PEORIA, Ill. (PRNewswire) - PEORIA, Ill., July 21 /PRNewswire-FirstCall/ -- Bolstered by continued global strength in the markets and industries it serves, Caterpillar Inc. today reported record second quarter sales and revenues of $9.360 billion and record profit of $760 million, or $1.08 per share. First half of the year results were also records, with company sales and revenues of $17.699 billion and profit of $1.341 billion, or $1.89 per share.
"Our global markets continue to exhibit the fundamental strengths needed for further growth, and Team Caterpillar remains well positioned to leverage this unprecedented opportunity now and in the years ahead," said Caterpillar Chairman and Chief Executive Officer Jim Owens. "We're aggressively pursuing improvement - utilizing our leadership position, strong cash flow and global capabilities in engineering, purchasing, sales and manufacturing to enhance the value customers and stockholders receive from an investment in Caterpillar."
Sales and revenues of $9.360 billion were up $1.777 billion, or 23 percent, compared to $7.583 billion in the second quarter of 2004. Improving sales volume and price realization drove the increase in sales and revenues.
Profit of $760 million, or $1.08 a share, was up 34 percent compared to profit of $566 million in the second quarter of 2004. The main contributors were improved price realization and sales volume, partially offset by higher core operating costs, about half of which were material costs.
"We're very pleased that this quarter marks another improvement in our profitability as measured by return on sales - 8.1 percent this quarter compared to 7.5 percent a year ago," Owens added. "Somewhat better prices were a positive factor in the profit improvement, and for the most part, we expect the price increases announced earlier this year to hold in the marketplace. That said, we are closely monitoring the competitive landscape and are determined to hold our market position. Further, our results continue to be positively driven by literally hundreds of 6 Sigma projects which are being completed every month."
Outlook
The outlook for 2005 has been increased over previously reported levels. Sales and revenues are now expected to be up 18 to 20 percent from 2004. The profit outlook for 2005 has also been improved to reflect an estimated profit range of $4.00 to $4.20 per share.
The previous outlook reflected sales and revenues up 16 to 18 percent, and profit per share of $3.89 to $4.03, up 35 to 40 percent from 2004.
"The strength of our markets is clearly not a blip on the radar," Owens said. "Key indicators such as low interest rates, robust commodity prices and needed investment for capacity in electric power and energy production point to continued growth. While this growth is expected to continue in the near term, we're laying a solid foundation for our future by staying focused on prudently managing our cost structure and margins while continuing to invest in new products and production capacity to meet strong customer demand."
(Complete outlook begins on page 12.)
For 80 years, Caterpillar has been building the world's infrastructure and, in partnership with our independent dealers, is driving positive and sustainable change on every continent. Caterpillar is a technology leader and the world's largest maker of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. More information is available at http://www.CAT.com/ .
PEORIA, Ill. (PRNewswire) - PEORIA, Ill., July 21 /PRNewswire-FirstCall/ -- Caterpillar Financial Services Corporation (Cat Financial) today reported record revenues of $587 million, an increase of $120 million or 26 percent compared with second quarter 2004. Profit after tax was a record $90 million, a $27 million or 43 percent increase over second quarter 2004.
Of the increase in revenues, $69 million resulted from the impact of continued growth of finance receivables and operating leases (earning assets) and $39 million from the impact of higher interest rates on new and existing finance receivables.
On a pre-tax basis, profit was up $41 million, principally due to $33 million from growth in earning assets, $12 million from a decrease in the provision for credit losses due to improved portfolio health, and $6 million from an increased gain on sale of equipment returned from lease, partially offset by $11 million from higher operating expenses and $6 million from the decrease in the interest rate spread.
New retail financing was a record $3.27 billion, an increase of $681 million or 26 percent from the same period one year ago. The increase was primarily related to increased financing in our North America and Asia- Pacific segments.
Past dues over 30 days at the end of the period were 2.08 percent compared to 2.57 percent at the end of the same period one-year ago. Write-offs, net of recoveries, were $3 million during the quarter compared with $16 million for the second quarter of 2004.
Caterpillar Vice President and Cat Financial President Kent M. Adams said, "We are pleased with the continued growth in our business as well as the reduction in past dues and write-offs. Our efficiency measured by managed assets per employee continues to improve reflecting the benefits of the investments we have made in our people and technology."
Cat Financial, a wholly-owned subsidiary of Caterpillar Inc., provides a wide range of financing alternatives for Caterpillar machinery and engines, Solar (R) gas turbines, as well as other equipment and marine vessels. The company also extends loans to customers and dealers. Cat Financial has offices and subsidiaries located throughout the Americas, Asia, Australia, and Europe, with headquarters in Nashville, Tennessee.
STATISTICAL HIGHLIGHTS:
SECOND QUARTER 2005 VS. SECOND QUARTER 2004
(ENDING JUNE 30)
(Millions of dollars)
2005 2004 CHANGE
Revenues $587 $467 26%
Net Profit $90 $63 43%
New Retail Financing $3,268 $2,587 26%
Total Assets $24,229 $21,145 15%
FIRST SIX MONTHS 2005 VS. FIRST SIX MONTHS 2004
(ENDING JUNE 30)
(Millions of dollars)
2005 2004 CHANGE
Revenues $1,130 $924 22%
Net Profit $173 $135 28%
New Retail Financing $5,711 $4,557 25%
Caterpillar Financial Services Corporation
By Nick Zieminski
NEW YORK, July 21 (Reuters) - Caterpillar Inc. (CAT.N: Quote, Profile, Research) on Thursday reported a 34 percent jump in second-quarter profit and raised its full-year outlook, citing strong global demand from mining and energy sectors and an ability to maintain high prices.
But Caterpillar shares eased slightly after a run-up in advance of the earnings.
Net income rose to $760 million, or $1.08 a share, from $566 million, or 80 cents a share, in the year-earlier quarter.
Sales increased 23 percent to $9.36 billion, fueled by double-digit revenue growth at each of the company's three divisions - machinery, engines and financial services.
The results at the Dow Jones industrial average component handily beat Wall Street forecasts of $1.01 per share on sales of $8.49 billion.
"It's another smashing, rousing success of a quarter," said analyst Scott Burns of Morningstar in Chicago. Burns said Caterpillar was benefiting from a continued build-up of infrastructure worldwide and demand for commodities.
"The boom in the commodity market has caught everybody by surprise," he said. "There was definite underinvestment in commodity production and power generation the past few years."
'BUY ON THE RUMOR, SELL ON THE NEWS'
Caterpillar said demand for mining products has increased at an unprecedented rate over the past two years, and the company has responded by ramping up production. But shortages of parts like tires have led to slower deliveries.
Caterpillar shares were down 70 cents, or 1.3 percent, to $52.51 on the New York Stock Exchange
BANGALORE, July 21 (Reuters) - CATERPILLAR INC. (CAT.N: Quote, Profile, Research) Latest Forecast* Yr ago qtr EPS (diluted, $/shr) 1.08 1.01** 0.80 Net ($ million) 760 -- 566 Revenue ($ million) 9,360.0 8,485.3*** 7,583.0 *Source: Reuters Estimates
NEW YORK, July 21 (Reuters) - Caterpillar Inc. (CAT.N: Quote, Profile, Research) on Thursday reported a 34 percent jump in second-quarter profits and raised its full-year outlook, saying it continues to see strength in its key markets and industries.
Caterpillar reported record net income of $760 million, or $1.08 a share, up from $566 million, or 80 cents a share, in the year-earlier quarter.
Sales at the world's leading heavy equipment maker increased 23 percent to $9.36 billion from $7.56 billion a year earlier.
The results handily beat Wall Street forecasts. Analysts on average had expected profits of $1.01 per share on sales of $8.49 billion.
Caterpillar raised its 2005 earnings forecast to a range of $4.00 to $4.20, compared with its earlier forecast of $3.89 to $4.03 and above analysts' average estimate of $3.96.
It forecast 2005 sales will grow 18 percent to 20 percent, up from its earlier estimate of 16 percent to 18 percent sales growth.
"Our global markets continue to exhibit the fundamental strengths needed for further growth," said Caterpillar Chairman and Chief Executive Officer Jim Owens in a statement.
"Somewhat better prices were a positive factor in the profit improvement, and for the most part, we expect the price increases announced earlier this year to hold in the marketplace," Owens said.
Caterpillar, an industrial bellwether and a component of the Dow Jones Industrial Average, were trading at $54.80 on the Inet electronic system, up 3 percent.
NEW YORK, July 21 (Reuters) - Caterpillar Inc. (CAT.N: Quote, Profile, Research) on Thursday reported higher second-quarter results and raised its full-year outlook, saying it continues to see strength in its key markets and industries.
Net income rose 34 percent to $760 million, or $1.08 a share, from $566 million, or 80 cents a share, in the year-earlier quarter.
NEW YORK (Dow Jones) -- Caterpillar Inc.'s second-quarter profit rose 34%, helped by price increases and stronger sales for its machinery and engines, the company reported Thursday.
The Peoria, Ill.-based company (CAT) also said that 2005 sales would be up 18% to 20% and that earnings would now be $4 to $4.20 a share, up from a previous $ 3.89 to $4.03 a share.
Second-quarter net income rose to $760 million, or $1.08 a share, compared with $566 million or 80 cents, in the same period a year ago.
The Thomson First Call-derived average analyst figure was for earnings of $ 1.01 a share.
Caterpillar's revenue rose 23% to $9.36 billion, also topping analysts' estimates of $8.41 billion in sales. Machinery sales climbed 25% to $6.03 billion and engine sales grew 22% to $2.76 billion.
North America sales were up 24% to $647 million. "Low interest rates and rising home prices supported housing construction, and nonresidential construction benefited from record corporate profits and favorable credit conditions," Caterpillar said.
Mining sales remained strong as a result of robust pricing for coal and metals, the company added.
Shares of Caterpillar, a component of the Dow Jones Industrial Average, fell 95 cents, about 1.8%, to $52.25 in recent trade Thursday.
CHICAGO -(Dow Jones)- China's decision to revalue its currency versus the dollar won't have a major impact on results at Caterpillar Inc. (CAT), executives from the company said Thursday.
In a long-awaited move and amid mounting political pressure, China said Thursday that it would abandon its currency peg, and said that it had set the value of the yuan at 8.11 per dollar, a 2% appreciation from previous levels.
Like other major exporters, Caterpillar, a producer of heavy equipment, stands to benefit from the increased buying power of customers in China, where demand has soared in recent years amid a surge in economic growth.
Caterpillar executives, speaking on a conference call following the release of the company's second-quarter earnings report, said they welcomed the move by Chinese authorities, but that its immediate impact would be limited.
"Overall, it looks like the change in the rate is going to be about 2%, and in general that is not going to have a very significant effect at all on our results - very, very small," said Mike DeWalt, head of investor relations at the Peoria, Ill., company.
Nonetheless, "We think that the action they take was good, and we are supportive," he added, noting that the company's sales to China are approaching $1 billion a year.
Jim Owens, chairman and chief executive at Caterpillar, said he is encouraged that China is moving to more of a market-based system with its exchange rate. While acknowledging that the move itself won't have a big material impact, he said the company is encouraged about opportunities in China.
Caterpillar said early Thursday that it generated record revenue of $9.36 billion in the second quarter, a 23% increase from the year-earlier period. Though nearly half the total was generated outside North America, the Asia/ Pacific region only accounted for $1.13 billion in the quarter, a 9% increase from the year-earlier period. Caterpillar didn't break out a total for China.
During the conference call, Owens said that Caterpillar is "seeing a very strong rebound in domestic sales in China" after a drop-off in demand in the second half of 2004.
Overall in the second quarter, Caterpillar posted a second-quarter net profit of $760 million, or $1.08 per share, a 34% increase over the year-earlier period. The second quarter number exceeded the $1.01 average estimate from a Thomson First Call survey.
The company, which raised its earnings estimate for 2005 to $4 to $4.20 from $ 3.89 to $4.03 previously, cited improved pricing and higher sales volume domestically and abroad.
Caterpillar shares recently were down 84 cents, or 1.6%, to $52.36 on the New York Stock Exchange, in line with the broader market's decline.
NHR Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
