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SECOND AND FINAL ADD TO CATERPILLAR EARNINGS

 /SECOND AND FINAL ADD - NY063 - CATERPILLAR EARNINGS/
 During the first quarter, Mitsubishi Heavy Industries, Ltd. (MHI) and Caterpillar Inc.'s (NYSE: CAT) wholly owned subsidiary, Caterpillar Industrial Inc., signed an agreement to form a new lift truck joint venture company. The new venture, known as Mitsubishi Caterpillar Forklift, began operations July 1.
 MHI holds 80 percent of the equity of the new joint venture company. Caterpillar owns 20 percent.
 The new venture will design, manufacture and distribute lift trucks, other material handling equipment, and related parts.
 The sale of assets to the joint venture is expected to result in a pretax gain for Caterpillar Inc. of $50 to $65 million. This will result primarily from the sale of inventory valued on a LIFO (last in, first-out) basis. The gain is expected to be recognized in the fourth quarter of this year when payment is expected for assets sold to the joint venture. Cash flow will also be favorably affected by $150 million to $170 million over the last half of the year as payments are received and receivables liquidated.
 Outlook
 The economic outlook for the second half of 1992 continues to call for better growth than in the first half for the United States and Canada. The recoveries are expected to be mild by historical standards, and industry sales for the year may not show improvement over 1991 levels.
 The outlook for Europe, however, has deteriorated and now indicates weaker growth as monetary policies have remained tighter than anticipated. Slower growth than expected is also forecast for Japan. Consequently, annual industry sales for the industrialized countries outside North America will be weaker than anticipated earlier.
 The outlook for developing countries continues to be mixed with slower growth expected in many nations, and weak growth anticipated in Brazil. Industry sales for these regions are still likely to decline slightly from last year levels.
 Worldwide construction industry demand for machines is now probably going to be slightly lower than 1991. Company sales, however, are still expected to increase due to price realization and less inventory reduction by dealers.
 As disclosed in the company's latest proxy statement, the company has hedged a portion of its revenues on U.S.-manufactured product sold in Europe to protect margins against potential strengthening of the U.S. dollar. As a result, price realization on these sales will not improve due to the weaker dollar.
 Labor negotiations remain uncertain in the outlook for 1992. While the UAW strike ended in mid-April, a new contract has not been signed.
 The uncertain economic environment and the ongoing labor situation continue to make it extremely difficult to forecast. However, it is expected that results will improve significantly, and that the company will return to profitability for the second half. In addition, company results and cash flow will be favorably affected by the sale of assets to the lift truck joint venture mentioned earlier.
 CATERPILLAR INC.
 CONSOLIDATED RESULTS OF OPERATIONS
 (Millions of dollars except per share data)
 Periods ended Three Months Six Months
 June 30 1992 1991 1992 1991
 Machinery and Engines:
 Sales $ 2,514 $ 2,606 $ 4,610 $ 5,192
 Operating costs:
 Cost of goods sold 2,153 2,236 4,021 4,448
 SG&A expenses 310 290 602 577
 Research and development
 expenses 74 65 133 127
 Provision for plant
 closing and consoli-
 dation costs - - - 21
 Total 2,537 2,591 4,756 5,173
 Operating profit (loss) (23) 15 (146) 19
 Interest expense 85 72 164 145
 Total (108) (57) (310) (126)
 Other income 34 7 35 12
 Profit (loss) before
 taxes (74) (50) (275) (114)
 Financial Products:
 Revenues 86 85 173 174
 Operating costs:
 SG&A expenses 32 32 66 68
 Interest expense 44 42 88 83
 Total 76 74 154 151
 Operating profit 10 11 19 23
 Other income 6 2 10 4
 Profit before taxes 16 13 29 27
 Consolidated profit (loss)
 before taxes (58) (37) (246) (87)
 Provision (credit) for
 income taxes (11) (11) (68) (26)
 Profit (loss) of
 consolidated
 companies (47) (26) (178) (61)
 Equity in profit (loss) of
 affiliated companies (6) 9 (7) 12
 Profit (loss) $ (53) $ (17) $ (185) $ (49)
 Profit (loss) per share of
 common stock $ (.52) $ (.16) $ (1.83) $ (.48)
 Weighted avg. no. of common
 shares outstndg (thousands)100,924 100,910 100,919 100,909
 CATERPILLAR INC. FINANCIAL POSITION
 (Millions of dollars)
 Consolidated
 (Caterpillar Inc. and subsidiaries)
 June 30, Dec. 31, June 30,
 1992 1991 1991
 Assets
 Current assets:
 Cash and short-term investments $ 75 $ 104 $ 100
 Receivables - trade and other 2,124 2,009 2,321
 Receivables - finance 699 664 708
 Refundable income taxes 154 154 86
 Deferred income taxes and
 prepaid expenses 758 718 658
 Inventories 1,755 1,921 2,133
 Total current assets 5,565 5,570 6,006
 Land, buildings, machinery, and
 equipment - net 3,964 4,049 4,007
 Long-term receivables - trade
 and other 137 124 107
 Long-term receivables - finance 1,595 1,481 1,319
 Investments in affiliated companies 332 346 326
 Intangible assets 119 120 171
 Other assets 370 352 306
 Total Assets $12,082 $12,042 $12,242
 Liabilities
 Current liabilities:
 Short-term borrowings $ 563 $ 474 $ 1,269
 Accounts payable and
 accrued expenses 1,758 1,662 1,595
 Accrued wages, salaries,
 and employee benefits 795 718 560
 Dividends payable 15 15 30
 Income taxes 25 109 144
 Long-term debt due within one year 815 881 424
 Total current liabilities 3,971 3,859 4,022
 Long-term debt due after one year 4,039 3,892 3,522
 Deferred income taxes and
 other liabilities 245 247 269
 Total liabilities 8,255 7,998 7,813
 Stockholders' Equity
 Common stock 799 798 798
 Profit employed in the business 2,923 3,138 3,539
 Foreign currency trans-
 lation adjustment 105 108 92
 Total Stockholders' Equity 3,827 4,044 4,429
 Total Liabilities and
 Stockholders' Equity $12,082 $12,042 $12,242
 -0- 7/16/92 AB NY063
 /CONTACT: Richard Stober of Caterpillar, 309-675-5548/
 (CAT) CO: Caterpillar Inc. ST: Illinois IN: MAC SU: ERN


AH -- NY063B -- 9766 07/16/92 12:48 EDT
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Date:Jul 16, 1992
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