Caterpillar last week reported record first-quarter profit per share of $1.45, an 18 percent increase compared with $1.23 per share in the first quarter of 2007. Sales and revenue of $11.796 billion was also a first-quarter record, an 18 percent jump compared with Q107 sales and revenue of $10.016 billion.
“We continue to see robust demand for products used in the global mining and energy industries and for machines used by our customers to build infrastructure, particularly in emerging markets,” said Caterpillar chairman and CEO Jim Owens.
Owens added that Caterpillar’s financial products business had its best first quarter ever for revenues and profit, despite challenges in the credit markets.
The geographic mix of sales continued to shift with sales and revenues increasing 30 percent outside of North America and 4 percent inside North America. Sales and revenue outside North America represented 58 percent of total sales and revenue in the first quarter, up from 53 percent of the total a year ago.
Profit of $922 million was up 13 percent, from $816 million in the first quarter 2007. The improvement was a result of better price realization and higher sales volume, partially offset by higher costs. Profit per share of $1.45 was up from $1.23 per share in Q107. Machinery and engine sales improved 18 percent to $11 billion, up from $9.3 billion in the first quarter of 2007, while financial products increased from $695 million in Q107 to $817 million in the just-concluded quarter.
Caterpillar expects 2008 to be another record year with sales and revenue increasing 5 to 15 percent despite further weakening in North America. “Even though we’re currently weathering a recessionary storm in the United States, we expect the rest of the world to continue to invest in infrastructure growth well into the next decade,” added Owens. “We will continue to invest in capacity, new products and our global deployment of the Caterpillar Production System with 6 Sigma.”
Caterpillar expects North American sales in a range of down 2 percent to up 2 percent for 2008, with sales increasing 10 to 15 percent outside North America. The company said North American dealers reduced their reported machine inventories by about $.1 billion in 2007, and therefore will reduce inventories by a much smaller amount in 2008, thus lessening the impact on company sales.