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Caterpillar sales and revenues reach $14bn for second quarter 2018

August 2, 2018

Caterpillar’s sales and revenues reached $14bn for the second quarter (Q2) of 2018, compared with $11bn in the same period, an increase of 24%. Meanwhile, Q2 2018 profit/share of $2.82 was a second-quarter record.  Profit/share was $1.35 in Q2 of 2017. Adjusted profit per share was $2.97, compared with adjusted profit/share of $1.49 of the same period last year.

During Q2, Machinery, Energy & Transportation (ME&T) operating cash flow was $2.1bn, and the company repurchased $750m of Caterpillar common stock. In June 2018, the board of directors approved an increase to the quarterly dividend of 10% to $0.86/share. Q2 of 2018 ended with an enterprise cash balance of $8.7bn.

Jim Umpleby, CEO of Caterpillar, says: “Caterpillar delivered record second-quarter profit/share. Our team is doing a great job executing our strategy for profitable growth, focusing on operational excellence, expanded offerings and services.”

Caterpillar is raising its 2018 profit/share outlook to a range of $10.50 to $11.50. Excluding restructuring costs of about $400m, it expects adjusted profit/share to be in a range of $11.00 to $12.00. The prior profit/share outlook range was $9.75 to $10.75, and the adjusted profit/share outlook range was $10.25 to $11.25.

“Based on outstanding results in the first half of the year and continued strength in many of our end markets, Caterpillar is again raising our profit outlook for 2018. We remain focused on operational excellence, cost discipline and investing for long-term profitable growth,” adds Umpleby.

Caterpillar is seeing sales in most of its markets continue to improve, while order rates are healthy, and the backlog remained solid in the quarter. For operating profit, the company is raising the outlook range primarily due to the continued strength in many end markets. Recently imposed tariffs are expected to impact material costs in the second half of the year by approximately $100m to $200m, and the company expects supply chain challenges to continue to pressure freight costs.

In January 2014, the board of directors authorised the repurchase of $10.0bn of Caterpillar common stock. The current programme expires at the end of this year. Under this authorisation, the company repurchased $1.25bn in common stock in the first half of 2018, of which $750m was repurchased in Q2. From 30 June 2018, $4.2bn remained on the current authorisation. Caterpillar expects share repurchases during Q2 of 2018 to be in a similar range as the first half, but the amount could vary depending upon market conditions and investing priorities. The company, aligned with the cash deployment strategy, plans to be in the market for share repurchase on a fairly consistent basis.

In July 2018, the board of directors authorised the repurchase of up to $10.0bn of Caterpillar common stock effective 1 January 2019, with no expiration date.

This story appeared first on Caterpillar and is also available on our sister title Aggregates Business.

 

 

 

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