By Nathalie Tadena
Caterpillar Inc.'s (CAT) third-quarter earnings fell 44% as weak
demand for mining equipment continued to weigh on results.
The world's largest seller of bulldozers, excavators and wheel
loaders lowered its full-year guidance to earnings of $5.50 a share
and revenue of $55 billion. Its previous outlook called for
earnings of $6.50 a share on revenue of $56 billion to $58
billion.
"Unfortunately, order rates have not picked up much despite
continuing strong commodity production," said Chairman and Chief
Executive Doug Oberhelman. "That has caused us to ratchet down our
sales and revenues outlook as we have moved through 2013."
The global mining boom helped Caterpillar rebound quickly from
the 2008 recession. However, the company is facing tougher
year-earlier comparisons in most geographic markets. Falling demand
for mining equipment because of lower prices for mined commodities,
such as iron ore, has also pressured sales of mining equipment.
With expected sales and revenues nearly $11 billion lower than
last year, Mr. Oberhelman said 2013 has been a "painful" year.
Caterpillar noted significant risks and uncertainties remain
that could temper economic growth next year. For 2014, it expects
sales to be flat from 2013, plus or minus 5%. The company said it
won't be increasing its expectations for its resource industries
segment until mining orders improve.
For the latest quarter, Caterpillar reported a profit of $946
million, or $1.45 a share, down from $1.7 billion, or $2.54 a
share, a year earlier. Revenue declined 18% to $13.42 billion.
Analysts polled by Thomson Reuters most recently projected
earnings of $1.66 on revenue of $14.35 billion.
Machinery and power system sales fell 19%.
The company on Tuesday said sales of its construction and mining
equipment dropped 9% world-wide in the three months to the end of
September, as plunging sales in Asia offset an improving North
American market.
Caterpillar shares fell 2.9% to $86.55 premarket. The stock is
up 4.3% over the past three months through Tuesday's close.
Write to Nathalie Tadena at nathalie.tadena@wsj.com
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