COLUMBUS, Ind. – Marine engine and genset manufacturer Cummins Inc. (NYSE:CMI) expects to repay its $225 million of Notes due March 2005 with available cash and, if necessary, through the use of existing short-term credit facilities, the company said in a press release today.
Cummins anticipates strong cash flow generation in 2004 and beyond as a result of increased sales demand in nearly all of its end markets and an improved earnings outlook, according to the release.
"We are pleased and optimistic about the ongoing strength of our business and believe we will generate significant cash to retire this debt," said Tim Solso, Cummins chairman and CEO. "By retiring this debt we will make solid progress toward our stated goal of achieving the metrics needed to return to investment grade."
Standard & Poor's Ratings Services recently raised its outlook on Cummins to stable, citing the company's improving operating performance and recovering industry fundamentals that should result in stronger earnings and cash generation, Cummins said.
"We will continue to monitor our performance and cash position as we move closer to the maturity date," Solso said. "But at this point we feel very confident."