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CATERPILLAR INC. THIRD QUARTER 1992 FINANCIAL RESULTS

 CATERPILLAR INC. THIRD QUARTER 1992 FINANCIAL RESULTS
 PEORIA, Ill., Oct. 22 -- Caterpillar Inc. (NYSE: CAT) today reported


the following results:
 CATERPILLAR INC.
 STATISTICAL HIGHLIGHTS
 THIRD QUARTER 1992 VS. THIRD QUARTER 1991 (QUARTER ENDS SEPT. 30)
 (Dollars in millions, except per share data)
 THIRD QUARTER 1992 1991 Percent
 Change
 Sales and revenues $ 2,677 $ 2,358 14
 Sales inside the U.S. $ 1,176 $ 1,040 13
 Sales outside the U.S. $ 1,410 $ 1,233 14
 Revenues of financial
 subsidiaries $ 91 $ 85 7
 Profit (loss) $ 23 $ (37)
 Profit (loss) per share of common
 stock $ .23 $ (.37)
 Employment (end of quarter) 51,725 55,031 -6
 Average number of shares
 outstanding (thousands) 100,946 100,911
 THIRD-QUARTER HIGHLIGHTS -- 1992 VS. 1991
 PROFIT. The improvement in profit resulted primarily from a 14 percent increase in sales and revenues which was due to higher physical sales volume as well as improved price realization.
 SALES AND REVENUES. Sales and revenues increased 14 percent. The higher sales resulted from an 8 percent increase in physical sales volume and 6 percent higher price realization. The higher sales volume resulted principally from the absence of dealer inventory reductions that occurred in the third quarter last year and product shipments deferred from earlier in the year during the UAW strike. Revenues of financial subsidiaries rose, primarily from a larger portfolio of earning assets.
 EMPLOYMENT. Worldwide employment at the end of the third quarter was 51,725 -- a decline of 3,306 from one year ago. Hourly employment decreased 2,110. Salaried and management decreased 1,196.
 OUTLOOK. The company expects that fourth-quarter results, excluding the gain on the sale of assets to the lift truck joint venture and the impact of adoption of two accounting standards, will be marginally profitable. The profit outlook for 1993 is principally dependent on the strength of the recovery in North America and on the timing of recovery in Europe.
 CATERPILLAR INC. RESULTS OF OPERATIONS
 THIRD QUARTER 1992 COMPARED WITH THIRD QUARTER 1991
 Caterpillar reported a profit of $23 million or 23 cents per share of common stock for the third quarter. This compares with a loss of $37 million or 37 cents per share for the same quarter last year.
 Consolidated sales and revenues were $2.68 billion, an increase of $319 million, or 14 percent from the third quarter 1991.
 MACHINERY AND ENGINES
 Machinery and Engines recorded a before-tax profit of $31 million, compared with a loss of $74 million in the third quarter 1991. Sales of $2.59 billion rose $313 million.
 The most significant factor favorably affecting third-quarter profit was a 14 percent improvement in sales which was due to higher physical sales volume as well as improved price realization.
 Sales volume increased 8 percent, resulting principally from the absence of dealer inventory reductions that occurred in the third quarter last year and product shipments deferred from earlier in the year during the United Auto Workers (UAW) strike. However, reported sales of lift trucks were considerably less than a year ago as a result of the lift truck joint venture with Mitsubishi Heavy Industries, Ltd. effective July 1, 1992. Caterpillar owns 20 percent of the joint venture company.
 Price realization improved 6 percent because of price increases implemented since the third quarter 1991 and the weaker dollar, as sales in European currencies translated into more U. S. dollars. The benefit of the weaker dollar on price realization was reduced by currency hedges covering a portion of revenues on U.S.-manufactured product sold in Europe. These hedges were put in place in 1991 to protect profit margins against potential strengthening of the U.S. dollar.
 Cost of goods sold included a $27 million favorable adjustment to inventory as a result of a periodic reconciliation of inventory stock records to the accounting records. In addition, LIFO (last-in, first- out) inventory decrement benefits were $10 million, compared with $5 million benefit in the third quarter of 1991.
 There were several unfavorable items that partially offset the above benefits:
 -- Higher costs resulting from the weaker dollar, as costs incurred in European currencies translated into more U.S. dollars.
 -- An unfavorable change in other income of $21 million, principally because of currency exchange losses of $11 million in the third quarter of this year, compared with a $9 million gain in the same period of 1991.
 -- The effects of inflation, particularly for employee wages and benefits, which were largely offset by lower employment on all payrolls.
 -- An unfavorable change in the mix of product sales, as relatively more lower-margin machines and engines were sold.
 -- Higher depreciation of $14 million.
 -- A $13 million provision based on a preliminary assessment of future costs related to a voluntary environmental cleanup at Solar Turbines Incorporated, a wholly owned subsidiary.
 The company's Brazilian operations continued to be unprofitable as a result of the political instability and poor economic conditions in that country. Losses were less than in the third quarter of 1991, but continue to have a material negative effect on consolidated results.
 -0- 10/22/92
 /CONTACT: Richard Stober of Caterpillar Public Information, 309-675-5548/
 (CAT) CO: Caterpillar Inc. ST: Illinois IN: MAC SU: ERN


PS -- NY047 -- 3426 10/22/92 10:23 EDT
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Date:Oct 22, 1992
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