Caterpillar profit beats estimates but sales fall
Caterpillar (NYSE:CAT), the world's largest maker of mining and construction equipment, logged Thursday higher-than-expected second-quarter results, with net income up 4.1% even as revenue fell short.
The Peoria, Illinois-based company, which also makes railroad locomotives as well as diesel and turbine engines, also boosted its full-year earnings forecast.
Caterpillar Chairman and Chief Executive Officer Doug Oberhelman said in a statement the machinery maker increased the bottom line despite a weak quarter for our Resource Industries segment, which is principally mining.
“Three key things are contributing to the continuing strength of our financial results—the diversity of our businesses, substantial success in operational improvements through the execution of our strategy and the strength of our cash flow and balance sheet,” Oberhelman added.
Caterpillar earned $999 million, or $1.57 per share, in the quarter. A year earlier it earned $960 million, or $1.45 per share.
Removing restructuring costs, earnings were $1.69 per share. Analysts predicted $1.51 per share.
Revenue for the company fell 3.2% cent to $14.15 billion from $14.62 billion. Wall Street expected $14.45 billion.
CAT has been hit especially hard by the slowdown of the past two years, having to lay-off employees and close down plants. During this first quarter Caterpillar cut over 9,000 jobs, bringing its global workforce to about 132,000.
As the company’s Construction Industries and Energy & Transportation segments continue to improve, Caterpillar now anticipates a 2014 adjusted profit of $6.20 per share, up from a previous outlook of $6.10 per share. Analysts foresee $6.18 per share.
The machinery giant plans to buy back about $2.5 billion shares in the third quarter.