Caterpillar's second-quarter sales and revenue took a hit in the face of continued global economic uncertainty.
Sales and revenues posted at $10.342 billion, a 16-percent decline year-to-year. The company reported a profit of $0.93 per share, down from $1.31, a year earlier.
Mike DeWalt is Vice President with responsibility for Caterpillar’s Financial Services Division. He says Caterpillar’s second-quarter sales and profit were still better than analyst and the company expected.
DeWalt says Caterpillar is on pace with its three-year restructuring efforts and will also need make more staff reductions in the remainder of the year. “Bases on the actions we’re going to take, I am fairly confident it’s going to spread around the world. It’s not all going to be here. But there will be some.”
Those additional staff reductions mean the company also increased its expected restructuring cost from $550 million to $700 million, or about $0.80 per share.
DeWalt says the additional staff reductions will happen by select areas of the company, rather than at the corporate level. He says the results are emblematic of the hits the company has taken in mining and oil. “I mean if you look at mining trucks, we produced about 1,700 in 2012 and we’ll produce less than 100 this year. So there’s just not the scope for it to get that much worse. I mean it could go to zero and the outside world probably wouldn’t notice that.”
DeWalt says the company remains diverse and nimble enough to keep its balance sheet strong. He says the three-year restructuring efforts they started last September are on track.
Caterpillar also reduced its full-year earnings outlook to match analysts expectations in the range of $40 to 40.5 billion dollars. The mid-point of the range would make profit $2.75 per share for the year.