# Caterpillar 3rd quarter profit up 124%



## bontai Joe (Sep 16, 2003)

Press Release Source: Caterpillar Inc. 


Caterpillar Third-Quarter Profit Up 124 Percent on Increased Sales and Revenues of 38 Percent. Company Reaffirms 2004 Profit Per Share Up 80 to 85 Percent, 2005 Sales and Revenues Up About 10 Percent.
Thursday October 21, 8:34 am ET 


PEORIA, Ill., Oct. 21 /PRNewswire-FirstCall/ -- Caterpillar Inc. (NYSE: CAT - News) today reported record sales and revenues of $7.65 billion for the third quarter and record third-quarter profit of $498 million, or $1.41 per share. Results for the nine months ended September 30 are the best in company history with sales and revenues of $21.68 billion and profit of $1.48 billion, or $4.19 per share.
"These year-to-date results reflect our team's unwavering focus on serving Caterpillar customers in a year that has continued to gain strength and momentum," said Chairman and Chief Executive Officer Jim Owens. "Our entire value chain is responding to the strongest recovery we've ever seen across the broad spectrum of markets we serve. We will deliver record sales and profit this year."

Third-quarter sales and revenues were $7.65 billion, up $2.10 billion or 38 percent compared to $5.55 billion in the third quarter one year ago. The increase in sales and revenues was driven by $1.83 billion of higher Machinery and Engines volume, $136 million of increased Price Realization, a $102 million favorable impact of Currency on sales due primarily to the strengthening euro and British pound and $41 million of higher Financial Products revenues.

Profit of $498 million or $1.41 per share was up $276 million or 124 percent compared to $222 million or $0.62 per share in the third quarter of 2003. The main contributors to the profit increase were higher Sales Volume of $543 million, higher price realization of $136 million and the absence of a $55 million non-recurring bond retirement charge recorded in the third quarter of 2003. Partially offsetting these favorable items were $371 million of higher Core Operating Costs.

"We are encouraged by the improved operating profit generated from each of our major lines of business this quarter. Machinery profit was up 78 percent, Engines was up 96 percent and Financial Products was up 40 percent," Owens said.

"While we're pleased with the profit improvement delivered this quarter, higher material costs and inefficiencies related to supply chain bottlenecks affecting our global industry limited the profit pull-through we would expect to see with this strong sales growth. Looking forward, continued global economic growth will likely sustain external cost pressures in the near term, but we are aggressively managing this upturn with a determination to improve our cost structure," Owens continued.

"We are drawing on the power of an engaged workforce and 6 Sigma process improvements to drive almost a 40 percent increase in our machinery and engines physical production. This exemplifies the extraordinary efforts our team is making to satisfy customer demand and maintain our industry leadership position," said Owens.

Outlook

We expect 2004 sales and revenues to be up about 30 percent and profit per share to be up 80 to 85 percent compared to 2003. This outlook is in line with the projection issued on September 28, 2004.

"While global economic growth in 2005 is expected to slow slightly from the robust levels we've experienced this year, the key sectors we serve should continue to show solid growth next year. Our products are instrumental in increasing capacity in the mining, oil and gas, North American on-highway truck and bus, and infrastructure development sectors," Owens commented.

Based on our preliminary outlook, we expect 2005 sales and revenues to be up about 10 percent from 2004 with record profit per share.

(Complete outlook begins on page 12.)
For more than 75 years, Caterpillar has been building the world's infrastructure and, in partnership with our independent dealers, is driving positive and sustainable change on every continent. Caterpillar is a technology leader and the world's largest maker of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. More information is available at http://www.CAT.com/ .


The rest of this is too long to post here, but can be read at:http://biz.yahoo.com/prnews/041021/cgth015_1.html


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