PEORIA, Ill., July 26, 2016 /PRNewswire/ --
|
|
Second
Quarter
|
($ in billions except
profit per share)
|
|
2015
|
|
2016
|
|
|
|
|
|
Sales and
Revenues
|
|
$12.317
|
|
$10.342
|
Profit Per
Share
|
|
$1.31
|
|
$0.93
|
Profit Per
Share
|
|
$1.40
|
|
$1.09
|
(Excluding
Restructuring Costs)
|
|
|
|
|
Caterpillar Inc. (NYSE: CAT) today announced profit per share of
$0.93 for the second quarter of 2016,
a decrease from $1.31 per share in
the second quarter of 2015. Excluding restructuring
costs, profit per share was $1.09, down from $1.40 per share in the second quarter of 2015.
Second-quarter 2016 sales and revenues were $10.3 billion, down from $12.3 billion, or 16 percent, in the second
quarter of 2015.
"I'm pleased with our financial performance and focus on our
long-term strategy given the difficult economic and industry
environment we're facing. Our goal when sales decrease is to
lower costs so the decline in operating profit is no more than 25
to 30 percent of the decline in sales and revenues. For the
quarter, our decremental operating profit pull
through was better than our target range. Together
with our dealers, we're having success managing through the
downturn in industries like mining and oil and gas, and in sluggish
economic conditions in much of the developing world. In what
is likely to be our fourth down year for sales and revenues, we're
proud of what we're accomplishing – our machine market position has
increased, including in China,
product quality continues to be at high levels, and the safety in
our facilities is world class," said Caterpillar Chairman and Chief
Executive Officer Doug
Oberhelman.
2016 Outlook
World economic growth remains subdued and is not sufficient to
drive improvement in most of the industries and markets we
serve. Commodity prices appear to have stabilized, but at low
levels. Global uncertainty continues, and the recent Brexit
outcome and the turmoil in Turkey
add to risks, especially in Europe.
The outlook for 2016 that we provided with our first-quarter
financial results in April expected sales and revenues in a range
of $40 to $42 billion. At the
midpoint of that range, profit was expected to be $3.00 per share, or $3.70 per share excluding restructuring
costs. Over the past quarter, economic risks have persisted
and, as a result, our current expectations for 2016 sales and
revenues are closer to the bottom end of that outlook range.
Restructuring costs in 2016, which were expected to be about
$550 million, are now forecast to be
about $700 million, or about
$0.80 per share. Additional
workforce reductions expected in the second half of 2016 are the
primary reason for the increase in restructuring costs. Sales
and revenues for 2016 are expected to be in a range of $40.0 to $40.5 billion, and the profit outlook at
the midpoint of the sales and revenues range is about $2.75 per share, or about $3.55 per share excluding restructuring
costs. Our revised outlook for both sales and revenues and
profit per share excluding restructuring costs is in line with the
Thompson First Call analyst consensus.
"Despite a solid second quarter, we're cautious as we enter the
second half of the year. We're not expecting an upturn in
important industries like mining, oil and gas and rail to happen
this year. We're continuing significant restructuring plans,
which are designed to bring our cost structure more in line with
demand while maintaining our capability to quickly serve our
customers when our business recovers. Once it does recover,
we expect substantial incremental profit improvement, realizing the
benefits of the tough actions we're implementing now coupled with
our ongoing investments in products and digital capabilities.
Amidst these very challenging market conditions, our balance sheet
remains strong, and our employees are delivering better performance
on everything from safety, quality and cost management to machine
market position. I'm inspired by our people as they're the
primary reason we're weathering this downturn as successfully as we
are," said Oberhelman.
Highlights
- Second-quarter sales and revenues and profit were better
than expected
- Cost reduction efforts are paying off with
second-quarter decremental operating profit pull through better
than the target range
- Mining, oil and gas, and rail industries remain
challenged
- Revised outlook for 2016 is in line with analyst
estimates
- Strong balance sheet – Maintained $0.77 per share dividend (announced June 8, 2016)
Notes:
- Glossary of terms is included on pages 16-17; first
occurrence of terms shown in bold italics.
- Information on non-GAAP financial measures is included on
page 18.
- Caterpillar will conduct a teleconference and live webcast,
with a slide presentation, beginning at 10
a.m. Central Time on Tuesday, July
26, 2016, to discuss its 2016 second-quarter results. The
slides accompanying the webcast will be available before the
webcast on the Caterpillar website at
http://www.caterpillar.com/investors/events-and-presentations.
About Caterpillar:
For 90 years, Caterpillar Inc. has been making sustainable progress
possible and driving positive change on every continent.
Customers turn to Caterpillar to help them develop infrastructure,
energy and natural resource assets. With 2015 sales and
revenues of $47.011 billion,
Caterpillar is the world's leading manufacturer of construction and
mining equipment, diesel and natural gas engines, industrial gas
turbines and diesel-electric locomotives. The company
principally operates through its three product segments -
Construction Industries, Resource Industries and Energy &
Transportation - and also provides financing and related services
through its Financial Products segment. For more information,
visit caterpillar.com. To connect with us on social media,
visit caterpillar.com/social-media.
Forward-Looking Statements
Certain statements in this press release relate to future events
and expectations and are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Words such as "believe," "estimate," "will be," "will,"
"would," "expect," "anticipate," "plan," "project," "intend,"
"could," "should" or other similar words or expressions often
identify forward-looking statements. All statements other
than statements of historical fact are forward-looking statements,
including, without limitation, statements regarding our outlook,
projections, forecasts or trend descriptions. These
statements do not guarantee future performance, and we do not
undertake to update our forward-looking statements.
Caterpillar's actual results may differ materially from those
described or implied in our forward-looking statements based on a
number of factors, including, but not limited to: (i) global and
regional economic conditions and economic conditions in the
industries we serve; (ii) government monetary or fiscal policies
and infrastructure spending; (iii) commodity price changes,
component price increases, fluctuations in demand for our products
or significant shortages of component products; (iv) disruptions or
volatility in global financial markets limiting our sources of
liquidity or the liquidity of our customers, dealers and suppliers;
(v) political and economic risks, commercial instability and events
beyond our control in the countries in which we operate; (vi)
failure to maintain our credit ratings and potential resulting
increases to our cost of borrowing and adverse effects on our cost
of funds, liquidity, competitive position and access to capital
markets; (vii) our Financial Products segment's risks associated
with the financial services industry; (viii) changes in interest
rates or market liquidity conditions; (ix) an increase in
delinquencies, repossessions or net losses of Cat Financial's
customers; (x) new regulations or changes in financial services
regulations; (xi) a failure to realize, or a delay in realizing,
all of the anticipated benefits of our acquisitions, joint ventures
or divestitures; (xii) international trade policies and their
impact on demand for our products and our competitive position;
(xiii) our ability to develop, produce and market quality products
that meet our customers' needs; (xiv) the impact of the highly
competitive environment in which we operate on our sales and
pricing; (xv) failure to realize all of the anticipated benefits
from initiatives to increase our productivity, efficiency and cash
flow and to reduce costs; (xvi) additional restructuring costs or a
failure to realize anticipated savings or benefits from past or
future cost reduction actions; (xvii) inventory management
decisions and sourcing practices of our dealers and our OEM
customers; (xviii) compliance with environmental laws and
regulations; (xix) alleged or actual violations of trade or
anti-corruption laws and regulations; (xx) additional tax expense
or exposure; (xxi) currency fluctuations; (xxii) our or Cat
Financial's compliance with financial covenants; (xxiii) increased
pension plan funding obligations; (xxiv) union disputes or other
employee relations issues; (xxv) significant legal proceedings,
claims, lawsuits or government investigations; (xxvi) changes in
accounting standards; (xxvii) failure or breach of IT security;
(xxviii) adverse effects of unexpected events including natural
disasters; and (xxix) other factors described in more detail under
"Item 1A. Risk Factors" in our Form 10-K filed with the SEC on
February 16, 2016 for the year ended
December 31, 2015.
CONSOLIDATED RESULTS
Consolidated Sales and Revenues
Consolidated Sales and Revenues Comparison
Second Quarter 2016 vs. Second Quarter 2015
To access this chart, go to
http://www.caterpillar.com/en/investors/quarterly-results.html for
the downloadable version of Caterpillar 2Q 2016
earnings.
The chart above
graphically illustrates reasons for the change in Consolidated
Sales and Revenues between the second quarter of 2015 (at left) and
the second quarter of 2016 (at right). Items favorably
impacting sales and revenues appear as upward stair steps with the
corresponding dollar amounts above each bar, while items negatively
impacting sales and revenues appear as downward stair steps with
dollar amounts reflected in parentheses above each bar.
Caterpillar management utilizes these charts internally to visually
communicate with the company's Board of Directors and
employees.
|
Sales and Revenues
Total sales and revenues were $10.342
billion in the second quarter of 2016, a decline of
$1.975 billion, or 16 percent,
compared with $12.317 billion in the
second quarter of 2015. The decrease was primarily due to
lower sales volume resulting from continued weak
commodity prices globally and economic weakness in developing
countries. While sales for both new equipment and
aftermarket parts declined in all segments, most of the decrease
was for new equipment. Unfavorable price
realization also contributed to the decline.
Sales declined in all regions. In North America, sales
decreased 16 percent primarily due to lower end-user demand for
construction, continuing declines in mining and the impact of low
oil prices. In EAME, sales declined 15 percent
primarily in Africa/Middle East due to weak economic conditions
resulting from low oil and other commodity prices and an uncertain
political environment. Sales decreased 31 percent in
Latin America
primarily due to continued widespread economic weakness across the
region. The most significant decreases were in Brazil and Mexico. Asia/Pacific sales declined 13 percent
primarily due to lower end-user demand for Energy &
Transportation applications.
Sales decreased in all segments. Energy &
Transportation's sales declined 20 percent largely due to lower
end-user demand for oil and gas and transportation
applications. Resource
Industries' sales declined 29 percent mostly due to
continued low end-user demand. Construction
Industries' sales decreased 8 percent primarily due to
unfavorable price realization and lower demand from end users.
Financial Products' segment revenues were down
3 percent primarily due to lower average earning
assets.
Consolidated Operating Profit
Consolidated Operating Profit Comparison
Second Quarter 2016 vs. Second Quarter 2015
To access this chart, go to
http://www.caterpillar.com/en/investors/quarterly-results.html for
the downloadable version of Caterpillar 2Q 2016 earnings.
The chart above
graphically illustrates reasons for the change in Consolidated
Operating Profit (Loss) between the second quarter of 2015 (at
left) and the second quarter of 2016 (at right). Items
favorably impacting operating profit appear as upward
stair steps with the corresponding dollar amounts above each bar,
while items negatively impacting operating profit appear as
downward stair steps with dollar amounts reflected in parentheses
above each bar. Caterpillar management utilizes these charts
internally to visually communicate with the company's Board of
Directors and employees. The bar entitled Other includes
consolidating adjustments and Machinery, Energy
& Transportation other operating (income)
expenses.
|
Operating profit for the second quarter of 2016 was $785 million, compared with $1.333 billion in the second quarter of
2015. The decrease of $548
million was primarily due to lower sales volume, including
an unfavorable mix of products. In addition, price
realization and restructuring costs were unfavorable. The
unfavorable price realization resulted from competitive market
conditions and an unfavorable geographic mix of sales. These
items were partially offset by significantly lower costs.
Period costs were lower primarily due to
substantial restructuring activities and other cost reduction
actions over the past year and lower short-term incentive
compensation expense. The reductions primarily impacted
period manufacturing costs and selling, general and administrative
expenses (SG&A).
More than half of the improvement in variable
manufacturing costs was from lower material costs. In
addition, both cost absorption and freight costs were
favorable. The impact of cost absorption was due to a more
significant inventory decrease in the second quarter of 2015,
compared to the second quarter of 2016.
Restructuring costs of $139
million in the second quarter of 2016 were related to
several restructuring programs across the company. In the
second quarter of 2015, restructuring costs were $86 million.
Other Profit/Loss Items
- Other income/expense in the second quarter of 2016 was
income of $84 million, compared with
expense of $72 million in the second
quarter of 2015. The favorable change was primarily due to the net
impact from currency translation and hedging gains
and losses and a gain on the sale of securities in the second
quarter of 2016. The favorable impact from currency translation and
hedging was primarily due to the absence of net losses during the
second quarter of 2015.
- The provision for income taxes in the second quarter
reflects an estimated annual tax rate of 25 percent, compared to
29.5 percent for the second quarter of 2015 and 25.5 percent for
the full-year 2015 excluding discrete items. The full-year rate for
2015 of 25.5 percent was lower than the second-quarter 2015 rate
primarily due to changes in the geographic mix of profits from a
tax perspective, along with the impact of the permanent renewal of
the U.S. research and development tax credit in the fourth
quarter.
Global Workforce
Caterpillar worldwide, full-time employment was about 100,000 at
the end of the second quarter of 2016, compared with about 111,200
at the end of the second quarter of 2015, a decrease of about
11,200 full-time employees. The flexible workforce decreased
by about 2,700 for a total decrease in the global workforce of
about 13,900. The decrease was primarily the result of
restructuring programs and lower production volumes.
|
|
June
30
|
|
|
2016
|
|
2015
|
|
Increase/ (Decrease)
|
Full-time
employment
|
|
100,000
|
|
111,200
|
|
(11,200)
|
Flexible
workforce
|
|
12,900
|
|
15,600
|
|
(2,700)
|
Total
|
|
112,900
|
|
126,800
|
|
(13,900)
|
|
|
|
|
|
|
|
Geographic summary of
change
|
|
|
|
|
|
|
U.S.
workforce
|
|
|
|
|
|
(7,500)
|
Non-U.S.
workforce
|
|
|
|
|
|
(6,400)
|
Total
|
|
|
|
|
|
(13,900)
|
SEGMENT RESULTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and Revenues
by Geographic Region
|
|
|
|
%
|
|
North
|
|
%
|
|
Latin
|
|
%
|
|
|
|
%
|
|
Asia/
|
|
%
|
(Millions of
dollars)
|
Total
|
|
Change
|
|
America
|
|
Change
|
|
America
|
|
Change
|
|
EAME
|
|
Change
|
|
Pacific
|
|
Change
|
Second Quarter
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
Industries¹
|
$
4,426
|
|
(8)
|
%
|
|
$
2,247
|
|
(13)
|
%
|
|
$
277
|
|
(32)
|
%
|
|
$
1,010
|
|
-
|
%
|
|
$
892
|
|
12
|
%
|
Resource
Industries²
|
1,457
|
|
(29)
|
%
|
|
539
|
|
(36)
|
%
|
|
258
|
|
(21)
|
%
|
|
317
|
|
(25)
|
%
|
|
343
|
|
(24)
|
%
|
Energy &
Transportation³
|
3,750
|
|
(20)
|
%
|
|
1,809
|
|
(11)
|
%
|
|
277
|
|
(38)
|
%
|
|
1,062
|
|
(22)
|
%
|
|
602
|
|
(30)
|
%
|
All Other
Segments⁴
|
41
|
|
(25)
|
%
|
|
14
|
|
(30)
|
%
|
|
2
|
|
(67)
|
%
|
|
9
|
|
(25)
|
%
|
|
16
|
|
(6)
|
%
|
Corporate Items and
Eliminations
|
(29)
|
|
|
|
|
(25)
|
|
|
|
|
-
|
|
|
|
|
(2)
|
|
|
|
|
(2)
|
|
|
|
Machinery, Energy
& Transportation
|
$
9,645
|
|
(17)
|
%
|
|
$
4,584
|
|
(16)
|
%
|
|
$
814
|
|
(31)
|
%
|
|
$
2,396
|
|
(15)
|
%
|
|
$
1,851
|
|
(13)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
$
759
|
|
(3)
|
%
|
|
$
473
|
|
4
|
%
|
|
$
82
|
|
(22)
|
%
|
|
$
103
|
|
2
|
%
|
|
$
101
|
|
(18)
|
%
|
Corporate Items and
Eliminations
|
(62)
|
|
|
|
|
(34)
|
|
|
|
|
(12)
|
|
|
|
|
(5)
|
|
|
|
|
(11)
|
|
|
|
Financial
Products Revenues
|
$
697
|
|
(5)
|
%
|
|
$
439
|
|
2
|
%
|
|
$
70
|
|
(26)
|
%
|
|
$
98
|
|
3
|
%
|
|
$
90
|
|
(20)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Sales
and Revenues
|
$10,342
|
|
(16)
|
%
|
|
$
5,023
|
|
(15)
|
%
|
|
$
884
|
|
(31)
|
%
|
|
$
2,494
|
|
(14)
|
%
|
|
$
1,941
|
|
(13)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second Quarter
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
Industries¹
|
$
4,803
|
|
|
|
|
$
2,586
|
|
|
|
|
$
408
|
|
|
|
|
$
1,013
|
|
|
|
|
$
796
|
|
|
|
Resource
Industries²
|
2,048
|
|
|
|
|
846
|
|
|
|
|
328
|
|
|
|
|
424
|
|
|
|
|
450
|
|
|
|
Energy &
Transportation³
|
4,708
|
|
|
|
|
2,034
|
|
|
|
|
444
|
|
|
|
|
1,364
|
|
|
|
|
866
|
|
|
|
All Other
Segments⁴
|
55
|
|
|
|
|
20
|
|
|
|
|
6
|
|
|
|
|
12
|
|
|
|
|
17
|
|
|
|
Corporate Items and
Eliminations
|
(31)
|
|
|
|
|
(30)
|
|
|
|
|
1
|
|
|
|
|
(2)
|
|
|
|
|
-
|
|
|
|
Machinery, Energy
& Transportation
|
$11,583
|
|
|
|
|
$
5,456
|
|
|
|
|
$
1,187
|
|
|
|
|
$
2,811
|
|
|
|
|
$
2,129
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
$
785
|
|
|
|
|
$
456
|
|
|
|
|
$
105
|
|
|
|
|
$
101
|
|
|
|
|
$
123
|
|
|
|
Corporate Items and
Eliminations
|
(51)
|
|
|
|
|
(25)
|
|
|
|
|
(10)
|
|
|
|
|
(6)
|
|
|
|
|
(10)
|
|
|
|
Financial
Products Revenues
|
$
734
|
|
|
|
|
$
431
|
|
|
|
|
$
95
|
|
|
|
|
$
95
|
|
|
|
|
$
113
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Sales
and Revenues
|
$12,317
|
|
|
|
|
$
5,887
|
|
|
|
|
$
1,282
|
|
|
|
|
$
2,906
|
|
|
|
|
$
2,242
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
Does not include inter-segment sales of $12 million and $26 million
in second quarter 2016 and 2015, respectively.
|
|
|
|
2
Does not include inter-segment sales of $57 million and $75 million
in second quarter 2016 and 2015, respectively.
|
|
|
|
3
Does not include inter-segment sales of $658 million and $766
million in second quarter 2016 and 2015, respectively.
|
|
|
|
4
Does not include inter-segment sales of $101 million and $100
million in second quarter 2016 and 2015, respectively.
|
|
|
|
|
Sales and Revenues
by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
Second
Quarter 2015
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
Other
|
|
Second Quarter
016
|
|
$
Change
|
|
%
Change
|
Construction
Industries
|
$
4,803
|
|
$
(184)
|
|
$
(203)
|
|
$
10
|
|
$
-
|
|
$
4,426
|
|
$
(377)
|
|
(8)
|
%
|
Resource
Industries
|
2,048
|
|
(562)
|
|
(26)
|
|
(3)
|
|
-
|
|
1,457
|
|
(591)
|
|
(29)
|
%
|
Energy &
Transportation
|
4,708
|
|
(951)
|
|
(4)
|
|
(3)
|
|
-
|
|
3,750
|
|
(958)
|
|
(20)
|
%
|
All Other
Segments
|
55
|
|
(14)
|
|
-
|
|
-
|
|
-
|
|
41
|
|
(14)
|
|
(25)
|
%
|
Corporate Items and
Eliminations
|
(31)
|
|
4
|
|
-
|
|
(2)
|
|
-
|
|
(29)
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Machinery, Energy
& Transportation
|
$
11,583
|
|
$
(1,707)
|
|
$
(233)
|
|
$
2
|
|
$
-
|
|
$
9,645
|
|
$
(1,938)
|
|
(17)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
785
|
|
-
|
|
-
|
|
-
|
|
(26)
|
|
759
|
|
(26)
|
|
(3)
|
%
|
Corporate Items and
Eliminations
|
(51)
|
|
-
|
|
-
|
|
-
|
|
(11)
|
|
(62)
|
|
(11)
|
|
|
|
Financial Products
Revenues
|
$
734
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
(37)
|
|
$
697
|
|
$
(37)
|
|
(5)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Sales
and Revenues
|
$
12,317
|
|
$
(1,707)
|
|
$
(233)
|
|
$
2
|
|
$
(37)
|
|
$
10,342
|
|
$
(1,975)
|
|
(16)
|
%
|
|
Operating Profit
(Loss) by Segment
|
|
Second
|
|
Second
|
|
$
|
|
%
|
(Millions of
dollars)
|
Quarter
2016
|
|
Quarter
2015
|
|
Change
|
|
Change
|
Construction
Industries
|
$
550
|
|
$
588
|
|
$
(38)
|
|
(6)
|
%
|
Resource
Industries
|
(163)
|
|
27
|
|
(190)
|
|
(704)
|
%
|
Energy &
Transportation
|
602
|
|
942
|
|
(340)
|
|
(36)
|
%
|
All Other
Segments
|
(14)
|
|
(18)
|
|
4
|
|
22
|
%
|
Corporate Items and
Eliminations
|
(297)
|
|
(322)
|
|
25
|
|
|
|
Machinery, Energy
& Transportation
|
$
678
|
|
$
1,217
|
|
$
(539)
|
|
(44)
|
%
|
|
|
|
|
|
|
|
|
|
Financial Products
Segment
|
202
|
|
184
|
|
18
|
|
10
|
%
|
Corporate Items and
Eliminations
|
(31)
|
|
(1)
|
|
(30)
|
|
|
|
Financial
Products
|
$
171
|
|
$
183
|
|
$
(12)
|
|
(7)
|
%
|
Consolidating
Adjustments
|
(64)
|
|
(67)
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Operating Profit (Loss)
|
$
785
|
|
$
1,333
|
|
$
(548)
|
|
(41)
|
%
|
CONSTRUCTION
INDUSTRIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2015
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
Second
Quarter 2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison1
|
$4,803
|
|
($184)
|
|
($203)
|
|
$10
|
|
$4,426
|
|
($377)
|
|
(8)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
North
America
|
$2,247
|
|
$2,586
|
|
($339)
|
|
(13)
|
%
|
|
|
|
|
|
|
|
Latin
America
|
277
|
|
408
|
|
(131)
|
|
(32)
|
%
|
|
|
|
|
|
|
|
EAME
|
1,010
|
|
1,013
|
|
(3)
|
|
-
|
%
|
|
|
|
|
|
|
|
Asia/Pacific
|
892
|
|
796
|
|
96
|
|
12
|
%
|
|
|
|
|
|
|
|
Total1
|
$4,426
|
|
$4,803
|
|
($377)
|
|
(8)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
Operating
Profit
|
$550
|
|
$588
|
|
($38)
|
|
(6)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Does not include
inter-segment sales of $12 million and $26 million in second
quarter 2016 and 2015, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction Industries' sales were $4.426 billion in the second quarter of 2016, a
decrease of $377 million, or 8
percent, from the second quarter of 2015. The decrease in
sales was due to unfavorable price realization and lower
volume. While sales declined for both new equipment and
aftermarket parts, most of the decrease was for new equipment.
- Unfavorable price realization resulted from competitive market
conditions globally and an unfavorable geographic mix of
sales.
- Sales volume declined primarily due to lower end-user
demand.
Sales decreased in North
America and Latin America
while slightly increasing in Asia/Pacific. Sales in EAME were flat.
- In North America, the sales
decline was primarily due to lower end-user demand. Although
residential and nonresidential construction activity is improving,
we believe declines in activity related to oil and gas have
resulted in the availability of existing equipment to support the
increased demand. The decline was also due to unfavorable price
realization and the unfavorable impact of dealers decreasing
inventories in the second quarter of 2016, compared to flat
inventories in the second quarter of 2015.
- In Latin America, end-user
demand was down across the region, with the most significant
declines in Brazil due to the
continued recession.
- Sales in Asia/Pacific were
higher as a result of the favorable impact of changes in dealer
inventories, which were about flat in the second quarter of 2016
and decreased in the second quarter of 2015.
- Sales in EAME were flat. Price realization was unfavorable, and
sales declined in oil-producing economies and in South Africa. Price realization was
unfavorable due to competitive market conditions, and the sales
decline in South Africa was a
result of continued weak economic conditions. These unfavorable
items were about offset by sales increases in several European
countries, reflecting modest improvements in economic
conditions.
Construction Industries' profit was $550
million in the second quarter of 2016, compared with
$588 million in the second quarter of
2015. The decrease in profit was primarily due to unfavorable
price realization and lower sales volume, including an unfavorable
mix of products. The decline was largely offset by favorable
costs, primarily due to restructuring and cost reduction actions,
lower material costs, favorable cost absorption and improved
freight costs. The favorable cost absorption was a result of
inventory decreasing more in the second quarter of 2015 than in the
second quarter of 2016.
RESOURCE
INDUSTRIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
Sales
Comparison
|
|
|
Second
Quarter 2015
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
Second
Quarter 2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison1
|
$2,048
|
|
($562)
|
|
($26)
|
|
($3)
|
|
|
$1,457
|
|
($591)
|
|
(29)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
North
America
|
$539
|
|
$846
|
|
($307)
|
|
(36)
|
%
|
|
|
|
|
|
|
|
|
|
Latin
America
|
258
|
|
328
|
|
(70)
|
|
(21)
|
%
|
|
|
|
|
|
|
|
|
|
EAME
|
317
|
|
424
|
|
(107)
|
|
(25)
|
%
|
|
|
|
|
|
|
|
|
|
Asia/Pacific
|
343
|
|
450
|
|
(107)
|
|
(24)
|
%
|
|
|
|
|
|
|
|
|
|
Total1
|
$1,457
|
|
$2,048
|
|
($591)
|
|
(29)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Operating Profit
(Loss)
|
($163)
|
|
$27
|
|
($190)
|
|
(704)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Does not include
inter-segment sales of $57 million and $75 million in second
quarter 2016 and 2015, respectively.
|
|
|
|
|
|
Resource Industries' sales were $1.457
billion in the second quarter of 2016, a decrease of
$591 million, or 29 percent, from the
second quarter of 2015. The decline was primarily due to
lower sales volume. While sales were lower for both new
equipment and aftermarket parts, most of the decrease was for new
equipment.
The sales decrease was primarily due to lower end-user demand
across all regions. While commodity prices have improved from
their recent lows, it is not clear at this time if the current
prices are sufficient to drive increased demand for equipment.
Mining customers continued to focus on improving productivity
in existing mines and reducing their total capital expenditures, as
they have for several years. As a result, sales and new
orders in Resource Industries continue to be weak.
Resource Industries incurred a loss of $163 million in the second quarter of 2016,
compared with a profit of $27 million
in the second quarter of 2015. The unfavorable change was due
to a decrease in sales volume, partially offset by lower period
costs due to restructuring and cost reduction actions and favorable
material costs.
ENERGY &
TRANSPORTATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
|
|
Sales
Comparison
|
|
Second
Quarter 2015
|
|
Sales
Volume
|
|
Price
Realization
|
|
Currency
|
|
Second
Quarter 2016
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
Comparison1
|
$4,708
|
|
($951)
|
|
($4)
|
|
($3)
|
|
|
$3,750
|
|
($958)
|
|
(20)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales by
Geographic Region
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
North
America
|
$1,809
|
|
$2,034
|
|
($225)
|
|
(11)
|
%
|
|
|
|
|
|
|
|
|
|
Latin
America
|
277
|
|
444
|
|
(167)
|
|
(38)
|
%
|
|
|
|
|
|
|
|
|
|
EAME
|
1,062
|
|
1,364
|
|
(302)
|
|
(22)
|
%
|
|
|
|
|
|
|
|
|
|
Asia/Pacific
|
602
|
|
866
|
|
(264)
|
|
(30)
|
%
|
|
|
|
|
|
|
|
|
|
Total1
|
$3,750
|
|
$4,708
|
|
($958)
|
|
(20)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
$602
|
|
$942
|
|
($340)
|
|
(36)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Does not include
inter-segment sales of $658 million and $766 million in second
quarter 2016 and 2015, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Energy & Transportation's sales were $3.750 billion in the second quarter of 2016, a
decrease of $958 million, or 20
percent, from the second quarter of 2015. The decrease was
primarily the result of lower sales volume. Sales decreased
in all applications with nearly 80 percent of the decline in oil
and gas and transportation.
- Oil and Gas – Sales continued to decrease in much of the
world due to low oil prices. The sales decline was most significant
in EAME and Asia/Pacific,
primarily due to lower demand for equipment used for gas
compression, production and drilling applications. The decline in
sales in North America was mostly
due to lower end-user demand for reciprocating engines used in gas
compression applications.
- Transportation – Sales decreased in all geographic
regions. The most significant decline was in Asia/Pacific primarily due to lower demand for
equipment used in marine applications. The decrease in North America was due to discontinued
production of on-highway vocational trucks. Weakness continued in
the rail industry across all regions and was the most significant
reason for the sales declines in EAME and Latin America. Sales into the rail industry in
North America were about
flat.
- Power Generation – Sales decreased in EAME, Asia/Pacific and North America and were about flat in
Latin America. The decline in EAME
was a result of competitive price pressures, as well as continued
weakness in the Middle East with
low oil prices limiting investments. The decline in Asia/Pacific and North America was due to the absence of
several large projects.
- Industrial – Sales were lower primarily in North America and Latin America for most industrial applications
due to lower end-user demand.
Energy & Transportation's profit was $602 million in the second quarter of 2016,
compared with $942 million in the
second quarter of 2015. The decline was due to lower sales
volume, including an unfavorable mix of products, partially offset
by lower costs primarily due to a decrease in short-term incentive
compensation expense, the impact of restructuring and cost
reduction actions, as well as favorable material costs.
|
FINANCIAL PRODUCTS
SEGMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions of
dollars)
|
|
|
|
|
|
|
|
|
Revenues by
Geographic Region
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
North
America
|
$473
|
|
$456
|
|
$17
|
|
4
|
%
|
|
|
|
Latin
America
|
82
|
|
105
|
|
(23)
|
|
(22)
|
%
|
|
|
|
EAME
|
103
|
|
101
|
|
2
|
|
2
|
%
|
|
|
|
Asia/Pacific
|
101
|
|
123
|
|
(22)
|
|
(18)
|
%
|
|
|
|
Total
|
$759
|
|
$785
|
|
($26)
|
|
(3)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second
Quarter 2016
|
|
Second
Quarter 2015
|
|
$
Change
|
|
%
Change
|
|
|
Operating
Profit
|
$202
|
|
$184
|
|
$18
|
|
10
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Products' revenues were $759
million in the second quarter of 2016, a decrease of
$26 million, or 3 percent, from the
second quarter of 2015. The decline was primarily due to lower
average earning assets in Asia/Pacific and Latin America, partially offset by higher
average earning assets in North
America.
Financial Products' profit was $202
million in the second quarter of 2016, compared with
$184 million in the second quarter of
2015. The improvement was primarily due to a $30 million increase in gains on sales of
securities at Insurance Services and a $13
million decrease in SG&A expenses. These favorable
impacts were partially offset by an $11
million unfavorable impact from the sale of returned or
repossessed equipment primarily driven by the absence of gains in
second quarter of 2015.
At the end of the second quarter of 2016, past dues at Cat
Financial were 2.93 percent, compared with 2.97 percent at the end
of the second quarter of 2015. Write-offs, net of recoveries,
were $33 million for the second
quarter of 2016, compared with $38
million for the second quarter of 2015.
As of June 30, 2016, Cat
Financial's allowance for credit losses totaled $346 million, or 1.25 percent of net finance
receivables, compared with $405
million, or 1.42 percent of net finance receivables at
June 30, 2015. The allowance
for credit losses at year-end 2015 was $338
million, or 1.22 percent of net finance receivables.
Corporate Items and Eliminations
Expense for corporate items and eliminations was $328 million in the second quarter of 2016, an
increase of $5 million from the
second quarter of 2015. Corporate items and eliminations
include: corporate-level expenses; restructuring costs; timing
differences, as some expenses are reported in segment profit on a
cash basis; retirement benefit costs other than service cost;
currency differences for ME&T, as segment profit is reported
using annual fixed exchange rates; cost of sales methodology
differences, as segments use a current cost methodology; and
inter-segment eliminations.
The increase in expense from the second quarter of 2015 was
primarily due to an increase in restructuring costs and methodology
differences, largely offset by timing differences and lower
corporate costs.
2016 OUTLOOK
World economic growth remains subdued and is not sufficient to
drive improvement in most of the industries and markets we
serve. Commodity prices appear to have stabilized, but at low
levels. Global uncertainty continues, and the recent Brexit
outcome and the turmoil in Turkey
add to risks, especially in Europe.
The outlook for 2016 that we provided with our first-quarter
financial results in April expected sales and revenues in a range
of $40 to $42 billion. At the
midpoint of that range, profit was expected to be $3.00 per share, or $3.70 per share excluding restructuring
costs. Over the past quarter, economic risks have persisted
and, as a result, our current expectations for 2016 sales and
revenues are closer to the bottom end of that outlook range.
Restructuring costs in 2016, which were expected to be about
$550 million, are now forecast to be
about $700 million, or about
$0.80 per share. Additional
workforce reductions expected in the second half of 2016 are the
primary reason for the increase in restructuring costs. Sales
and revenues for 2016 are expected to be in a range of $40.0 to $40.5 billion, and the profit outlook at
the midpoint of the sales and revenues range is about $2.75 per share, or about $3.55 per share excluding restructuring
costs. Our revised outlook for both sales and revenues and
profit per share excluding restructuring costs is in line with the
Thompson First Call analyst consensus.
QUESTIONS AND
ANSWERS
|
|
|
Q1:
|
What caused the
price deterioration in the second quarter, especially in
Construction Industries? What do you expect for the balance
of the year?
|
|
|
A:
|
We continue to see
competitive pressure that started in the last half of 2015 driven
by excess industry capacity, unfavorable currency pressure and an
overall weak economic environment. We expect the current
competitive pressure to continue for the remainder of 2016,
although we expect our year-over-year comparison for price
realization in the second half of the year will be better than the
first half.
|
|
|
Q2:
|
Oil prices have
improved from the beginning of 2016 and have stabilized. How
does this affect your thinking about shipments of reciprocating
engines and turbines for 2016?
|
|
|
A:
|
While oil prices have
improved since the beginning of 2016, it is not clear at this time
that the current price level is sufficient to drive increased
demand. We have seen minimal change in the continued low
drill rig counts and little improvement in our customers' fleet
utilization rates. We continue to monitor a number of factors
in addition to oil prices that shape our outlook, including recent
order rates, quotation activity, current backlog, trends in retail
statistics and discussions with our customers. Based on all
of these factors, we do not see the current price driving
significant increase in demand for our products in 2016.
|
|
|
Q3:
|
Can you discuss
changes in dealer inventories during 2016?
|
|
|
A:
|
Changes in dealer
inventories had little impact on sales from the second quarter of
2015 to the second quarter of 2016. Dealer machine and
engine inventories decreased about $400 million in the second
quarter of 2016 and about $300 million in the second quarter of
2015.
|
|
|
|
During the first six
months of 2016, dealer machine and engine inventories decreased
about $100 million. We expect dealers will reduce inventories
during the remainder of 2016, resulting in lower year-end
inventories in 2016, compared to 2015.
|
|
|
Q4:
|
Can you comment on
your order backlog?
|
|
|
A:
|
At the end of the
second quarter of 2016, the order backlog was $11.8 billion.
This represents about a $1.3 billion reduction from the end of the
first quarter of 2016. About two-thirds of the decrease was
in Construction Industries. It is not uncommon for the
construction order backlog to decline during the second-quarter
selling season, and we believe the reduction also reflects
increased machine availability through our factories and product
distribution centers. In addition, the order backlog for
Energy & Transportation and Resource Industries declined.
Compared to the second quarter of 2015, the order backlog has
declined about $3.0 billion with decreases in all
segments.
|
|
|
Q5:
|
Can you comment on
expense related to your 2016 short-term incentive compensation
plans?
|
|
|
A:
|
Short-term incentive
compensation expense is directly related to financial and
operational performance, measured against targets set annually.
Second-quarter 2016 expense was about $85 million.
Second-quarter 2015 expense was about $200
million.
|
|
|
|
For 2016, our outlook
includes short-term incentive compensation expense of about $410
million. Full-year 2015 short-term incentive compensation
expense was about $585 million.
|
|
|
Q6:
|
Can you give us an
update on how Cat Financial is performing?
|
|
|
A:
|
Cat Financial's
portfolio continues to perform well overall despite ongoing
weakness in many key end markets. The second quarter of 2016
past dues were 2.93 percent, compared with 2.97 percent in the
second quarter of 2015, with current past dues remaining lower than
historical averages. Write-offs in the second quarter of 2016
were $33 million, or 0.48 percent of the average retail portfolio,
compared with $38 million, or 0.56 percent of the average retail
portfolio in second quarter of 2015, and only slightly above
historical averages for the second quarter. We believe
customer risk exposure is well managed, with a broad distribution
of portfolio exposure across a global customer base. Cat
Financial continues to work closely with its customers to provide
financing support for new Caterpillar product purchases and to
actively monitor global portfolio health.
|
|
|
Q7:
|
Can you comment on
your balance sheet and cash priorities?
|
|
|
A:
|
The ME&T
debt-to-capital ratio was 39.0 percent at the end of
the second quarter of 2016, compared with 37.7 percent at the end
of the first quarter. Our cash and liquidity positions remain
strong with an enterprise cash balance of $6.764 billion as of June
30, 2016. ME&T operating cash flow for the second quarter
of 2016 was $1.165 billion, compared with $1.638 billion in the
second quarter of 2015. The decline was primarily due to
lower profit and the absence of a dividend from Cat Financial that
was paid in the second quarter of 2015.
|
|
|
|
Our long-term cash
deployment priorities are unchanged, and we remain focused on the
continued strength of our balance sheet in order to maintain our
credit rating and the dividend.
|
|
|
Q8:
|
On June 23, 2016,
the citizens of the United Kingdom voted to exit the European Union
(Brexit). Although it is still early, how do you expect this
vote will impact your business?
|
|
|
A:
|
Although the new U.K.
government confirmed its intent to move forward with Brexit, there
is little economic data available that reflects activity since the
referendum was held. It is possible that in the short term
the uncertainty could impact our customers' purchasing
decisions. We have a substantial manufacturing presence in
the U.K., and a weaker British pound would be positive for our
exports from the U.K. However, it is still too early to draw
any definitive conclusions about what impact, if any, the Brexit
vote will have on our business and on long-term economic growth in
Europe.
|
|
|
Q9:
|
Can you comment on
your Solar Turbines business and how 2016 is progressing as
compared with initial estimates? Also, how do you expect
continued low oil and gas prices will affect how your customers
administer parts and service?
|
|
|
A:
|
At the beginning of
the year, we forecasted Solar's sales to be down less than 10
percent in 2016. The market fundamentals are playing out like
we forecasted, with new equipment sales related to oil down
significantly, offset by higher sales into gas compression.
The increase in midstream compression for turbines is being driven
by pipeline capacity additions and significant infrastructure
investment, primarily in North America, due to fuel switching to
natural gas for power generation and the build out of new Liquefied
Natural Gas (LNG) export facilities. Customer services are
also an important part of Solar's business. Unlike equipment
sold into many other industries Caterpillar serves, turbines
operating in the field are generally not taken out of production in
a market downturn. They are still operating and require
parts, overhaul and field service. The backlog for Solar is
flat from the end of the first quarter, and slightly up from the
beginning of the year. However, customers are continuing to
squeeze their maintenance budgets, and we expect them to delay some
work into 2017. Based on our latest forecast, we now expect
Solar's sales to be down about 10 percent from 2015.
|
|
|
Q10:
|
Can you provide an
update on the readiness of your North American Tier 4
locomotives?
|
|
|
A:
|
Our North American
Tier 4 freight locomotive is on schedule for deliveries in the
second half of 2016. In addition, we recently introduced our
entry into the passenger rail locomotive business with a Tier 4
offering to a U.S. customer.
|
|
|
Q11:
|
Did the tax rate
related to restructuring costs change?
|
|
|
A:
|
During the second
quarter, we revised how we report the tax impact of restructuring
costs. Previously, we used the estimated annual tax rate (25
percent for 2016). We are now using statutory tax rates for
the jurisdictions where the costs are deductible to compute the
after tax impact of restructuring costs. This change would
have lowered per share restructuring costs in our April 2016
outlook from $0.70 to $0.62. This change had no impact on our
April profit per share outlook of $3.00 per share; however, it
would have lowered our outlook for profit per share excluding
restructuring costs by $0.08 ($3.70 per share would have been $3.62
per share). As a result of this change, first-quarter 2016 per
share restructuring costs were revised from $0.21 to $0.18. There
was no impact to first-quarter 2016 profit per share of $0.46,
however profit per share excluding restructuring costs was revised
from $0.67 to $0.64.
|
GLOSSARY OF
TERMS
|
|
1.
|
All Other
Segments – Primarily includes activities such as: the business
strategy, product management, development, and manufacturing of
filters and fluids, undercarriage, tires and rims, ground engaging
tools, fluid transfer products, precision seals and rubber, and
sealing and connecting components primarily for Cat® products;
parts distribution; distribution services responsible for dealer
development and administration including a wholly owned dealer in
Japan, dealer portfolio management and ensuring the most efficient
and effective distribution of machines, engines and parts; digital
investments for new customer and dealer solutions that integrate
data analytics with state-of-the art digital technologies while
transforming the buying experience.
|
2.
|
Consolidating
Adjustments – Elimination of transactions between Machinery,
Energy & Transportation and Financial Products.
|
3.
|
Construction
Industries – A segment primarily responsible for supporting
customers using machinery in infrastructure, forestry and building
construction applications. Responsibilities include business
strategy, product design, product management and development,
manufacturing, marketing and sales and product support. The
product portfolio includes backhoe loaders, small wheel loaders,
small track-type tractors, skid steer loaders, multi-terrain
loaders, mini excavators, compact wheel loaders, telehandlers,
select work tools, small, medium and large track excavators, wheel
excavators, medium wheel loaders, compact track loaders, medium
track-type tractors, track-type loaders, motor graders, pipelayers,
forestry and paving products.
|
4.
|
Currency –
With respect to sales and revenues, currency represents the
translation impact on sales resulting from changes in foreign
currency exchange rates versus the U.S. dollar. With respect
to operating profit, currency represents the net translation impact
on sales and operating costs resulting from changes in foreign
currency exchange rates versus the U.S. dollar. Currency
includes the impact on sales and operating profit for the
Machinery, Energy & Transportation lines of business only;
currency impacts on Financial Products' revenues and operating
profit are included in the Financial Products' portions of the
respective analyses. With respect to other income/expense,
currency represents the effects of forward and option contracts
entered into by the company to reduce the risk of fluctuations in
exchange rates (hedging) and the net effect of changes in foreign
currency exchange rates on our foreign currency assets and
liabilities for consolidated results (translation).
|
5.
|
Debt-to-Capital
Ratio – A key measure of Machinery, Energy &
Transportation's financial strength used by management. The
metric is defined as Machinery, Energy & Transportation's
short-term borrowings, long-term debt due within one year and
long-term debt due after one year (debt) divided by the sum of
Machinery, Energy & Transportation's debt and stockholders'
equity. Debt also includes Machinery, Energy &
Transportation's long-term borrowings from Financial
Products.
|
6.
|
EAME – A
geographic region including Europe, Africa, the Middle East and the
Commonwealth of Independent States (CIS).
|
7.
|
Earning Assets
– Assets consisting primarily of total finance receivables net of
unearned income, plus equipment on operating leases, less
accumulated depreciation at Cat Financial.
|
8.
|
Energy &
Transportation – A segment primarily responsible for supporting
customers using reciprocating engines, turbines, diesel-electric
locomotives and related parts across industries serving power
generation, industrial, oil and gas and transportation
applications, including marine and rail-related businesses.
Responsibilities include business strategy, product design, product
management and development, manufacturing, marketing and sales and
product support of turbines and turbine-related services,
reciprocating engine powered generator sets, integrated systems
used in the electric power generation industry, reciprocating
engines and integrated systems and solutions for the marine and oil
and gas industries; reciprocating engines supplied to the
industrial industry as well as Cat machinery; the remanufacturing
of Cat engines and components and remanufacturing services for
other companies; the business strategy, product design, product
management and development, manufacturing, remanufacturing, leasing
and service of diesel-electric locomotives and components and other
rail-related products and services and product support of
on-highway vocational trucks for North America.
|
9.
|
Financial Products
Segment – Provides financing to customers and dealers for
the purchase and lease of Cat and other equipment, as well as some
financing for Caterpillar sales to dealers. Financing plans
include operating and finance leases, installment sale contracts,
working capital loans and wholesale financing plans. The
segment also provides various forms of insurance to customers and
dealers to help support the purchase and lease of our
equipment. Financial Products segment profit is determined on
a pretax basis and includes other income/expense items.
|
10.
|
Latin America
– A geographic region including Central and South American
countries and Mexico.
|
11.
|
Machinery, Energy
& Transportation (ME&T) – Represents the aggregate
total of Construction Industries, Resource Industries, Energy &
Transportation and All Other Segments and related corporate items
and eliminations.
|
12.
|
Machinery, Energy
& Transportation Other Operating (Income) Expenses
– Comprised primarily of gains/losses on disposal of
long-lived assets, gains/losses on divestitures and legal
settlements and accruals. Restructuring costs classified as
other operating expenses on the Results of Operations are presented
separately on the Operating Profit Comparison.
|
13.
|
Operating Profit
Pull Through – A key metric used by management to measure the
rate of operating profit change relative to the change in sales and
revenues. The metric is defined as the change in operating
profit divided by the change in sales and revenues. Excludes
restructuring costs and mark-to-market gains or losses resulting
from pension and OPEB plan remeasurements.
|
14.
|
Pension and Other
Postemployment Benefits (OPEB) – The company's defined benefit
pension and postretirement benefit plans.
|
15.
|
Period Costs –
Includes period manufacturing costs, selling, general and
administrative (SG&A) and research and development (R&D)
expenses excluding the impact of currency. Period
manufacturing costs support production but are defined as generally
not having a direct relationship to short-term changes in
volume. Examples include machinery and equipment repair,
depreciation on manufacturing assets, facility support,
procurement, factory scheduling, manufacturing planning and
operations management. SG&A and R&D costs are not
linked to the production of goods or services and include
marketing, legal and financial services and the development of new
and significant improvements in products or processes.
|
16.
|
Price
Realization – The impact of net price changes excluding
currency and new product introductions. Price realization
includes geographic mix of sales, which is the impact of changes in
the relative weighting of sales prices between geographic
regions.
|
17.
|
Resource
Industries – A segment primarily responsible for supporting
customers using machinery in mining, quarry, waste, and material
handling applications. Responsibilities include business strategy,
product design, product management and development, manufacturing,
marketing and sales and product support. The product portfolio
includes large track-type tractors, large mining trucks, hard rock
vehicles, longwall miners, electric rope shovels, draglines,
hydraulic shovels, track and rotary drills, highwall miners, large
wheel loaders, off-highway trucks, articulated trucks, wheel
tractor scrapers, wheel dozers, landfill compactors, soil
compactors, material handlers, continuous miners, scoops and
haulers, hardrock continuous mining systems, select work tools,
machinery components and electronics and control systems. In
addition to equipment, Resource Industries also develops and sells
technology to provide customers fleet management systems, equipment
management analytics and autonomous machine capabilities.
Resource Industries also manages areas that provide services to
other parts of the company, including integrated manufacturing and
research and development.
|
18.
|
Restructuring
Costs – Primarily costs for employee separation costs,
long-lived asset impairments and contract terminations. These
costs are included in Other Operating (Income) Expenses.
Restructuring costs also include other exit-related costs primarily
for accelerated depreciation and equipment relocation (primarily
included in Cost of goods sold) and sales discounts and payments to
dealers and customers related to discontinued products (included in
Sales of ME&T).
|
19.
|
Sales Volume –
With respect to sales and revenues, sales volume represents the
impact of changes in the quantities sold for Machinery, Energy
& Transportation as well as the incremental revenue impact of
new product introductions, including emissions-related product
updates. With respect to operating profit, sales volume
represents the impact of changes in the quantities sold for
Machinery, Energy & Transportation combined with product mix as
well as the net operating profit impact of new product
introductions, including emissions-related product updates.
Product mix represents the net operating profit impact of changes
in the relative weighting of Machinery, Energy & Transportation
sales with respect to total sales.
|
20.
|
Variable
Manufacturing Costs – Represents volume-adjusted costs
excluding the impact of currency. Variable manufacturing
costs are defined as having a direct relationship with the volume
of production. This includes material costs, direct labor and
other costs that vary directly with production volume such as
freight, power to operate machines and supplies that are consumed
in the manufacturing process.
|
NON-GAAP FINANCIAL MEASURES
The following definition is provided for "non-GAAP financial
measures" in connection with Regulation G issued by the Securities
and Exchange Commission. The non-GAAP financial measures we
use have no standardized meaning prescribed by U.S. GAAP and
therefore are unlikely to be comparable to the calculation of
similar measures for other companies. Management does not
intend these items to be considered in isolation or substituted for
the related GAAP
measure.
Profit Per Share Excluding Restructuring Costs
We incurred restructuring costs in 2015 and in the first and
second quarters of 2016 and expect to incur additional
restructuring costs in the second half of 2016. We believe it
is important to separately quantify the profit per share impact of
restructuring costs in order for our results and outlook to be
meaningful to our readers as these costs are incurred in the
current year to generate longer-term benefits. Reconciliation
of profit per share excluding restructuring costs to the most
directly comparable GAAP measure, diluted profit per share, are as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
2016
Outlook
|
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
Previous
1
|
|
Current
2
|
|
|
Profit (Loss) per
share
|
|
$0.46
|
|
$1.31
|
|
$0.93
|
|
$3.00
|
|
$2.75
|
|
|
Per share
restructuring costs 3
|
|
$0.18
|
|
$0.09
|
|
$0.16
|
|
$0.70
|
|
$0.80
|
|
|
Profit per share
excluding restructuring costs
|
|
$0.64
|
|
$1.40
|
|
$1.09
|
|
$3.70
|
|
$3.55
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 2016
Sales and Revenues Outlook in a range of $40-42 billion (as of
April 22, 2016). Profit per share at midpoint.
|
|
|
2 2016
Sales and Revenues Outlook in a range of $40.0-40.5 billion (as of
July 26, 2016). Profit per share at midpoint.
|
|
|
1-2 2016
Outlook does not include any impact from mark-to-market gains or
losses resulting from pension and OPEB plan
remeasurements.
|
|
3At
statutory tax rates, except 2016 Previous Outlook, which was at the
estimated annual tax rate. At statutory tax rates,
the 2016 Previous Outlook for per share restructuring costs
was $0.62.
|
|
Machinery, Energy & Transportation
Caterpillar defines Machinery, Energy & Transportation as it
is presented in the supplemental data as Caterpillar Inc. and its
subsidiaries with Financial Products accounted for on the equity
basis. Machinery, Energy & Transportation information
relates to the design, manufacture and marketing of our
products. Financial Products' information relates to the
financing to customers and dealers for the purchase and lease of
Caterpillar and other equipment. The nature of these
businesses is different, especially with regard to the financial
position and cash flow items. Caterpillar management utilizes
this presentation internally to highlight these differences.
We also believe this presentation will assist readers in
understanding our business. Pages 19-27 reconcile Machinery,
Energy & Transportation with Financial Products on the equity
basis to Caterpillar Inc. consolidated financial information.
Caterpillar's latest
financial results and outlook are also available via:
|
Telephone:
|
800-228-7717 (Inside
the United States and Canada)
|
|
858-764-9492 (Outside
the United States and Canada)
|
Internet:
|
|
|
http://www.caterpillar.com/en/investors.html
|
|
http://www.caterpillar.com/en/investors/quarterly-results.html
(live broadcast/replays of quarterly conference call)
|
Caterpillar
Inc.
Condensed
Consolidated Statement of Results of Operations
(Unaudited)
(Dollars in
millions except per share data)
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
9,645
|
|
|
|
$
|
11,583
|
|
|
|
$
|
18,425
|
|
|
|
$
|
23,544
|
|
|
|
Revenues of Financial
Products
|
|
697
|
|
|
|
|
734
|
|
|
|
|
1,378
|
|
|
|
|
1,475
|
|
|
|
Total sales and
revenues
|
|
10,342
|
|
|
|
|
12,317
|
|
|
|
|
19,803
|
|
|
|
|
25,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
7,419
|
|
|
|
|
8,674
|
|
|
|
|
14,241
|
|
|
|
|
17,434
|
|
|
|
Selling, general and
administrative expenses
|
|
1,123
|
|
|
|
|
1,318
|
|
|
|
|
2,211
|
|
|
|
|
2,567
|
|
|
|
Research and
development expenses
|
|
468
|
|
|
|
|
510
|
|
|
|
|
976
|
|
|
|
|
1,034
|
|
|
|
Interest expense of
Financial Products
|
|
148
|
|
|
|
|
148
|
|
|
|
|
300
|
|
|
|
|
298
|
|
|
|
Other operating
(income) expenses
|
|
399
|
|
|
|
|
334
|
|
|
|
|
796
|
|
|
|
|
651
|
|
|
|
Total operating
costs
|
|
9,557
|
|
|
|
|
10,984
|
|
|
|
|
18,524
|
|
|
|
|
21,984
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
785
|
|
|
|
|
1,333
|
|
|
|
|
1,279
|
|
|
|
|
3,035
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
130
|
|
|
|
|
125
|
|
|
|
|
259
|
|
|
|
|
254
|
|
|
|
Other income
(expense)
|
|
84
|
|
|
|
|
(72)
|
|
|
|
|
84
|
|
|
|
|
122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
739
|
|
|
|
|
1,136
|
|
|
|
|
1,104
|
|
|
|
|
2,903
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
184
|
|
|
|
|
335
|
|
|
|
|
276
|
|
|
|
|
856
|
|
|
|
Profit of
consolidated companies
|
|
555
|
|
|
|
|
801
|
|
|
|
|
828
|
|
|
|
|
2,047
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
(2)
|
|
|
|
|
2
|
|
|
|
|
(3)
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
553
|
|
|
|
|
803
|
|
|
|
|
825
|
|
|
|
|
2,051
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
3
|
|
|
|
|
1
|
|
|
|
|
4
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
1
|
$
|
550
|
|
|
|
$
|
802
|
|
|
|
$
|
821
|
|
|
|
$
|
2,047
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit per common
share
|
$
|
0.94
|
|
|
|
$
|
1.33
|
|
|
|
$
|
1.41
|
|
|
|
$
|
3.39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit per common
share – diluted 2
|
$
|
0.93
|
|
|
|
$
|
1.31
|
|
|
|
$
|
1.40
|
|
|
|
$
|
3.34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares
outstanding (millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Basic
|
|
584.1
|
|
|
|
|
603.2
|
|
|
|
|
583.4
|
|
|
|
|
604.1
|
|
|
|
- Diluted
2
|
|
588.6
|
|
|
|
|
610.7
|
|
|
|
|
588.2
|
|
|
|
|
611.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
$
|
1.54
|
|
|
|
$
|
1.47
|
|
|
|
$
|
1.54
|
|
|
|
$
|
1.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Profit attributable
to common stockholders.
|
2
|
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)
|
|
|
June
30,
|
|
December
31,
|
|
2016
|
|
2015
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and short-term
investments
|
$
|
6,764
|
|
|
|
$
|
6,460
|
|
|
|
|
Receivables - trade
and other
|
|
6,326
|
|
|
|
|
6,695
|
|
|
|
|
Receivables -
finance
|
|
9,201
|
|
|
|
|
8,991
|
|
|
|
|
Prepaid expenses and
other current assets
|
|
1,857
|
|
|
|
|
1,662
|
|
|
|
|
Inventories
|
|
9,458
|
|
|
|
|
9,700
|
|
|
|
Total current
assets
|
|
33,606
|
|
|
|
|
33,508
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment – net
|
|
15,916
|
|
|
|
|
16,090
|
|
|
|
Long-term receivables
- trade and other
|
|
1,180
|
|
|
|
|
1,170
|
|
|
|
Long-term receivables
- finance
|
|
13,689
|
|
|
|
|
13,651
|
|
|
|
Noncurrent deferred
and refundable income taxes
|
|
2,536
|
|
|
|
|
2,489
|
|
|
|
Intangible
assets
|
|
2,652
|
|
|
|
|
2,821
|
|
|
|
Goodwill
|
|
6,677
|
|
|
|
|
6,615
|
|
|
|
Other
assets
|
|
2,044
|
|
|
|
|
1,998
|
|
|
Total
assets
|
$
|
78,300
|
|
|
|
$
|
78,342
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
-- Machinery, Energy
& Transportation
|
$
|
263
|
|
|
|
$
|
9
|
|
|
|
|
|
-- Financial
Products
|
|
7,220
|
|
|
|
|
6,958
|
|
|
|
|
Accounts
payable
|
|
5,104
|
|
|
|
|
5,023
|
|
|
|
|
Accrued
expenses
|
|
3,127
|
|
|
|
|
3,116
|
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
1,265
|
|
|
|
|
1,994
|
|
|
|
|
Customer
advances
|
|
1,259
|
|
|
|
|
1,146
|
|
|
|
|
Dividends
payable
|
|
450
|
|
|
|
|
448
|
|
|
|
|
Other current
liabilities
|
|
1,635
|
|
|
|
|
1,671
|
|
|
|
|
Long-term debt due
within one year:
|
|
|
|
|
|
|
|
|
|
|
|
|
-- Machinery, Energy
& Transportation
|
|
1,055
|
|
|
|
|
517
|
|
|
|
|
|
-- Financial
Products
|
|
5,805
|
|
|
|
|
5,360
|
|
|
|
Total current
liabilities
|
|
27,183
|
|
|
|
|
26,242
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt due
after one year:
|
|
|
|
|
|
|
|
|
|
|
|
|
-- Machinery, Energy
& Transportation
|
|
8,434
|
|
|
|
|
8,960
|
|
|
|
|
|
-- Financial
Products
|
|
15,546
|
|
|
|
|
16,209
|
|
|
|
Liability for
postemployment benefits
|
|
8,533
|
|
|
|
|
8,843
|
|
|
|
Other
liabilities
|
|
3,301
|
|
|
|
|
3,203
|
|
|
Total
liabilities
|
|
62,997
|
|
|
|
|
63,457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
|
|
|
|
|
|
Common
stock
|
|
5,277
|
|
|
|
|
5,238
|
|
|
|
Treasury
stock
|
|
(17,579)
|
|
|
|
|
(17,640)
|
|
|
|
Profit employed in
the business
|
|
29,167
|
|
|
|
|
29,246
|
|
|
|
Accumulated other
comprehensive income (loss)
|
|
(1,633)
|
|
|
|
|
(2,035)
|
|
|
|
Noncontrolling
interests
|
|
71
|
|
|
|
|
76
|
|
|
Total
stockholders' equity
|
|
15,303
|
|
|
|
|
14,885
|
|
|
Total liabilities
and stockholders' equity
|
$
|
78,300
|
|
|
|
$
|
78,342
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Caterpillar
Inc.
Condensed
Consolidated Statement of Cash Flow
(Unaudited)
(Millions of
dollars)
|
|
|
Six Months
Ended
|
|
June
30,
|
|
2016
|
|
2015
|
Cash flow from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
$
|
825
|
|
|
|
$
|
2,051
|
|
|
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
1,494
|
|
|
|
|
1,514
|
|
|
|
|
Other
|
|
368
|
|
|
|
|
142
|
|
|
|
Changes in assets and
liabilities, net of acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
Receivables – trade
and other
|
|
573
|
|
|
|
|
383
|
|
|
|
|
Inventories
|
|
305
|
|
|
|
|
332
|
|
|
|
|
Accounts
payable
|
|
208
|
|
|
|
|
(326)
|
|
|
|
|
Accrued
expenses
|
|
1
|
|
|
|
|
(71)
|
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
(743)
|
|
|
|
|
(801)
|
|
|
|
|
Customer
advances
|
|
93
|
|
|
|
|
98
|
|
|
|
|
Other assets –
net
|
|
(127)
|
|
|
|
|
215
|
|
|
|
|
Other liabilities –
net
|
|
(197)
|
|
|
|
|
(179)
|
|
|
Net cash provided by
(used for) operating activities
|
|
2,800
|
|
|
|
|
3,358
|
|
|
Cash flow from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
– excluding equipment leased to others
|
|
(580)
|
|
|
|
|
(656)
|
|
|
|
Expenditures for
equipment leased to others
|
|
(1,025)
|
|
|
|
|
(815)
|
|
|
|
Proceeds from
disposals of leased assets and property, plant and
equipment
|
|
383
|
|
|
|
|
367
|
|
|
|
Additions to finance
receivables
|
|
(4,643)
|
|
|
|
|
(4,577)
|
|
|
|
Collections of
finance receivables
|
|
4,466
|
|
|
|
|
4,477
|
|
|
|
Proceeds from sale of
finance receivables
|
|
42
|
|
|
|
|
74
|
|
|
|
Investments and
acquisitions (net of cash acquired)
|
|
(38)
|
|
|
|
|
(63)
|
|
|
|
Proceeds from sale of
businesses and investments (net of cash sold)
|
|
—
|
|
|
|
|
168
|
|
|
|
Proceeds from sale of
securities
|
|
195
|
|
|
|
|
128
|
|
|
|
Investments in
securities
|
|
(243)
|
|
|
|
|
(119)
|
|
|
|
Other –
net
|
|
(14)
|
|
|
|
|
(75)
|
|
|
Net cash provided by
(used for) investing activities
|
|
(1,457)
|
|
|
|
|
(1,091)
|
|
|
Cash flow from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
(898)
|
|
|
|
|
(846)
|
|
|
|
Distribution to
noncontrolling interests
|
|
—
|
|
|
|
|
(7)
|
|
|
|
Common stock issued,
including treasury shares reissued
|
|
(47)
|
|
|
|
|
33
|
|
|
|
Treasury shares
purchased
|
|
—
|
|
|
|
|
(525)
|
|
|
|
Excess tax benefit
from stock-based compensation
|
|
4
|
|
|
|
|
18
|
|
|
|
Proceeds from debt
issued (original maturities greater than three months)
|
|
2,841
|
|
|
|
|
3,691
|
|
|
|
Payments on debt
(original maturities greater than three months)
|
|
(3,331)
|
|
|
|
|
(6,089)
|
|
|
|
Short-term borrowings
- net (original maturities three months or less)
|
|
391
|
|
|
|
|
1,972
|
|
|
Net cash provided by
(used for) financing activities
|
|
(1,040)
|
|
|
|
|
(1,753)
|
|
|
Effect of exchange
rate changes on cash
|
|
1
|
|
|
|
|
(34)
|
|
|
Increase
(decrease) in cash and short-term investments
|
|
304
|
|
|
|
|
480
|
|
|
Cash and short-term
investments at beginning of period
|
|
6,460
|
|
|
|
|
7,341
|
|
|
Cash and short-term
investments at end of period
|
$
|
6,764
|
|
|
|
$
|
7,821
|
|
|
|
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 June 30, 2016
(Unaudited)
(Millions of dollars)
|
|
|
|
|
Supplemental
Consolidating Data
|
|
Consolidated
|
|
Machinery,
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
9,645
|
|
|
|
$
|
9,645
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
Revenues of Financial
Products
|
|
697
|
|
|
|
|
—
|
|
|
|
|
778
|
|
|
|
|
(81)
|
2
|
|
Total sales and
revenues
|
|
10,342
|
|
|
|
|
9,645
|
|
|
|
|
778
|
|
|
|
|
(81)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
7,419
|
|
|
|
|
7,419
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Selling, general and
administrative expenses
|
|
1,123
|
|
|
|
|
981
|
|
|
|
|
147
|
|
|
|
|
(5)
|
3
|
|
Research and
development expenses
|
|
468
|
|
|
|
|
468
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Interest expense of
Financial Products
|
|
148
|
|
|
|
|
—
|
|
|
|
|
152
|
|
|
|
|
(4)
|
4
|
|
Other operating
(income) expenses
|
|
399
|
|
|
|
|
99
|
|
|
|
|
308
|
|
|
|
|
(8)
|
3
|
|
Total operating
costs
|
|
9,557
|
|
|
|
|
8,967
|
|
|
|
|
607
|
|
|
|
|
(17)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
785
|
|
|
|
|
678
|
|
|
|
|
171
|
|
|
|
|
(64)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
130
|
|
|
|
|
143
|
|
|
|
|
—
|
|
|
|
|
(13)
|
4
|
|
Other income
(expense)
|
|
84
|
|
|
|
|
5
|
|
|
|
|
28
|
|
|
|
|
51
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
739
|
|
|
|
|
540
|
|
|
|
|
199
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
184
|
|
|
|
|
122
|
|
|
|
|
62
|
|
|
|
|
—
|
|
|
Profit of
consolidated companies
|
|
555
|
|
|
|
|
418
|
|
|
|
|
137
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
(2)
|
|
|
|
|
(2)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Equity in profit of
Financial Products' subsidiaries
|
|
—
|
|
|
|
|
135
|
|
|
|
|
—
|
|
|
|
|
(135)
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
553
|
|
|
|
|
551
|
|
|
|
|
137
|
|
|
|
|
(135)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
3
|
|
|
|
|
1
|
|
|
|
|
2
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
7
|
$
|
550
|
|
|
|
$
|
550
|
|
|
|
$
|
135
|
|
|
|
$
|
(135)
|
|
|
|
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, Energy &
Transportation.
|
3
|
Elimination of net
expenses recorded by Machinery, Energy & Transportation paid to
Financial Products.
|
4
|
Elimination of
interest expense recorded between Financial Products and Machinery,
Energy & Transportation.
|
5
|
Elimination of
discount recorded by Machinery, Energy & Transportation on
receivables sold to Financial Products and of interest earned
between Machinery, Energy & Transportation and Financial
Products.
|
6
|
Elimination of
Financial Products' profit due to equity method of
accounting.
|
7
|
Profit attributable
to common stockholders.
|
Caterpillar
Inc.
Supplemental Data for Results of Operations
For the Three Months Ended June 30, 2015
(Unaudited)
(Millions of dollars)
|
|
|
|
|
Supplemental
Consolidating Data
|
|
Consolidated
|
|
Machinery,
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
11,583
|
|
|
|
$
|
11,583
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
Revenues of Financial
Products
|
|
734
|
|
|
|
|
—
|
|
|
|
|
805
|
|
|
|
|
(71)
|
2
|
|
Total sales and
revenues
|
|
12,317
|
|
|
|
|
11,583
|
|
|
|
|
805
|
|
|
|
|
(71)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
8,674
|
|
|
|
|
8,675
|
|
|
|
|
—
|
|
|
|
|
(1)
|
3
|
|
Selling, general and
administrative expenses
|
|
1,318
|
|
|
|
|
1,140
|
|
|
|
|
172
|
|
|
|
|
6
|
3
|
|
Research and
development expenses
|
|
510
|
|
|
|
|
510
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Interest expense of
Financial Products
|
|
148
|
|
|
|
|
—
|
|
|
|
|
150
|
|
|
|
|
(2)
|
4
|
|
Other operating
(income) expenses
|
|
334
|
|
|
|
|
41
|
|
|
|
|
300
|
|
|
|
|
(7)
|
3
|
|
Total operating
costs
|
|
10,984
|
|
|
|
|
10,366
|
|
|
|
|
622
|
|
|
|
|
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
1,333
|
|
|
|
|
1,217
|
|
|
|
|
183
|
|
|
|
|
(67)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
125
|
|
|
|
|
136
|
|
|
|
|
—
|
|
|
|
|
(11)
|
4
|
|
Other income
(expense)
|
|
(72)
|
|
|
|
|
(130)
|
|
|
|
|
2
|
|
|
|
|
56
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
1,136
|
|
|
|
|
951
|
|
|
|
|
185
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
335
|
|
|
|
|
276
|
|
|
|
|
59
|
|
|
|
|
—
|
|
|
Profit of
consolidated companies
|
|
801
|
|
|
|
|
675
|
|
|
|
|
126
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
2
|
|
|
|
|
2
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Equity in profit of
Financial Products' subsidiaries
|
|
—
|
|
|
|
|
126
|
|
|
|
|
—
|
|
|
|
|
(126)
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
803
|
|
|
|
|
803
|
|
|
|
|
126
|
|
|
|
|
(126)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
1
|
|
|
|
|
1
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
7
|
$
|
802
|
|
|
|
$
|
802
|
|
|
|
$
|
126
|
|
|
|
$
|
(126)
|
|
|
|
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, Energy &
Transportation.
|
3
|
Elimination of net
expenses recorded by Machinery, Energy & Transportation paid to
Financial Products.
|
4
|
Elimination of
interest expense recorded between Financial Products and Machinery,
Energy & Transportation.
|
5
|
Elimination of
discount recorded by Machinery, Energy & Transportation on
receivables sold to Financial Products and of
interest earned
between Machinery, Energy & Transportation and Financial
Products.
|
6
|
Elimination of
Financial Products' profit due to equity method of
accounting.
|
7
|
Profit attributable
to common stockholders.
|
Caterpillar
Inc.
Supplemental Data for Results of Operations
For the Six Months Ended June 30, 2016
(Unaudited)
(Millions of dollars)
|
|
|
|
|
Supplemental
Consolidating Data
|
|
Consolidated
|
|
Machinery,
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
18,425
|
|
|
|
$
|
18,425
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
Revenues of Financial
Products
|
|
1,378
|
|
|
|
|
—
|
|
|
|
|
1,537
|
|
|
|
|
(159)
|
2
|
|
Total sales and
revenues
|
|
19,803
|
|
|
|
|
18,425
|
|
|
|
|
1,537
|
|
|
|
|
(159)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
14,241
|
|
|
|
|
14,241
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Selling, general and
administrative expenses
|
|
2,211
|
|
|
|
|
1,936
|
|
|
|
|
286
|
|
|
|
|
(11)
|
3
|
|
Research and
development expenses
|
|
976
|
|
|
|
|
976
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Interest expense of
Financial Products
|
|
300
|
|
|
|
|
—
|
|
|
|
|
307
|
|
|
|
|
(7)
|
4
|
|
Other operating
(income) expenses
|
|
796
|
|
|
|
|
204
|
|
|
|
|
606
|
|
|
|
|
(14)
|
3
|
|
Total operating
costs
|
|
18,524
|
|
|
|
|
17,357
|
|
|
|
|
1,199
|
|
|
|
|
(32)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
1,279
|
|
|
|
|
1,068
|
|
|
|
|
338
|
|
|
|
|
(127)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
259
|
|
|
|
|
283
|
|
|
|
|
—
|
|
|
|
|
(24)
|
4
|
|
Other income
(expense)
|
|
84
|
|
|
|
|
(47)
|
|
|
|
|
28
|
|
|
|
|
103
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
1,104
|
|
|
|
|
738
|
|
|
|
|
366
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
276
|
|
|
|
|
162
|
|
|
|
|
114
|
|
|
|
|
—
|
|
|
Profit of
consolidated companies
|
|
828
|
|
|
|
|
576
|
|
|
|
|
252
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
(3)
|
|
|
|
|
(3)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Equity in profit of
Financial Products' subsidiaries
|
|
—
|
|
|
|
|
249
|
|
|
|
|
—
|
|
|
|
|
(249)
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
825
|
|
|
|
|
822
|
|
|
|
|
252
|
|
|
|
|
(249)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
4
|
|
|
|
|
1
|
|
|
|
|
3
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
7
|
$
|
821
|
|
|
|
$
|
821
|
|
|
|
$
|
249
|
|
|
|
$
|
(249)
|
|
|
|
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, Energy &
Transportation.
|
3
|
Elimination of net
expenses recorded by Machinery, Energy & Transportation paid to
Financial Products.
|
4
|
Elimination of
interest expense recorded between Financial Products and Machinery,
Energy & Transportation.
|
5
|
Elimination of
discount recorded by Machinery, Energy & Transportation on
receivables sold to Financial Products and of interest earned
between Machinery, Energy & Transportation and Financial
Products.
|
6
|
Elimination of
Financial Products' profit due to equity method of
accounting.
|
7
|
Profit attributable
to common stockholders.
|
Caterpillar
Inc.
Supplemental Data for Results of Operations
For the Six Months Ended June 30, 2015
(Unaudited)
(Millions of dollars)
|
|
|
|
|
|
Supplemental
Consolidating Data
|
|
|
Consolidated
|
|
Machinery,
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Sales and
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of Machinery,
Energy & Transportation
|
$
|
23,544
|
|
|
|
$
|
23,544
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
Revenues of Financial
Products
|
|
1,475
|
|
|
|
|
—
|
|
|
|
|
1,618
|
|
|
|
|
(143)
|
2
|
|
Total sales and
revenues
|
|
25,019
|
|
|
|
|
23,544
|
|
|
|
|
1,618
|
|
|
|
|
(143)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
17,434
|
|
|
|
|
17,435
|
|
|
|
|
—
|
|
|
|
|
(1)
|
3
|
|
Selling, general and
administrative expenses
|
|
2,567
|
|
|
|
|
2,254
|
|
|
|
|
305
|
|
|
|
|
8
|
3
|
|
Research and
development expenses
|
|
1,034
|
|
|
|
|
1,034
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Interest expense of
Financial Products
|
|
298
|
|
|
|
|
—
|
|
|
|
|
301
|
|
|
|
|
(3)
|
4
|
|
Other operating
(income) expenses
|
|
651
|
|
|
|
|
65
|
|
|
|
|
599
|
|
|
|
|
(13)
|
3
|
|
Total operating
costs
|
|
21,984
|
|
|
|
|
20,788
|
|
|
|
|
1,205
|
|
|
|
|
(9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
3,035
|
|
|
|
|
2,756
|
|
|
|
|
413
|
|
|
|
|
(134)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
excluding Financial Products
|
|
254
|
|
|
|
|
275
|
|
|
|
|
—
|
|
|
|
|
(21)
|
4
|
|
Other income
(expense)
|
|
122
|
|
|
|
|
8
|
|
|
|
|
1
|
|
|
|
|
113
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
profit before taxes
|
|
2,903
|
|
|
|
|
2,489
|
|
|
|
|
414
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
|
856
|
|
|
|
|
729
|
|
|
|
|
127
|
|
|
|
|
—
|
|
|
Profit of
consolidated companies
|
|
2,047
|
|
|
|
|
1,760
|
|
|
|
|
287
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in profit
(loss) of unconsolidated affiliated companies
|
|
4
|
|
|
|
|
4
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Equity in profit of
Financial Products' subsidiaries
|
|
—
|
|
|
|
|
285
|
|
|
|
|
—
|
|
|
|
|
(285)
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
|
2,051
|
|
|
|
|
2,049
|
|
|
|
|
287
|
|
|
|
|
(285)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Profit
(loss) attributable to noncontrolling interests
|
|
4
|
|
|
|
|
2
|
|
|
|
|
2
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
7
|
$
|
2,047
|
|
|
|
$
|
2,047
|
|
|
|
$
|
285
|
|
|
|
$
|
(285)
|
|
|
|
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, Energy &
Transportation.
|
3
|
Elimination of net
expenses recorded by Machinery, Energy & Transportation paid to
Financial Products.
|
4
|
Elimination of
interest expense recorded between Financial Products and Machinery,
Energy & Transportation.
|
5
|
Elimination of
discount recorded by Machinery, Energy & Transportation on
receivables sold to Financial Products and of interest earned
between Machinery, Energy & Transportation and Financial
Products.
|
6
|
Elimination of
Financial Products' profit due to equity method of
accounting.
|
7
|
Profit attributable
to common stockholders.
|
Caterpillar
Inc.
Supplemental Data
for Cash Flow
For the Six Months
Ended June 30, 2016
(Unaudited)
(Millions of
dollars)
|
|
|
|
|
Supplemental
Consolidating Data
|
|
Consolidated
|
|
Machinery,
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Cash flow from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
$
|
825
|
|
|
|
$
|
822
|
|
|
|
$
|
252
|
|
|
|
$
|
(249)
|
2
|
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
1,494
|
|
|
|
|
1,056
|
|
|
|
|
438
|
|
|
|
|
—
|
|
|
|
Undistributed profit
of Financial Products
|
|
—
|
|
|
|
|
(242)
|
|
|
|
|
—
|
|
|
|
|
242
|
3
|
|
|
Other
|
|
368
|
|
|
|
|
257
|
|
|
|
|
9
|
|
|
|
|
102
|
4
|
|
Changes in assets and
liabilities, net of acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables - trade
and other
|
|
573
|
|
|
|
|
45
|
|
|
|
|
19
|
|
|
|
|
509
|
4,5
|
|
|
Inventories
|
|
305
|
|
|
|
|
309
|
|
|
|
|
—
|
|
|
|
|
(4)
|
4
|
|
|
Accounts
payable
|
|
208
|
|
|
|
|
284
|
|
|
|
|
(16)
|
|
|
|
|
(60)
|
4
|
|
|
Accrued
expenses
|
|
1
|
|
|
|
|
8
|
|
|
|
|
(7)
|
|
|
|
|
—
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
(743)
|
|
|
|
|
(726)
|
|
|
|
|
(17)
|
|
|
|
|
—
|
|
|
|
Customer
advances
|
|
93
|
|
|
|
|
93
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
Other assets -
net
|
|
(127)
|
|
|
|
|
(187)
|
|
|
|
|
82
|
|
|
|
|
(22)
|
4
|
|
|
Other liabilities -
net
|
|
(197)
|
|
|
|
|
(336)
|
|
|
|
|
117
|
|
|
|
|
22
|
4
|
Net cash provided by
(used for) operating activities
|
|
2,800
|
|
|
|
|
1,383
|
|
|
|
|
877
|
|
|
|
|
540
|
|
Cash flow from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
- excluding equipment leased to others
|
|
(580)
|
|
|
|
|
(577)
|
|
|
|
|
(3)
|
|
|
|
|
—
|
|
|
Expenditures for
equipment leased to others
|
|
(1,025)
|
|
|
|
|
(41)
|
|
|
|
|
(1,001)
|
|
|
|
|
17
|
4
|
|
Proceeds from
disposals of leased assets and property, plant and
equipment
|
|
383
|
|
|
|
|
49
|
|
|
|
|
344
|
|
|
|
|
(10)
|
4
|
|
Additions to finance
receivables
|
|
(4,643)
|
|
|
|
|
—
|
|
|
|
|
(6,026)
|
|
|
|
|
1,383
|
5
|
|
Collections of
finance receivables
|
|
4,466
|
|
|
|
|
—
|
|
|
|
|
6,007
|
|
|
|
|
(1,541)
|
5
|
|
Net intercompany
purchased receivables
|
|
—
|
|
|
|
|
—
|
|
|
|
|
396
|
|
|
|
|
(396)
|
5
|
|
Proceeds from sale of
finance receivables
|
|
42
|
|
|
|
|
—
|
|
|
|
|
42
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
(832)
|
|
|
|
|
(1,000)
|
|
|
|
|
1,832
|
6
|
|
Investments and
acquisitions (net of cash acquired)
|
|
(38)
|
|
|
|
|
(38)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Proceeds from sale of
securities
|
|
195
|
|
|
|
|
17
|
|
|
|
|
178
|
|
|
|
|
—
|
|
|
Investments in
securities
|
|
(243)
|
|
|
|
|
(15)
|
|
|
|
|
(228)
|
|
|
|
|
—
|
|
|
Other -
net
|
|
(14)
|
|
|
|
|
(1)
|
|
|
|
|
(20)
|
|
|
|
|
7
|
8
|
Net cash provided by
(used for) investing activities
|
|
(1,457)
|
|
|
|
|
(1,438)
|
|
|
|
|
(1,311)
|
|
|
|
|
1,292
|
|
Cash flow from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
(898)
|
|
|
|
|
(898)
|
|
|
|
|
(7)
|
|
|
|
|
7
|
7
|
|
Common stock issued,
including treasury shares reissued
|
|
(47)
|
|
|
|
|
(47)
|
|
|
|
|
7
|
|
|
|
|
(7)
|
8
|
|
Excess tax benefit
from stock-based compensation
|
|
4
|
|
|
|
|
4
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
1,000
|
|
|
|
|
832
|
|
|
|
|
(1,832)
|
6
|
|
Proceeds from debt
issued (original maturities greater than three months)
|
|
2,841
|
|
|
|
|
1
|
|
|
|
|
2,840
|
|
|
|
|
—
|
|
|
Payments on debt
(original maturities greater than three months)
|
|
(3,331)
|
|
|
|
|
(7)
|
|
|
|
|
(3,324)
|
|
|
|
|
—
|
|
|
Short-term borrowings
- net (original maturities three months or less)
|
|
391
|
|
|
|
|
255
|
|
|
|
|
136
|
|
|
|
|
—
|
|
Net cash provided by
(used for) financing activities
|
|
(1,040)
|
|
|
|
|
308
|
|
|
|
|
484
|
|
|
|
|
(1,832)
|
|
Effect of exchange
rate changes on cash
|
|
1
|
|
|
|
|
(14)
|
|
|
|
|
15
|
|
|
|
|
—
|
|
Increase
(decrease) in cash and short-term investments
|
|
304
|
|
|
|
|
239
|
|
|
|
|
65
|
|
|
|
|
—
|
|
Cash and short-term
investments at beginning of period
|
|
6,460
|
|
|
|
|
5,340
|
|
|
|
|
1,120
|
|
|
|
|
—
|
|
Cash and short-term
investments at end of period
|
$
|
6,764
|
|
|
|
$
|
5,579
|
|
|
|
$
|
1,185
|
|
|
|
$
|
—
|
|
|
|
|
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
|
Elimination of
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
Financial Products' cash flow activity from investing to operating
for receivables that arose from the sale of inventory.
|
|
6
|
Elimination of net
proceeds and payments to/from Machinery, Energy &
Transportation and Financial Products.
|
|
7
|
Elimination of
dividend from Financial Products to Machinery, Energy &
Transportation.
|
|
8
|
Elimination of change
in investment and common stock related to Financial
Products.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Caterpillar
Inc.
Supplemental Data
for Cash Flow
For the Six Months
Ended June 30, 2015
(Unaudited)
(Millions of
dollars)
|
|
|
|
|
Supplemental
Consolidating Data
|
|
Consolidated
|
|
Machinery,
Energy &
Transportation 1
|
|
Financial
Products
|
|
Consolidating
Adjustments
|
Cash flow from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit of
consolidated and affiliated companies
|
$
|
2,051
|
|
|
|
$
|
2,049
|
|
|
|
$
|
287
|
|
|
|
$
|
(285)
|
2
|
|
Adjustments for
non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
1,514
|
|
|
|
|
1,070
|
|
|
|
|
444
|
|
|
|
|
—
|
|
|
|
Undistributed profit
of Financial Products
|
|
—
|
|
|
|
|
(35)
|
|
|
|
|
—
|
|
|
|
|
35
|
3
|
|
|
Other
|
|
142
|
|
|
|
|
92
|
|
|
|
|
(65)
|
|
|
|
|
115
|
4
|
|
Changes in assets and
liabilities, net of acquisitions and divestitures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables - trade
and other
|
|
383
|
|
|
|
|
377
|
|
|
|
|
(53)
|
|
|
|
|
59
|
4,5
|
|
|
Inventories
|
|
332
|
|
|
|
|
337
|
|
|
|
|
—
|
|
|
|
|
(5)
|
4
|
|
|
Accounts
payable
|
|
(326)
|
|
|
|
|
(362)
|
|
|
|
|
24
|
|
|
|
|
12
|
4
|
|
|
Accrued
expenses
|
|
(71)
|
|
|
|
|
(75)
|
|
|
|
|
4
|
|
|
|
|
—
|
|
|
|
Accrued wages,
salaries and employee benefits
|
|
(801)
|
|
|
|
|
(788)
|
|
|
|
|
(13)
|
|
|
|
|
—
|
|
|
|
Customer
advances
|
|
98
|
|
|
|
|
98
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
Other assets -
net
|
|
215
|
|
|
|
|
136
|
|
|
|
|
48
|
|
|
|
|
31
|
4
|
|
|
Other liabilities -
net
|
|
(179)
|
|
|
|
|
(219)
|
|
|
|
|
71
|
|
|
|
|
(31)
|
4
|
Net cash provided by
(used for) operating activities
|
|
3,358
|
|
|
|
|
2,680
|
|
|
|
|
747
|
|
|
|
|
(69)
|
|
Cash flow from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
- excluding equipment leased to others
|
|
(656)
|
|
|
|
|
(651)
|
|
|
|
|
(5)
|
|
|
|
|
—
|
|
|
Expenditures for
equipment leased to others
|
|
(815)
|
|
|
|
|
(108)
|
|
|
|
|
(726)
|
|
|
|
|
19
|
4
|
|
Proceeds from
disposals of leased assets and property, plant and
equipment
|
|
367
|
|
|
|
|
33
|
|
|
|
|
338
|
|
|
|
|
(4)
|
4
|
|
Additions to finance
receivables
|
|
(4,577)
|
|
|
|
|
—
|
|
|
|
|
(6,171)
|
|
|
|
|
1,594
|
5,8
|
|
Collections of
finance receivables
|
|
4,477
|
|
|
|
|
—
|
|
|
|
|
5,965
|
|
|
|
|
(1,488)
|
5
|
|
Net intercompany
purchased receivables
|
|
—
|
|
|
|
|
—
|
|
|
|
|
295
|
|
|
|
|
(295)
|
5
|
|
Proceeds from sale of
finance receivables
|
|
74
|
|
|
|
|
—
|
|
|
|
|
74
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
(35)
|
|
|
|
|
1
|
|
|
|
|
34
|
6
|
|
Investments and
acquisitions (net of cash acquired)
|
|
(63)
|
|
|
|
|
(63)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Proceeds from sale of
businesses and investments (net of cash sold)
|
|
168
|
|
|
|
|
175
|
|
|
|
|
—
|
|
|
|
|
(7)
|
8
|
|
Proceeds from sale of
securities
|
|
128
|
|
|
|
|
6
|
|
|
|
|
122
|
|
|
|
|
—
|
|
|
Investments in
securities
|
|
(119)
|
|
|
|
|
(9)
|
|
|
|
|
(110)
|
|
|
|
|
—
|
|
|
Other -
net
|
|
(75)
|
|
|
|
|
(29)
|
|
|
|
|
(46)
|
|
|
|
|
—
|
|
Net cash provided by
(used for) investing activities
|
|
(1,091)
|
|
|
|
|
(681)
|
|
|
|
|
(263)
|
|
|
|
|
(147)
|
|
Cash flow from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
(846)
|
|
|
|
|
(846)
|
|
|
|
|
(250)
|
|
|
|
|
250
|
7
|
|
Distribution to
noncontrolling interests
|
|
(7)
|
|
|
|
|
(7)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Common stock issued,
including treasury shares reissued
|
|
33
|
|
|
|
|
33
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Treasury shares
purchased
|
|
(525)
|
|
|
|
|
(525)
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Excess tax benefit
from stock-based compensation
|
|
18
|
|
|
|
|
18
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Net intercompany
borrowings
|
|
—
|
|
|
|
|
(1)
|
|
|
|
|
35
|
|
|
|
|
(34)
|
6
|
|
Proceeds from debt
issued (original maturities greater than three months)
|
|
3,691
|
|
|
|
|
3
|
|
|
|
|
3,688
|
|
|
|
|
—
|
|
|
Payments on debt
(original maturities greater than three months)
|
|
(6,089)
|
|
|
|
|
(509)
|
|
|
|
|
(5,580)
|
|
|
|
|
—
|
|
|
Short-term borrowings
- net (original maturities three months or less)
|
|
1,972
|
|
|
|
|
6
|
|
|
|
|
1,966
|
|
|
|
|
—
|
|
Net cash provided by
(used for) financing activities
|
|
(1,753)
|
|
|
|
|
(1,828)
|
|
|
|
|
(141)
|
|
|
|
|
216
|
|
Effect of exchange
rate changes on cash
|
|
(34)
|
|
|
|
|
(22)
|
|
|
|
|
(12)
|
|
|
|
|
—
|
|
Increase
(decrease) in cash and short-term investments
|
|
480
|
|
|
|
|
149
|
|
|
|
|
331
|
|
|
|
|
—
|
|
Cash and short-term
investments at beginning of period
|
|
7,341
|
|
|
|
|
6,317
|
|
|
|
|
1,024
|
|
|
|
|
—
|
|
Cash and short-term
investments at end of period
|
$
|
7,821
|
|
|
|
$
|
6,466
|
|
|
|
$
|
1,355
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
|
Elimination of
non-cash adjustments 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
Financial Products' cash flow activity from investing to operating
for receivables that arose from the sale of inventory.
|
6
|
Elimination of net
proceeds and payments to/from Machinery, Energy &
Transportation and Financial Products.
|
7
|
Elimination of
dividend from Financial Products to Machinery, Energy &
Transportation.
|
8
|
Elimination of
proceeds received from Financial Products related to Machinery,
Energy & Transportation's sale of businesses and
investments.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/caterpillar-reports-second-quarter-2016-results-300303673.html
SOURCE Caterpillar Inc.