Summary
Caterpillar Inc. (CAT) reported record-breaking results for the second quarter of 2004, with sales and revenues reaching $7.56 billion and profits of $552 million, or $1.55 per share. This represents a significant increase of 27% in sales and 38% in profit compared to the same period in 2003. The strong performance was driven by robust demand across major industries and geographic markets, leading to higher volume and improved price realization. Reflecting this strong performance and positive economic outlook, the company raised its full-year profit outlook. Caterpillar now expects 2004 sales and revenues to increase by approximately 25% and profit per share to rise by 80-85% compared to 2003. The company highlighted its strategic decision to meet unprecedented customer demand, even at the expense of increased operating costs such as higher material and expediting expenses, positioning itself to benefit from a strong global economic recovery.
Key Highlights
- 1Record-breaking Q2 2004 sales and revenues of $7.56 billion, up 27% year-over-year.
- 2Q2 2004 profit of $552 million, or $1.55 per share, a 38% increase from Q2 2003.
- 3Full-year profit outlook raised significantly, now expecting profit per share to increase 80-85% compared to 2003.
- 4Increased sales driven by higher Machinery and Engines volume (up $1.35 billion), improved price realization, and favorable currency impacts.
- 5Company strategically invested in meeting high customer demand, leading to higher core operating costs (+$254 million) due to material costs and expediting, but maintained strong profitability.
- 6Product development investments continue, with Caterpillar positioned as a leader in clean-diesel engine technology (EPA certification for ACERT® engines).
- 7Worldwide employment increased to 72,916 from 67,075 a year prior, reflecting growth in production and acquisitions.