Three Months Ended Nine Months Ended September 30, September 30,
2008 2007 2008 2007 Sales and revenues: Sales of Machinery and
Engines $12,148 $10,668 $35,924 $30,602 Revenues of Financial
Products 833 774 2,477 2,212 Total sales and revenues 12,981 11,442
38,401 32,814 Operating costs: Cost of goods sold 9,704 8,270
28,349 23,706 Selling, general and administrative expenses 1,061
938 3,094 2,796 Research and development expenses 437 357 1,221
1,047 Interest expense of Financial Products 291 289 854 839 Other
operating expenses 315 275 892 760 Total operating costs 11,808
10,129 34,410 29,148 Operating profit 1,173 1,313 3,991 3,666
Interest expense excluding Financial Products 59 69 203 228 Other
income (expense) 138 51 325 232 Consolidated profit before taxes
1,252 1,295 4,113 3,670 Provision for income taxes 395 395 1,249
1,155 Profit of consolidated companies 857 900 2,864 2,515 Equity
in profit (loss) of unconsolidated affiliated companies 11 27 32 51
Profit $868 $927 $2,896 $2,566 Profit per common share $1.43 $1.45
$4.72 $4.00 Profit per common share - diluted(1) $1.39 $1.40 $4.57
$3.87 Weighted average common shares outstanding (millions) - Basic
607.0 638.3 613.2 641.0 - Diluted(1) 624.8 660.0 633.2 662.7 Cash
dividends declared per common share $- $- $.78 $.66 (1) Diluted by
assumed exercise of stock-based compensation awards using the
treasury stock method. Caterpillar Inc. Condensed Consolidated
Statement of Financial Position (Unaudited) (Millions of dollars)
September 30, December 31, 2008 2007 Assets Current assets: Cash
and short-term investments $2,138 $1,122 Receivables - trade and
other 9,580 8,249 Receivables - finance 8,094 7,503 Deferred and
refundable income taxes 839 816 Prepaid expenses and other current
assets 583 583 Inventories 9,290 7,204 Total current assets 30,524
25,477 Property, plant and equipment - net 11,817 9,997 Long-term
receivables - trade and other 685 685 Long-term receivables -
finance 15,024 13,462 Investments in unconsolidated affiliated
companies 100 598 Noncurrent deferred and refundable income taxes
1,337 1,553 Intangible assets 536 475 Goodwill 2,234 1,963 Other
assets 1,972 1,922 Total assets $64,229 $56,132 Liabilities Current
liabilities: Short-term borrowings: -- Machinery and Engines $1,858
$187 -- Financial Products 6,315 5,281 Accounts payable 5,149 4,723
Accrued expenses 3,668 3,178 Accrued wages, salaries and employee
benefits 1,115 1,126 Customer advances 1,946 1,442 Dividends
payable - 225 Other current liabilities 1,112 951 Long-term debt
due within one year: -- Machinery and Engines 353 180 -- Financial
Products 5,844 4,952 Total current liabilities 27,360 22,245
Long-term debt due after one year: -- Machinery and Engines 4,265
3,639 -- Financial Products 15,529 14,190 Liability for
postemployment benefits 4,796 5,059 Other liabilities 2,170 2,116
Total liabilities 54,120 47,249 Redeemable noncontrolling interest
464 - Stockholders' equity Common stock 2,993 2,744 Treasury stock
(11,109) (9,451) Profit employed in the business 19,673 17,398
Accumulated other comprehensive income (1,912) (1,808) Total
stockholders' equity 9,645 8,883 Total liabilities, redeemable
noncontrolling interest and stockholders' equity $64,229 $56,132
Caterpillar Inc. Condensed Consolidated Statement of Cash Flow
(Unaudited) (Millions of dollars) Nine Months Ended September 30,
2008 2007 Cash flow from operating activities: Profit $2,896 $2,566
Adjustments for non-cash items: Depreciation and amortization 1,453
1,301 Other 84 38 Changes in assets and liabilities: Receivables -
trade and other (676) 850 Inventories (1,380) (715) Accounts
payable and accrued expenses 790 268 Customer advances 321 541
Other assets - net 154 (89) Other liabilities - net (372) 670 Net
cash provided by (used for) operating activities 3,270 5,430 Cash
flow from investing activities: Capital expenditures - excluding
equipment leased to others (1,362) (969) Expenditures for equipment
leased to others (1,082) (971) Proceeds from disposals of property,
plant and equipment 754 302 Additions to finance receivables
(11,168) (9,797) Collections of finance receivables 7,402 7,908
Proceeds from the sale of finance receivables 710 800 Investments
and acquisitions (net of cash acquired) (139) (130) Proceeds from
sale of available-for-sale securities 292 196 Investments in
available-for-sale securities (270) (286) Other - net 116 336 Net
cash provided by (used for) investing activities (4,747) (2,611)
Cash flow from financing activities: Dividends paid (700) (617)
Common stock issued, including treasury shares reissued 128 311
Payment for stock repurchase derivative contracts (38) - Treasury
shares purchased (1,716) (1,485) Excess tax benefit from
stock-based compensation 55 143 Proceeds from debt issued (original
maturities greater than three months) 14,020 7,506 Payments on debt
(original maturities greater than three months) (10,888) (7,923)
Short-term borrowings (original maturities three months or
less)-net 1,646 (374) Net cash provided by (used for) financing
activities 2,507 (2,439) Effect of exchange rate changes on cash
(14) - Increase (decrease) in cash and short-term investments 1,016
380 Cash and short-term investments at beginning of period 1,122
530 Cash and short-term investments at end of period $2,138 $910
Certain amounts for prior periods have been reclassified to conform
to the current period financial statement presentation. All
short-term investments, which consist primarily of highly liquid
investments with original maturities of three months or less, are
considered to be cash equivalents. Caterpillar Inc. Supplemental
Data for Results of Operations For The Three Months Ended September
30, 2008 (Unaudited) (Millions of dollars) Supplemental
Consolidating Data Machinery and Financial Consolidating
Consolidated Engines(1) Products Adjustments Sales and revenues:
Sales of Machinery and Engines $12,148 $12,148 $- $- Revenues of
Financial Products 833 - 897 (64)(2) Total sales and revenues
12,981 12,148 897 (64) Operating costs: Cost of goods sold 9,704
9,704 - - Selling, general and administrative expenses 1,061 924
142 (5)(3) Research and development expenses 437 437 - - Interest
expense of Financial Products 291 - 292 (1)(4) Other operating
expenses 315 3 319 (7)(3) Total operating costs 11,808 11,068 753
(13) Operating profit 1,173 1,080 144 (51) Interest expense
excluding Financial Products 59 59 - -(4) Other income (expense)
138 63 24 51(5) Consolidated profit before taxes 1,252 1,084 168 -
Provision for income taxes 395 353 42 - Profit of consolidated
companies 857 731 126 - Equity in profit (loss) of unconsolidated
affiliated companies 11 12 (1) - Equity in profit of Financial
Products' subsidiaries - 125 - (125)(6) Profit $868 $868 $125
$(125) (1) Represents Caterpillar Inc. and its subsidiaries with
Financial Products accounted for on the equity basis. (2)
Elimination of Financial Products' revenues earned from Machinery
and Engines. (3) Elimination of net expenses recorded by Machinery
and Engines paid to Financial Products. (4) Elimination of interest
expense recorded between Financial Products and Machinery and
Engines. (5) Elimination of discount recorded by Machinery and
Engines on receivables sold to Financial Products and of interest
earned between Machinery and Engines and Financial Products. (6)
Elimination of Financial Products' profit due to equity method of
accounting. Caterpillar Inc. Supplemental Data for Results of
Operations For The Three Months Ended September 30, 2007
(Unaudited) (Millions of dollars) Supplemental Consolidating Data
Machinery and Financial Consolidating Consolidated Engines(1)
Products Adjustments Sales and revenues: Sales of Machinery and
Engines $10,668 $10,668 $- $- Revenues of Financial Products 774 -
863 (89)(2) Total sales and revenues 11,442 10,668 863 (89)
Operating costs: Cost of goods sold 8,270 8,270 - - Selling,
general and administrative expenses 938 831 112 (5)(3) Research and
development expenses 357 357 - - Interest expense of Financial
Products 289 - 291 (2)(4) Other operating expenses 275 - 282 (7)(3)
Total operating costs 10,129 9,458 685 (14) Operating profit 1,313
1,210 178 (75) Interest expense excluding Financial Products 69 70
- (1)(4) Other income (expense) 51 (41) 18 74(5) Consolidated
profit before taxes 1,295 1,099 196 - Provision for income taxes
395 337 58 - Profit of consolidated companies 900 762 138 - Equity
in profit (loss) of unconsolidated affiliated companies 27 26 1 -
Equity in profit of Financial Products' subsidiaries - 139 -
(139)(6) Profit $927 $927 $139 $(139) (1) Represents Caterpillar
Inc. and its subsidiaries with Financial Products accounted for on
the equity basis. (2) Elimination of Financial Products' revenues
earned from Machinery and Engines. (3) Elimination of net expenses
recorded by Machinery and Engines paid to Financial Products. (4)
Elimination of interest expense recorded between Financial Products
and Machinery and Engines. (5) Elimination of discount recorded by
Machinery and Engines on receivables sold to Financial Products and
of interest earned between Machinery and Engines and Financial
Products. (6) Elimination of Financial Products' profit due to
equity method of accounting. Caterpillar Inc. Supplemental Data for
Results of Operations For The Nine Months Ended September 30, 2008
(Unaudited) (Millions of dollars) Supplemental Consolidating Data
Machinery and Financial Consolidating Consolidated Engines(1)
Products Adjustments Sales and revenues: Sales of Machinery and
Engines $35,924 $35,924 $- $- Revenues of Financial Products 2,477
- 2,719 (242)(2) Total sales and revenues 38,401 35,924 2,719 (242)
Operating costs: Cost of goods sold 28,349 28,349 - - Selling,
general and administrative expenses 3,094 2,681 430 (17)(3)
Research and development expenses 1,221 1,221 - - Interest expense
of Financial Products 854 - 857 (3)(4) Other operating expenses 892
(17) 927 (18)(3) Total operating costs 34,410 32,234 2,214 (38)
Operating profit 3,991 3,690 505 (204) Interest expense excluding
Financial Products 203 203 - -(4) Other income (expense) 325 61 60
204(5) Consolidated profit before taxes 4,113 3,548 565 - Provision
for income taxes 1,249 1,089 160 - Profit of consolidated companies
2,864 2,459 405 - Equity in profit (loss) of unconsolidated
affiliated companies 32 33 (1) - Equity in profit of Financial
Products' subsidiaries - 404 - (404)(6) Profit $2,896 $2,896 $404
$(404) (1) Represents Caterpillar Inc. and its subsidiaries with
Financial Products accounted for on the equity basis. (2)
Elimination of Financial Products' revenues earned from Machinery
and Engines. (3) Elimination of net expenses recorded by Machinery
and Engines paid to Financial Products. (4) Elimination of interest
expense recorded between Financial Products and Machinery and
Engines. (5) Elimination of discount recorded by Machinery and
Engines on receivables sold to Financial Products and of interest
earned between Machinery and Engines and Financial Products. (6)
Elimination of Financial Products' profit due to equity method of
accounting. Caterpillar Inc. Supplemental Data for Results of
Operations For The Nine Months Ended September 30, 2007 (Unaudited)
(Millions of dollars) Supplemental Consolidating Data Machinery and
Financial Consolidating Consolidated Engines(1) Products
Adjustments Sales and revenues: Sales of Machinery and Engines
$30,602 $30,602 $- $- Revenues of Financial Products 2,212 - 2,508
(296)(2) Total sales and revenues 32,814 30,602 2,508 (296)
Operating costs: Cost of goods sold 23,706 23,706 - - Selling,
general and administrative expenses 2,796 2,469 342 (15)(3)
Research and development expenses 1,047 1,047 - - Interest expense
of Financial Products 839 - 842 (3)(4) Other operating expenses 760
(14) 795 (21)(3) Total operating costs 29,148 27,208 1,979 (39)
Operating profit 3,666 3,394 529 (257) Interest expense excluding
Financial Products 228 233 - (5)(4) Other income (expense) 232 (77)
57 252(5) Consolidated profit before taxes 3,670 3,084 586 -
Provision for income taxes 1,155 966 189 - Profit of consolidated
companies 2,515 2,118 397 - Equity in profit (loss) of
unconsolidated affiliated companies 51 48 3 - Equity in profit of
Financial Products' subsidiaries - 400 - (400)(6) Profit $2,566
$2,566 $400 $(400) (1) Represents Caterpillar Inc. and its
subsidiaries with Financial Products accounted for on the equity
basis. (2) Elimination of Financial Products' revenues earned from
Machinery and Engines. (3) Elimination of net expenses recorded by
Machinery and Engines paid to Financial Products. (4) Elimination
of interest expense recorded between Financial Products and
Machinery and Engines. (5) Elimination of discount recorded by
Machinery and Engines on receivables sold to Financial Products and
of interest earned between Machinery and Engines and Financial
Products. (6) Elimination of Financial Products' profit due to
equity method of accounting. Caterpillar Inc. Supplemental Data for
Cash Flow For The Nine Months Ended September 30, 2008 (Unaudited)
(Millions of dollars) Supplemental Consolidating Data Machinery and
Financial Consolidating Consolidated Engines(1) Products
Adjustments Cash flow from operating activities: Profit $2,896
$2,896 $404 $(404)(2) Adjustments for non-cash items: Depreciation
and amortization 1,453 879 574 - Undistributed profit of Financial
Products - (404) - 404(3) Other 84 151 (199) 132(4) Changes in
assets and liabilities: Receivables - trade and other (676) (489)
(30) (157)(4,5) Inventories (1,380) (1,380) - - Accounts payable
and accrued expenses 790 557 161 72(4) Customer advances 321 321 -
- Other assets - net 154 52 (26) 128(4) Other liabilities - net
(372) (240) (13) (119)(4) Net cash provided by (used for) operating
activities 3,270 2,343 871 56 Cash flow from investing activities:
Capital expenditures - excluding equipment leased to others (1,362)
(1,345) (17) - Expenditures for equipment leased to others (1,082)
- (1,101) 19(4) Proceeds from disposals of property, plant and
equipment 754 27 727 -(4) Additions to finance receivables (11,168)
- (29,272) 18,104(5) Collections of finance receivables 7,402 -
24,430 (17,028)(5) Proceeds from sale of finance receivables 710 -
1,861 (1,151)(5) Net intercompany borrowings - 239 (6) (233)(6)
Investments and acquisitions (net of cash acquired) (139) (139) -
-(7) Proceeds from sale of available- for-sale securities 292 20
272 - Investments in available-for- sale securities (270) (14)
(256) - Other - net 116 151 (35) -(7) Net cash provided by (used
for) investing activities (4,747) (1,061) (3,397) (289) Cash flow
from financing activities: Dividends paid (700) (700) - -(8) Common
stock issued, including treasury shares reissued 128 128 - -(7)
Payment for stock repurchase derivative contracts (38) (38) - -
Treasury shares purchased (1,716) (1,716) - - Excess tax benefit
from stock-based compensation 55 55 - - Net intercompany borrowings
- 6 (239) 233(6) Proceeds from debt issued (original maturities
greater than three months) 14,020 49 13,971 - Payments on debt
(original maturities greater than three months) (10,888) (173)
(10,715) - Short-term borrowings (original maturities three months
or less)-net 1,646 1,219 427 - Net cash provided by (used for)
financing activities 2,507 (1,170) 3,444 233 Effect of exchange
rate changes on cash (14) (9) (5) - Increase (decrease) in cash and
short-term investments 1,016 103 913 - Cash and short-term
investments at beginning of period 1,122 862 260 - Cash and
short-term investments at end of period $2,138 $965 $1,173 $- (1)
Represents Caterpillar Inc. and its subsidiaries with Financial
Products accounted for on the equity basis. (2) Elimination of
Financial Products' profit after tax due to equity method of
accounting. (3) Non-cash adjustment for the undistributed earnings
from Financial Products. (4) Elimination of non-cash adjustments
and changes in assets and liabilities related to consolidated
reporting. (5) Reclassification of Cat Financial's cash flow
activity from investing to operating for receivables that arose
from the sale of inventory. (6) Net proceeds and payments to/from
Machinery and Engines and Financial Products. (7) Change in
investment and common stock related to Financial Products. (8)
Elimination of dividends from Financial Products to Machinery and
Engines. Caterpillar Inc. Supplemental Data for Cash Flow For The
Nine Months Ended September 30, 2007 (Unaudited) (Millions of
dollars) Supplemental Consolidating Data Machinery and Financial
Consolidating Consolidated Engines(1) Products Adjustments Cash
flow from operating activities: Profit $2,566 $2,566 $400 $(400)(2)
Adjustments for non-cash items: Depreciation and amortization 1,301
784 517 - Undistributed profit of Financial Products - (400) -
400(3) Other 38 88 (276) 226(4) Changes in assets and liabilities:
Receivables - trade and other 850 (448) 5 1,293(4,5) Inventories
(715) (715) - - Accounts payable and accrued expenses 268 30 202
36(4) Customer advances 541 541 - - Other assets - net (89) (59)
(12) (18)(4) Other liabilities - net 670 630 47 (7)(4) Net cash
provided by (used for) operating activities 5,430 3,017 883 1,530
Cash flow from investing activities: Capital expenditures -
excluding equipment leased to others (969) (956) (13) -
Expenditures for equipment leased to others (971) - (978) 7(4)
Proceeds from disposals of property, plant and equipment 302 14 292
(4)(4) Additions to finance receivables (9,797) - (26,452)
16,655(5) Collections of finance receivables 7,908 - 25,020
(17,112)(5) Proceeds from sale of finance receivables 800 - 1,888
(1,088)(5) Net intercompany borrowings - 13 1 (14)(6) Investments
and acquisitions (net of cash acquired) (130) (138) - 8(7) Proceeds
from sale of available- for-sale securities 196 17 179 -
Investments in available-for- sale securities (286) (19) (267) -
Other - net 336 101 237 (2)(7) Net cash provided by (used for)
investing activities (2,611) (968) (93) (1,550) Cash flow from
financing activities: Dividends paid (617) (617) (4) 4(8) Common
stock issued, including treasury shares reissued 311 311 (2) 2(7)
Payment for stock repurchase derivative contracts - - - - Treasury
shares purchased (1,485) (1,485) - - Excess tax benefit from
stock-based compensation 143 143 - - Net intercompany borrowings -
(1) (13) 14(6) Proceeds from debt issued (original maturities
greater than three months) 7,506 125 7,381 - Payments on debt
(original maturities greater than three months) (7,923) (169)
(7,754) - Short-term borrowings (original maturities three months
or less)-net (374) (84) (290) - Net cash provided by (used for)
financing activities (2,439) (1,777) (682) 20 Effect of exchange
rate changes on cash - (9) 9 - Increase (decrease) in cash and
short- term investments 380 263 117 - Cash and short-term
investments at beginning of period 530 319 211 - Cash and
short-term investments at end of period $910 $582 $328 $- (1)
Represents Caterpillar Inc. and its subsidiaries with Financial
Products accounted for on the equity basis. (2) Elimination of
Financial Products' profit after tax due to equity method of
accounting. (3) Non-cash adjustment for the undistributed earnings
from Financial Products. (4) Elimination of non-cash adjustments
and changes in assets and liabilities related to consolidated
reporting. (5) Reclassification of Cat Financial's cash flow
activity from investing to operating for receivables that arose
from the sale of inventory. (6) Net proceeds and payments to/from
Machinery and Engines and Financial Products. (7) Change in
investment and common stock related to Financial Products. (8)
Elimination of dividends from Financial Products to Machinery and
Engines. DATASOURCE: Caterpillar Inc. Web site: http://www.cat.com/
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