Caterpillar third-quarter 2012 profit was up 49 percent compared to the same period last year, on sales and revenue that were up 5 percent. Total income was $16.4 billion for the quarter. Caterpillar reported a $273 million pre-tax gain from the sale of its logisitics business as part of that profit.
Chairman/CEO Doug Oberhelman continued to point to “economic and geopolitical headwinds facing the world,” but noted the company continues to “track toward our goals on cost control, margin improvement, product quality, safety and better product availability for our customers.”
Caterpillar expects 2012 sales and revenues to be about $66 billion and profit in a range of $9.00 to $9.25 per share. The previous outlook for sales and revenues was a range of $68 to $70 billion with profit of about $9.60 per share at the middle of the sales and revenues outlook range.
- Global economic conditions that are weaker than we had previously expected.
- Cat dealers have lowered order rates well below end-user demand to reduce their inventories.
- Production across much of the company has been lowered, resulting in temporary shutdowns and layoffs.
- Lower production will continue until inventories and dealer order rates move back in line with dealer deliveries to end users.
Oberhelman said economic uncertaintly is “definitely impacting our business with dealers intending to lower inventories and mining customers delaying some projects and reducing orders.”
“We’re focused on being very nimble and taking actions to respond to the current environment while at the same time keeping our 2015 goals and expectations in mind. It requires a pragmatic and steady approach as we balance our actions in the short term with what we need to do to be prepared for better growth when the world economy improves,” Oberhelman added.
Last week, Caterpillar
- Reassigned several vice presidents
- Introduced a hybrid excavator
- Announced its Tier 4-Final diesel solution
Caterpillar preliminary 2013 outlook
From an economic standpoint, Caterpillar said it is expecting slightly better world growth in 2013 with modest improvement in the United States, China and most of the developing world, but continuing difficulty in Europe. Its preliminary outlook for 2013 is for sales and revenues to be about the same as 2012 in a range of up 5 percent to down 5 percent.
“We are taking a pragmatic view of 2013—we’re not expecting rapid growth, and we’re not predicting a global recession. At this point, we expect 2013 sales will be similar overall to 2012, but with a slightly weaker first half and a slightly better second half. While machine deliveries to end users have continued to hold up, our sales will probably remain relatively weak early in 2013 as dealers are likely to continue reducing inventories. When expected dealer inventory reductions level off, and easing actions by central banks and governments around the world begin to improve economic growth, we expect our business will begin to improve. While there's reason for optimism, and we're not expecting a global recession in 2013, we are prepared and stand ready to take action no matter what happens to the global economy,” Oberhelman added.