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Press release from Business Wire

Cummins Reports Strong Second Quarter Profits

<ul> <li class='bwlistitemmargb'> <b>Continues to deliver strong margins despite challenging economic environment</b> </li> <li class='bwlistitemmargb'> <b>Expects full-year revenues of $18 billion, EBIT of 14.25 to 14.75 percent</b> </li> </ul>

Tuesday, July 31, 2012

Cummins Reports Strong Second Quarter Profits07:30 EDT Tuesday, July 31, 2012 COLUMBUS, Ind. (Business Wire) -- Cummins Inc. (NYSE: CMI) today reported strong profits for the second quarter of 2012. Second quarter revenue of $4.45 billion decreased 4 percent from the same quarter in 2011. Excluding the impact of divestitures and currency movements, revenues were flat year over year. Growth in North America offset weakness in international markets, particularly China and Brazil. Earnings before interest and taxes (EBIT) was $669 million or 15.0 percent of sales. Excluding gains from divestitures, EBIT was $663 million or 14.9 percent of sales compared to $707 million or 15.2 percent of sales in the second quarter of 2011. Net income attributable to Cummins in the second quarter of 2012 was $469 million ($2.47 per diluted share) compared to $505 million in the same period a year ago ($2.60 per diluted share). Excluding gains from divestitures, the Company reported earnings of $2.45 per share compared to $2.41 in the second quarter of 2011. “The Company continued to deliver strong profits despite the weakening global economic conditions,” said Tom Linebarger, Chairman and Chief Executive Officer. “Second quarter gross margins were at record levels as we continue to drive improvements in productivity and quality. Looking forward, as the global economy improves, our growth opportunities remain strong.” Based on the current forecast, Cummins expects full year revenues to be $18 billion, with EBIT in the range of 14.25 to 14.75 percent of sales. Other recent highlights: Cummins increased its dividend by 25 percent. The Company repurchased 1.8 million shares of common stock. Cummins Emission Solutions and Cummins Parts business each recently received supplier Quality Achievement awards from PACCAR for 2011 performance. The Company was recognized by Chrysler Group LLC as the 2012 Sustainability Supplier of the Year. The Company completed the acquisition of the emission control assets of Hilite International. Second quarter 2012 detail (all comparisons to same period in 2011)Engine Segment Sales – $2.8 billion, down 2 percent Segment EBIT – $376 million, or 13.2 percent of sales, compared to $377 million or 13.0 percent of sales Improved demand in North American heavy duty truck, medium duty truck and light duty truck and construction markets offset by lower sales to China construction, Brazilian truck and North American oil and gas markets Components Sales - $1.0 billion, flat Segment EBIT - $116 million, or 11.2 percent of sales, compared to $120 million or 11.6 percent of sales Increased demand in North American on-highway markets and higher product content in Brazil offset by lower demand in Europe and China and the impact of divestitures completed in 2011 Power Generation Sales – $909 million, flat Segment EBIT – $94 million, or 10.3 percent of sales, compared to $105 million or 11.6 percent of sales Higher revenues in North America offsetting lower demand in Europe, China and Latin America Distribution Sales – $794 million, up 1 percent Segment EBIT – $92 million, or 11.6 percent of sales, compared to $106 million or 13.5 percent of sales Revenue increase driven by strong parts and service growth in several regions offsetting weaker demand in North American oil and gas market and power generation in the Middle East About Cummins Cummins Inc., a global power leader, is a corporation of complementary business units that design, manufacture, distribute and service diesel and natural gas engines and related technologies, including fuel systems, controls, air handling, filtration, emission solutions and electrical power generation systems. Headquartered in Columbus, Indiana, (USA) Cummins employs approximately 44,000 people worldwide and serves customers in approximately 190 countries and territories through a network of more than 600 company-owned and independent distributor locations and approximately 6,500 dealer locations. Cummins earned $1.85 billion on sales of $18.0 billion in 2011. Press releases can be found on the Web at www.cummins.com. Forward-looking disclosure statement 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 our forecasts, guidance, preliminary results, expectations, hopes, beliefs and intentions on strategies regarding the future. These forward looking statements include, without limitation, statements relating to our plans and expectations for our revenues for the second quarter of 2012, as well as the full year. Our 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: the adoption and implementation of global emission standards; the price and availability of energy; the pace of infrastructure development; increasing global competition among our customers; general economic, business and financing conditions; governmental action; changes in our customers' business strategies; competitor pricing activity; expense volatility; labor relations; and other risks detailed from time to time in our Securities and Exchange Commission filings, including particularly in the Risk Factors section of our 2011 Annual Report on Form 10-K. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this press release and we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. More detailed information about factors that may affect our performance may be found in our filings with the Securities and Exchange Commission, which are available at http://www.sec.gov or at http://www.cummins.com in the Investor Relations section of our website. Presentation of Non-GAAP Financial InformationNet income attributable to Cummins excluding gain on divestitures and EBIT arenon-GAAP measures used in this release, and are defined and reconciled to what management believes to be the most comparable GAAP measure in a schedule attached to this release. Cummins presents this information as it believes it is useful to understanding the Company's operating performance, and because EBIT is a measure used internally to assess the performance of the operating units.Webcast informationCummins management will host a teleconference to discuss these results today at 10 a.m. EDT. This teleconference will be webcast and available on the Investor Relations section of the Cummins website at www.cummins.com . Participants wishing to view the visuals available with the audio are encouraged to sign-in a few minutes prior to the start of the teleconference.CUMMINS INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF INCOME(Unaudited) (a)             Three months endedJuly 1,April 1,June 26,In millions, except per share amounts201220122011NET SALES$4,452 $ 4,472 $ 4,641 Cost of sales   3,242   3,274   3,438   GROSS MARGIN1,210 1,198 1,203   OPERATING EXPENSES AND INCOME Selling, general and administrative expenses 487 475 463 Research, development and engineering expenses 187 181 157 Equity, royalty and interest income from investees (Note 1) 104 104 117 Gain on sale of businesses 6 - 68 Other operating income (expense), net   2   2   -   OPERATING INCOME648 648 768   Interest income 7 8 10 Interest expense 8 8 13 Other income (expense), net   14   2   (3 ) INCOME BEFORE INCOME TAXES661 650 762   Income tax expense (Note 2)   166   175   225   CONSOLIDATED NET INCOME495 475 537   Less: Net income attributable to noncontrolling interests   26   20   32   NET INCOME ATTRIBUTABLE TO CUMMINS INC.$469 $ 455 $ 505     EARNINGS PER COMMON SHARE ATTRIBUTABLETO CUMMINS INC. Basic $2.47 $ 2.39 $ 2.61 Diluted $2.47 $ 2.38 $ 2.60   WEIGHTED AVERAGE SHARES OUTSTANDING Basic 189.8 190.4 193.8 Diluted 190.1 190.8 194.4   CASH DIVIDENDS DECLARED PER COMMON SHARE$0.40 $ 0.40 $ 0.2625 (a) Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.   CUMMINS INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF INCOME(Unaudited) (a)         Six months endedIn millions, except per share amountsJuly 1, 2012June 26, 2011NET SALES$8,924 $ 8,501 Cost of sales   6,516   6,341   GROSS MARGIN2,408 2,160   OPERATING EXPENSES AND INCOME Selling, general and administrative expenses 962 852 Research, development and engineering expenses 368 286 Equity, royalty and interest income from investees (Note 1) 208 213 Gain on sale of businesses 6 68 Other operating income (expense), net   4   (6 ) OPERATING INCOME1,296 1,297   Interest income 15 16 Interest expense 16 23 Other income (expense), net   16   (6 ) INCOME BEFORE INCOME TAXES1,311 1,284   Income tax expense (Note 2)   341   382   CONSOLIDATED NET INCOME970 902   Less: Net income attributable to noncontrolling interests   46   54   NET INCOME ATTRIBUTABLE TO CUMMINS INC.$924 $ 848     EARNINGS PER COMMON SHARE ATTRIBUTABLETO CUMMINS INC. Basic $4.86 $ 4.36 Diluted $4.85 $ 4.34   WEIGHTED AVERAGE SHARES OUTSTANDING Basic 190.1 194.6 Diluted 190.5 195.2   CASH DIVIDENDS DECLARED PER COMMON SHARE$0.80 $ 0.525 (a) Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.   CUMMINS INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited) (a)In millions, except par value   July 1, 2012     December 31, 2011ASSETS Current assets   Cash and cash equivalents $1,145 $ 1,484 Marketable securities   261     277     Total cash, cash equivalents and marketable securities 1,406 1,761 Accounts and notes receivable, net 2,620 2,526 Inventories 2,581 2,141 Prepaid expenses and other current assets   639     663     Total current assets   7,246     7,091   Long-term assets Property, plant and equipment 5,475 5,245 Accumulated depreciation   (3,051)   (2,957 ) Property, plant and equipment, net   2,424     2,288   Investments and advances related to equity method investees 890 838 Goodwill 345 339 Other intangible assets, net 268 227 Other assets   996     885     Total assets $12,169   $ 11,668     LIABILITIES Current liabilities Loans payable $58 $ 28 Accounts payable (principally trade) 1,634 1,546 Current portion of accrued product warranty 407 422 Accrued compensation, benefits and retirement costs 340 511 Deferred revenue 208 208 Taxes payable (including taxes on income) 258 282 Other accrued expenses   665     660   Total current liabilities   3,570     3,657   Long-term liabilities Long-term debt 653 658 Pensions 118 205 Postretirement benefits other than pensions 425 432 Other liabilities and deferred revenue   966     885   Total liabilities   5,732     5,837     EQUITY Cummins Inc. shareholders' equity Common stock, $2.50 par value, 500 shares authorized, 222.4 and 222.2 shares issued 2,036 2,001 Retained earnings 6,810 6,038 Treasury stock, at cost, 32.0 and 30.2 shares (1,777) (1,587 ) Common stock held by employee benefits trust, at cost, 1.6 and 1.8 shares (20) (22 ) Accumulated other comprehensive loss Defined benefit postretirement plans (703) (724 ) Other   (243)   (214 ) Total accumulated other comprehensive loss   (946)   (938 ) Total Cummins Inc. shareholders' equity 6,103 5,492 Noncontrolling interests   334     339   Total equity   6,437     5,831   Total liabilities and equity $12,169   $ 11,668   (a) Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.   CUMMINS INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited) (a)       Six months endedIn millionsJuly 1, 2012     June 26, 2011CASH FLOWS FROM OPERATING ACTIVITIES Consolidated net income $970 $ 902 Adjustments to reconcile consolidated net income to net cash provided by operating activities Depreciation and amortization 171 159 Gain on sale of businesses (6) (68 ) Deferred income taxes (39) 87 Equity in income of investees, net of dividends (25) 2 Pension contributions in excess of expense (52) (47 ) Other post-retirement benefits payments in excess of expense (7) (10 ) Stock-based compensation expense 21 18 Excess tax benefits on stock-based awards (11) (4 ) Translation and hedging activities 7 (6 ) Changes in current assets and liabilities, net of acquisitions and divestitures: Accounts and notes receivable (116) (513 ) Inventories (439) (290 ) Other current assets (47) 11 Accounts payable 61 307 Accrued expenses (173) 169 Changes in other liabilities and deferred revenue 103 58 Other, net   (21)   (31 ) Net cash provided by operating activities   397     744     CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (266) (215 ) Investments in internal use software (40) (22 ) Investments in and advances to equity investees (40) (20 ) Proceeds from sale of business, net of cash sold - 111 Acquisition of businesses, net of cash acquired (12) - Investments in marketable securities—acquisitions (276) (361 ) Investments in marketable securities—liquidations 280 343 Cash flows from derivatives not designated as hedges 1 6 Other, net   3     7   Net cash used in investing activities   (350)   (151 )   CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from borrowings 46 60 Payments on borrowings and capital lease obligations (75) (94 ) Net borrowings under short-term credit agreements 3 11 Distributions to noncontrolling interests (32) (26 ) Dividend payments on common stock (152) (102 ) Repurchases of common stock (196) (373 ) Excess tax benefits on stock-based awards 11 4 Other, net   9     7   Net cash used in financing activities   (386)   (513 ) EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS   -     8   Net increase (decrease) in cash and cash equivalents (339) 88 Cash and cash equivalents at beginning of year   1,484     1,023   CASH AND CASH EQUIVALENTS AT END OF PERIOD$1,145   $ 1,111   (a) Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.   CUMMINS INC. AND SUBSIDIARIESSEGMENT INFORMATION(Unaudited)   Engine   Components   PowerGeneration   Distribution   Non-segmentItems(1)   TotalIn millionsThree months ended July 1, 2012 External sales $2,381$710$572$789$-$4,452 Intersegment sales 4603263375(1,128)   -   Total sales 2,8411,036909794(1,128)4,452 Depreciation and amortization(2)4719118-85 Research, development and engineering expenses 11551192-187 Equity, royalty and interest income from investees 3781049-104 Interest income 313--7 Segment EBIT 3761169492(9)669   Three months ended April 1, 2012 External sales $ 2,412 $ 774 $ 516 $ 770 $ - $ 4,472 Intersegment sales 447   325   264   5   (1,041 )   - Total sales 2,859 1,099 780 775 (1,041 ) 4,472 Depreciation and amortization(2) 47 19 11 7 - 84 Research, development and engineering expenses 111 51 18 1 - 181 Equity, royalty and interest income from investees 38 8 10 48 - 104 Interest income 4 1 2 1 - 8 Segment EBIT 381 143 76 94 (36 ) 658   Three months ended June 26, 2011 External sales $ 2,476 $ 741 $ 649 $ 775 $ - $ 4,641 Intersegment sales 424 291 260 10 (985 )   - Total sales 2,900 1,032 909 785 (985 ) 4,641 Depreciation and amortization(2) 44 18 11 5 - 78 Research, development and engineering expenses 102 43 12 - - 157 Equity, royalty and interest income from investees 49 9 13 46 - 117 Interest income 6 1 3 - - 10 Segment EBIT 377 120 105 106 67 775   Six months ended July 1, 2012 External sales $4,793$1,484$1,088$1,559$-$8,924 Intersegment sales 90765160110(2,169)   - Total sales 5,7002,1351,6891,569(2,169)8,924 Depreciation and amortization(2)94382215-169 Research, development and engineering expenses 226102373-368 Equity, royalty and interest income from investees 75162097-208 Interest income 7251-15 Segment EBIT 757259170186(45)1,327   Six months ended June 26, 2011 External sales $ 4,482 $ 1,401 $ 1,206 $ 1,412 $ - $ 8,501 Intersegment sales 809 555 498 15 (1,877 )   - Total sales 5,291 1,956 1,704 1,427 (1,877 ) 8,501 Depreciation and amortization(2) 89 36 21 11 - 157 Research, development and engineering expenses 182 80 23 1 - 286 Equity, royalty and interest income from investees 91 17 21 84 - 213 Interest income 9 2 4 1 - 16 Segment EBIT 667 225 194 195 26 1,307 (1)   Includes intersegment sales and profit in inventory eliminations and unallocated corporate expenses. The three and six months ended July 1, 2012, include a $6 million gain ($4 million after-tax) related to adjustments from our 2011 divestitures. There were no significant unallocated corporate expenses for the three months ended April 1, 2012. The three and six months ended June 26, 2011, include a $68 million gain ($37 million after-tax) related to the sale of certain assets and liabilities of our exhaust business from the Components segment. The gains have been excluded from segment results as they were not considered in our evaluation of operating results for the three and six months ended July 1, 2012 and June 26, 2011. There were no other significant unallocated corporate expenses for the three and six months ended July 1, 2012 and June 26, 2011. (2) Depreciation and amortization as shown on a segment basis excludes the amortization of debt discount that is included in the Condensed Consolidated Statements of Income as “Interest expense.”           CUMMINS INC. AND SUBSIDIARIESRECONCILIATION OF SEGMENT INFORMATION(Unaudited)   A reconciliation of our segment information to the corresponding amounts in theCondensed Consolidated Statements of Income is shown in the table below:   Three months endedSix months endedJuly 1,   April 1,   June 26,July 1,   June 26,In millions20122012201120122011 Segment EBIT $669 $ 658 $ 775 $1,327 $ 1,307 Less Interest expense   8   8   13   16   23 Income before income taxes $661 $ 650 $ 762 $1,311 $ 1,284             CUMMINS INC. AND SUBSIDIARIESSELECTED FOOTNOTE DATA(Unaudited)   NOTE 1. EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES   Equity, royalty and interest income from investees included in our Condensed Consolidated Statementsof Income for the interim reporting periods was as follows:   Three months endedSix months endedJuly 1,   April 1,   June 26,July 1,   June 26,In millions20122012201120122011Distribution Entities North American distributors $38 $ 40 $ 35 $78 $ 65 Komatsu Cummins Chile, Ltda. 6 5 6 11 10 All other distributors 2 1 1 3 2 Manufacturing Entities Chongqing Cummins Engine Company, Ltd. 17 18 19 35 31 Dongfeng Cummins Engine Company, Ltd. 17 16 26 33 49 Cummins Westport, Inc. 4 5 3 9 4 Shanghai Fleetguard Filter Co., Ltd. 4 3 4 7 8 Tata Cummins, Ltd. 3 4 3 7 7 Beijing Foton Cummins Engine Co., Ltd. 2 (2 ) (1 ) - (3 ) Valvoline Cummins, Ltd. 2 2 2 4 4 Komatsu manufacturing alliances 1 (1 ) (1 ) - 1 All other manufacturers   (1)   1     6     -   12   Cummins share of net income $95 $ 92 $ 103 $187 $ 190 Royalty and interest income   9     12     14     21   23   Equity, royalty and interest income from investees $104   $ 104   $ 117   $208 $ 213     NOTE 2.INCOME TAXES Our effective tax rate for the year is expected to approximate 26 percent, absent any discrete period activity. Our tax rate is generally less than the 35 percent U.S. income tax rate primarily due to lower tax rates on foreign income. The tax rates for the three and six month periods ended July 1, 2012, were 25.1 percent and 26.0 percent, respectively. The tax rates for the three and six month periods ended June 26, 2011, were 29.5 percent and 29.8 percent, respectively, and included a discrete tax charge of $4 million related to the enactment of state law changes in Indiana. The decrease in the 2012 effective tax rates versus the comparable periods in 2011 is due primarily to our assertion that income earned after 2011 by our China operations is permanently reinvested, as well as certain tax planning strategies implemented in our U.K. subsidiaries.   CUMMINS INC. AND SUBSIDIARIESFINANCIAL MEASURES THAT SUPPLEMENT GAAP(Unaudited)   Net income and diluted earnings per share (EPS) attributable to Cummins Inc. excluding special items   We believe this is a useful measure of our operating performance for the periods presented as it illustrates our operating performance without regard to special items including the gains related to the sale of certain assets and liabilities. This measure is not in accordance with, or an alternative for, accounting principles generally accepted in the United States of America (GAAP) and may not be consistent with measures used by other companies. It should be considered supplemental data. The following table reconciles net income attributable to Cummins Inc. to net income attributable to Cummins Inc. excluding special items for the three and six month periods ended July 1, 2012 and June 26, 2011.         Three months endedSix months endedJuly 1, 2012   June 26, 2011July 1, 2012   June 26, 2011In millionsNet Income   Diluted EPSNet Income   Diluted EPSNet Income   Diluted EPSNet Income   Diluted EPS Net income attributable to Cummins Inc. $469$2.47 $ 505 $ 2.60 $924$4.85 $ 848 $ 4.34 Subtract Gain on sale of businesses(1)   4   0.02   37   0.19   4   0.02   37   0.19 Net income attributable to Cummins Inc. excluding special items $465$2.45 $ 468 $ 2.41 $920$4.83 $ 811 $ 4.15   (1) The gains have been excluded from operating results as they were not considered in our evaluation of performance for the three and six months ended July 1, 2012 and June 26, 2011.             CUMMINS INC. AND SUBSIDIARIESFINANCIAL MEASURES THAT SUPPLEMENT GAAP(Unaudited)   Earnings before interest, taxes and noncontrolling interests   We define EBIT as earnings before interest expense, income tax expense and noncontrolling interests in income of consolidated subsidiaries (EBIT). We use EBIT to assess and measure the performance of our operating segments and also as a component in measuring our variable compensation programs. Below is a reconciliation of EBIT, a non-GAAP financial measure, to “Net income attributable to Cummins Inc.,” for each of the applicable periods:   Three months endedSix months endedJuly 1,   April 1,   June 26,July 1,   June 26,In millions20122012201120122011 Earnings before interest expense, income taxes and special items $663 $ 658 $ 707 $1,321 $ 1,239   Earnings before interest expense, income taxes and special items as a percentage of net sales14.9%14.7%15.2%14.8%14.6%   Add Gain on sale of businesses 6 - 68 6 68                     Earnings before interest expense and income taxes $669 $ 658 $ 775 $1,327 $ 1,307   EBIT as a percentage of net sales15.0%14.7%16.7%14.9%15.4%   Less Interest expense 8 8 13 16 23 Income tax expense   166   175   225   341   382 Consolidated net income   495   475   537   970   902   Less Net income attributable to noncontrolling interests   26   20   32   46   54 Net income attributable to Cummins Inc. $469 $ 455 $ 505 $924 $ 848   Net income attributable to Cummins Inc. as a percentage of net sales10.5%10.2%10.9%10.4%10.0%       CUMMINS INC. AND SUBSIDIARIESBUSINESS UNIT SALES DATA(Unaudited)   Engine segment net sales by market   2012           In millionsQ1Q2Q3Q4YTD Heavy-duty truck $ 892 $807 $ - $ - $ 1,699 Medium-duty bus and truck 526 512 - - 1,038 Light-duty automotive and RV 286 297 - - 583 Industrial 861 859 - - 1,720 Stationary power   294   366   -   -   660   Total sales $ 2,859 $2,841 $ - $ - $ 5,700   2011In millionsQ1Q2Q3Q4YTD Heavy-duty truck $ 485 $ 693 $ 748 $ 865 $ 2,791 Medium-duty bus and truck 474 608 640 598 2,320 Light-duty automotive and RV 296 310 271 299 1,176 Industrial 855 988 977 1,030 3,850 Stationary power   281   301   319   269   1,170 Total sales $ 2,391 $ 2,900 $ 2,955 $ 3,061 $ 11,307   Unit shipments by engine classification (including unit shipments to Power Generation)   2012UnitsQ1Q2Q3Q4YTD Midrange 109,000 110,000 - - 219,000 Heavy-duty 36,000 33,000 - - 69,000 High horsepower   5,500   5,800   -   -   11,300 Total units   150,500   148,800   -   -   299,300   2011UnitsQ1Q2Q3Q4YTD Midrange 109,400 131,300 130,600 138,100 509,400 Heavy-duty 20,000 29,900 31,100 35,300 116,300 High horsepower   4,900   5,700   5,600   5,400   21,600 Total units   134,300   166,900   167,300   178,800   647,300       CUMMINS INC. AND SUBSIDIARIESBUSINESS UNIT SALES DATA(Unaudited)   Component segment sales by business   2012           In millionsQ1Q2Q3Q4YTD Emission solutions $ 404 $349 $ - $ - $ 753 Turbo technologies 298 297 - - 595 Filtration 270 266 - - 536 Fuel systems   127   124   -   -   251   Total sales $ 1,099 $1,036 $ - $ - $ 2,135   2011In millionsQ1Q2Q3Q4YTD Emission solutions $ 273 $ 311 $ 306 $ 372 $ 1,262 Turbo technologies 297 314 298 314 1,223 Filtration 255 287 288 283 1,113 Fuel systems   99   120   123   123   465 Total sales $ 924 $ 1,032 $ 1,015 $ 1,092 $ 4,063   In the first quarter of 2012, our Power Generation segment reorganized its reporting structure to include the following businesses: power products, power systems, generator technologies and power solutions. Sales for our Power Generation segment by business (including 2011 and 2010 reorganized balances) were as follows:   2012In millionsQ1Q2Q3Q4YTD Power products $ 375 $459 $ - $ - $ 834 Power systems 188 217 - - 405 Generator technologies 141 160 - - 301 Power solutions   76   73   -   -   149 Total sales $ 780 $909 $ - $ - $ 1,689   2011In millionsQ1Q2Q3Q4YTD Power products $ 377 $ 415 $ 433 $ 411 $ 1,636 Power systems 189 210 188 228 815 Generator technologies 154 189 166 164 673 Power solutions   75   95   87   117   374 Total sales $ 795 $ 909 $ 874 $ 920 $ 3,498   2010In millionsYTD Power products $ 1,465 Power systems 616 Generator technologies 550 Power solutions   288 Total sales $ 2,919       CUMMINS INC. AND SUBSIDIARIESBUSINESS UNIT SALES DATA(Unaudited)   Distribution segment sales by product   2012                               In millionsQ1Q2Q3Q4YTD Parts and filtration $ 288 $302 $ - $ - $ 590 Power generation 186 201 - - 387 Engines 166 147 - - 313 Service   135   144   -   -   279   Total sales $ 775 $794 $ - $ - $ 1,569   2011In millionsQ1Q2Q3Q4YTD Parts and filtration $ 235 $ 271 $ 283 $ 296 $ 1,085 Power generation 145 195 191 191 722 Engines 140 186 171 206 703 Service   122   133   138   141   534 Total sales $ 642 $ 785 $ 783 $ 834 $ 3,044 Cummins Inc.Carole Casto, Executive Director - Corporate Communications, 317-610-2480carole.casto@cummins.com