US: Cummins hikes quarterly dividend by 39%

Wednesday, July 11, 2007,

Tags: Corporate Finance, Supplier Strategy.

AutomotiveWorld.com

Cummins' board has hiked the company's quarterly cash dividend on common stock by 39% to US$0.25 per share, up from US$0.18 per share. The dividend is payable on 31 August to shareholders of record on 17 August.

"After three consecutive years of record financial results, the company continues to perform extremely well," says Tim Solso, Cummins chairman and chief executive officer. "Today's actions are indicative of the board's continued confidence in the company's ability to grow profitably and generate strong cash flow."

Cummins stated that the latest dividend increase is the second for the company in the past year - it increased its dividend by 20% in July 2006 - and comes four months after the company announced a 2-for-1 stock split. On a split-adjusted basis, Cummins stock has nearly doubled in 2007.

According to Solso, the company's strong financial performance has resulted in significant cash flow, which has allowed the company to strengthen its balance sheet and invest in profitable growth.

Published on Wednesday, July 11, 2007