by Christopher Freeburn | October 10, 2012 1:46 pm
Cummins (NYSE:CMI) shares fell in Wednesday trading after the company cut its profit forecast for the year and announced plans to lay off up to 1,500 workers.
The engine manufacturer said earnings would grow by about 13.5% this year. That was down from earlier projections of growth between 14.25% and 14.75%. The company said revenues would be about $1 billion less than previous estimates of $18 billion, Bloomberg noted.
Shares of Cummins dropped about 3% in afternoon trading, falling below $89 a share.
In July, the company posted second-quarter profits of $2.45 a share, topping analysts who estimated earnings of $2.27 a share, but warned that third-quarter results would be dented by sluggish economic conditions worldwide.
Company officials said they saw falling demand from China and in the North American heavy truck markets. In addition to letting go between 1,000 and 1,500 workers by the end of the year, Cummins will reduce working hours and impose production shutdowns at some of its plants.
Analysts described the forecast as worse than expected.
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