AP NEWS
Related topics

Caterpillar Profits Slip

October 17, 2000

PEORIA, Ill. (AP) _ Caterpillar Inc. reported a 1 percent dip in third-quarter profits Tuesday, blaming the decrease on weak foreign currencies and higher administrative and research costs.

The heavy equipment manufacturer reported net earnings of $216 million, down from $219 million in the same quarter last year. It reported per-share earnings of 62 cents, up from last year’s 61 cents; the increase in per-share results reflects a fewer number of Caterpillar shares outstanding.

The results beat Wall Street’s recently lowered expectations of 58 cents per share, according to First Call/Thomson Financial, but the numbers generated some skepticism among analysts.

``The real number is significantly lower than 62 cents (per share), said Joanna Shatney, an analyst for Goldman, Sachs and Co. She said Caterpillar’s per-share earnings would be 53 to 55 cents without being propped up by other income and a stock buyback of two million shares.

Third-quarter sales were $4.78 billion, up 1 percent from $4.72 billion in the same period in 1999.

Caterpillar shares closed Tuesday down $1.25 to $30.50 on the New York Stock Exchange.

The company last month warned that third-quarter earnings could be down as much as 15 percent, although Caterpillar still expects a moderate profit increase for the year.

``The third quarter was a challenging one, especially considering the continued strength of the dollar and softness in key markets,″ said Glen Barton, Caterpillar’s chairman and CEO. ``In response to these conditions, we have redoubled efforts to reduce costs to ensure we deliver acceptable results for the full year.″

For the first nine months, Caterpillar reported earnings of $789 million, or $2.25 per share, up from $707 million, or $1.97 per share, in the same period a year earlier.

Revenues came to $15.06 billion, up nearly 3 percent from $14.68 billion.

Caterpillar said it expects a slight increase in sales and revenue in 2001, primarily due to expected increases in sales in Europe, Asia and Latin American. North American sales are expected to decrease.

AP RADIO
Update hourly