Caterpillar ended the year with a drop in sales and revenue and an uncertain 2020 outlook.
The company is reporting an 8% decrease in 4th quarter sales and revenue, compared to the same time last year. The company’s sales and revenue amounted to $13.1 billion.
Deerfield-based Caterpillar attributes the decrease to “lower sales volume driven by the impact from changes in dealer inventories and lower end-user demand,” primarily in the construction and resource industries.
Sales declined mainly in North America. Latin America and Europe Asia Middle East markets also saw decreases. Sales in Asia/Pacific were flat.
"While sales declined modestly in 2019, we delivered an operating margin and free cash flow consistent with our long-term targets and continued to invest in services and expanded offerings," Jim Umpleby, Caterpillar Chairman and CEO, said in a press release. "The team's focus on executing our strategy for profitable growth also allowed us to increase our dividend by 20% and return more than $6 billion in capital to shareholders through dividends and share repurchases."
Fourth quarter profit per share rose to $1.97, compared with $1.78 profit per share in the same quarter of 2018. The company repurchased $4.0 billion of its common stock throughout the year.
Full-year sales and revenues came in at $53.8 billion, down 2% from the previous year. Full-year profit was $10.74 per share. Caterpillar previously estimated a full-year profit per share outlook range of $10.90 to $11.40. That range had been adjusted down in previous quarters.
The company expects 2020 profit to be in a range of $8.50 to $10.00 per share.
“We expect continued global economic uncertainty to pressure sales to users in 2020 and cause dealers to further reduce inventories,” said Umpleby. “We have improved our lead times and remain prepared to respond quickly to any positive or negative changes in customer demand.”4Q 2019 Caterpillar Inc Earnings Release - Final by Dana Vollmer on Scribd
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