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Non-GAAP Reconciliation – EBIT

                                                                            Three Months E...
Non-GAAP Reconciliation – EBIT

                                                                                Year Ended...
Non-GAAP Reconciliation – EBITDA

                                                                                    Year...
Non-GAAP Reconciliation – Cash From
       Operations Excluding Pension Contributions


                                  ...
Non-GAAP Reconciliation – Net
Assets

                                                     December    December 31,
Millio...
Non-GAAP Reconciliation – Equity Used for
Return on Equity Calculation


                                               De...
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cmi_Q42006NonGAAP_v2

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cmi_Q42006NonGAAP_v2

  1. 1. Non-GAAP Reconciliation – EBIT Three Months Ended Millions December 31, December 31, October 1, 2006 2005 2006 Segment EBIT $ 303 $ 269 $ 296 Less: Interest Expense $ 20 $ 26 $ 23 Earnings before income taxes and minority $ 283 $ 243 $ 273 interests EBIT = Earnings before interest, taxes, and minority interests. We use EBIT to assess and measure the performance of our operating segments and also as a component in measuring our variable compensation programs. The table above reconciles EBIT, a non-GAAP financial measure, to our consolidated earnings before income taxes and minority interests, for each of the applicable periods. 1
  2. 2. Non-GAAP Reconciliation – EBIT Year Ended Millions December 31, December 31, 2006 2005 Segment EBIT $ 1,179 $ 907 Less: Interest Expense $ 96 $ 109 Earnings before income taxes and minority $ 1,083 $ 798 interests EBIT = Earnings before interest, taxes, and minority interests. We use EBIT to assess and measure the performance of our operating segments and also as a component in measuring our variable compensation programs. The table above reconciles EBIT, a non-GAAP financial measure, to our consolidated earnings before income taxes and minority interests, for each of the applicable periods. 2
  3. 3. Non-GAAP Reconciliation – EBITDA Year Ended Millions December 31, December 31, December 31, 2006 2005 2004 Segment EBIT $ 1,179 $ 907 $ 543 Depreciation & Amortization $ 296 $ 295 $ 272 EBITDA $ 1,475 $ 1,202 $ 815 EBITDA = Earnings before interest, taxes, minority interests, depreciation, and amortization. 3
  4. 4. Non-GAAP Reconciliation – Cash From Operations Excluding Pension Contributions Year Ended Millions December 31, December 31, 2006 2005 Cash provided by operations $ 840 $ 760 Add back: pension contributions $ 266 $ 151 Cash provided by operations $ 1,106 $ 911 excluding pension contributions We believe cash provided by operations excluding pension contributions is a useful measure of our operating performance for the periods presented as it illustrates our operating performance without regard to funding decisions. This measure is not in accordance with, or an alternative for, GAAP and may not be consistent with measures used by other companies. It should be considered supplemental data. 4
  5. 5. Non-GAAP Reconciliation – Net Assets December December 31, Millions 31, 2006 2005 Net assets for operating segments $ 4,056 $ 3,479 Liabilities deducted in computing net assets 3,510 3,354 Minimum pension liability excluded from net assets - (837) Pension and other postretirement liabilities (837) - Deferred tax assets not allocated to segments 710 863 Debt-related costs not allocated to segments 26 26 Total assets $ 7,645 $ 6,885 5
  6. 6. Non-GAAP Reconciliation – Equity Used for Return on Equity Calculation December December 31, Millions 31, 2006 2005 Equity used for return on equity calculation $ 3,313 $ 2,387 less Defined other postretirement benefits 3 - less Defined benefit pension plans 508 - less Minimum pension liability adjustment - 523 Total shareholder’s equity $ 2,802 $ 1,864 6

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