Caterpillar mining sales slump, stock still performs
Caterpillar Inc. (NYSE:CAT) said Thursday that its slumping retail machine sales in Asia suffered an even sharper drop in the three months through May due to ongoing spending cuts at mining companies.
The world's largest construction and mining equipment manufacturer reported in a filing that resource industry sales in the Asia/Pacific region were down an average of 69% compared to the same period a year earlier.
Such sales in Latin America fell an average of 63% in the period from their levels during the same three months the year before.
But despite the dismal sales numbers, Caterpillar stock year to date is up almost 20% to $108.85, driven by cost cutting, dividend increases and the mining sector's cyclical nature, which has investors looking forward to a recovery.
Commodity price falls have caused miners to reduce spending, hitting the Peoria, Illinois-based company hard.
Bloomberg reports Caterpillar saying in April that sales of large mining trucks in the first quarter declined around 80% from their peak in 2012.
Rolling 3 Month Retail Sales Statistics