Caterpillar Sales Plunge 38%, Guidance Falls Short Despite Improving Demand (CAT)
1/27/2010-Caterpillar (NYSE:CAT) reported Q4 EPS of $0.41, ex-items, topping consensus estimates of $0.28.
Sales in the quarter fell by 39% year-over-year to $7.90 billion, and came in short of consensus estimates of $8.11 billion.
Caterpillar expects 2010 EPS of about $2.50 (vs. consensus estimates of $2.71) with sales expected to rise 10% to 25% (vs. consensus estimates of $36.1 billion).
"We're encouraged by signs of improving demand. Dealer sales to end users are up, order rates are up, dealer inventories came down in 2009, and we're seeing stronger service parts sales," said Caterpillar Chairman and Chief Executive Officer Jim Owens. "As a result, we are focused on increasing production levels in our plants and with our suppliers. Although we expect efficiency improvements in 2010, higher production will require selective increases in employment, and we've already recalled more than 500 previously laid-off production employees."
"We expect 2010 will be a better year than 2009, and Caterpillar is in an excellent position to benefit from growth in the world economy." Owens said.