Does this 10-K show Caterpillar's 1995 revenue, net profit, or EPS?

No. Items 6, 7, and 8 incorporate the financial statements, selected financial data, and MD&A by reference from the Appendix to the 1996 Annual Meeting Proxy Statement (pages A-3 through A-36). Investors need that appendix to see reported revenue, profit, and per-share results.

How exposed is Caterpillar to international markets?

Highly exposed. Sales outside the United States were 52% of 1995 consolidated sales, and about 25.2% of net property by book value was located outside the U.S. The filing also lists currency fluctuations in Europe and Japan, inflation, and political uncertainty in China and the CIS as key factors affecting the 1996 outlook.

What legal or regulatory risks does the company face?

The main items are two European Commission complaints (from May and November 1993) alleging violations of EC competition law, which seek injunctive relief and unspecified fines, and a September 1994 complaint by the UAW, UAW Local 974, and Citizens for a Better Environment before the Illinois Pollution Control Board. Management says it believes the claims are without merit and that none is likely to have a material effect on financial condition, liquidity, or results.

How much is Caterpillar investing in research and environmental compliance?

Research and engineering spending was $532 million in 1995, up from $435 million in 1994. Environmental capital expenditures were about $11 million in 1995 (including $3 million for Clean Air Act compliance), and environmental-related expenses of about $131 million, including $28 million for Clean Air Act compliance. Both are expected to remain at similar or moderately higher levels in 1996 and 1997.

Are there plant closures or restructuring risks?

Yes, in limited form. The York, Pennsylvania plant, which employs about 1,400 people (about 1,100 represented by the UAW), is planned for closure beginning in 1996 unless a satisfactory labor contract is reached. The company also reports plant-closing reserves of $55 million in accounts payable and accrued expenses and $115 million in accrued wages and benefits at year-end 1995, plus $99 million deducted from net property.

CAT 10-K FY1995 Annual Report — Revenue, Net Income, EPS

01—Abstract

Summary

Summary of the 10-K filed March 5, 1996. Cited figures are marked; the original filing is the authoritative source.

Caterpillar Inc.'s 10-K for fiscal year 1995 is a short, largely incorporated-by-reference filing.

The company's financial statements, MD&A, and selected financial data sit in an appendix to the 1996 proxy statement, so this document itself contains no revenue, profit, or EPS figures. What it does show is a global industrial company with three segments (Machinery, Engines, and Financial Products), 194.0 million common shares outstanding, and non-affiliate equity market value of about $11.3 billion^a as of December 31, 1995. Investors should pull the proxy appendix (Notes and Statements 1-4) for the actual financial results.

Operationally, the company is heavily international. Sales outside the United States were 52% of consolidated sales in 1995, up from 49% in 1994 and 1993. The company employed 54,352 people at year-end, with 14,374 outside the U.S. Research and engineering spending rose to $532 million^b in 1995 from $435 million in 1994, of which $375 million went to new prime products and major component development.

The product distribution network includes more than 1,300 dealer locations worldwide, and the company operates 30 U.S. and 13 non-U.S. manufacturing locations. The main risk items are legal and environmental. Two European Commission antitrust matters (a May 1993 Statement of Objections and a November 1993 complaint) concern dealer service fees, parts policies, and export pricing, and management says it has strong defenses.

A UAW and environmental group complaint in Illinois is also pending. Environmental capital spending was about $11 million^c in 1995 and is expected to rise moderately in 1996 and 1997, while environmental-related operating costs were about $131 million.

Management said the likelihood of material environmental liability beyond accrued amounts is remote. The York, Pennsylvania plant could close in 1996 if labor negotiations with the UAW fail.

02—Key points

Key Highlights

Sales outside the U.S. reached 52% of consolidated sales in 1995, up from 49% in 1994 and 1993, reflecting growing international exposure.
Research and engineering expense increased to $532 million in 1995, from $435 million in 1994 and $455 million in 1993, with $375 million directed to new prime products and major component development.
Workforce of 54,352 at December 31, 1995, with 14,374 employees (about 26%) located outside the United States.
Operates three segments: Machinery (construction, mining, and agricultural equipment), Engines (diesel, gas, and turbine power systems), and Financial Products (customer and dealer financing and insurance).
Two European Commission antitrust matters are pending, concerning dealer service fees, dealer restrictions, and export pricing and parts policies; management believes it has strong defenses.
Environmental capital spending was about $11 million in 1995 and environmental-related expenses about $131 million, with both expected to remain at similar or moderately higher levels in 1996-1997.
The York, Pennsylvania manufacturing plant faces possible closure in 1996 unless a satisfactory labor agreement with the UAW is reached.

03—Questions

Frequently Asked Questions

Does this 10-K show Caterpillar's 1995 revenue, net profit, or EPS?
No. Items 6, 7, and 8 incorporate the financial statements, selected financial data, and MD&A by reference from the Appendix to the 1996 Annual Meeting Proxy Statement (pages A-3 through A-36). Investors need that appendix to see reported revenue, profit, and per-share results.
How exposed is Caterpillar to international markets?
Highly exposed. Sales outside the United States were 52% of 1995 consolidated sales, and about 25.2% of net property by book value was located outside the U.S. The filing also lists currency fluctuations in Europe and Japan, inflation, and political uncertainty in China and the CIS as key factors affecting the 1996 outlook.
What legal or regulatory risks does the company face?
The main items are two European Commission complaints (from May and November 1993) alleging violations of EC competition law, which seek injunctive relief and unspecified fines, and a September 1994 complaint by the UAW, UAW Local 974, and Citizens for a Better Environment before the Illinois Pollution Control Board. Management says it believes the claims are without merit and that none is likely to have a material effect on financial condition, liquidity, or results.
How much is Caterpillar investing in research and environmental compliance?
Research and engineering spending was $532 million in 1995, up from $435 million in 1994. Environmental capital expenditures were about $11 million in 1995 (including $3 million for Clean Air Act compliance), and environmental-related expenses of about $131 million, including $28 million for Clean Air Act compliance. Both are expected to remain at similar or moderately higher levels in 1996 and 1997.
Are there plant closures or restructuring risks?
Yes, in limited form. The York, Pennsylvania plant, which employs about 1,400 people (about 1,100 represented by the UAW), is planned for closure beginning in 1996 unless a satisfactory labor contract is reached. The company also reports plant-closing reserves of $55 million in accounts payable and accrued expenses and $115 million in accrued wages and benefits at year-end 1995, plus $99 million deducted from net property.

04—Continue

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