Caterpillar Stays on Track to Break Sales Slump
24 Oktober 2017 - 3:22PM
Dow Jones News
By Austen Hufford
Caterpillar Inc. posted stronger-than-expected revenue and
profit growth and boosted its outlook for the year amid rising
demand for its equipment across the globe.
Shares jumped 7% in premarket trading as the company said there
was increased demand for its products throughout many of its
industries and regions and investors hoped the company could
finally end a multiyear sales slump.
The Peoria, Ill., manufacturing giant now expects revenue of $44
billion this year, up from $42 billion to $44 billion previously.
Caterpillar reported $38.5 billion in revenue in 2016, its fourth
straight year of declining sales.
On the profit front, the company said the higher revenue and
cost cuts will drive greater bottom-line growth. For the full year,
the company now expects adjusted profit-per-share of $6.25, up from
$5 previously.
Chief Executive Jim Umpleby highlighted growth in construction
in China, onshore oil and gas in North America and increased
capital expenditures by mining customers.
Mr. Umpleby, who became CEO in January, has been working to
shrink the company's manufacturing footprint, cut its head count
and choose his team. In August, Caterpillar said its chief
financial officer, Brad Halverson, will retire early next year.
Caterpillar also raised its estimate for restructuring costs for
the year to $1.3 billion from $1.2 billion.
The company said meeting more of its financial and operational
performance objectives raised short-term incentive-compensation
expenses in the quarter by about $400 million, compared with no
similar costs in the third quarter last year.
Caterpillar's full-time workforce decreased to 96,700 employees
at the end of the third quarter, from 97,100 the prior year. The
company's "flexible" workforce increased by 6,500 to 114,900.
Caterpillar, which had in years past released guidance for the
following year during its third quarter, didn't provide that
Tuesday, citing its new enterprise strategy.
The manufacturer also said it would raise prices early next year
through a new structural change to its machine pricing: list prices
will fall but the company will cut merchandising discounts even
more, leading to higher prices.
The company saw revenue increases across its three main segments
and in every geographic region.
In all for the third quarter, Caterpillar reported a profit of
$1.06 billion, or $1.77 a share, compared with $283 million, or 48
cents a share, a year ago. Excluding restructuring costs, the
company said it earned $1.95 a share, compared with 85 cents a year
ago. Revenue increased 25% to $11.41 billion.
Analysts polled by Thomson Reuters had expected $1.27 in
adjusted earnings per share on revenue of $10.65 billion.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
October 24, 2017 09:07 ET (13:07 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Caterpillar (NYSE:CAT)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Caterpillar (NYSE:CAT)
Historical Stock Chart
Von Jul 2023 bis Jul 2024