Caterpillar Inc. announced profit per share of $1.63 for the third quarter of 2014, an increase from third-quarter 2013 profit per share of $1.45. The third quarter of 2014 included a negative impact of $0.09 per share for restructuring costs. Excluding restructuring costs, third-quarter 2014 profit per share was $1.72. Third-quarter 2014 sales and revenues were $13.549 billion, up from $13.423 billion in the third quarter of 2013.
“We’re pleased with the third-quarter profit improvement considering world economic growth remains slower than we’d like”, said Caterpillar Chairman and Chief Executive Officer Doug Oberhelman. “We’ve continued to focus on what we can control – cost management and operational execution. We continue on a Lean manufacturing journey and are focused on improving safety, quality, efficiency and inventory turns. We’re making progress and it is beginning to be reflected in our results. The diversity of the businesses we’re in and the strengthening of our operational performance have been key to helping us improve results and our competitive position in this weak economic recovery. Our broad geographic reach and manufacturing footprint help mitigate the impact of currency fluctuations. In fact, currency impacts were positive in the third quarter.”
“In addition to the profit improvement, we have a strong balance sheet and through the first nine months of the year, we’ve had good cash flow. So far this year, we’ve returned value to our stockholders by repurchasing $4.2 billion of Caterpillar stock and raising our quarterly dividend by 17 percent,” Oberhelman said.
“We are confident that, when we see more significant economic growth around the world, our consistent focus on operational performance will have prepared us to deliver even better results,” Oberhelman added.
The company now expects 2014 sales and revenues to be about $55 billion, the middle of the previous outlook range of $54 to $56 billion. While the mid-point of the sales and revenues outlook range has not changed, profit per share expectations for 2014 continue to improve.
“In January we provided our first profit outlook for 2014 at $5.85 per share excluding restructuring costs – our current outlook excluding restructuring costs is $6.50 per share, a substantial improvement. The fact that we continue to raise our profit per share outlook on relatively flat sales is a testament to our diverse portfolio of businesses, disciplined cost control and operational execution. I’m proud of our people for what they’ve been able to accomplish in the current economic environment. We have an exceptional team around the world and in uncertain times like these, they are especially important to us. As we move into the final quarter of 2014, we expect to build on what we’ve been working on: strategy execution, operational performance, cost management, cash flow, our healthy balance sheet and improving our market position,” Oberhelman said.
From an economic perspective, the company said it believes there is a reasonable likelihood that world economic growth could improve in 2015. In developed countries, growth-oriented monetary policies should support continued modest economic improvement. In addition, the company believes there is potential for increased investment in infrastructure in countries such as the United States, India and Turkey.