What were the primary drivers of the sales decline in the third quarter of 2015?

The primary drivers of the sales decline were lower sales volume across all segments, weak end-user demand due to global economic conditions, and the unfavorable impact of currency translation as the U.S. dollar strengthened against most major currencies, particularly the Euro.

How did restructuring costs affect Caterpillar's profitability?

Caterpillar incurred $101 million in restructuring costs during the third quarter of 2015, which reduced profit per share by $0.13. This compares to $81 million in restructuring costs in the prior year's third quarter.

What is the company's current financial health and liquidity position?

Caterpillar maintained a strong financial position with a ME&T debt-to-capital ratio of 37.4% at September 30, 2015, within its target range. The company also had significant available credit lines totaling $14.3 billion, and ended the quarter with $6.05 billion in cash and short-term investments, indicating good liquidity.

How did the Financial Products segment perform?

The Financial Products segment saw a 12% decrease in revenues to $752 million, primarily due to lower average earning assets and a reduction in average financing rates. Profit for the segment was $207 million, down from $220 million in the prior year's quarter, impacted by lower net yield and lower average earning assets.

CAT 10-Q Quarterly Report Q3 FY2015 — Revenue, Net Income, EPS

Summary

Caterpillar Inc. reported a significant year-over-year decline in sales and profit for the third quarter and first nine months of 2015. Sales and revenues for the third quarter decreased by 19% to $10.96 billion, while profit per share fell by 62% to $0.62. This downturn was driven by lower sales volume across all segments, particularly in Machinery, Energy & Transportation (ME&T) and Financial Products, impacted by global economic weakness, lower end-user demand, and a strengthening U.S. dollar. Despite the revenue pressures, Caterpillar demonstrated proactive cost management, including a significant reduction in incentive compensation expenses. The company also continued its restructuring efforts, incurring $101 million in costs during the third quarter. ME&T operating cash flow remained robust, providing flexibility. The company's financial position remained solid, with a debt-to-capital ratio of 37.4% for ME&T, within its target range, and ample available credit facilities.

Financial Highlights

47 data points

Beta

Revenue

$10.96B

0.2% Gross Margin

Net Income

$559.00M

0.1% Net Margin

EPS (Diluted)

$0.94

Total Assets

$78.97B

Free Cash Flow

$1.51B

Financial Statements

Beta

Revenue	$10.96B
Cost of Revenue	$7.87B
Gross Profit	$2.41B
R&D Expenses	$513.00M
SG&A Expenses	$1.13B
Operating Expenses	$10.04B
Operating Income	$925.00M
Net Income	$559.00M
EPS (Basic)	$0.95
EPS (Diluted)	$0.94
Shares Outstanding (Basic)	588.40M
Shares Outstanding (Diluted)	594.80M

Key Highlights

1Total sales and revenues for Q3 2015 decreased by 19% to $10.96 billion compared to $13.55 billion in Q3 2014.
2Profit per share for Q3 2015 was $0.62, a 62% decrease from $1.63 in Q3 2014.
3The decline in sales was attributed to lower sales volume across all segments and a strong U.S. dollar, with notable impacts in Energy & Transportation, Construction Industries, and Resource Industries.
4Restructuring costs were $101 million in Q3 2015, impacting profit per share by $0.13.
5Machinery, Energy & Transportation (ME&T) operating cash flow was $766 million in Q3 2015, down from $1.44 billion in Q3 2014.
6The ME&T debt-to-capital ratio remained stable at 37.4% at the end of Q3 2015.
7Financial Products segment revenues decreased by 12% due to lower average earning assets and financing rates.

CATERPILLAR INC Quarterly Report for Q3 Ended Sep 30, 2015

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions