8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC  20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934

Date of Report:  February 2, 2012

  CUMMINS INC.
(Exact name of registrant as specified in its charter)

Indiana
(State or other Jurisdiction of
Incorporation) 1-4949
(Commission File Number) 35-0257090
(I.R.S. Employer Identification
 No.)

500 Jackson Street
P. O. Box 3005
Columbus, IN  47202-3005
(Principal Executive Office)  (Zip Code)

Registrant's telephone number, including area code:  (812) 377-5000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On February 2, 2012, Cummins Inc. issued a press release regarding its release of fourth quarter and full year 2011 results. 
 

Item 7.01.  Regulation FD Disclosure

The following information is furnished pursuant to Item 2.02, "Results of Operations and Financial Condition" and Item 7.01, "Regulation FD Disclosure."
 

On February 2, 2012, Cummins Inc. (“Cummins,” “the Company,” “the registrant,” “we,” “our,” or, “us”) issued the attached press release reporting its financial results for the fourth quarter and full year of 2011.  A copy of Cummins' press release is attached hereto as Exhibit 99 and hereby incorporated by reference.
 

Item 9.01. Financial Statements and Exhibits.

(d) The following exhibit is furnished herewith:
 

99-Press Release dated February 2, 2012

SIGNATURE
 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 2, 2012

CUMMINS INC.

 /s/ Marsha L. Hunt
______________________________

Marsha L. Hunt
Vice President - Corporate Controller
(Principal Accounting Officer)

CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited) (a)
		Three months ended
		December 31,		September 25,		December 31,
In millions, except per share amounts		2011		2011		2010
NET SALES		$	4,921	$	4,626	$	4,139
Cost of  sales			3,680		3,438		3,155
GROSS MARGIN			1,241		1,188		984
OPERATING EXPENSES AND INCOME
	Selling, general and administrative expenses		496		489		423
	Research, development and engineering expenses		179		164		123
	Equity, royalty and interest income from investees  (Note 1)		101		102		90
	Gain on sale of businesses (Note 2)		53		-		-
	Other operating (expense) income, net (Note 3)		25		2		(3)
OPERATING INCOME			745		639		525
Interest income			9		9		7
Interest expense			10		11		11
Other income (expense), net			14		(8)		9
INCOME BEFORE INCOME TAXES			758		629		530
Income tax expense  (Note 4)			186		157		139
CONSOLIDATED NET INCOME			572		472		391
Less: Net income attributable to noncontrolling interests			24		20		29
NET INCOME ATTRIBUTABLE TO CUMMINS INC.		$	548	$	452	$	362
EARNINGS PER COMMON SHARE ATTRIBUTABLE
	TO CUMMINS INC.
	Basic	$	2.87	$	2.35	$	1.85
	Diluted	$	2.86	$	2.35	$	1.84
WEIGHTED AVERAGE SHARES OUTSANDING
	Basic		190.9		192.1		195.8
	Diluted		191.5		192.7		196.4
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 (GAAP).

CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Unaudited (a)
		For the years ended
		December 31,		December 31,
In millions, except per share amounts		2011		2010
NET SALES		$	18,048	$	13,226
Cost of  sales			13,459		10,058
GROSS MARGIN			4,589		3,168
OPERATING EXPENSES AND INCOME
	Selling, general and administrative expenses		1,837		1,487
	Research, development and engineering expenses		629		414
	Equity, royalty and interest income from investees  (Note 1)		416		351
	Gain on sale of businesses  (Note 2)		121		-
	Other operating (expense) income, net (Note 3)		21		(16)
OPERATING INCOME			2,681		1,602
Interest income			34		21
Interest expense			44		40
Other income (expense), net			-		34
INCOME BEFORE INCOME TAXES			2,671		1,617
Income tax expense  (Note 4)			725		477
CONSOLIDATED NET INCOME			1,946		1,140
Less: Net income attributable to noncontrolling interests			98		100
NET INCOME ATTRIBUTABLE TO CUMMINS INC.		$	1,848	$	1,040
EARNINGS PER COMMON SHARE ATTRIBUTABLE
	TO CUMMINS INC.
	Basic	$	9.58	$	5.29
	Diluted	$	9.55	$	5.28
WEIGHTED AVERAGE SHARES OUTSTANDING
	Basic		193.0		196.7
	Diluted		193.6		197.1
CASH DIVIDENDS DECLARED PER COMMON SHARE		$	1.325	$	0.875

(a)     Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America (GAAP).

CUMMINS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (a)
					December 31,		December 31,
In millions, except par value					2011		2010
ASSETS
Current assets
	Cash and cash equivalents				$	1,484	$	1,023
	Marketable securities					277		339
		Total cash, cash equivalents and marketable securities				1,761		1,362
	Accounts and notes receivable, net					2,526		2,243
	Inventories					2,141		1,977
	Deferred income taxes					268		314
	Prepaid expenses and other current assets					395		393
		Total current assets				7,091		6,289
Long-term assets
	Property, plant and equipment, net					2,288		2,041
	Investments and advances related to equity method investees					838		734
	Goodwill and other intangibles, net					566		589
	Other assets					885		749
		Total assets			$	11,668	$	10,402
LIABILITIES
Current liabilities
	Loans payable				$	28	$	82
	Accounts payable (principally trade)					1,546		1,362
	Accrued expenses					2,083		1,816
		Total current liabilities				3,657		3,260
Long-term liabilities
	Long-term debt					658		709
	Other liabilities					1,522		1,437
		Total liabilities				5,837		5,406
EQUITY
	Cummins Inc. shareholders’ equity
		Common stock, $2.50 par value, 500 shares authorized, 222.2 and 221.8 shares issued				2,001		1,934
		Retained earnings				6,038		4,445
		Treasury stock, at cost, 30.2 and 24.0 shares				(1,587)		(964)
		Common stock held by employee benefits trust, at cost, 1.8 and 2.1 shares				(22)		(25)
		Accumulated other comprehensive loss				(938)		(720)
			Total Cummins Inc. shareholders’ equity			5,492		4,670
	Noncontrolling interests					339		326
				Total equity		5,831		4,996
Total liabilities and equity					$	11,668	$	10,402

(a)     Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America (GAAP).

CUMMINS INC. AND SUBSIDIARIES
CONDENSED  CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (a)
		For the years ended
		December 31,		December 31,
In millions		2011		2010
NET CASH PROVIDED BY OPERATING ACTIVITIES		$	2,073	$	1,006
CASH FLOWS FROM INVESTING ACTIVITIES
	Capital expenditures		(622)		(364)
	Investments in internal use software		(60)		(43)
	Proceeds from disposals of property, plant and equipment		8		55
	Investments in and advances to equity investees		(81)		(2)
	Proceeds from sale of businesses, net of cash sold		199		-
	Acquisition of business, net of cash acquired		-		(104)
	Investments in marketable securities-acquisitions		(729)		(823)
	Investments in marketable securities-liquidations		750		690
	Purchases of other investments		-		(62)
	Cash flows from derivatives not designated as hedges		(18)		2
	Other, net		1		-
Net cash used in investing activities			(552)		(651)
CASH FLOWS FROM FINANCING ACTIVITIES
	Proceeds from borrowings		127		214
	Payments on borrowings and capital lease obligations		(237)		(143)
	Net borrowings (payments) under short-term credit agreements		6		9
	Distributions to noncontrolling interests		(56)		(28)
	Dividend payments on common stock		(255)		(172)
	Proceeds from sale of common stock held by employee benefit trust		-		58
	Repurchases of common stock		(629)		(241)
	Excess tax benefits (deficiencies) on stock-based awards		5		10
	Other, net		14		26
Net cash used in financing activities			(1,025)		(267)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS			(35)		5
Net increase (decrease) in cash and cash equivalents			461		93
Cash and cash equivalents at beginning of year			1,023		930
CASH AND CASH EQUIVALENTS AT END OF PERIOD		$	1,484	$	1,023

(a)     Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America (GAAP).

CUMMINS INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(Unaudited)

In millions		Engine		Components		Power Generation		Distribution		Non-segment Items(1)		Total
Three months ended December 31, 2011
External sales		$	2,628	$	781	$	682	$	830	$	-	$	4,921
Intersegment sales			433		311		238		4		(986)		-
	Total sales		3,061		1,092		920		834		(986)		4,921
Depreciation and amortization(2)			46		18		10		8		-		82
Research, development and engineering expenses			112		49		17		1		-		179
Equity, royalty and interest income from investees			40		7		10		44		-		101
Interest income			4		2		2		1		-		9
Segment EBIT			368		132		87		87		94		768
Three months ended September 25, 2011
External sales		$	2,539	$	704	$	604	$	779	$	-	$	4,626
Intersegment sales			416		311		270		4		(1,001)		-
	Total sales		2,955		1,015		874		783		(1,001)		4,626
Depreciation and amortization(2)			46		19		11		6		-		82
Research, development and engineering expenses			103		46		14		1		-		164
Equity, royalty and interest income from investees			35		7		16		44		-		102
Interest income			5		1		2		1		-		9
Segment EBIT			349		113		92		104		(18)		640
Three months ended December 31, 2010
External sales		$	2,099	$	656	$	690	$	694	$	-	$	4,139
Intersegment sales			398		262		213		5		(878)		-
	Total sales		2,497		918		903		699		(878)		4,139
Depreciation and amortization (2)			46		18		10		6		-		80
Research, development and engineering expenses			76		33		13		1		-		123
Equity, royalty and interest income from investees			37		6		8		39		-		90
Interest income			5		1		1		-		-		7
Segment EBIT			256		83		92		82		28		541
For the year ended December 31, 2011
External sales		$	9,649	$	2,886	$	2,492	$	3,021	$	-	$	18,048
Intersegment sales			1,658		1,177		1,006		23		(3,864)		-
	Total sales		11,307		4,063		3,498		3,044		(3,864)		18,048
Depreciation and amortization (2)			181		73		42		25		-		321
Research, development and engineering expenses			397		175		54		3		-		629
Equity, royalty and interest income from investees			166		31		47		172		-		416
Interest income			18		5		8		3		-		34
Segment EBIT			1,384		470		373		386		102		2,715
For the year ended December 31, 2010
External sales		$	6,594	$	2,171	$	2,150	$	2,311	$	-	$	13,226
Intersegment sales			1,294		875		769		13		(2,951)		-
	Total sales		7,888		3,046		2,919		2,324		(2,951)		13,226
Depreciation and amortization (2)			171		79		41		25		-		316
Research, development and engineering expenses			263		114		36		1		-		414
Equity, royalty and interest income from investees			161		23		35		132		-		351
Interest income			12		2		5		2		-		21
Segment EBIT			809		278		299		297		(26)		1,657
(1)	Includes intersegment sales and profit in inventory eliminations and unallocated corporate expenses.  For the three months ended December 31, 2011 unallocated corporate expenses includes a $53 million gain ($33 after-tax) recorded for the sale of certain assets and liabilities of our light-duty filtration business from the Components segment, and a $38 million gain ($24 million after-tax) related to flood damage recoveries from the insurance settlement regarding a June 2008 flood in Southern Indiana.  There were no significant unallocated corporate expenses for the three months ended September 25, 2011 and the three months ended December 31, 2010.  The year ended December 31, 2011, includes a $121 million gain ($70 million after-tax) related to the sale of certain assets and liabilities of our exhaust and light-duty filtration business, both from the Components segment, and a $38 million gain ($24 million after-tax) related to flood damage recoveries from the insurance settlement regarding a June 2008 flood in Southern Indiana.  The gains have been excluded from segment results as they were not considered by management in its evaluation of operating results for the year ended December 31, 2011.  For the year ended December 31, 2010 unallocated corporate expenses included $32 million in Brazil tax recoveries ($21 million after-tax) and $2 million in flood damage expenses.  This tax recovery has been excluded from segment results as it was not considered by management in its evaluation of operating results for the year ended December 31, 2010.
(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 SUBSIDIARIES

RECONCILIATION OF SEGMENT INFORMATION

(Unaudited)

A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidatead Statements of Income is shown in the table below:

		Three months ended						For the years ended
		December 31,		September 25,		December 31,		December 31,		December 31,
In millions		2011		2011		2010		2011		2010
Segment EBIT		$	768	$	640	$	541	$	2,715	$	1,657
Less:
	Interest expense		10		11		11		44		40
Income before income taxes		$	758	$	629	$	530	$	2,671	$	1,617

CUMMINS INC. AND SUBSIDIARIES

SELECTED FOOTNOTE DATA

(Unaudited)

NOTE 1.  EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES

Equity, royalty and interest income from investees included in our Condensed Consolidated Statements of Income for the interim reporting periods was as follows:

		Three months ended						For the years ended
		December 31,		September 25,		December 31,		December 31,		December 31,
In millions		2011		2011		2010		2011		2010
Distribution Entities
North American distributors		$	34	$	35	$	29	$	134	$	101
Komatsu Cummins Chile, Ltda			6		6		5		22		16
All other distributors			1		1		1		4		3
Manufacturing Entities
Chongqing Cummins Engine Company, Ltd.			17		20		11		68		46
Dongfeng Cummins Engine Company, Ltd.			16		15		23		80		99
Cummins Westport, Inc.			6		4		3		14		10
Tata Cummins, Ltd.			5		2		3		14		14
Shanghai Fleetguard Filter Co., Ltd.			3		4		3		15		12
Komatsu manufacturing alliances			2		-		4		3		11
Valvoline Cummins, Ltd.			1		2		1		7		8
Beijing Foton Cummins Engine Co., Ltd.			(2)		(2)		(4)		(7)		(16)
Cummins MerCruiser Diesel Marine, LLC			(3)		-		(2)		(3)		(3)
All other manufacturers			5		7		5		24		20
	Cummins share of net income		91		94		82		375		321
Royalty and interest income			10		8		8		41		30
Equity, royalty and interest income from investees		$	101	$	102	$	90	$	416	$	351

NOTE 2.  SALE OF BUSINESSES

In the second quarter of 2011, we sold certain assets and liabilities of our exhaust business which manufactures exhaust products and select components for emission systems for a variety of applications not core to our other product offerings.  This business was historically included in our Components segment.  The sales price was $123 million.  We recognized a gain on the sale of $68 million ($37 million after-tax), which included an allocation of goodwill of $19 million.  The gain was excluded from segment results as it was not considered by management in its evaluation of operating results for the year ended December 31, 2011.

Sales for this business were $62 million, $171 million and $126 million in 2011 (through closing), 2010 and 2009, respectively.  EBIT for this business was approximately $9 million, $22 million and $11 million in 2011 (through closing), 2010 and 2009, respectively.   

During the fourth quarter of 2011, we sold certain assets and liabilities of our light-duty filtration business which manufactures light-duty automotive and industrial filtration solutions.  The sales price was $90 million and included a note receivable from the buyer of approximately $1 million.  There are no earnouts or other contingencies associated with the sales price.  We recognized a gain on the sale of $53 million ($33 million after-tax), which included an allocation of goodwill of $6 million.  The gain was excluded from segment results as it was not considered by management in its evaluation of operating results for the year ended December 31, 2011.

Sales for this business were $64 million, $74 million and $54 million in 2011 (through closing), 2010 and 2009, respectively.  EBIT for this business was approximately $13 million, $9 million and $2 million in 2011 (through closing), 2010 and 2009, respectively. 

We will enter into supply and other agreements with the operations that will represent ongoing involvement and as such, the results of these operations will not be presented as discontinued operations.

CUMMINS INC. AND SUBSIDIARIES

SELECTED FOOTNOTE DATA

(Unaudited)

NOTE 3.  FLOOD INSURANCE RECOVERY

In June 2008, four of our sites in Southern Indiana, including our Technical Center, experienced extensive flood damage.  In October 2011, we received $40 million from our insurance carriers to settle all outstanding 2008 flood claims.  As a result, we recognized a gain of approximately $38 million ($24 million after-tax), net of any remaining flood related expenses, in “Other operating (expense) income, net” in our Condensed Consolidated Statements of Income.

NOTE 4.  INCOME TAXES

Our income tax rates are generally less than the 35 percent U.S. income tax rate primarily because of lower taxes on foreign earnings and research tax credits. Our effective tax rate for the fourth quarter and full year of 2011 was 24.5 percent and 27.1 percent, respectively.  Excluding the gain on sale of certain assets and liabilities of the businesses and the flood insurance recovery, our effective tax rate for the fourth quarter and full year of 2011 was 22.8 percent and 26.3 percent, respectively.  The tax rate for the fourth quarter and full year includes discrete tax items that total a benefit of $56 million ($0.29 per share) and $85 million ($0.44 per share), respectively.  The discrete tax items for the fourth quarter and full year related primarily to additional research credits claimed on amended tax returns for prior periods, the settlement of uncertain tax positions and restructuring of our foreign operations.  Our effective tax rate for the fourth quarter and full year of 2010 was 26.2 percent and 29.5 percent, respectively. 

A reconciliation of the U.S. federal income tax rate of 35 percent to the actual effective tax rate is as follows:

		Years ended December 31,
		2011		2010
	U.S. federal statutory rate	35.0	%	35.0	%
	State income tax, net of federal effect	0.4		0.6
	Research tax credits	(4.7)		(1.3)
	Differences in rates and taxability of foreign subsidiaries and joint ventures	(4.6)		(4.7)
	Other, net	1.0		(0.1)
Effective tax rate		27.1	%	29.5	%

We expect our 2012 effective tax rate to be 29 percent excluding any discrete items that may arise.  The research tax credit expired December 31, 2011 and has not yet been renewed by Congress.  If the research credit is reinstated, we would anticipate the 2012 effective tax rate to be 28 percent.

NOTE 5.  DEPRECIATION AND AMORTIZATION

Depreciation and amortization expense included in operating activities of the Condensed Consolidated Statements of Cash Flows for the years ended December 31, 2011 and 2010, was $325 million and $320 million, respectively.

CUMMINS INC. AND SUBSIDIARIES

FINANCIAL 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 period presented as it illustrates our operating performance without regard to special items including the gains related to the sale of certain assets and liabilities of our exhaust business and our filtration business and flood insurance recovery.  This measure is not in accordance with, or an alternative for, accounting principles generally accepted in the United States of America 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 quarter and year ended December 31, 2011.

			Three months ended				Year ended
			December 31, 2011				December 31, 2011
In millions			Net Income		Diluted EPS		Net Income		Diluted EPS
Net income attributable to Cummins Inc.		$	548	$	2.86	$	1,848	$	9.55
Subtract:
	Gain on sale of businesses(1)		33		0.17		70		0.36
	Flood insurance recovery(1)		24		0.13		24		0.12
Net income attributable to Cummins Inc. excluding
	special items	$	491	$	2.56	$	1,754	$	9.07
(1)	The gains have been excluded from operating results as they were not considered by management in its evaluation of performance for the year ended December 31, 2011.

CUMMINS INC. AND SUBSIDIARIES

FINANCIAL MEASURES THAT SUPPLEMENT GAAP

(Unaudited)

Earnings before interest expense, income taxes and noncontrolling interests.

We define EBIT as earnings or loss 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 ended						For the years ended
		December 31,		September 25,		December 31,		December 31,		December 31,
In millions		2011		2011		2010		2011		2010
Earnings before interest expense, income taxes and
	special items	$	677	$	640	$	541	$	2,556	$	1,657
Earnings before interest expense, income taxes and
	special items as a percentage of net sales		13.8%		13.8%		13.1%		14.2%		12.5%
Add:
	Gain on sale of businesses		53		-		-		121		-
	Flood insurance recovery		38		-		-		38		-
Earnings before interest expense and income taxes		$	768	$	640	$	541	$	2,715	$	1,657
EBIT as a percentage of net sales			15.6%		13.8%		13.1%		15.0%		12.5%
Less:
	Interest expense		10		11		11		44		40
	Income tax expense		186		157		139		725		477
Consolidated net income			572		472		391		1,946		1,140
Less:
	Net income attributable to noncontrolling interests		24		20		29		98		100
Net income attributable to Cummins Inc.		$	548	$	452	$	362	$	1,848	$	1,040
Net income attributable to Cummins Inc.
	as a percentage of net sales		11.1%		9.8%		8.7%		10.2%		7.9%

CUMMINS INC. AND SUBSIDIARIES

BUSINESS UNIT SALES DATA

(Unaudited)

Engine segment net sales by market

2011
In millions			Q1		Q2		Q3		Q4		YTD
Heavy-duty truck		$	485	$	693	$	748	$	865	$	2,791
Medium-duty truck and bus			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
2010
In millions			Q1		Q2		Q3		Q4		YTD
Heavy-duty truck		$	252	$	340	$	395	$	516	$	1,503
Medium-duty truck and bus			217		352		430		436		1,435
Light-duty automotive and RV			207		296		239		280		1,022
Industrial			577		656		700		956		2,889
Stationary power			170		255		305		309		1,039
	Total sales	$	1,423	$	1,899	$	2,069	$	2,497	$	7,888

Unit shipments by engine classification (including unit shipments to Power Generation)

2011
Units		Q1	Q2	Q3	Q4	YTD
Mid-range		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
2010
Units		Q1	Q2	Q3	Q4	YTD
Mid-range		69,100	90,500	93,500	115,800	368,900
Heavy-duty		8,700	14,500	15,200	22,800	61,200
High horsepower		3,400	4,800	4,900	5,400	18,500
	Total units	81,200	109,800	113,600	144,000	448,600

CUMMINS INC. AND SUBSIDIARIES

BUSINESS UNIT SALES DATA

(Unaudited)

Component segment sales by business

2011
In millions			Q1		Q2		Q3		Q4		YTD
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
2010
In millions			Q1		Q2		Q3		Q4		YTD
Emission solutions		$	137	$	170	$	192	$	251	$	750
Turbo technologies			200		226		239		283		948
Filtration			228		250		248		285		1,011
Fuel systems			65		83		90		99		337
	Total sales	$	630	$	729	$	769	$	918	$	3,046

Power generation segment sales by business

2011
In millions			Q1		Q2		Q3		Q4		YTD
Commercial products		$	505	$	568	$	579	$	578	$	2,230
Generator technologies			153		190		166		164		673
Commercial projects			55		58		46		84		243
Consumer			50		53		48		49		200
Power electronics			32		40		35		45		152
	Total sales	$	795	$	909	$	874	$	920	$	3,498
2010
In millions			Q1		Q2		Q3		Q4		YTD
Commercial products		$	307	$	436	$	519	$	569	$	1,831
Generator technologies			107		135		140		167		549
Commercial projects			33		57		49		83		222
Consumer			43		49		49		45		186
Power electronics			27		31		34		39		131
	Total sales	$	517	$	708	$	791	$	903	$	2,919

Distribution segment sales by business

2011
In millions			Q1		Q2		Q3		Q4		YTD
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
2010
In millions			Q1		Q2		Q3		Q4		YTD
Parts and filtration		$	193	$	221	$	220	$	248	$	882
Power generation			99		135		125		157		516
Engines			83		109		112		162		466
Service			101		111		116		132		460
	Total sales	$	476	$	576	$	573	$	699	$	2,324

EX-99

Contact:

Janet Williams

Director - Corporate Communications

(317) 610-2488

janet.williams@cummins.com

Cummins announces record revenue and profits for 2011, with revenue growth of 36 percent and EBIT increasing by 54 percent

• Strong fourth quarter results as revenue grows 19 percent and EBIT increases 25 percent
• Expects 10 percent revenue growth in 2012 and EBIT to improve to a range of 14.5 to 15 percent of sales

COLUMBUS, IND. – Cummins Inc. (NYSE: CMI)  today reported record sales, profits and cash flow from operations for all of 2011 as well as strong results for the fourth quarter.

Fourth quarter revenue of $4.9 billion increased 19 percent from the same quarter in 2010 and set a new quarterly record for the Company.  The increase year-over-year was driven by higher demand in truck, construction, power generation and oil and gas markets in North America.  The Company also experienced strong growth in global mining markets.  Growth in these markets offset weaker demand in the construction market in China and power generation in India.

Net income attributable to Cummins in the fourth quarter was $548 million ($2.86 per diluted share).  Excluding the gain from the disposition of the light duty filtration business ($0.17 per diluted share) and the previously announced insurance settlement related to the 2008 flood in Indiana ($0.13 per diluted share), the Company reported net income of $491 million ($2.56 per diluted share) with a tax rate of 22.8 percent for the quarter.

Earnings before interest and taxes (EBIT) was $768 million for the fourth quarter.  Excluding the special items noted above, EBIT was $677 million or 13.8 percent of sales.  This represents a 25 percent growth in earnings year-over-year.

Revenue for the full year was $18 billion, up 36 percent from 2010, with strong growth in most geographic regions. 

Net income attributable to Cummins for the full year was $1.85 billion ($9.55 per diluted share), up from $1.04 billion ($5.28 per diluted share) in 2010.  Excluding the benefit from the gains on divestiture of two businesses within the Components segment ($0.36 per diluted share), and the flood insurance settlement ($0.12 per diluted share), the Company reported full year net income of $1.75 billion ($9.07 per diluted share) with a tax rate of 26.3 percent for the year.

EBIT for the year, excluding special items, was $2.56 billion or 14.2% of sales, compared to $1.66 billion or 12.5% of sales in 2010.

“Cummins had its best year ever in 2011, despite economic uncertainty in a number of regions.  We continue to benefit from our leading position in a number of end markets and geographies,” said Tom Linebarger, Chairman and Chief Executive Officer.  “Revenue in the United States grew 53 percent and international revenue grew 27 percent year-over-year.  In fact, we experienced record full year revenues in North America, Brazil, China, India and a number of other important markets.”

Based on the current forecast, Cummins anticipates that total Company revenues will increase 10 percent in 2012, with EBIT in the range of 14.5 to 15 percent of sales. 

“Our 2011 results and our forecast for 2012 reaffirms our confidence in reaching our goal  of achieving $30 billion in sales and 18 percent EBIT in 2015,” Linebarger said.

Other highlights from 2011:

• Cash flow from operations more than doubled to $2.1 billion.
• Cummins unveiled a new high horsepower engine, the QSK95, in Seymour, Ind., that will be the world’s most powerful high-speed diesel engine.
• The Company increased its dividend by 52 percent and repurchased 6.4 million shares.
• Cummins’ performance was recognized by the three major credit rating agencies, all of which upgraded the Company’s ratings.

Fourth quarter detail (all comparisons to same period in 2010)

Engine Segment

• Sales – $3.1 billion, up 23 percent
• Segment EBIT – $368 million, or 12.0 percent of sales, compared to $256 million or 10.3 percent of sales
• Improved demand for North American on-highway heavy duty, midrange and light duty engines
• Strong demand for oil and gas engines in North America and mining engines globally

Components

• Sales - $1.1 billion, an increase of 19 percent
• Segment EBIT - $132 million, or 12.1 percent of sales, compared to $83 million or 9.0 percent of sales
• Record quarter driven by increased demand in North America
• Europe, India and Brazil showed year-over-year growth offsetting weaker demand in China

Power Generation

• Sales – $920 million, up 2 percent
• Segment EBIT – $87 million, or 9.5 percent of sales, compared to $92 million or 10.2 percent of sales
• Commercial products business sales increase because of stronger demand in most regions
• Improved demand in North America, China and Europe

Distribution

• Sales – $834 million, up 19 percent
• Segment EBIT – $87 million, or 10.4 percent of sales, compared to $82 million or 11.7 percent of sales
• Revenue increase driven by strong growth in Asia Pacific region, power generation demand in North America and oil and gas and mining markets

About Cummins

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 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, expectations, hopes, beliefs and intentions on strategies regarding the future.  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 2010 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 Information
EBIT is a non-GAAP measure used in this release, and is 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 information
Cummins management will host a teleconference to discuss these results today at 10 a.m. EST. 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.