PEORIA, Ill., April 25, 2017 /PRNewswire/ --
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First
Quarter
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($ in billions except
profit per share)
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2017
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2016
|
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Sales and
Revenues
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$9.822
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$9.461
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Profit Per
Share
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$0.32
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$0.46
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Profit Per
Share
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$1.28
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$0.64
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(Excluding
Restructuring Costs)
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- First-quarter sales and revenues up from 2016
- Outstanding operational performance in quarter
- Full-year sales and revenues outlook raised to a range of
$38 billion to $41 billion
- Continued uncertainty and economic volatility for remainder of
2017
Caterpillar Inc. (NYSE: CAT) today announced first-quarter 2017
sales and revenues of $9.8 billion,
compared with $9.5 billion in the
first quarter of 2016. First-quarter 2017 profit per share was
$0.32, compared with $0.46 per share in the first quarter of 2016.
Excluding restructuring costs, first-quarter 2017
profit per share was $1.28, double
first-quarter 2016 profit per share excluding restructuring costs
of $0.64 per share.
"Our team delivered outstanding operational performance and, for
the first time in more than two years, same quarter sales and
revenues increased," said Caterpillar Chief Executive Officer
Jim Umpleby. "We're also benefiting
from our significant cost reduction and restructuring actions,
which have improved cash flow and further strengthened an already
healthy balance sheet. With this momentum, we will continue to
focus investment on improving our competitive position by investing
in new technologies and improving our productivity to deliver
profit growth and shareholder value."
2017 Outlook
While Caterpillar had strong first-quarter performance and is
seeing signs of recovery in several of the industries it serves,
geopolitical and market uncertainty along with volatility in
commodity prices continue to present risks for the rest of the
year.
In January 2017, Caterpillar
provided an outlook range for sales and revenues for the full year
of $36 billion to $39 billion with a
midpoint of $37.5 billion. As a
result of a stronger than expected start to the year, the company's
expectations for full-year 2017 sales and revenues have increased.
The current sales and revenues outlook is now a range of
$38 billion to $41 billion with a
midpoint of $39.5 billion.
For the full year of 2017, Caterpillar expects profit per share
of about $2.10 at the midpoint of the
sales and revenues outlook range, or about $3.75 per share excluding restructuring costs.
The previous outlook for 2017 profit per share was about
$2.30 per share at the midpoint of
the sales and revenues outlook, or about $2.90 per share excluding restructuring
costs.
Restructuring costs expected in 2017 are significantly higher
than the prior outlook primarily due to ongoing manufacturing
facility consolidations. The company expects to incur about
$1.25 billion of restructuring costs
in 2017, an increase of $750 million
from the prior outlook, as the current outlook now includes
restructuring costs for recently announced actions at manufacturing
facilities in Gosselies, Belgium,
and Aurora, Illinois.
"There are encouraging signs, with promising quoting activity in
many of the markets we serve and retail sales to users turning
positive for both machines and Energy &
Transportation for the first time in several years,"
continued Umpleby. "While we are raising the full-year outlook for
sales and revenues, there continues to be uncertainty across the
globe, potential for volatility in commodity prices, and weakness
in key markets."
The 2017 outlook does not include a mark-to-market gain or loss
for remeasurement of pension and OPEB plans.
Notes:
- Glossary of terms is included on pages 15-16; first
occurrence of terms shown in bold italics.
- Information on non-GAAP financial measures is included on
page 17.
- Caterpillar will conduct a teleconference and live webcast,
with a slide presentation, beginning at 10
a.m. Central Time on Tuesday, April
25, 2017, to discuss its 2017 first-quarter financial
results. The accompanying slides will be available before the
webcast on the Caterpillar website at
http://www.caterpillar.com/investors/events-and-presentations.
About Caterpillar:
For more than 90 years, Caterpillar Inc. has been making
sustainable progress possible and driving positive change on every
continent. Customers turn to Caterpillar to help them develop
infrastructure, energy and natural resource assets. With 2016 sales
and revenues of $38.537 billion,
Caterpillar is the world's leading manufacturer of construction and
mining equipment, diesel and natural gas engines, industrial gas
turbines and diesel-electric locomotives. The company principally
operates through its three product segments - Construction
Industries, Resource Industries and Energy & Transportation -
and also provides financing and related services through its
Financial Products segment. For more information, visit
caterpillar.com. To connect with us on social media, visit
caterpillar.com/social-media.
Forward-Looking Statements
Certain statements in this press release relate to future events
and expectations and are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Words such as "believe," "estimate," "will be," "will," "would,"
"expect," "anticipate," "plan," "project," "intend," "could,"
"should" or other similar words or expressions often identify
forward-looking statements. All statements other than statements of
historical fact are forward-looking statements, including, without
limitation, statements regarding our outlook, projections,
forecasts or trend descriptions. These statements do not guarantee
future performance and speak only as of the date they are made, and
we do not undertake to update our forward-looking statements.
Caterpillar's actual results may differ materially from those
described or implied in our forward-looking statements based on a
number of factors, including, but not limited to: (i) global and
regional economic conditions and economic conditions in the
industries we serve; (ii) commodity price changes, material price
increases, fluctuations in demand for our products or significant
shortages of material; (iii) government monetary or fiscal
policies; (iv) political and economic risks, commercial instability
and events beyond our control in the countries in which we operate;
(v) our ability to develop, produce and market quality products
that meet our customers' needs; (vi) the impact of the highly
competitive environment in which we operate on our sales and
pricing; (vii) information technology security threats and computer
crime; (viii) additional restructuring costs or a failure to
realize anticipated savings or benefits from past or future cost
reduction actions; (ix) failure to realize all of the anticipated
benefits from initiatives to increase our productivity, efficiency
and cash flow and to reduce costs; (x) inventory management
decisions and sourcing practices of our dealers and our OEM
customers; (xi) a failure to realize, or a delay in realizing, all
of the anticipated benefits of our acquisitions, joint ventures or
divestitures; (xii) union disputes or other employee relations
issues; (xiii) adverse effects of unexpected events including
natural disasters; (xiv) disruptions or volatility in global
financial markets limiting our sources of liquidity or the
liquidity of our customers, dealers and suppliers; (xv) failure to
maintain our credit ratings and potential resulting increases to
our cost of borrowing and adverse effects on our cost of funds,
liquidity, competitive position and access to capital markets;
(xvi) our Financial Products segment's risks associated with the
financial services industry; (xvii) changes in interest rates or
market liquidity conditions; (xviii) an increase in delinquencies,
repossessions or net losses of Cat Financial's customers; (xix)
currency fluctuations; (xx) our or Cat Financial's compliance with
financial and other restrictive covenants in debt agreements; (xxi)
increased pension plan funding obligations; (xxii) alleged or
actual violations of trade or anti-corruption laws and regulations;
(xxiii) international trade policies and their impact on demand for
our products and our competitive position; (xxiv) additional tax
expense or exposure; (xxv) significant legal proceedings, claims,
lawsuits or government investigations; (xxvi) new regulations or
changes in financial services regulations; (xxvii) compliance with
environmental laws and regulations; and (xxviii) other factors
described in more detail in Caterpillar's Forms 10-Q, 10-K and
other filings with the Securities and Exchange Commission.
CONSOLIDATED RESULTS
Consolidated Sales and Revenues
Consolidated Sales and Revenues Comparison
First Quarter 2017 vs. First Quarter 2016
To access this chart, go to
http://www.caterpillar.com/en/investors/quarterly-results.html
for the downloadable version of Caterpillar 1Q
2017 earnings.
The chart above graphically illustrates reasons for the change
in Consolidated Sales and Revenues between the first quarter of
2016 (at left) and the first quarter of 2017 (at right). Items
favorably impacting sales and revenues appear as upward stair steps
with the corresponding dollar amounts above each bar, while items
negatively impacting sales and revenues appear as downward stair
steps with dollar amounts reflected in parentheses above each bar.
Caterpillar management utilizes these charts internally to visually
communicate with the company's board of directors and
employees.
Sales and Revenues
Total sales and revenues were $9.822
billion in the first quarter of 2017, an increase of
$361 million, or 4 percent, compared
with $9.461 billion in the first
quarter of 2016. The increase was primarily due to higher
sales volume, with the most significant increase in
Resource Industries mostly due to higher end-user
demand for aftermarket parts. Sales volume for Energy &
Transportation increased slightly mostly due to aftermarket parts
for reciprocating engines. Construction Industries'
sales volume was about flat. Favorable price
realization also contributed to the sales improvement.
Financial Products' segment revenues increased 2
percent primarily due to higher average financing rates.
Sales increased in Asia/Pacific
and Latin America
and were about flat in EAME and North America. Asia/Pacific sales increased 12 percent
primarily due to an increase in construction equipment sales in
China resulting from increased
infrastructure and residential investment. In addition, higher
commodity prices and increased mining production favorably impacted
demand for aftermarket parts in Australia. Sales increased 14 percent in
Latin America primarily due to
stabilizing economic conditions in several countries in the region
that resulted in improved end-user demand from low levels. In
North America, sales were flat as
higher demand for aftermarket parts was offset by lower end-user
demand for new equipment and the unfavorable impact of changes in
dealer inventories as dealers increased inventories more in the
first quarter of 2016 than in the first quarter of 2017. Also,
increased demand in North America
for oil and gas applications was about offset by lower sales for
infrastructure construction equipment.
Consolidated Operating Profit
Consolidated Operating Profit Comparison
First Quarter 2017 vs. First Quarter 2016
To access this chart, go to
http://www.caterpillar.com/en/investors/quarterly-results.html
for the downloadable version of Caterpillar 1Q 2017
earnings.
The chart above graphically illustrates reasons for the change
in Consolidated Operating Profit between the first quarter of 2016
(at left) and the first quarter of 2017 (at right). Items favorably
impacting operating profit appear as upward stair steps
with the corresponding dollar amounts above each bar, while items
negatively impacting operating profit appear as downward stair
steps with dollar amounts reflected in parentheses above each bar.
Caterpillar management utilizes these charts internally to visually
communicate with the company's board of directors and employees.
The bar entitled Other includes consolidating
adjustments and Machinery, Energy &
Transportation other operating (income) expenses.
Operating profit for the first quarter of 2017 was $417 million, compared with $494 million in the first quarter of 2016, an
unfavorable change of $77 million
driven by a significant increase in restructuring costs. Excluding
restructuring costs, operating profit improved by $514 million, compared with the first quarter of
2016. The increase was primarily due to higher sales volume, with
nearly half of that increase due to a favorable mix of products.
Lower period costs, improved variable
manufacturing costs and favorable price realization also
contributed to the increase in operating profit. About half of the
variable manufacturing cost improvement was from lower material
costs, and price realization was favorable in Construction
Industries.
Period costs were lower primarily due to substantial
restructuring and cost reduction actions over the past year. The
reductions impacted period manufacturing costs, selling, general
and administrative expenses and research and development expenses
(R&D), with the most significant reduction in R&D. In
addition, stock-based compensation expense was lower, as discussed
in Q&A #5. These reductions were partially offset by higher
short-term incentive compensation expense.
Restructuring costs of $752
million in the first quarter of 2017 were primarily related
to the announced closure of the facility in Gosselies, Belgium. In the first quarter of 2016,
restructuring costs were $161
million.
Other Profit/Loss Items
- Other income/expense in the first quarter of 2017 was
expense of $5 million, compared with
zero income/expense in the first quarter of 2016. The unfavorable
change was primarily due to the impact from currency
translation and hedging gains and losses. Net losses were higher in
the first quarter of 2017, compared with the first quarter of
2016.
- The provision for income taxes in the first quarter
reflects an estimated annual tax rate of 32 percent, which excludes
the discrete items discussed in the following paragraph, compared
to 25 percent for the first quarter of 2016. The increase is
primarily due to higher non-U.S. restructuring costs in 2017 that
are taxed at relatively lower non-U.S. tax rates, along with other
changes in the geographic mix of profits from a tax
perspective.
In addition, a tax benefit of $17
million was recorded for the settlement of stock-based
compensation awards with tax deductions in excess of cumulative
U.S. GAAP compensation expense. This benefit was offset by a
$15 million increase to prior year
taxes related to non-U.S. restructuring costs.
Excluding restructuring costs and discrete items, the 2017
estimated annual tax rate is expected to be 28 percent.
Global Workforce
Caterpillar worldwide, full-time employment was about 95,300 at
the end of the first quarter of 2017, compared with about 101,400
at the end of the first quarter of 2016, a decrease of about 6,100
full-time employees. The flexible workforce decreased by about 300
for a total decrease in the global workforce of about 6,400. The
decrease was primarily the result of restructuring programs.
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March
31
|
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|
2017
|
|
2016
|
|
Increase/
(Decrease)
|
Full-time
employment
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|
95,300
|
|
101,400
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|
(6,100)
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Flexible
workforce
|
|
12,600
|
|
12,900
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|
(300)
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Total
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107,900
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114,300
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(6,400)
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Geographic
summary
|
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U.S.
workforce
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46,500
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50,500
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|
(4,000)
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Non-U.S.
workforce
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|
61,400
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|
63,800
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|
(2,400)
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Total
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|
107,900
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|
114,300
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|
(6,400)
|
SEGMENT RESULTS
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Sales and Revenues
by Geographic Region
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%
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North
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%
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Latin
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%
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%
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Asia/
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%
|
(Millions of
dollars)
|
Total
|
|
Change
|
|
America
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|
Change
|
|
America
|
|
Change
|
|
EAME
|
|
Change
|
|
Pacific
|
|
Change
|
First Quarter
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
Industries¹
|
$4,091
|
|
1
|
%
|
|
$
1,913
|
|
(7)
|
%
|
|
$
250
|
|
8
|
%
|
|
$
812
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|
(4)
|
%
|
|
$1,116
|
|
23
|
%
|
Resource
Industries²
|
1,670
|
|
15
|
%
|
|
598
|
|
(1)
|
%
|
|
269
|
|
-
|
%
|
|
416
|
|
59
|
%
|
|
387
|
|
23
|
%
|
Energy &
Transportation³
|
3,356
|
|
2
|
%
|
|
1,722
|
|
10
|
%
|
|
275
|
|
38
|
%
|
|
900
|
|
(8)
|
%
|
|
459
|
|
(13)
|
%
|
All Other
Segments⁴
|
37
|
|
(3)
|
%
|
|
8
|
|
(47)
|
%
|
|
-
|
|
(100)
|
%
|
|
16
|
|
78
|
%
|
|
13
|
|
-
|
%
|
Corporate Items and
Eliminations
|
(24)
|
|
|
|
|
(23)
|
|
|
|
|
-
|
|
|
|
|
(2)
|
|
|
|
|
1
|
|
|
|
Machinery, Energy
& Transportation
|
$9,130
|
|
4
|
%
|
|
$
4,218
|
|
-
|
%
|
|
$
794
|
|
14
|
%
|
|
$2,142
|
|
2
|
%
|
|
$1,976
|
|
12
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
$
760
|
|
2
|
%
|
|
$
486
|
|
6
|
%
|
|
$
83
|
|
(5)
|
%
|
|
$
100
|
|
2
|
%
|
|
$
91
|
|
(8)
|
%
|
Corporate Items and
Eliminations
|
(68)
|
|
|
|
|
(38)
|
|
|
|
|
(14)
|
|
|
|
|
(4)
|
|
|
|
|
(12)
|
|
|
|
Financial
Products Revenues
|
$
692
|
|
2
|
%
|
|
$
448
|
|
5
|
%
|
|
$
69
|
|
(5)
|
%
|
|
$
96
|
|
2
|
%
|
|
$
79
|
|
(11)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Sales
and Revenues
|
$9,822
|
|
4
|
%
|
|
$
4,666
|
|
-
|
%
|
|
$
863
|
|
12
|
%
|
|
$2,238
|
|
2
|
%
|
|
$2,055
|
|
11
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
Industries¹
|
$4,043
|
|
|
|
|
$
2,058
|
|
|
|
|
$
231
|
|
|
|
|
$
847
|
|
|
|
|
$
907
|
|
|
|
Resource
Industries²
|
1,449
|
|
|
|
|
604
|
|
|
|
|
268
|
|
|
|
|
262
|
|
|
|
|
315
|
|
|
|
Energy &
Transportation³
|
3,278
|
|
|
|
|
1,566
|
|
|
|
|
200
|
|
|
|
|
982
|
|
|
|
|
530
|
|
|
|
All Other
Segments⁴
|
38
|
|
|
|
|
15
|
|
|
|
|
1
|
|
|
|
|
9
|
|
|
|
|
13
|
|
|
|
Corporate Items and
Eliminations
|
(28)
|
|
|
|
|
(24)
|
|
|
|
|
(1)
|
|
|
|
|
(2)
|
|
|
|
|
(1)
|
|
|
|
Machinery, Energy
& Transportation
|
$8,780
|
|
|
|
|
$
4,219
|
|
|
|
|
$
699
|
|
|
|
|
$2,098
|
|
|
|
|
$1,764
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
$
743
|
|
|
|
|
$
459
|
|
|
|
|
$
87
|
|
|
|
|
$
98
|
|
|
|
|
$
99
|
|
|
|
Corporate Items and
Eliminations
|
(62)
|
|
|
|
|
(34)
|
|
|
|
|
(14)
|
|
|
|
|
(4)
|
|
|
|
|
(10)
|
|
|
|
Financial
Products Revenues
|
$
681
|
|
|
|
|
$
425
|
|
|
|
|
$
73
|
|
|
|
|
$
94
|
|
|
|
|
$
89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Sales
and Revenues
|
$9,461
|
|
|
|
|
$
4,644
|
|
|
|
|
$
772
|
|
|
|
|
$2,192
|
|
|
|
|
$1,853
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
1.
Does not include inter-segment sales of $25 million and $8 million
in first quarter 2017 and 2016, respectively.
|
|
|
|
2.
Does not include inter-segment sales of $91 million and $71 million
in first quarter 2017 and 2016, respectively.
|
|
|
|
3.
Does not include inter-segment sales of $780 million and $632
million in first quarter 2017 and 2016, respectively.
|
|
|
|
4.
Does not include inter-segment sales of $95 million and $92 million
in first quarter 2017 and 2016, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and Revenues
by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First
|
|
Sales
|
|
Price
|
|
|
|
|
|
First
|
|
$
|
|
%
|
(Millions of
dollars)
|
Quarter
2016
|
|
Volume
|
|
Realization
|
|
Currency
|
|
Other
|
|
Quarter
2017
|
|
Change
|
|
Change
|
Construction
Industries
|
$
4,043
|
|
$
(68)
|
|
$
123
|
|
$
(7)
|
|
$
-
|
|
$
4,091
|
|
$
48
|
|
1
|
%
|
Resource
Industries
|
1,449
|
|
246
|
|
(32)
|
|
7
|
|
-
|
|
1,670
|
|
221
|
|
15
|
%
|
Energy &
Transportation
|
3,278
|
|
93
|
|
(1)
|
|
(14)
|
|
-
|
|
3,356
|
|
78
|
|
2
|
%
|
All Other
Segments
|
38
|
|
(1)
|
|
-
|
|
-
|
|
-
|
|
37
|
|
(1)
|
|
(3)
|
%
|
Corporate Items and
Eliminations
|
(28)
|
|
5
|
|
(2)
|
|
1
|
|
-
|
|
(24)
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Machinery, Energy
& Transportation
|
$
8,780
|
|
$
275
|
|
$
88
|
|
$
(13)
|
|
$
-
|
|
$
9,130
|
|
$
350
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
$
743
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$ 17
|
|
$
760
|
|
$
17
|
|
2
|
%
|
Corporate Items and
Eliminations
|
(62)
|
|
-
|
|
-
|
|
-
|
|
(6)
|
|
(68)
|
|
(6)
|
|
|
|
Financial Products
Revenues
|
$
681
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$ 11
|
|
$
692
|
|
$
11
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Sales
and Revenues
|
$
9,461
|
|
$
275
|
|
$
88
|
|
$
(13)
|
|
$ 11
|
|
$
9,822
|
|
$
361
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit
(Loss) by Segment
|
|
First
|
|
First
|
|
$
|
|
%
|
(Millions of
dollars)
|
Quarter
2017
|
|
Quarter
2016
|
|
Change
|
|
Change
|
Construction
Industries
|
$
635
|
|
$
440
|
|
$
195
|
|
44
|
%
|
Resource
Industries
|
158
|
|
(96)
|
|
254
|
|
265
|
%
|
Energy &
Transportation
|
552
|
|
410
|
|
142
|
|
35
|
%
|
All Other
Segments
|
(13)
|
|
(7)
|
|
(6)
|
|
(86)
|
%
|
Corporate Items and
Eliminations
|
(1,030)
|
|
(357)
|
|
(673)
|
|
|
|
Machinery, Energy
& Transportation
|
$
302
|
|
$
390
|
|
$
(88)
|
|
(23)
|
%
|
Financial Products
Segment
|
$
183
|
|
$
168
|
|
$
15
|
|
9
|
%
|
Corporate Items and
Eliminations
|
3
|
|
(1)
|
|
4
|
|
|
|
Financial
Products
|
$
186
|
|
$
167
|
|
$
19
|
|
11
|
%
|
Consolidating
Adjustments
|
(71)
|
|
(63)
|
|
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Operating Profit
|
$
417
|
|
$
494
|
|
$
(77)
|
|
(16)
|
%
|
|
|
|
|
|
|
|
|
|
CONSTRUCTION
INDUSTRIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2016
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
First Quarter
2017
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison1
|
$4,043
|
|
($68)
|
|
$123
|
|
($7)
|
|
$4,091
|
|
$48
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
North
America
|
$1,913
|
|
$2,058
|
|
($145)
|
|
(7)
|
%
|
|
|
|
|
|
|
Latin
America
|
250
|
|
231
|
|
19
|
|
8
|
%
|
|
|
|
|
|
|
EAME
|
812
|
|
847
|
|
(35)
|
|
(4)
|
%
|
|
|
|
|
|
|
Asia/Pacific
|
1,116
|
|
907
|
|
209
|
|
23
|
%
|
|
|
|
|
|
|
Total1
|
$4,091
|
|
$4,043
|
|
$48
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
Segment
Profit
|
$635
|
|
$440
|
|
$195
|
|
44
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1. Does not include
inter-segment sales of $25 million and $8 million in first quarter
2017 and 2016, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction Industries' sales were $4.091 billion in the first quarter of 2017,
compared with $4.043 billion in the
first quarter of 2016. The increase was due to favorable price
realization, partially offset by slightly lower volume.
- Although market conditions remain competitive, price
realization was favorable due to a particularly weak pricing
environment in the first quarter of 2016 and previously announced
price increases impacting the first quarter of 2017.
- Sales volume declined primarily due to the unfavorable impact
of changes in dealer inventories resulting from a more significant
increase in dealer inventories in the first quarter of 2016 than in
the first quarter of 2017. This was partially offset by higher
end-user demand, primarily for equipment in Asia/Pacific.
Sales increased in Asia/Pacific
and decreased in North America.
Sales were about flat in EAME and Latin
America.
- Sales in Asia/Pacific were
higher as a result of an increase in end-user demand, primarily in
China, stemming from increased
government support for infrastructure and strong residential
investment. This increase was partially offset by an unfavorable
impact from changes in dealer inventories, primarily in
China, which were about flat in
the first quarter of 2016 and decreased in the first quarter of
2017.
- In North America, the sales
decline was primarily due to an unfavorable impact from changes in
dealer inventories and lower end-user demand, partially offset by
favorable price realization. End-user demand was lower in part due
to lower deliveries into rental fleets in the first quarter of
2017, compared with the first quarter of 2016. Although residential
and non-residential building construction activity improved, the
company believes demand for new construction equipment has remained
low due to end users' utilization of existing used equipment and
weak infrastructure development. The unfavorable impact of changes
in dealer inventories resulted from a more significant increase in
dealer inventories in the first quarter of 2016 than in the first
quarter of 2017.
Construction Industries' profit was $635
million in the first quarter of 2017, compared with
$440 million in the first quarter of
2016. The increase in profit was primarily due to favorable price
realization and lower period costs. The lower period costs were
mostly a result of the favorable impact of restructuring and cost
reduction actions.
RESOURCE
INDUSTRIES
|
|
|
(Millions of
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2016
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
|
First Quarter
2017
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison1
|
$1,449
|
|
$246
|
|
($32)
|
|
$7
|
|
|
$1,670
|
|
$221
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
North
America
|
$598
|
|
$604
|
|
($6)
|
|
(1)
|
%
|
|
|
Latin
America
|
269
|
|
268
|
|
1
|
|
-
|
%
|
|
EAME
|
416
|
|
262
|
|
154
|
|
59
|
%
|
|
Asia/Pacific
|
387
|
|
315
|
|
72
|
|
23
|
%
|
|
Total1
|
$1,670
|
|
$1,449
|
|
$221
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Profit
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
Segment
Profit
|
$158
|
|
($96)
|
|
$254
|
|
265
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1. Does not include
inter-segment sales of $91 million and $71 million in first quarter
2017 and 2016, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resource Industries' sales were $1.670
billion in the first quarter of 2017, an increase of
$221 million, or 15 percent, from the
first quarter of 2016. The increase was primarily due to higher
sales volume. While sales improved for both new equipment and
aftermarket parts, most of the increase was for aftermarket parts,
which have increased sequentially in each of the last four
quarters. Sales for new equipment were favorably impacted by
changes in dealer inventories, which more than offset lower
end-user demand. Dealer inventories increased slightly in the first
quarter of 2017, compared with a decrease in the first quarter of
2016. Increases in certain commodity prices over the past year,
along with continued commodity consumption, have resulted in
increased mining production driving the need for maintenance and
rebuild activities. The company believes commodity prices need to
stabilize at these higher levels to drive stronger activity and
longer-term demand for both equipment and aftermarket parts.
Resource Industries' profit was $158
million in the first quarter of 2017, compared with a loss
of $96 million in the first quarter
of 2016. The favorable change was due to higher sales volume and
lower period costs. Period costs were lower primarily due to the
favorable impact of restructuring and cost reduction actions,
partially offset by an increase in short-term incentive
compensation expense.
ENERGY &
TRANSPORTATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2016
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
|
First Quarter
2017
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison1
|
$3,278
|
|
$93
|
|
($1)
|
|
($14)
|
|
|
$3,356
|
|
$78
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
North
America
|
$1,722
|
|
$1,566
|
|
$156
|
|
10
|
%
|
|
Latin
America
|
275
|
|
200
|
|
75
|
|
38
|
%
|
|
EAME
|
900
|
|
982
|
|
(82)
|
|
(8)
|
%
|
|
Asia/Pacific
|
459
|
|
530
|
|
(71)
|
|
(13)
|
%
|
|
Total1
|
$3,356
|
|
$3,278
|
|
$78
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
Segment
Profit
|
$552
|
|
$410
|
|
$142
|
|
35
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1. Does not include
inter-segment sales of $780 million and $632 million in first
quarter 2017 and 2016, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Energy & Transportation's sales were $3.356 billion in the first quarter of 2017,
compared with $3.278 billion in the
first quarter of 2016. The increase was primarily due to higher
sales of aftermarket parts for reciprocating engines.
- Oil and Gas – The sales increase was primarily in
North America, due to higher
demand for aftermarket parts as a result of relatively stable oil
prices and increasing fleet utilization as well as for
reciprocating engines used in gas compression as natural gas
pipeline build-out continued. This was partially offset by a
decrease in Asia/Pacific primarily
due to lower demand for equipment used in drilling and production
applications.
- Power Generation – Sales decreased in EAME and were
about flat in all other regions. The decline in EAME was primarily
a result of continued weakness in the Middle East with oil prices continuing to
limit investments.
- Industrial – Sales were about flat as increases in
Asia/Pacific and Latin America were mostly offset by a decrease
in EAME, reflecting changes in end-user demand for industrial
applications.
- Transportation – Sales were about flat with an increase
in demand for rail applications mostly offset by a decrease in
sales for marine applications. Rail application sales increased
primarily for rail services and aftermarket in North America despite continued weakness in
the rail industry. The North American rail industry continues to be
depressed with a significant number of idle locomotives. Sales
declined in marine applications mostly due to lower demand,
primarily for work boats and offshore vessels.
Energy & Transportation's profit was $552 million in the first quarter of 2017,
compared with $410 million in the
first quarter of 2016. The increase was primarily due to higher
sales volume, a favorable impact from cost absorption and improved
material costs. Cost absorption was favorable as inventory
increased more in the first quarter of 2017 than in the first
quarter of 2016. Period costs were about flat as the favorable
impact of restructuring and cost reduction actions was about offset
by higher short-term incentive compensation expense.
FINANCIAL PRODUCTS
SEGMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by
Geographic Region
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
North
America
|
$486
|
|
$459
|
|
$27
|
|
6
|
%
|
|
|
Latin
America
|
83
|
|
87
|
|
(4)
|
|
(5)
|
%
|
|
|
EAME
|
100
|
|
98
|
|
2
|
|
2
|
%
|
|
|
Asia/Pacific
|
91
|
|
99
|
|
(8)
|
|
(8)
|
%
|
|
|
Total
|
$760
|
|
$743
|
|
$17
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter
2017
|
|
First Quarter
2016
|
|
$
Change
|
|
%
Change
|
|
|
Segment
Profit
|
$183
|
|
$168
|
|
$15
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products' revenues were $760
million in the first quarter of 2017, an increase of
$17 million, or 2 percent, from the
first quarter of 2016. The increase was primarily due to higher
average financing rates in North
America, partially offset by lower average earning
assets in North America,
Latin America and Asia/Pacific and lower average financing rates
in Asia/Pacific.
Financial Products' profit was $183
million in the first quarter of 2017, compared with
$168 million in the first quarter of
2016. The increase was primarily due to a decrease in the provision
for credit losses at Cat Financial.
At the end of the first quarter of 2017, past dues at Cat
Financial were 2.64 percent, compared with 2.78 percent at the end
of the first quarter of 2016. Write-offs, net of recoveries, in the
first quarter of 2017 were $15
million, or 0.23 percent of the average retail portfolio,
compared with $31 million, or 0.47
percent of the average retail portfolio in the first quarter of
2016, and were below historical averages for the first quarter.
As of March 31, 2017, Cat
Financial's allowance for credit losses totaled $346 million, or 1.28 percent of finance
receivables, compared with $340
million, or 1.21 percent of finance receivables at
March 31, 2016. The allowance for
credit losses at year-end 2016 was $343
million, or 1.29 percent of finance receivables.
Corporate Items and Eliminations
Expense for corporate items and eliminations was $1.027 billion in the first quarter of 2017, an
increase of $669 million from the
first quarter of 2016. Corporate items and eliminations include:
restructuring costs; corporate-level expenses; timing differences,
as some expenses are reported in segment profit on a cash basis;
retirement benefit costs other than service cost; currency
differences for ME&T, as segment profit is reported using
annual fixed exchange rates; cost of sales methodology differences
as segments use a current cost methodology; and inter-segment
eliminations.
Restructuring costs in the first quarter of 2017 were
$752 million, $591 million higher than the first quarter of
2016, primarily due to the announced closure of the facility in
Gosselies, Belgium. Excluding
restructuring costs, expense for corporate items and eliminations
was $275 million, an increase of
$78 million from the first quarter of
2016, primarily due to timing differences.
QUESTIONS AND ANSWERS
Q1:
|
Can you comment on
first-quarter restructuring costs and your 2017 outlook for
restructuring costs?
|
|
|
A:
|
During the first
quarter of 2017, we incurred $752 million of restructuring costs
with approximately $670 million related to our manufacturing
facility in Gosselies, Belgium. On March 27, 2017, Caterpillar
informed Belgian authorities of the decision to proceed to a
collective dismissal, which will lead to the closure of the
Gosselies site, impacting about 2,000 employees. Production
operations at Gosselies are expected to end by mid-year 2017. The
restructuring costs are primarily for severance costs and asset
impairment charges.
|
|
|
|
First-quarter 2017
restructuring costs also include charges related to our decision to
move production from the Aurora, Illinois, facility into other U.S.
manufacturing facilities by the end of 2018, as well as ongoing
manufacturing facility consolidations that have been previously
announced. We expect to incur about $1.25 billion of restructuring
costs during 2017, with costs for the remainder of the year
primarily for these announced restructuring actions.
|
|
|
Q2:
|
Can you discuss
changes in dealer inventories during the first quarter of
2017?
|
|
|
A:
|
Dealers generally
increase inventories in the first quarter in preparation for the
spring selling season. Dealer machine and engine inventories
increased about $200 million in the first quarter of 2017, compared
to an increase of about $300 million in the first quarter of
2016.
|
|
|
Q3:
|
Can you discuss
changes to your order backlog by segment?
|
|
|
A:
|
At the end of the
first quarter of 2017, the order backlog was about $14.8 billion.
This represents about a $2.7 billion increase from the end of 2016.
The increase was across all segments, but primarily in Energy &
Transportation and Construction Industries.
|
|
|
|
Compared with the
first quarter of 2016, the order backlog increased $1.7 billion.
The increase was across all segments, primarily in Construction
Industries.
|
|
|
Q4:
|
Can you comment on
first-quarter 2017 expense related to your short-term incentive
compensation plan? What is included in your 2017
outlook?
|
|
|
A:
|
Short-term incentive
compensation expense is directly related to financial and
operational performance, measured against targets set annually.
First-quarter 2017 expense was about $235 million, compared with
first-quarter 2016 expense of about $120 million.
|
|
|
|
For 2017, our current
outlook includes short-term incentive compensation expense of about
$950 million, up from $750 million in our previous outlook.
Short-term incentive compensation expense was about $250 million in
2016, significantly below targeted levels.
|
|
|
Q5:
|
Why did your
stock-based compensation expense decrease in the first quarter of
2017 compared with the first quarter of 2016?
|
|
|
A:
|
The decrease of $52
million was primarily related to timing. In 2017, we changed the
vesting policy for the annual equity award to require six months of
continuous employment prior to separation for participants who meet
certain criteria (generally, 55 years of age or older and at least
five years of service with the company) rather than to permit
immediate vesting upon separation. Stock-based compensation expense
for these individuals is now recognized over a six-month period,
rather than in the first quarter. This change will not impact
stock-based compensation expense for the year but does impact the
quarterly expense pattern.
|
|
|
Q6:
|
Can you comment on
your balance sheet and cash priorities?
|
|
|
A:
|
The ME&T
debt-to-capital ratio was 41.7 percent at the end of
the first quarter of 2017, compared with 41.0 percent at the end of
2016. Our cash and liquidity positions remain strong with an
enterprise cash balance of $9.472 billion as of March 31, 2017.
ME&T operating cash flow for the first quarter of 2017 was
$1.524 billion, compared with $219 million in the first quarter of
2016. The increase was primarily due to higher profit excluding
restructuring costs in the first quarter of 2017, compared with the
first quarter of 2016. First-quarter 2017 restructuring costs were
primarily for severance costs that have not yet been paid and for
non-cash impairment charges. In addition, there were lower
severance and short-term incentive compensation payments in the
first quarter of 2017 versus the first quarter of
2016.
|
|
|
|
Although our
short-term priorities for the use of cash may vary from time to
time as business needs and conditions dictate, our long-term cash
deployment strategy remains unchanged: maintain a strong financial
position in support of our credit rating, provide capital to
support growth, appropriately fund employee benefit plans, pay
dividends and repurchase common
stock.
|
GLOSSARY OF TERMS
1.
|
All Other
Segments – Primarily includes activities such as: the business
strategy, product management and development, and manufacturing of
filters and fluids, undercarriage, tires and rims, ground engaging
tools, fluid transfer products, precision seals, and rubber sealing
and connecting components primarily for Cat® products; parts
distribution; distribution services responsible for dealer
development and administration including a wholly owned dealer in
Japan, dealer portfolio management and ensuring the most efficient
and effective distribution of machines, engines and parts; digital
investments for new customer and dealer solutions that integrate
data analytics with state-of-the art digital technologies while
transforming the buying experience.
|
2.
|
Consolidating
Adjustments – Elimination of transactions between Machinery,
Energy & Transportation and Financial Products.
|
3.
|
Construction
Industries – A segment primarily responsible for supporting
customers using machinery in infrastructure, forestry and building
construction applications. Responsibilities include business
strategy, product design, product management and development,
manufacturing, marketing and sales and product support. The product
portfolio includes backhoe loaders, small wheel loaders, small
track-type tractors, skid steer loaders, multi-terrain loaders,
mini excavators, compact wheel loaders, telehandlers, select work
tools, small, medium and large track excavators, wheel excavators,
medium wheel loaders, compact track loaders, medium track-type
tractors, track-type loaders, motor graders, pipelayers, forestry
and paving products and related parts.
|
4.
|
Currency –
With respect to sales and revenues, currency represents the
translation impact on sales resulting from changes in foreign
currency exchange rates versus the U.S. dollar. With respect to
operating profit, currency represents the net translation impact on
sales and operating costs resulting from changes in foreign
currency exchange rates versus the U.S. dollar. Currency includes
the impact on sales and operating profit for the Machinery, Energy
& Transportation lines of business only excluding restructuring
costs; currency impacts on Financial Products' revenues and
operating profit are included in the Financial Products' portions
of the respective analyses. With respect to other income/expense,
currency represents the effects of forward and option contracts
entered into by the company to reduce the risk of fluctuations in
exchange rates (hedging) and the net effect of changes in foreign
currency exchange rates on our foreign currency assets and
liabilities for consolidated results (translation).
|
5.
|
Debt-to-Capital
Ratio – A key measure of Machinery, Energy &
Transportation's financial strength used by management. The metric
is defined as Machinery, Energy & Transportation's short-term
borrowings, long-term debt due within one year and long-term debt
due after one year (debt) divided by the sum of Machinery, Energy
& Transportation's debt and shareholders' equity. Debt also
includes Machinery, Energy & Transportation's long-term
borrowings from Financial Products.
|
6.
|
EAME – A
geographic region including Europe, Africa, the Middle East and the
Commonwealth of Independent States (CIS).
|
7.
|
Earning Assets
– Assets consisting primarily of total finance receivables net of
unearned income, plus equipment on operating leases, less
accumulated depreciation at Cat Financial.
|
8.
|
Energy &
Transportation – A segment primarily responsible for
supporting customers using reciprocating engines, turbines,
diesel-electric locomotives and related parts across industries
serving power generation, industrial, oil and gas and
transportation applications, including marine and rail-related
businesses. Responsibilities include business strategy, product
design, product management and development, manufacturing,
marketing and sales and product support of turbines and
turbine-related services, reciprocating engine powered generator
sets, integrated systems used in the electric power generation
industry, reciprocating engines and integrated systems and
solutions for the marine and oil and gas industries; reciprocating
engines supplied to the industrial industry as well as Cat
machinery; the remanufacturing of Cat engines and components and
remanufacturing services for other companies; the business
strategy, product design, product management and development,
manufacturing, remanufacturing, leasing and service of
diesel-electric locomotives and components and other rail-related
products and services and product support of on-highway vocational
trucks for North America.
|
9.
|
Financial Products
Segment – Provides financing alternatives to
customers and dealers around the world for Caterpillar products, as
well as financing for vehicles, power generation facilities and
marine vessels that, in most cases, incorporate Caterpillar
products. Financing plans include operating and finance leases,
installment sale contracts, working capital loans and wholesale
financing plans. The segment also provides insurance and risk
management products and services that help customers and dealers
manage their business risk. Insurance and risk management products
offered include physical damage insurance, inventory protection
plans, extended service coverage for machines and engines, and
dealer property and casualty insurance. The various forms of
financing, insurance and risk management products offered to
customers and dealers help support the purchase and lease of our
equipment. Financial Products segment profit is determined on a
pretax basis and includes other income/expense items.
|
10.
|
Latin America
– A geographic region including Central and South American
countries and Mexico.
|
11.
|
Machinery, Energy
& Transportation (ME&T) – Represents the aggregate
total of Construction Industries, Resource Industries, Energy &
Transportation and All Other Segments and related corporate items
and eliminations.
|
12.
|
Machinery, Energy
& Transportation Other Operating (Income)
Expenses – Comprised primarily of gains/losses on
disposal of long-lived assets, gains/losses on divestitures and
legal settlements and accruals. Restructuring costs classified as
other operating expenses on the Results of Operations are presented
separately on the Operating Profit Comparison.
|
13.
|
Pension and other
postemployment benefit (OPEB) – The company's defined
benefit pension and postretirement benefit plans.
|
14.
|
Period
Costs – Includes period manufacturing costs, ME&T
selling, general and administrative (SG&A) and research and
development (R&D) expenses excluding the impact of currency and
exit-related costs that are included in restructuring costs (see
definition below). Period manufacturing costs support production
but are defined as generally not having a direct relationship to
short-term changes in volume. Examples include machinery and
equipment repair, depreciation on manufacturing assets, facility
support, procurement, factory scheduling, manufacturing planning
and operations management. SG&A and R&D costs are not
linked to the production of goods or services and include
marketing, legal and finance services and the development of new
and significant improvements in products or processes.
|
15.
|
Price
Realization – The impact of net price changes excluding
currency and new product introductions. Price realization includes
geographic mix of sales, which is the impact of changes in the
relative weighting of sales prices between geographic
regions.
|
16.
|
Resource
Industries – A segment primarily responsible for
supporting customers using machinery in mining, quarry, waste, and
material handling applications. Responsibilities include business
strategy, product design, product management and development,
manufacturing, marketing and sales and product support. The product
portfolio includes large track-type tractors, large mining trucks,
hard rock vehicles, longwall miners, electric rope shovels,
draglines, hydraulic shovels, track and rotary drills, highwall
miners, large wheel loaders, off-highway trucks, articulated
trucks, wheel tractor scrapers, wheel dozers, landfill compactors,
soil compactors, material handlers, continuous miners, scoops and
haulers, hardrock continuous mining systems, select work tools,
machinery components, electronics and control systems and related
parts. In addition to equipment, Resource Industries also develops
and sells technology products and services to provide customers
fleet management, equipment management analytics and autonomous
machine capabilities. Resource Industries also manages areas that
provide services to other parts of the company, including
integrated manufacturing and research and development.
|
17.
|
Restructuring
Costs – Primarily costs for employee separation costs,
long-lived asset impairments and contract terminations. These costs
are included in Other Operating (Income) Expenses. Restructuring
costs also include other exit-related costs primarily for
accelerated depreciation, inventory write-downs and equipment
relocation (primarily included in Cost of goods sold) and sales
discounts and payments to dealers and customers related to
discontinued products (included in Sales of ME&T).
|
18.
|
Sales Volume –
With respect to sales and revenues, sales volume represents the
impact of changes in the quantities sold for Machinery, Energy
& Transportation as well as the incremental revenue impact of
new product introductions, including emissions-related product
updates. With respect to operating profit, sales volume represents
the impact of changes in the quantities sold for Machinery, Energy
& Transportation combined with product mix as well as the net
operating profit impact of new product introductions, including
emissions-related product updates. Product mix represents the net
operating profit impact of changes in the relative weighting of
Machinery, Energy & Transportation sales with respect to total
sales. The impact of sales volume on segment profit includes
intersegment sales.
|
19.
|
Variable
Manufacturing Costs – Represents volume-adjusted
costs excluding the impact of currency and restructuring costs (see
definition above). Variable manufacturing costs are defined as
having a direct relationship with the volume of production. This
includes material costs, direct labor and other costs that vary
directly with production volume such as freight, power to operate
machines and supplies that are consumed in the manufacturing
process.
|
NON-GAAP FINANCIAL MEASURES
The following definition is provided for "non-GAAP financial
measures" in connection with Regulation G issued by the Securities
and Exchange Commission. The non-GAAP financial measures
Caterpillar uses have no standardized meaning prescribed by U.S.
GAAP and therefore are unlikely to be comparable to the calculation
of similar measures for other companies. Management does not intend
these items to be considered in isolation or substituted for the
related GAAP
measure.
Profit Per Share Excluding Restructuring Costs
The company incurred restructuring costs in 2016 and in the
first quarter of 2017 and expects to incur additional restructuring
costs during the remainder of 2017. The company believes it is
important to separately quantify the profit per share impact of
restructuring costs in order for Caterpillar's results and outlook
to be meaningful to readers as these costs are incurred in the
current year to generate longer-term benefits.
Reconciliations of profit per share excluding restructuring
costs to the most directly comparable GAAP measure, diluted profit
per share, are as follows:
|
|
|
First
Quarter
|
|
2017
Outlook
|
|
|
|
|
2016
|
|
2017
|
|
Previous
1
|
|
Current
2
|
|
|
Profit per
share
|
$0.46
|
|
$0.32
|
|
$2.30
|
|
$2.10
|
|
|
Per share
restructuring costs3
|
$0.18
|
|
$0.96
|
|
$0.60
|
|
$1.65
|
|
|
Profit per share
excluding restructuring costs
|
$0.64
|
|
$1.28
|
|
$2.90
|
|
$3.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1. 2017
Sales and Revenues Outlook in a range of $36-$39 billion (as of
January 26, 2017). Profit per share at midpoint.
|
|
|
2. 2017
Sales and Revenues Outlook in a range of $38-$41 billion.
Profit per share at midpoint.
|
|
|
3. At
estimated annual tax rate based on full-year outlook for per share
restructuring costs at statutory tax rates. First-quarter 2017 and
Current 2017 Outlook at estimated
annual tax rate of 22 percent plus a $15 million increase to prior
year taxes related to non-U.S. restructuring costs. First-quarter
2017 also includes a favorable
interim adjustment of $0.06 per share resulting from the difference
in the estimated annual tax rate for consolidated
reporting of 32 percent and the estimated
annual tax rate for profit per share excluding restructuring costs
and discrete items of 28 percent.
|
|
|
|
|
|
|
|
Machinery, Energy & Transportation
Caterpillar defines Machinery, Energy & Transportation as it
is presented in the supplemental data as Caterpillar Inc. and its
subsidiaries with Financial Products accounted for on the equity
basis. Machinery, Energy & Transportation information relates
to the design, manufacture and marketing of Caterpillar products.
Financial Products' information relates to the financing to
customers and dealers for the purchase and lease of Caterpillar and
other equipment. The nature of these businesses is different,
especially with regard to the financial position and cash flow
items. Caterpillar management utilizes this presentation internally
to highlight these differences. The company also believes this
presentation will assist readers in understanding Caterpillar's
business. Pages 18-24 reconcile Machinery, Energy &
Transportation with Financial Products on the equity basis to
Caterpillar Inc. consolidated financial information.
Caterpillar's latest financial results and outlook are also
available via:
Telephone:
|
800-228-7717 (Inside
the United States and Canada)
|
|
858-764-9492 (Outside
the United States and Canada)
|
Internet:
|
|
|
http://www.caterpillar.com/en/investors.html
|
|
http://www.caterpillar.com/en/investors/quarterly-results.html
(live broadcast/replays of quarterly conference call)
|
Caterpillar
Inc.
Condensed
Consolidated Statement of Results of Operations
(Unaudited)
(Dollars in
millions except per share data)
|
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
2017
|
|
2016
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
9,130
|
|
|
|
$
|
8,780
|
|
|
|
Revenues of Financial
Products
|
|
692
|
|
|
|
|
681
|
|
|
|
Total sales and
revenues
|
|
9,822
|
|
|
|
|
9,461
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
6,758
|
|
|
|
|
6,822
|
|
|
|
Selling, general and
administrative expenses
|
|
1,045
|
|
|
|
|
1,088
|
|
|
|
Research and
development expenses
|
|
418
|
|
|
|
|
508
|
|
|
|
Interest expense of
Financial Products
|
|
159
|
|
|
|
|
152
|
|
|
|
Other operating
(income) expenses
|
|
1,025
|
|
|
|
|
397
|
|
|
|
Total operating
costs
|
|
9,405
|
|
|
|
|
8,967
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
417
|
|
|
|
|
494
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
123
|
|
|
|
|
129
|
|
|
|
Other income
(expense)
|
|
(5)
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
289
|
|
|
|
|
365
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
90
|
|
|
|
|
92
|
|
|
|
Profit of
consolidated companies
|
|
199
|
|
|
|
|
273
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
(5)
|
|
|
|
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
194
|
|
|
|
|
272
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit (loss)
attributable to noncontrolling interests
|
|
2
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
1
|
$
|
192
|
|
|
|
$
|
271
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit per common
share
|
$
|
0.33
|
|
|
|
$
|
0.46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit per common
share – diluted 2
|
$
|
0.32
|
|
|
|
$
|
0.46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding (millions)
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
|
587.5
|
|
|
|
|
582.8
|
|
|
|
-
Diluted2
|
|
593.2
|
|
|
|
|
587.7
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
$
|
—
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Profit attributable
to common shareholders.
|
2
|
Diluted by assumed
exercise of stock-based compensation awards using the treasury
stock method.
|
Caterpillar
Inc.
Condensed
Consolidated Statement of Financial Position
(Unaudited)
(Millions of
dollars)
|
|
March
31,
|
|
December
31,
|
|
2017
|
|
2016
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and short-term
investments
|
$
|
9,472
|
|
|
|
$
|
7,168
|
|
|
|
|
Receivables - trade
and other
|
|
6,533
|
|
|
|
|
5,981
|
|
|
|
|
Receivables -
finance
|
|
8,684
|
|
|
|
|
8,522
|
|
|
|
|
Prepaid expenses and
other current assets
|
|
1,777
|
|
|
|
|
1,682
|
|
|
|
|
Inventories
|
|
9,082
|
|
|
|
|
8,614
|
|
|
|
Total current
assets
|
|
35,548
|
|
|
|
|
31,967
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment – net
|
|
14,727
|
|
|
|
|
15,322
|
|
|
|
Long-term receivables
- trade and other
|
|
944
|
|
|
|
|
1,029
|
|
|
|
Long-term receivables
- finance
|
|
13,426
|
|
|
|
|
13,556
|
|
|
|
Noncurrent deferred
and refundable income taxes
|
|
2,940
|
|
|
|
|
2,790
|
|
|
|
Intangible
assets
|
|
2,287
|
|
|
|
|
2,349
|
|
|
|
Goodwill
|
|
6,051
|
|
|
|
|
6,020
|
|
|
|
Other
assets
|
|
1,626
|
|
|
|
|
1,671
|
|
|
Total
assets
|
$
|
77,549
|
|
|
|
$
|
74,704
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
-- Machinery, Energy
& Transportation
|
$
|
436
|
|
|
|
$
|
209
|
|
|
|
|
|
-- Financial
Products
|
|
7,385
|
|
|
|
|
7,094
|
|
|
|
|
Accounts
payable
|
|
5,302
|
|
|
|
|
4,614
|
|
|
|
|
Accrued
expenses
|
|
3,086
|
|
|
|
|
3,003
|
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
1,666
|
|
|
|
|
1,296
|
|
|
|
|
Customer
advances
|
|
1,383
|
|
|
|
|
1,167
|
|
|
|
|
Dividends
Payable
|
|
—
|
|
|
|
|
452
|
|
|
|
|
Other current
liabilities
|
|
1,641
|
|
|
|
|
1,635
|
|
|
|
|
Long-term debt due
within one year:
|
|
|
|
|
|
|
|
|
|
|
|
|
-- Machinery, Energy
& Transportation
|
|
505
|
|
|
|
|
507
|
|
|
|
|
|
-- Financial
Products
|
|
6,231
|
|
|
|
|
6,155
|
|
|
|
Total current
liabilities
|
|
27,635
|
|
|
|
|
26,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt due
after one year:
|
|
|
|
|
|
|
|
|
|
|
|
|
-- Machinery, Energy
& Transportation
|
|
8,804
|
|
|
|
|
8,436
|
|
|
|
|
|
-- Financial
Products
|
|
14,921
|
|
|
|
|
14,382
|
|
|
|
Liability for
postemployment benefits
|
|
9,291
|
|
|
|
|
9,357
|
|
|
|
Other
liabilities
|
|
3,238
|
|
|
|
|
3,184
|
|
|
Total
liabilities
|
|
63,889
|
|
|
|
|
61,491
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
|
|
|
Common
stock
|
|
5,222
|
|
|
|
|
5,277
|
|
|
|
Treasury
stock
|
|
(17,391)
|
|
|
|
|
(17,478)
|
|
|
|
Profit employed in
the business
|
|
27,584
|
|
|
|
|
27,377
|
|
|
|
Accumulated other
comprehensive income (loss)
|
|
(1,827)
|
|
|
|
|
(2,039)
|
|
|
|
Noncontrolling
interests
|
|
72
|
|
|
|
|
76
|
|
|
Total
shareholders' equity
|
|
13,660
|
|
|
|
|
13,213
|
|
|
Total liabilities
and shareholders' equity
|
$
|
77,549
|
|
|
|
$
|
74,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Caterpillar
Inc.
Condensed
Consolidated Statement of Cash Flow
(Unaudited)
(Millions of
dollars)
|
|
Three Months
Ended
|
|
March
31,
|
|
2017
|
|
2016
|
Cash flow from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
$
|
194
|
|
|
|
$
|
272
|
|
|
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
710
|
|
|
|
|
740
|
|
|
|
|
Other
|
|
301
|
|
|
|
|
269
|
|
|
|
Changes in assets and
liabilities, net of acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
Receivables – trade
and other
|
|
(353)
|
|
|
|
|
14
|
|
|
|
|
Inventories
|
|
(444)
|
|
|
|
|
(74)
|
|
|
|
|
Accounts
payable
|
|
732
|
|
|
|
|
211
|
|
|
|
|
Accrued
expenses
|
|
132
|
|
|
|
|
33
|
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
360
|
|
|
|
|
(852)
|
|
|
|
|
Customer
advances
|
|
193
|
|
|
|
|
174
|
|
|
|
|
Other assets –
net
|
|
(261)
|
|
|
|
|
(145)
|
|
|
|
|
Other liabilities –
net
|
|
(23)
|
|
|
|
|
(152)
|
|
|
Net cash provided by
(used for) operating activities
|
|
1,541
|
|
|
|
|
490
|
|
|
Cash flow from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
– excluding equipment leased to others
|
|
(204)
|
|
|
|
|
(357)
|
|
|
|
Expenditures for
equipment leased to others
|
|
(305)
|
|
|
|
|
(383)
|
|
|
|
Proceeds from
disposals of leased assets and property, plant and
equipment
|
|
234
|
|
|
|
|
173
|
|
|
|
Additions to finance
receivables
|
|
(2,122)
|
|
|
|
|
(2,014)
|
|
|
|
Collections of
finance receivables
|
|
2,272
|
|
|
|
|
2,047
|
|
|
|
Proceeds from sale of
finance receivables
|
|
17
|
|
|
|
|
10
|
|
|
|
Investments and
acquisitions (net of cash acquired)
|
|
(18)
|
|
|
|
|
(12)
|
|
|
|
Proceeds from sale of
securities
|
|
89
|
|
|
|
|
49
|
|
|
|
Investments in
securities
|
|
(65)
|
|
|
|
|
(62)
|
|
|
|
Other –
net
|
|
(23)
|
|
|
|
|
(23)
|
|
|
Net cash provided by
(used for) investing activities
|
|
(125)
|
|
|
|
|
(572)
|
|
|
Cash flow from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
(452)
|
|
|
|
|
(448)
|
|
|
|
Distribution to
noncontrolling interests
|
|
(6)
|
|
|
|
|
(1)
|
|
|
|
Common stock issued,
including treasury shares reissued
|
|
(19)
|
|
|
|
|
(45)
|
|
|
|
Proceeds from debt
issued (original maturities greater than three months)
|
|
2,715
|
|
|
|
|
1,211
|
|
|
|
Payments on debt
(original maturities greater than three months)
|
|
(1,977)
|
|
|
|
|
(1,706)
|
|
|
|
Short-term borrowings
– net (original maturities three months or less)
|
|
618
|
|
|
|
|
486
|
|
|
Net cash provided by
(used for) financing activities
|
|
879
|
|
|
|
|
(503)
|
|
|
Effect of exchange
rate changes on cash
|
|
9
|
|
|
|
|
11
|
|
|
Increase
(decrease) in cash and short-term investments
|
|
2,304
|
|
|
|
|
(574)
|
|
|
Cash and short-term
investments at beginning of period
|
|
7,168
|
|
|
|
|
6,460
|
|
|
Cash and short-term
investments at end of period
|
$
|
9,472
|
|
|
|
$
|
5,886
|
|
|
|
|
|
|
|
|
|
|
|
|
All short-term
investments, which consist primarily of highly liquid investments
with original maturities of three months or less, are considered to
be cash equivalents.
|
Caterpillar
Inc.
Supplemental Data for Results of
Operations
For the Three
Months Ended March 31, 2017
(Unaudited)
(Millions of
dollars)
|
|
|
|
Supplemental
Consolidating Data
|
|
|
|
Machinery,
|
|
|
|
|
|
Consolidated
|
|
Energy
&
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
9,130
|
|
|
|
$
|
9,130
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
Revenues of Financial
Products
|
|
692
|
|
|
|
|
—
|
|
|
|
|
777
|
|
|
|
|
(85)
|
2
|
|
Total sales and
revenues
|
|
9,822
|
|
|
|
|
9,130
|
|
|
|
|
777
|
|
|
|
|
(85)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
6,758
|
|
|
|
|
6,758
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Selling, general and
administrative expenses
|
|
1,045
|
|
|
|
|
924
|
|
|
|
|
126
|
|
|
|
|
(5)
|
3
|
|
Research and
development expenses
|
|
418
|
|
|
|
|
418
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Interest expense of
Financial Products
|
|
159
|
|
|
|
|
—
|
|
|
|
|
163
|
|
|
|
|
(4)
|
4
|
|
Other operating
(income) expenses
|
|
1,025
|
|
|
|
|
728
|
|
|
|
|
302
|
|
|
|
|
(5)
|
3
|
|
Total operating
costs
|
|
9,405
|
|
|
|
|
8,828
|
|
|
|
|
591
|
|
|
|
|
(14)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
417
|
|
|
|
|
302
|
|
|
|
|
186
|
|
|
|
|
(71)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
123
|
|
|
|
|
144
|
|
|
|
|
—
|
|
|
|
|
(21)
|
4
|
|
Other income
(expense)
|
|
(5)
|
|
|
|
|
(53)
|
|
|
|
|
(2)
|
|
|
|
|
50
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
289
|
|
|
|
|
105
|
|
|
|
|
184
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
90
|
|
|
|
|
34
|
|
|
|
|
56
|
|
|
|
|
—
|
|
|
Profit of
consolidated companies
|
|
199
|
|
|
|
|
71
|
|
|
|
|
128
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
(5)
|
|
|
|
|
(5)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Equity in profit of
Financial Products' subsidiaries
|
|
—
|
|
|
|
|
126
|
|
|
|
|
—
|
|
|
|
|
(126)
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
194
|
|
|
|
|
192
|
|
|
|
|
128
|
|
|
|
|
(126)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
2
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
7
|
$
|
192
|
|
|
|
$
|
192
|
|
|
|
$
|
126
|
|
|
|
$
|
(126)
|
|
|
|
1.
|
Represents
Caterpillar Inc. and its subsidiaries with Financial Products
accounted for on the equity basis.
|
2.
|
Elimination of
Financial Products' revenues earned from Machinery, Energy &
Transportation.
|
3.
|
Elimination of net
expenses recorded by Machinery, Energy & Transportation paid to
Financial Products.
|
4.
|
Elimination of
interest expense recorded between Financial Products and Machinery,
Energy & Transportation.
|
5.
|
Elimination of
discount recorded by Machinery, Energy & Transportation on
receivables sold to Financial Products and of interest earned
between Machinery, Energy & Transportation and Financial
Products.
|
6.
|
Elimination of
Financial Products' profit due to equity method of
accounting.
|
7.
|
Profit attributable
to common shareholders.
|
Caterpillar
Inc.
Supplemental Data for Results of
Operations
For the Three
Months Ended March 31, 2016
(Unaudited)
(Millions of
dollars)
|
|
|
|
Supplemental
Consolidating Data
|
|
|
|
Machinery,
|
|
|
|
|
|
Consolidated
|
|
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
8,780
|
|
|
|
$
|
8,780
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
Revenues of Financial
Products
|
|
681
|
|
|
|
|
—
|
|
|
|
|
759
|
|
|
|
|
(78)
|
2
|
|
Total sales and
revenues
|
|
9,461
|
|
|
|
|
8,780
|
|
|
|
|
759
|
|
|
|
|
(78)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
6,822
|
|
|
|
|
6,822
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Selling, general and
administrative expenses
|
|
1,088
|
|
|
|
|
955
|
|
|
|
|
139
|
|
|
|
|
(6)
|
3
|
|
Research and
development expenses
|
|
508
|
|
|
|
|
508
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Interest expense of
Financial Products
|
|
152
|
|
|
|
|
—
|
|
|
|
|
155
|
|
|
|
|
(3)
|
4
|
|
Other operating
(income) expenses
|
|
397
|
|
|
|
|
105
|
|
|
|
|
298
|
|
|
|
|
(6)
|
3
|
|
Total operating
costs
|
|
8,967
|
|
|
|
|
8,390
|
|
|
|
|
592
|
|
|
|
|
(15)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
494
|
|
|
|
|
390
|
|
|
|
|
167
|
|
|
|
|
(63)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
129
|
|
|
|
|
140
|
|
|
|
|
—
|
|
|
|
|
(11)
|
4
|
|
Other income
(expense)
|
|
—
|
|
|
|
|
(52)
|
|
|
|
|
—
|
|
|
|
|
52
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
365
|
|
|
|
|
198
|
|
|
|
|
167
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
92
|
|
|
|
|
40
|
|
|
|
|
52
|
|
|
|
|
—
|
|
|
Profit of
consolidated companies
|
|
273
|
|
|
|
|
158
|
|
|
|
|
115
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
(1)
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Equity in profit of
Financial Products' subsidiaries
|
|
—
|
|
|
|
|
114
|
|
|
|
|
—
|
|
|
|
|
(114)
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
272
|
|
|
|
|
271
|
|
|
|
|
115
|
|
|
|
|
(114)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
1
|
|
|
|
|
—
|
|
|
|
|
1
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
7
|
$
|
271
|
|
|
|
$
|
271
|
|
|
|
$
|
114
|
|
|
|
$
|
(114)
|
|
|
|
1.
|
Represents
Caterpillar Inc. and its subsidiaries with Financial Products
accounted for on the equity basis.
|
2.
|
Elimination of
Financial Products' revenues earned from Machinery, Energy &
Transportation.
|
3.
|
Elimination of net
expenses recorded by Machinery, Energy & Transportation paid to
Financial Products.
|
4.
|
Elimination of
interest expense recorded between Financial Products and Machinery,
Energy & Transportation.
|
5.
|
Elimination of
discount recorded by Machinery, Energy & Transportation on
receivables sold to Financial Products and of interest earned
between Machinery, Energy & Transportation and Financial
Products.
|
6.
|
Elimination of
Financial Products' profit due to equity method of
accounting.
|
7.
|
Profit attributable
to common shareholders.
|
Caterpillar
Inc.
Supplemental Data
for Cash Flow
For the Three
Months Ended March 31, 2017
(Unaudited)
(Millions of
dollars)
|
|
|
|
Supplemental
Consolidating Data
|
|
|
|
Machinery,
|
|
|
|
|
|
Consolidated
|
|
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Cash flow from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
$
|
194
|
|
|
|
$
|
192
|
|
|
|
$
|
128
|
|
|
|
$
|
(126)
|
2
|
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
710
|
|
|
|
|
491
|
|
|
|
|
219
|
|
|
|
|
—
|
|
|
|
Undistributed profit
of Financial Products
|
|
—
|
|
|
|
|
(126)
|
|
|
|
|
—
|
|
|
|
|
126
|
3
|
|
|
Other
|
|
301
|
|
|
|
|
302
|
|
|
|
|
(48)
|
|
|
|
|
47
|
4
|
|
Changes in assets and
liabilities, net of acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables - trade
and other
|
|
(353)
|
|
|
|
|
(8)
|
|
|
|
|
52
|
|
|
|
|
(397)
|
4,5
|
|
|
Inventories
|
|
(444)
|
|
|
|
|
(444)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
Accounts
payable
|
|
732
|
|
|
|
|
734
|
|
|
|
|
6
|
|
|
|
|
(8)
|
4
|
|
|
Accrued
expenses
|
|
132
|
|
|
|
|
130
|
|
|
|
|
2
|
|
|
|
|
—
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
360
|
|
|
|
|
364
|
|
|
|
|
(4)
|
|
|
|
|
—
|
|
|
|
Customer
advances
|
|
193
|
|
|
|
|
193
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
Other assets -
net
|
|
(261)
|
|
|
|
|
(196)
|
|
|
|
|
(25)
|
|
|
|
|
(40)
|
4
|
|
|
Other liabilities -
net
|
|
(23)
|
|
|
|
|
(108)
|
|
|
|
|
45
|
|
|
|
|
40
|
4
|
Net cash provided by
(used for) operating activities
|
|
1,541
|
|
|
|
|
1,524
|
|
|
|
|
375
|
|
|
|
|
(358)
|
|
Cash flow from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
- excluding equipment leased to others
|
|
(204)
|
|
|
|
|
(203)
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
Expenditures for
equipment leased to others
|
|
(305)
|
|
|
|
|
(6)
|
|
|
|
|
(302)
|
|
|
|
|
3
|
4
|
|
Proceeds from
disposals of leased assets and property, plant and
equipment
|
|
234
|
|
|
|
|
41
|
|
|
|
|
194
|
|
|
|
|
(1)
|
4
|
|
Additions to finance
receivables
|
|
(2,122)
|
|
|
|
|
—
|
|
|
|
|
(2,535)
|
|
|
|
|
413
|
5
|
|
Collections of
finance receivables
|
|
2,272
|
|
|
|
|
—
|
|
|
|
|
2,788
|
|
|
|
|
(516)
|
5
|
|
Net intercompany
purchased receivables
|
|
—
|
|
|
|
|
—
|
|
|
|
|
(459)
|
|
|
|
|
459
|
5
|
|
Proceeds from sale of
finance receivables
|
|
17
|
|
|
|
|
—
|
|
|
|
|
17
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
50
|
|
|
|
|
(1,500)
|
|
|
|
|
1,450
|
6
|
|
Investments and
acquisitions (net of cash acquired)
|
|
(18)
|
|
|
|
|
(18)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Proceeds from sale of
securities
|
|
89
|
|
|
|
|
6
|
|
|
|
|
83
|
|
|
|
|
—
|
|
|
Investments in
securities
|
|
(65)
|
|
|
|
|
(2)
|
|
|
|
|
(63)
|
|
|
|
|
—
|
|
|
Other -
net
|
|
(23)
|
|
|
|
|
(34)
|
|
|
|
|
11
|
|
|
|
|
—
|
|
Net cash provided by
(used for) investing activities
|
|
(125)
|
|
|
|
|
(166)
|
|
|
|
|
(1,767)
|
|
|
|
|
1,808
|
|
Cash flow from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
(452)
|
|
|
|
|
(452)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Distribution to
noncontrolling interests
|
|
(6)
|
|
|
|
|
(6)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Common stock issued,
including treasury shares reissued
|
|
(19)
|
|
|
|
|
(19)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
1,500
|
|
|
|
|
(50)
|
|
|
|
|
(1,450)
|
6
|
|
Proceeds from debt
issued (original maturities greater than three months)
|
|
2,715
|
|
|
|
|
360
|
|
|
|
|
2,355
|
|
|
|
|
—
|
|
|
Payments on debt
(original maturities greater than three months)
|
|
(1,977)
|
|
|
|
|
(4)
|
|
|
|
|
(1,973)
|
|
|
|
|
—
|
|
|
Short-term borrowings
- net (original maturities three months or less)
|
|
618
|
|
|
|
|
226
|
|
|
|
|
392
|
|
|
|
|
—
|
|
Net cash provided by
(used for) financing activities
|
|
879
|
|
|
|
|
1,605
|
|
|
|
|
724
|
|
|
|
|
(1,450)
|
|
Effect of exchange
rate changes on cash
|
|
9
|
|
|
|
|
3
|
|
|
|
|
6
|
|
|
|
|
—
|
|
Increase
(decrease) in cash and short-term investments
|
|
2,304
|
|
|
|
|
2,966
|
|
|
|
|
(662)
|
|
|
|
|
—
|
|
Cash and short-term
investments at beginning of period
|
|
7,168
|
|
|
|
|
5,257
|
|
|
|
|
1,911
|
|
|
|
|
—
|
|
Cash and short-term
investments at end of period
|
$
|
9,472
|
|
|
|
$
|
8,223
|
|
|
|
$
|
1,249
|
|
|
|
$
|
—
|
|
|
|
1.
|
Represents
Caterpillar Inc. and its subsidiaries with Financial Products
accounted for on the equity basis.
|
|
2.
|
Elimination of
Financial Products' profit after tax due to equity method of
accounting.
|
|
3.
|
Elimination of
non-cash adjustment for the undistributed earnings from Financial
Products.
|
|
4.
|
Elimination of
non-cash adjustments and changes in assets and liabilities related
to consolidated reporting.
|
|
5.
|
Reclassification of
Financial Products' cash flow activity from investing to operating
for receivables that arose from the sale of inventory.
|
|
6.
|
Elimination of net
proceeds and payments to/from Machinery, Energy &
Transportation and Financial Products.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Caterpillar
Inc.
Supplemental Data
for Cash Flow
For the Three
Months Ended March 31, 2016
(Unaudited)
(Millions of
dollars)
|
|
|
|
Supplemental
Consolidating Data
|
|
|
|
Machinery,
|
|
|
|
|
|
Consolidated
|
|
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Cash flow from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
$
|
272
|
|
|
|
$
|
271
|
|
|
|
$
|
115
|
|
|
|
$
|
(114)
|
2
|
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
740
|
|
|
|
|
525
|
|
|
|
|
215
|
|
|
|
|
—
|
|
|
|
Undistributed profit
of Financial Products
|
|
—
|
|
|
|
|
(107)
|
|
|
|
|
—
|
|
|
|
|
107
|
3
|
|
|
Other
|
|
269
|
|
|
|
|
204
|
|
|
|
|
16
|
|
|
|
|
49
|
4
|
|
Changes in assets and
liabilities, net of acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables - trade
and other
|
|
14
|
|
|
|
|
41
|
|
|
|
|
20
|
|
|
|
|
(47)
|
4,5
|
|
|
Inventories
|
|
(74)
|
|
|
|
|
(74)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
Accounts
payable
|
|
211
|
|
|
|
|
288
|
|
|
|
|
2
|
|
|
|
|
(79)
|
4
|
|
|
Accrued
expenses
|
|
33
|
|
|
|
|
34
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
(852)
|
|
|
|
|
(831)
|
|
|
|
|
(21)
|
|
|
|
|
—
|
|
|
|
Customer
advances
|
|
174
|
|
|
|
|
174
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
Other assets -
net
|
|
(145)
|
|
|
|
|
(118)
|
|
|
|
|
17
|
|
|
|
|
(44)
|
4
|
|
|
Other liabilities -
net
|
|
(152)
|
|
|
|
|
(188)
|
|
|
|
|
(8)
|
|
|
|
|
44
|
4
|
Net cash provided by
(used for) operating activities
|
|
490
|
|
|
|
|
219
|
|
|
|
|
355
|
|
|
|
|
(84)
|
|
Cash flow from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
- excluding equipment leased to others
|
|
(357)
|
|
|
|
|
(356)
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
Expenditures for
equipment leased to others
|
|
(383)
|
|
|
|
|
(23)
|
|
|
|
|
(369)
|
|
|
|
|
9
|
4
|
|
Proceeds from
disposals of leased assets and property, plant and
equipment
|
|
173
|
|
|
|
|
21
|
|
|
|
|
159
|
|
|
|
|
(7)
|
4
|
|
Additions to finance
receivables
|
|
(2,014)
|
|
|
|
|
—
|
|
|
|
|
(2,662)
|
|
|
|
|
648
|
5
|
|
Collections of
finance receivables
|
|
2,047
|
|
|
|
|
—
|
|
|
|
|
2,849
|
|
|
|
|
(802)
|
5
|
|
Net intercompany
purchased receivables
|
|
—
|
|
|
|
|
—
|
|
|
|
|
(229)
|
|
|
|
|
229
|
5
|
|
Proceeds from sale of
finance receivables
|
|
10
|
|
|
|
|
—
|
|
|
|
|
10
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
(927)
|
|
|
|
|
(1,000)
|
|
|
|
|
1,927
|
6
|
|
Investments and
acquisitions (net of cash acquired)
|
|
(12)
|
|
|
|
|
(12)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Proceeds from sale of
securities
|
|
49
|
|
|
|
|
4
|
|
|
|
|
45
|
|
|
|
|
—
|
|
|
Investments in
securities
|
|
(62)
|
|
|
|
|
(5)
|
|
|
|
|
(57)
|
|
|
|
|
—
|
|
|
Other -
net
|
|
(23)
|
|
|
|
|
(23)
|
|
|
|
|
(7)
|
|
|
|
|
7
|
8
|
Net cash provided by
(used for) investing activities
|
|
(572)
|
|
|
|
|
(1,321)
|
|
|
|
|
(1,262)
|
|
|
|
|
2,011
|
|
Cash flow from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
(448)
|
|
|
|
|
(448)
|
|
|
|
|
(7)
|
|
|
|
|
7
|
7
|
|
Distribution to
noncontrolling interests
|
|
(1)
|
|
|
|
|
(1)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Common stock issued,
including treasury shares reissued
|
|
(45)
|
|
|
|
|
(45)
|
|
|
|
|
7
|
|
|
|
|
(7)
|
8
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
1,000
|
|
|
|
|
927
|
|
|
|
|
(1,927)
|
6
|
|
Proceeds from debt
issued (original maturities greater than three months)
|
|
1,211
|
|
|
|
|
1
|
|
|
|
|
1,210
|
|
|
|
|
—
|
|
|
Payments on debt
(original maturities greater than three months)
|
|
(1,706)
|
|
|
|
|
(3)
|
|
|
|
|
(1,703)
|
|
|
|
|
—
|
|
|
Short-term borrowings
- net (original maturities three months or less)
|
|
486
|
|
|
|
|
4
|
|
|
|
|
482
|
|
|
|
|
—
|
|
Net cash provided by
(used for) financing activities
|
|
(503)
|
|
|
|
|
508
|
|
|
|
|
916
|
|
|
|
|
(1,927)
|
|
Effect of exchange
rate changes on cash
|
|
11
|
|
|
|
|
(2)
|
|
|
|
|
13
|
|
|
|
|
—
|
|
Increase
(decrease) in cash and short-term investments
|
|
(574)
|
|
|
|
|
(596)
|
|
|
|
|
22
|
|
|
|
|
—
|
|
Cash and short-term
investments at beginning of period
|
|
6,460
|
|
|
|
|
5,340
|
|
|
|
|
1,120
|
|
|
|
|
—
|
|
Cash and short-term
investments at end of period
|
$
|
5,886
|
|
|
|
$
|
4,744
|
|
|
|
$
|
1,142
|
|
|
|
$
|
—
|
|
|
|
|
1.
|
Represents
Caterpillar Inc. and its subsidiaries with Financial Products
accounted for on the equity basis.
|
|
2.
|
Elimination of
Financial Products' profit after tax due to equity method of
accounting.
|
|
3.
|
Elimination of
non-cash adjustment for the undistributed earnings from Financial
Products.
|
|
4.
|
Elimination of
non-cash adjustments and changes in assets and liabilities related
to consolidated reporting.
|
|
5.
|
Reclassification of
Financial Products' cash flow activity from investing to operating
for receivables that arose from the sale of inventory.
|
|
6.
|
Elimination of net
proceeds and payments to/from Machinery, Energy &
Transportation and Financial Products.
|
|
7.
|
Elimination of
dividend from Financial Products to Machinery, Energy &
Transportation.
|
|
8.
|
Elimination of change
in investment and common stock related to Financial
Products.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/caterpillar-reports-first-quarter-2017-results-300445083.html
SOURCE Caterpillar Inc.