Caterpillar posted first quarter 2017 sales and revenues of $9.822 billion compared with $9.461 billion in the first quarter of 2016, a 3.8-percent increase. First quarter 2017 profit per share was $0.32 compared with $0.46 in the first quarter of 2016. Excluding restructuring costs, first quarter profit per share was $1.28, double first quarter profit per share excluding restructuring costs of $0.64 in the first quarter of 2016.
While Caterpillar had a strong first quarter performance and is seeing signs of recovery in several of the industries it serves, geopolitical and market uncertainty, along with volatility in commodity prices, continue to present risks for the remainder of this year.
“Our team delivered outstanding operational performance and, for the first time in more than two years, same quarter sales and revenue increased,” said Caterpillar CEO Jim Umpleby. “We’re also benefiting from our significant cost reduction and restructuring actions, which will have improved cash flow and further strengthened an already healthy balance sheet. With this momentum, we will continue to focus investment on improving our competitive position by investing in new technologies and improving our productivity to deliver profit growth and shareholder value.”
The company’s revenue increase stemmed from higher sales volume, with the most significant increase in Resource Industries because of higher end-user demand for after-market parts. Sales volume for Energy & Transportation increased slightly because of after-market parts for reciprocating engines. Construction Industries’ sales volume was about flat, Caterpillar said.
Sales increased in Asia/Pacific and Latin America, but were about flat in North America and Europe, Africa and the Middle East. Asia/Pacific sales jumped 12 percent primarily because of an increase in construction equipment sales in China resulting from increased infrastructure and residential investment. Higher commodity prices and increased mining production favorably impacted demand for after-market parts in Australia. Sales jumped 14 percent in Latin America primarily because of stabilizing economic conditions in several countries in the region that resulted in improved end-user demand from low levels. In North America, sales were flat as higher demand for after-market parts was offset by lower end-user demand for new equipment. Also there was an unfavorable impact of changes in dealer inventories as dealers increased inventories more in the first quarter of 2016 than in the first quarter of 2017.
Also, increased demand in North America for oil and gas applications was offset by lower sales for infrastructure construction equipment.