Caterpillar (CAT) Earnings Review

Earnings Review 30 2013 EPS $1.45 down 35.8% YoY Missed estimates by $0.23 Revenues $13.4bn down from $16.4bn (21%) YoY missed estimates by $1.1bn Operating Income $1.26bn down 50% Yoy Profit $960m down from $1.699 bn (14%) Q2 2012 3QFY13 Performance Segment Performance The Resource Industries segment's poor performance was the leading cause behind the fall in Caterpillar's overall sales, which the company attributed to higher dealer inventories and lower end-user demand. The segment was down over 42% YoY and even though the Power Systems and Construction Industries segments also recorded a decline in revenues, they did not lose their footing as completely. % of Overall Revenues Change YoY Change YoY 36.7% 2Q % 3Q % Segment Revenues $4,922 Power Systems Construction -4.5% -7.4% $4,547 33.9% -9.2% -7.3% Industries Resource Industries $3,004 22.4% -33.7% -42.4% Regional Performance The company recorded deteriorating performance in every segment over year earlier. The Asia/Pacific region was down the most, falling 32% YoY YoY during the quarter. Slowing growth and investments in emerging markets, uncertainty regarding the US government's monetary and fiscal policies, and a sluggish European economy all contributed to the decline in overall revenues. Region Revenue 2Q13 % Change 3Q13 % Change YoY -9.2% YoY -13.9% $5,206 $3,307 $2,900 $2,010 North America EAME -18.0% -24.6% -14.0% Asia/Pacific -32.1% Latin America -14.0% -11.7% ( CAT reduced its inventories by 23.7% YoY through the quarter, and a little over 3.5% from the preceding quarter. The company has not yet released official data on its order backlog and book-to-bill ratio. Caterpillar's dealer statistics, which are indicative of retail sales, have shown a 9% decline in overall sales on rolling three-month basis. 1 The company has so far repurchased shares worth $2bn this year, and raised its quarterly dividends by 15% YoY to $0.60/share in 3QFY13. Guidance ( In its earnings announcement, Caterpillar lowered its sales guidance for FY13 by $2 billion to around $55 billion. ( The company now expects to earn about $5.50/she /share compared to $6.50/share according to its past estimates. ( The company management did not provide sales or earnings estimates for 2014, but said it expects a flattish performance next year. Estimates Consensus Estimates Current EPS Estimates Prior Estimate 4Q2013 $1.37 $1.76 FY2014 $6.10 $7.02 Mean Target Price fot the next 12 Months: $90.6 SOURCES: Company Data, SEC filings, Bloomberg Professional Services BIDNESS etc. DISCLAIMER: Bidness Etc(TM) and related marks are owned by Bidness Etc. Any other trademarks appearing on this website are the property of their respective owners, and are not used to indicate the origin of goods or services offered or provided by Bidness Etc herein or to suggest approval for or affiliation with Bidness Etc.