Caterpillar Reports All-Time Record Quarter Driven by Strong Growth Outside North America
PEORIA, Ill.- Driven by robust growth in emerging markets and strength in key industries like energy and mining, Caterpillar Inc. (NYSE: CAT) today reported all-time records for sales and revenues and profit per share. Profit per share for the second quarter of 2008 was $1.74, a 40 percent increase from $1.24 per share in the second quarter of 2007. Sales and revenues of $13.624 billion were 20 percent higher than second quarter 2007 sales and revenues of $11.356 billion.
"Team Caterpillar has delivered another remarkable quarter," said Chairman and Chief Executive Officer Jim Owens. "While North America remains depressed and we've seen softening in Western Europe and Japan, Caterpillar continues to grow in emerging markets and in global industries like energy and mining … and we continue to see good growth in our integrated service businesses. It's gratifying to see the positive impact of being such a diverse company in terms of products, services, geography and the industries we serve," Owens said.
Sales and revenues were up $2.268 billion from the second quarter of 2007. Sales volume improved $1.402 billion, price realization was up $398 million, the impact of currency added $384 million and Financial Products revenues were $84 million higher. The geographic mix of sales continued to shift outside North America with sales and revenues increasing 30 percent outside North America compared with 7 percent inside North America. Sales and revenues outside North America represented 60 percent of total sales and revenues in the second quarter-up from 55 percent of the total a year ago.
Second-quarter profit of $1.106 billion was up $283 million, or 34 percent, from second quarter 2007 profit of $823 million. The increase was primarily a result of improved price realization and higher sales volume, partially offset by higher material and freight costs and increases in Selling, General and Administrative (SG&A) and Research and Development (R&D) expenses. While SG&A and R&D costs increased to support growth and product development, they were both lower as a percent of sales.
"We are seeing significant improvements in safety and quality from the deployment of the Caterpillar Production System (CPS) with 6 Sigma, and I am confident that CPS will improve product delivery, inventory turnover, plant capacity and manufacturing costs as we continue to aggressively deploy it throughout the company," Owens said….Full Story