
The 2017 disclosures include Eaton Cummins Automated Transmission Technologies joint venture results consolidated during the third quarter of 2017.
(2
)
Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the years ended December 31, 2017 and 2016.
(3
)
Depreciation and amortization as shown on a segment basis excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Income as "Interest expense." The amortization of debt discount and deferred costs was $3 million for both years ended December 31, 2017 and December 31, 2016.
(4
)
U.S. tax legislation passed in December 2017 decreased our equity earnings at certain equity investees, negatively impacting our equity, royalty and interest income from investees by $23 million, $4 million and $12 million for the Engine, Distribution and Component segments, respectively.
(5
)
Distribution segment EBIT included a gain of $15 million on the fair value adjustment resulting from the acquisition of the controlling interests in a North American distributor in the fourth quarter of 2016.
(6
)
In the fourth quarter of 2016, we sold our remaining 49 percent interest in Cummins Olayan Energy for $61 million and recognized a gain of $17 million.


A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidated Statements of Income is shown in the table below:
 
 
 
Three months ended
 
Years ended
In millions
 
December 31,
2017
 
December 31,
2016
 
December 31,
2017
 
December 31,
2016
Total EBIT
 
$
620

 
$
526

 
$
2,446

 
$
1,999

Less: Interest expense
 
24

 
18

 
81

 
69

Income before income taxes
 
$
596

 
$
508

 
$
2,365

 
$
1,930



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