Shares in Caterpillar Inc (NYSE:CAT), the world's largest earth-moving equipment maker, fell 2.2% after hours as the company cut its 2015 profit outlook. The company warned weaker commodity prices would result in a bigger-than-expected decline in demand, worsened by mining companies scaling back expansions and shelving major projects.
The manufacturer of construction and mining equipment said it now expects to earn $12 to $18 per share in 2015 on $80 billion to $100 billion in revenue. The company had previously forecast $15 to $20 per share of earnings, with CEO Doug Oberhelman saying at the time he was confident the global economy was improving.
But in a presentation at the MINExpo industry conference in Las Vegas, Oberhelman told analysts his company expected “fairly anemic and modest growth through 2015."
"There are a number of geopolitical and economic factors driving uncertainty in the world today, but our base case scenario calls for modest global economic growth over the next few years," Oberhelman in a statement.
Art Hogan, the managing director of Lazard Capital Markets in New York told Reuters Caterpillar’s message is just another proof of how global-reaching firms are speaking negatively to the pace of the economy. “And with slowdowns in Europe and Asia this is something we should get used to,” he added.
Last year Caterpillar banked on rising demand from the mining industry for 2012 and made an $8.8 billion acquisition of equipment manufacturer Bucyrus.