What were Caterpillar's main financial results for the second quarter of 2002?

Caterpillar reported second-quarter sales and revenues of $5.29 billion and a profit per share of $0.58. These results were in line with the company's expectations for a relatively weak first half of 2002. Sales and revenues decreased by $197 million compared to the second quarter of 2001, mainly due to lower volumes in the Machines and Engines segments.

What factors negatively impacted Caterpillar's profit in the second quarter?

Profit was negatively affected by several factors, including lower sales volume leading to manufacturing inefficiencies and absorption of fixed costs. Additionally, a $40 million decrease in the market value of securities held by Cat Insurance had to be recognized as a charge to income due to accounting standards (FAS 115), as these declines were considered 'other than temporary'.

How has Caterpillar adjusted its full-year 2002 outlook?

Caterpillar has revised its full-year outlook. While anticipating a gradual global economic recovery, the company now expects a slower-than-anticipated recovery in capital spending in North America. Consequently, worldwide industry opportunity is projected to be down slightly for 2002, with company sales and revenues also expected to be down slightly for the year. Full-year profit is now projected to be down approximately 15% from the prior year, excluding non-recurring charges.

What is the update on Caterpillar's ACERT emissions technology?

Caterpillar is making progress with its ACERT emissions technology. The company has begun shipping heavy-duty bridge engines to OEMs and has submitted applications for certification to the EPA and CARB. The first ACERT production medium-duty engines are planned for shipment in the first quarter of 2003, with heavy-duty engines following in the second quarter of 2003. This technology is expected to maintain the reliability and durability of Caterpillar engines.

CAT 8-K SEC Disclosure — Jul 16, 2002

Summary

Caterpillar Inc. (CAT) reported its second-quarter 2002 results, with sales and revenues of $5.29 billion and a profit per share of $0.58. These results were in line with expectations for a weak first half of the year. While consolidated revenues for the Financial Products Division increased by 3%, sales in the Machines and Engines segments decreased year-over-year primarily due to lower volumes. Profit was impacted by lower sales volume, manufacturing inefficiencies, and a $40 million decrease in the market value of securities held by Cat Insurance, which had to be recognized as a charge to income due to accounting rules. The company provided an updated outlook for the full year 2002, anticipating a gradual global economic recovery but noting that capital spending in North America is recovering slower than expected. Consequently, worldwide industry opportunity is now projected to be down slightly for the year, with company sales and revenues also expected to be down slightly. Full-year profit is projected to be down approximately 15% from the prior year, excluding non-recurring charges. The company also highlighted progress in its 6 Sigma initiatives and provided updates on its engine business, including progress on its ACERT emissions technology.

Key Highlights

1Second-quarter sales and revenues reached $5.29 billion, with a profit per share of $0.58.
2Sales and revenues were down $197 million compared to the second quarter of 2001, primarily due to volume reductions in Machines and Engines segments.
3Profit was negatively impacted by lower sales volume, manufacturing inefficiencies, and a $40 million charge related to the market value decrease of certain securities.
4The Financial Products Division saw a 3% increase in consolidated revenues.
5The company updated its full-year 2002 outlook, now expecting a slight decrease in company sales and revenues due to a slower-than-anticipated economic recovery in North America.
6Full-year profit is projected to be down approximately 15% compared to 2001, excluding non-recurring charges.
7Caterpillar provided an update on its ACERT emissions technology, with medium-duty engines planned for Q1 2003 and heavy-duty engines for Q2 2003.

CATERPILLAR INC 8-K Report (Jul 16, 2002)

Summary

Key Highlights

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