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MarketScreener Homepage  >  Equities  >  Nyse  >  Caterpillar Inc.    CAT

CATERPILLAR INC.

(CAT)
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Caterpillar Inc.: Form 8-K Exhibit 99.1

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08/06/2020 | 06:25pm EDT

Caterpillar Inc.
Caterpillar Inc.: Form 8-K Exhibit 99.1

07-Aug-2020 / 00:20 CET/CEST
Dissemination of a French Regulatory News, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.


Exhibit 99.1

Caterpillar Inc.

2Q 2020 Earnings Release

July 31, 2020

FOR IMMEDIATE RELEASE

Caterpillar Reports Second-Quarter 2020 Results

 

($ in billions except profit per share)

Sales and Revenues

Second Quarter

2020

 

2019

$10.0

$14.4

Profit Per Share

$0.84

$2.83


Second-quarter sales and revenues decreased 31%; profit per share declined 70%

Strong balance sheet; $8.8 billion of enterprise cash

 

DEERFIELD, Ill. - Caterpillar Inc. (NYSE: CAT) today announced second-quarter 2020 sales and revenues of $10.0 billion, a 31% decrease compared with $14.4 billion in the second quarter of 2019. The decline was due to lower sales volume driven by lower end-user demand and the impact from changes in dealer inventories. Dealers decreased machine and engine inventories about $1.4 billion during the second quarter of 2020, compared with an increase of about $500 million during the second quarter of 2019.

Second-quarter 2020 profit per share was $0.84, compared with $2.83 profit per share in the second quarter of 2019. Profit per share in the second quarter of 2020 included pre-tax remeasurement losses of $122 million, or $0.19 per share, resulting from the settlements of pension obligations.

Operating profit margin was 7.8% for the second quarter of 2020, compared with 15.3% for the second quarter of 2019.

For the first half of 2020, enterprise operating cash flow was $2.5 billion. Caterpillar ended the second quarter with $8.8 billion of enterprise cash and $18.5 billion of available liquidity sources. In July, Cat Financial issued $1.5 billion of new three-year and 18-month medium-term notes to supplement its liquidity position.

Response to COVID-19 and Global Business Conditions

"I am proud of the global team's continued focus on safety while executing our strategy and serving our customers," said Caterpillar Chairman and CEO Jim Umpleby. "In the second quarter, our employees and dealers remained dedicated to providing the essential products and services the world needs under very challenging conditions."

(more)

 

2

 

Operational Status

Caterpillar continues to implement safeguards in its facilities to protect team members, including increased frequency of cleaning and disinfecting, social distancing practices and other measures consistent with specific regulatory requirements and guidance from health authorities.

As of mid-July 2020, globally and across Caterpillar's three primary segments, nearly all of the company's primary production facilities continued to operate. This continues to fluctuate as conditions warrant, including the pace of economic recovery and the potential for additional COVID-related temporary shutdowns.

The company has continued to take actions to reduce costs and prioritize its spending to provide for investment in services and expanded offerings, key elements of its strategy for profitable growth, which was introduced in 2017.

Outlook

Caterpillar's financial results for the remainder of 2020 will be impacted by continued global economic uncertainty due to the COVID-19 pandemic. As such, Caterpillar withdrew its earnings guidance on March 26 and is not providing a financial outlook for 2020 at this time.

"We are well positioned for these challenging times because of the successful execution of our strategy," said Umpleby. "We are focused on employee safety and maintaining a competitive and flexible cost structure while continuing to invest in services and expanded offerings to better serve our customers. We will adjust production as conditions warrant and are prepared to respond quickly to any positive or negative changes in customer demand."

 

(more)

 

3

CONSOLIDATED RESULTS

Consolidated Sales and Revenues

 

The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the second quarter of 2019 (at left) and the second quarter of 2020 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company's Board of Directors and employees.

Total sales and revenues for the second quarter of 2020 were $9.997 billion, a decrease of $4.435 billion, or 31%, compared with $14.432 billion in the second quarter of 2019. The decline was due to lower sales volume driven by lower end-user demand and the impact from changes in dealer inventories. Dealers decreased machine and engine inventories about $1.4 billion during the second quarter of 2020, compared with an increase of about $500 million during the second quarter of 2019. The changes in dealer inventories came primarily in Construction Industries and Resource Industries.

Unfavorable price realization also contributed to the sales decline due to the geographic mix of sales and competitive market conditions in China. Sales were lower across all regions and in the three primary segments.

Sales and Revenues by Segment

 

(Millions of dollars)

Second
Quarter

2019

Sales
Volume

Price Realization

Currency

Inter-
Segment /
Other

Second
Quarter

2020

$
Change

% Change

Construction Industries

$ 6,467

$ (2,075)

$ (258)

$ (81)

$ (5)

$ 4,048

$ (2,419)

(37%)

Resource Industries

2,819

(933)

(23)

(45)

8

1,826

(993)

(35%)

Energy & Transportation

5,486

(942)

23

(64)

(354)

4,149

(1,337)

(24%)

All Other Segment

125

(5)

-

(1)

(4)

115

(10)

(8%)

Corporate Items and Eliminations

(1,226)

43

(1)

1

355

(828)

398

 

Machinery, Energy & Transportation

13,671

(3,912)

(259)

(190)

-

9,310

(4,361)

(32%)

Financial Products Segment

873

-

-

-

(110)

763

(110)

(13%)

Corporate Items and Eliminations

(112)

-

-

-

36

(76)

36

 

Financial Products Revenues

761

-

-

-

(74)

687

(74)

(10%)

Consolidated Sales and Revenues

$ 14,432

$ (3,912)

$ (259)

$ (190)

$ (74)

$ 9,997

$ (4,435)

(31%)

 

 

(more)

 

4

Sales and Revenues by Geographic Region

 

(Millions of dollars)
Second Quarter 2020

North America

Latin America

EAME

Asia/Pacific

External Sales and Revenues

Inter-Segment

Total Sales and Revenues

$ % Chg

$ % Chg

$ % Chg

$ % Chg

$ % Chg

$ % Chg

$ % Chg

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction Industries

$ 1,604

(54%)

$ 212

(46%)

$ 933

(16%)

$ 1,283

(10%)

$ 4,032

(37%)

$ 16

(24%)

$ 4,048

(37%)

Resource Industries

507

(52%)

270

(40%)

379

(15%)

554

(27%)

1,710

(37%)

116

7%

1,826

(35%)

Energy & Transportation

1,816

(21%)

197

(39%)

929

(20%)

599

(19%)

3,541

(22%)

608

(37%)

4,149

(24%)

All Other Segment

7

(50%)

1

-%

5

25%

15

-%

28

(18%)

87

(4%)

115

(8%)

Corporate Items and Eliminations

2

 

  1.                  

 

-

 

(2)

 

(1)

 

(827)

 

(828)

 

Machinery, Energy & Transportation

3,936

(42%)

679

(42%)

2,246

(17%)

2,449

(17%)

9,310

(32%)

-

-%

9,310

(32%)

Financial Products Segment

493

(12%)

60

(21%)

96

(6%)

114

(14%)

763

(13%)

-

-%

763

(13%)

Corporate Items and Eliminations

(43)

 

(9)

 

(9)

 

(15)

 

(76)

 

-

 

(76)

 

Financial Products Revenues

450

(8%)

51

(22%)

87

(6%)

99

(12%)

687

(10%)

-

-%

687

(10%)

Consolidated Sales and Revenues

$ 4,386

(40%)

$ 730

(41%)

$ 2,333

(17%)

$ 2,548

(17%)

$ 9,997

(31%)

$ -

-%

$ 9,997

(31%)

Second Quarter 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Construction Industries

$ 3,513

 

$ 392

 

$ 1,108

 

$ 1,433

 

$ 6,446

 

$ 21

 

$ 6,467

 

Resource Industries

1,058

 

448

 

446

 

759

 

2,711

 

108

 

2,819

 

Energy & Transportation

2,297

 

325

 

1,160

 

742

 

4,524

 

962

 

5,486

 

All Other Segment

14

 

1

 

4

 

15

 

34

 

91

 

125

 

Corporate Items and Eliminations

(39)

 

  1.                  

 

(5)

 

2

 

(44)

 

(1,182)

 

(1,226)

 

Machinery, Energy & Transportation

6,843

 

1,164

 

2,713

 

2,951

 

13,671

 

-

 

13,671

 

Financial Products Segment

563

 

76

 

102

 

132

 

873

 

-

 

873

 

Corporate Items and Eliminations

(72)

 

(11)

 

(9)

 

(20)

 

(112)

 

-

 

(112)

 

Financial Products Revenues

491

 

65

 

93

 

112

 

761

 

-

 

761

 

Consolidated Sales and Revenues

$ 7,334

 

$ 1,229

 

$ 2,806

 

$ 3,063

 

$ 14,432

 

$ -

 

$ 14,432

 

 

 

(more)

 

5

Consolidated Operating Profit

 

The chart above graphically illustrates reasons for the change in consolidated operating profit between the second quarter of 2019 (at left) and the second quarter of 2020 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company's Board of Directors and employees. The bar titled Other includes consolidating adjustments and Machinery, Energy & Transportation's other operating (income) expenses.

Operating profit for the second quarter of 2020 was $784 million, a decrease of $1.429 billion, or 65%, compared with $2.213 billion in the second quarter of 2019. The decrease was due to lower sales volume and unfavorable price realization, partially offset by favorable manufacturing costs and lower selling, general and administrative (SG&A) and research and development (R&D) expenses.

Favorable manufacturing costs were mostly driven by lower period manufacturing costs. Both period manufacturing costs and SG&A/R&D expenses benefited from reduced short-term incentive compensation expense and other cost reductions related to lower sales volumes.

Profit (Loss) by Segment

 

 

Second Quarter

Second Quarter

$

%

(Millions of dollars)

 

2020

 

 

2019

 

Change

Change

Construction Industries

$

 

518

$

 

1,247

$ (729)

(58%)

Resource Industries

 

 

152

 

 

481

(329)

(68%)

Energy & Transportation

 

 

624

 

 

886

(262)

(30%)

All Other Segment

 

 

(3)

 

 

11

(14)

n/a

Corporate Items and Eliminations

 

 

(542)

 

 

(441)

(101)

 

Machinery, Energy & Transportation

 

 

749

 

 

2,184

(1,435)

(66%)

Financial Products Segment

 

 

148

 

 

193

(45)

(23%)

Corporate Items and Eliminations

 

 

(38)

 

 

(50)

12

 

Financial Products

 

 

110

 

 

143

(33)

(23%)

Consolidating Adjustments

 

 

(75)

 

 

(114)

39

 

Consolidated Operating Profit

$

 

784

$

 

2,213

$ (1,429)

(65%)

 

 

(more)

 

6

Other Profit/Loss and Tax Items

  • Other income (expense) in the second quarter of 2020 was income of $29 million, compared with income of $68 million in the second quarter of 2019. The change was primarily due to the unfavorable impact of pension and other postemployment benefit (OPEB) plans, including $122 million of remeasurement losses resulting from the settlements of pension obligations, partially offset by favorable impacts from foreign currency exchange gains (losses), primarily due to the Australian dollar.
  • The provision for income taxes for the second quarter of 2020 reflected an estimated annual tax rate of 31%, excluding a $21 million discrete tax benefit related to the $122 million of remeasurement losses resulting from the settlements of pension obligations. The tax rate was 26% for the second quarter of 2019. The increase in the estimated annual tax rate was primarily related to changes in the expected geographic mix of profits from a tax perspective for 2020, including the impact of U.S. tax on non-U.S. earnings as a result of U.S. tax reform.
 

(more)

 

7

CONSTRUCTION INDUSTRIES

(Millions of dollars)

Segment Sales

Second Sales Price Inter- Second $ %

Quarter 2019 Volume Realization Currency Segment Quarter 2020 Change Change

Total Sales $ 6,467 $ (2,075) $ (258) $ (81) $ (5) $ 4,048 $ (2,419) (37%)

Sales by Geographic Region

Second Second $ %

Quarter 2020 Quarter 2019 Change Change

 

North America

$ 1,604

$ 3,513

$ (1,909)

(54%)

Latin America

212

392

(180)

(46%)

EAME

933

1,108

(175)

(16%)

Asia/Pacific

1,283

1,433

(150)

(10%)

External Sales

4,032

6,446

(2,414)

(37%)

Inter-segment

16

21

(5)

(24%)

Total Sales

$ 4,048

$ 6,467

$ (2,419)

(37%)

Segment Profit

 

 

 

 

 

Second

Second

 

%

 

Quarter 2020

Quarter 2019

Change

Change

Segment Profit

$ 518

$ 1,247

$ (729)

(58%)

Segment Profit Margin

12.8%

19.3%

(6.5 pts)

 

 

Construction Industries' total sales were $4.048 billion in the second quarter of 2020, a decrease of $2.419 billion, or 37%, compared with $6.467 billion in the second quarter of 2019. The decrease was due to lower sales volume, driven by lower end-user demand and the impact from changes in dealer inventories. In all regions, dealers decreased inventories during the second quarter of 2020, compared with an increase during the second quarter of 2019. Unfavorable price realization also contributed to the sales decline due to the geographic mix of sales and competitive market conditions in China.

In North America, sales decreased mostly due to lower sales volume driven by lower end-user demand and the impact from changes in dealer inventories. The lower end-user demand was driven primarily by pipeline and road construction.

Sales declined in Latin America primarily due to lower end-user demand across the region, the impact from changes in dealer inventories and unfavorable currency impacts from a weaker Brazilian real.

In EAME, sales decreased mostly because of lower sales volume across the region, driven by lower end-user demand and the impact from changes in dealer inventories.

Sales declined in Asia/Pacific primarily due to unfavorable price realization and currency impacts from a weaker Chinese yuan. In China, sales were about flat as higher end-user demand was mostly offset by the impact of changes in dealer inventories and unfavorable price realization.

Construction Industries' profit was $518 million in the second quarter of 2020, a decrease of $729 million, or 58%, compared with $1.247 billion in the second quarter of 2019. The decrease was mainly due to lower sales volume and unfavorable price realization, partially offset by favorable manufacturing costs and lower SG&A/R&D expenses. Favorable manufacturing costs were primarily attributed to lower period manufacturing costs. Both period manufacturing costs and SG&A/R&D expenses benefited from reduced short-term incentive compensation expense and other cost reductions related to lower sales volumes.

(more)

 

8

RESOURCE INDUSTRIES

(Millions of dollars)

Segment Sales

Second Sales Price Inter- Second $ %

Quarter 2019 Volume Realization Currency Segment Quarter 2020 Change Change

Total Sales $ 2,819 $ (933) $ (23) $ (45) $ 8 $ 1,826 $ (993) (35%)

Sales by Geographic Region

Second Second $ %

Quarter 2020 Quarter 2019 Change Change

 

North America

$ 507

$ 1,058

$ (551)

(52%)

Latin America

270

448

(178)

(40%)

EAME

379

446

(67)

(15%)

Asia/Pacific

554

759

(205)

(27%)

External Sales

1,710

2,711

(1,001)

(37%)

Inter-segment

116

108

8

7%

Total Sales

$ 1,826

$ 2,819

$ (993)

(35%)

Segment Profit

 

 

 

 

 

Second

Second

 

%

 

Quarter 2020

Quarter 2019

Change

Change

Segment Profit $ 152 $ 481 $ (329) (68%)

Segment Profit Margin 8.3% 17.1% (8.8 pts)

Resource Industries' total sales were $1.826 billion in the second quarter of 2020, a decrease of $993 million, or 35%, compared with $2.819 billion in the second quarter of 2019. The decrease was due to lower sales volume, driven by changes in dealer inventories and lower end-user demand. Dealers decreased inventories during the second quarter of 2020, compared with an increase during the second quarter of 2019. Lower end-user demand was primarily driven by equipment supporting non-residential construction and quarry and aggregates. Mining equipment end-user demand was down in the quarter, though to a lesser extent. The company's mining customers faced production disruptions impacting machine utilization and aftermarket parts demand.

Resource Industries' profit was $152 million in the second quarter of 2020, a decrease of $329 million, or 68%, compared with $481 million in the second quarter of 2019. The decrease was mainly because of lower sales volume, partially offset by favorable manufacturing costs. Favorable manufacturing costs were mostly due to lower period manufacturing costs driven by lower short-term incentive compensation expense, other cost-reduction actions implemented in response to lower sales volumes and the benefits of prior restructuring programs.

 

(more)

 

9

ENERGY & TRANSPORTATION

(Millions of dollars)

Segment Sales

Second Sales Price Inter- Second $ %

Quarter 2019 Volume Realization Currency Segment Quarter 2020 Change Change

Total Sales $ 5,486 $ (942) $ 23 $ (64) $ (354) $ 4,149 $ (1,337) (24%)

Sales by Application

Second Second $ %

Quarter 2020 Quarter 2019 Change Change

 

Oil and Gas

$ 1,027

$ 1,305

$ (278)

(21%)

Power Generation

895

1,021

(126)

(12%)

Industrial

678

957

(279)

(29%)

Transportation

941

1,241

(300)

(24%)

External Sales

3,541

4,524

(983)

(22%)

Inter-segment

608

962

(354)

(37%)

Total Sales

$ 4,149

$ 5,486

$ (1,337)

(24%)

Segment Profit

 

 

 

 

 

Second

Second

 

%

 

Quarter 2020

Quarter 2019

Change

Change

Segment Profit

$ 624

$ 886

$ (262)

(30%)

Segment Profit Margin

15.0%

16.2%

(1.2 pts)

 

 

Energy & Transportation's total sales were $4.149 billion in the second quarter of 2020, a decrease of $1.337 billion, or 24%, compared with $5.486 billion in the second quarter of 2019. Sales declined across all applications and inter-segment engine sales.

Oil and Gas - Sales decreased mainly due to lower demand in North America for reciprocating engines used in gas compression and decreased sales of engine aftermarket parts, partially offset by higher sales of turbines and turbine-related services.

Power Generation - Sales decreased primarily due to lower sales volume in small reciprocating engine applications and engine aftermarket parts.

Industrial - Sales decreased due to lower demand across all regions.

Transportation - Sales declined in rail due to lower deliveries of locomotives and related services and in marine applications, primarily in EAME and Asia/Pacific.

Energy & Transportation's profit was $624 million in the second quarter of 2020, a decrease of $262 million, or 30%, compared with $886 million in the second quarter of 2019. The decrease was due to lower sales volume, partially offset by lower manufacturing costs and SG&A/R&D expenses. Manufacturing costs and SG&A/R&D expenses were both impacted by a reduction in short-term incentive compensation expense and other cost reductions related to lower sales volumes.

 

(more)

 

10

FINANCIAL PRODUCTS SEGMENT

(Millions of dollars)

Revenues by Geographic Region

 

Second Quarter 2020

Second Quarter 2019

$

Change

%
Change

North America

$ 493

$ 563

$ (70)

(12%)

Latin America

60

76

(16)

(21%)

EAME

96

102

(6)

(6%)

Asia/Pacific

114

132

(18)

(14%)

Total Revenues

$ 763

$ 873

$ (110)

(13%)

 

Segment Profit

Second Second %

Quarter 2020 Quarter 2019 Change Change

Segment Profit $ 148 $ 193 $ (45) (23%)

Financial Products' segment revenues were $763 million in the second quarter of 2020, a decrease of $110 million, or 13%, from the second quarter of 2019. The decrease was primarily because of lower average financing rates and lower average earning assets across all regions.

Financial Products' segment profit was $148 million in the second quarter of 2020, compared with $193 million in the second quarter of 2019. The decrease was due to lower net yield on average earning assets, lower average earning assets and higher provision for credit losses at Cat Financial. These unfavorable impacts were partially offset by a reduction in SG&A expenses primarily due to lower short-term incentive compensation and employee benefit expenses and a favorable impact from equity securities in Insurance Services.

At the end of the second quarter of 2020, past dues at Cat Financial were 3.74%, compared with 3.38% at the end of the second quarter of 2019. Past dues increased primarily due to the impact of the COVID-19 pandemic. Write-offs, net of recoveries, were $30 million for the second quarter of 2020, compared with $74 million for the second quarter of 2019. As of June 30, 2020, Cat Financial's allowance for credit losses totaled $515 million, or 1.92% of finance receivables, compared with $457 million, or 1.69% of finance receivables at March 31, 2020. The increase in allowance for credit losses was driven in part by expectations of the lingering impact from COVID-19. The allowance for credit losses at year-end 2019 was $424 million, or 1.50% of finance receivables.

Corporate Items and Eliminations

Expense for corporate items and eliminations was $580 million in the second quarter of 2020, an increase of $89 million from the second quarter of 2019, primarily due to an unfavorable change in fair value adjustments related to deferred compensation plans and segment reporting methodology differences.

 

(more)

 

11

Notes

  1. Glossary of terms is included on the Caterpillar website at https://investors.caterpillar.com/overview/default.aspx.
  2. End-user demand is demonstrated by the company's Rolling 3 Month Retail Sales Statistics filed in a Form 8-K on Friday, July 31, 2020.
  3. Information on non-GAAP financial measures is included in the appendix on page 12.
  4. Some amounts within this report are rounded to the millions or billions and may not add.
  5. Caterpillar will conduct a teleconference and live webcast, with a slide presentation, beginning at 7:30 a.m. Central Time on Friday, July 31, 2020, to discuss its 2020 second-quarter results. The accompanying slides will be available before the webcast on the Caterpillar website at https://investors.caterpillar.com/events-presentations/default.aspx.

About Caterpillar

Since 1925, Caterpillar Inc. has been helping our customers build a better world - making sustainable progress possible and driving positive change on every continent. With 2019 sales and revenues of $53.8 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. Services offered throughout the product life cycle, cutting-edge technology and decades of product expertise set Caterpillar apart, providing exceptional value to help our customers succeed. The company principally operates through three primary segments - Construction Industries, Resource Industries and Energy & Transportation - and provides financing and related services through its Financial Products segment. For more information, visit caterpillar.com. To connect on social media, visit caterpillar.com/social-media.

Caterpillar's latest financial results are also available online:

https://investors.caterpillar.com/overview/default.aspx

https://investors.caterpillar.com/financials/quarterly-results/default.aspx (live broadcast/replays of quarterly conference call)

Caterpillar investor relations contact: Jennifer Driscoll, +1 224-551-4382 or Driscoll Jennifer@cat.com

Caterpillar media contact: Kate Kenny, +1 309-361-9333 or Kenny Kate@cat.com

Forward-Looking Statements

Certain statements in this press release relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "forecast," "target," "guide," "project," "intend," "could," "should" or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance and speak only as of the date they are made, and we do not undertake to update our forward-looking statements.

Caterpillar's actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global and regional economic conditions and economic conditions in the industries we serve; (ii) commodity price changes, material price increases, fluctuations in demand for our products or significant shortages of material; (iii) government monetary or fiscal policies; (iv) political and economic risks, commercial instability and events beyond our control in the countries in which we operate; (v) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; (vi) our ability to develop, produce and market quality products that meet our customers' needs; (vii) the impact of the highly competitive environment in which we operate on our sales and pricing; (viii) information technology security threats and computer crime; (ix) inventory management decisions and sourcing practices of our dealers and our OEM customers; (x) a failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures or divestitures; (xi) union disputes or other employee relations issues; (xii) adverse effects of unexpected events; (xiii) disruptions or volatility in global financial markets limiting our sources of liquidity or the liquidity of our customers, dealers and suppliers; (xiv) failure to maintain our credit ratings and potential resulting increases to our cost of borrowing and adverse effects on our cost of funds, liquidity, competitive position and access to capital markets; (xv) our Financial Products segment's risks associated with the financial services industry; (xvi) changes in interest rates or market liquidity conditions; (xvii) an increase in delinquencies, repossessions or net losses of Cat Financial's customers; (xviii) currency fluctuations; (xix) our or Cat Financial's compliance with financial and other restrictive covenants in debt agreements; (xx) increased pension plan funding obligations; (xxi) alleged or actual violations of trade or anti-corruption laws and regulations; (xxii) additional tax expense or exposure, including the impact of U.S. tax reform; (xxiii) significant legal proceedings, claims, lawsuits or government investigations; (xxiv) new regulations or changes in financial services regulations; (xxv) compliance with environmental laws and regulations; (xxvi) the duration and geographic spread of, business disruptions caused by, and the overall global economic impact of, the COVID-19 pandemic; and (xxvii) other factors described in more detail in Caterpillar's Forms 10-Q, 10-K and other filings with the Securities and Exchange Commission.

(more)

 

12

APPENDIX

NON-GAAP FINANCIAL MEASURES

The following definitions are provided for the non-GAAP financial measures. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management does not intend these items to be considered in isolation or as a substitute for the related GAAP measures.

Adjusted Profit Per Share

The company believes it is important to separately quantify the profit impact of a significant item in order for the company's results to be meaningful to readers. This item is remeasurement losses resulting from the settlements of pension obligations in the second quarter of 2020. The company does not consider this item indicative of earnings from ongoing business activities and believes the non-GAAP measure provides investors with useful perspective on underlying business results and trends and aids with assessing the company's period-over-period results. The company intends to discuss adjusted profit per share for the fourth quarter and full-year 2020, excluding mark-to-market gains or losses for remeasurement of pension and other postemployment benefit plans along with any other discrete items.

Reconciliations of adjusted profit per share to the most directly comparable GAAP measure, diluted profit per share, are as follows:

Second Quarter

 

 

2020

 

2019

Profit per share

$

0.84

$

2.83

Per share remeasurement losses of pension obligations1

$

0.19

$

-

Adjusted profit per share

$

1.03

$

2.83

1 At statutory tax rates.

Note: On March 26, 2020, the company withdrew its previous financial outlook due to the continued global economic uncertainty related to the COVID-19 pandemic.

Machinery, Energy & Transportation

Caterpillar defines Machinery, Energy & Transportation as it is presented in the supplemental data as Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis. Machinery, Energy & Transportation information relates to the design, manufacture and marketing of Caterpillar products. Financial Products' information relates to the financing to customers and dealers for the purchase and lease of Caterpillar and other equipment. The nature of these businesses is different, especially with regard to the financial position and cash flow items. Caterpillar management utilizes this presentation internally to highlight these differences. The company also believes this presentation will assist readers in understanding Caterpillar's business. Pages 13-23 reconcile Machinery, Energy & Transportation with Financial Products on the equity basis to Caterpillar Inc. consolidated financial information.

(more)

 

13

Caterpillar Inc.
Condensed Consolidated Statement of Results of Operations
(Unaudited)
(Dollars in millions except per share data)

Sales and revenues:

Three Months Ended June 30,

2020 2019

Six Months Ended
June 30,

2020 2019

 

 

 

 

Sales of Machinery, Energy & Transportation

$ 9,310

$ 13,671

$ 19,224

$ 26,395

Revenues of Financial Products

687

761

1,408

1,503

Total sales and revenues

9,997

14,432

20,632

27,898

Operating costs:

 

 

 

 

Cost of goods sold

7,113

9,941

14,379

18,944

Selling, general and administrative expenses

1,179

1,309

2,300

2,628

Research and development expenses

341

441

697

876

Interest expense of Financial Products

149

192

324

382

Other operating (income) expenses

431

336

744

648

Total operating costs

9,213

12,219

18,444

23,478

Operating profit

784

2,213

2,188

4,420

Interest expense excluding Financial Products

135

103

248

206

Other income (expense)

29

68

251

228

Consolidated profit before taxes

678

2,178

2,191

4,442

Provision (benefit) for income taxes

227

565

652

952

Profit of consolidated companies

451

1,613

1,539

3,490

Equity in profit (loss) of unconsolidated affiliated companies

8

6

13

13

Profit of consolidated and affiliated companies

459

1,619

1,552

3,503

Less: Profit (loss) attributable to noncontrolling interests

1

(1)

2

2

Profit 1

$ 458

$ 1,620

$ 1,550

$ 3,501

 

 

 

 

 

Profit per common share

$ 0.84

$ 2.85

$ 2.85

$ 6.14

Profit per common share - diluted 2

$ 0.84

$ 2.83

$ 2.83

$ 6.08

Weighted-average common shares outstanding (millions)

 

 

 

 

- Basic

541.5

567.8

544.5

569.9

- Diluted 2

544.5

573.1

548.2

575.8

 

(more)

 

14

Caterpillar Inc.
Condensed Consolidated Statement of Financial Position
(Unaudited)
(Millions of dollars)

Assets

Current assets:

Cash and short-term investments

Receivables - trade and other

Receivables - finance

Prepaid expenses and other current assets

Inventories

 

June 30,

2020

 

December 31,

2019

$

8,784 7,134 8,781 1,792 11,371

$

8,284 8,568 9,336 1,739 11,266

Total current assets

 

37,862

 

39,193

Property, plant and equipment - net

 

12,357

 

12,904

Long-term receivables - trade and other

 

1,167

 

1,193

Long-term receivables - finance

 

12,560

 

12,651

Noncurrent deferred and refundable income taxes

 

1,459

 

1,411

Intangible assets

 

1,420

 

1,565

Goodwill

 

6,192

 

6,196

Other assets

 

3,549

 

3,340

Total assets

$

76,566

$

78,453

Liabilities

 

 

 

 

Current liabilities:

 

 

 

 

Short-term borrowings:

 

 

 

 

-- Machinery, Energy & Transportation

$

13

$

5

-- Financial Products

 

4,301

 

5,161

Accounts payable

 

5,083

 

5,957

Accrued expenses

 

3,547

 

3,750

Accrued wages, salaries and employee benefits

 

958

 

1,629

Customer advances

 

1,227

 

1,187

Dividends payable

 

558

 

567

Other current liabilities

 

2,143

 

2,155

Long-term debt due within one year:

 

 

 

 

-- Machinery, Energy & Transportation

 

1,395

 

16

-- Financial Products

 

6,006

 

6,194

Total current liabilities

 

25,231

 

26,621

Long-term debt due after one year:

 

 

 

 

-- Machinery, Energy & Transportation

 

9,729

 

9,141

-- Financial Products

 

17,178

 

17,140

Liability for postemployment benefits

 

6,285

 

6,599

Other liabilities

 

4,366

 

4,323

Total liabilities

 

62,789

 

63,824

Shareholders' equity

 

 

 

 

Common stock

 

6,120

 

5,935

Treasury stock

 

(25,412)

 

(24,217)

Profit employed in the business

 

34,841

 

34,437

Accumulated other comprehensive income (loss)

 

(1,815)

 

(1,567)

Noncontrolling interests

 

43

 

41

Total shareholders' equity

 

13,777

 

14,629

Total liabilities and shareholders' equity

$

76,566

$

78,453

 

(more)

 

15

Caterpillar Inc.
Condensed Consolidated Statement of Cash Flow
(Unaudited)
(Millions of dollars)

Cash flow from operating activities:

Six Months Ended June 30,

2020 2019

 

 

Profit of consolidated and affiliated companies

$ 1,552

$ 3,503

Adjustments for non-cash items:

 

 

Depreciation and amortization

1,222

1,288

Net gain on remeasurement of pension obligations

(132)

-

Provision (benefit) for deferred income taxes

(32)

  1.             

Other

674

440

Changes in assets and liabilities, net of acquisitions and divestitures:

 

 

Receivables - trade and other

1,176

(166)

Inventories

(145)

(487)

Accounts payable

(655)

134

Accrued expenses

(253)

151

Accrued wages, salaries and employee benefits

(648)

(979)

Customer advances

(2)

14

Other assets - net

(7)

(120)

Other liabilities - net

(229)

  1.  

Net cash provided by (used for) operating activities

2,521

3,709

Cash flow from investing activities:

 

 

Capital expenditures - excluding equipment leased to others

(472)

(479)

Expenditures for equipment leased to others

(526)

(746)

Proceeds from disposals of leased assets and property, plant and equipment

382

422

Additions to finance receivables

(6,712)

(6,181)

Collections of finance receivables

6,801

5,902

Proceeds from sale of finance receivables

31

119

Investments and acquisitions (net of cash acquired)

(49)

(3)

Proceeds from sale of businesses and investments (net of cash sold)

13

-

Proceeds from sale of securities

151

170

Investments in securities

(369)

(243)

Other - net

7

(40)

Net cash provided by (used for) investing activities

(743)

(1,079)

Cash flow from financing activities:

 

 

Dividends paid

(1,125)

(986)

Common stock issued, including treasury shares reissued

(10)

39

Common shares repurchased

(1,130)

(2,105)

Proceeds from debt issued (original maturities greater than three months)

6,159

5,340

Payments on debt (original maturities greater than three months)

(4,629)

(4,901)

Short-term borrowings - net (original maturities three months or less)

(477)

(436)

Other - net

(1)

(2)

Net cash provided by (used for) financing activities

(1,213)

(3,051)

Effect of exchange rate changes on cash

(66)

(10)

Increase (decrease) in cash and short-term investments and restricted cash

499

(431)

Cash and short-term investments and restricted cash at beginning of period

8,292

7,890

Cash and short-term investments and restricted cash at end of period

$ 8,791

$ 7,459

 

 

All short-term investments, which consist primarily of highly liquid investments with original maturities of three months or less, are considered to be cash equivalents.

 

(more)

 

16

Caterpillar Inc.
Supplemental Data for Results of Operations
For the Three Months Ended June 30, 2020
(Unaudited)
(Millions of dollars)

Sales and revenues:

Sales of Machinery, Energy & Transportation

 

Consolidated

 

Supplemental Consolidating Data

Machinery,
Energy &
Transportation 1

 

Financial Products

 

Consolidating Adjustments

$ 9,310

$ 9,310

$

- $

-

Revenues of Financial Products

 

687

 

-

 

780

 

2

(93)

Total sales and revenues

 

9,997

 

9,310

 

780

 

(93)

Operating costs:

 

 

 

 

 

 

 

 

Cost of goods sold

 

7,113

 

7,114

 

-

 

3

(1)

Selling, general and administrative expenses

 

1,179

 

984

 

201

 

(6) 3

Research and development expenses

 

341

 

341

 

-

 

-

Interest expense of Financial Products

 

149

 

-

 

149

 

-

Other operating (income) expenses

 

431

 

122

 

320

 

3

(11)

Total operating costs

 

9,213

 

8,561

 

670

 

(18)

Operating profit

 

784

 

749

 

110

 

(75)

Interest expense excluding Financial Products

 

135

 

135

 

-

 

-

Other income (expense)

 

29

 

(77)

 

31

 

75 4

Consolidated profit before taxes

 

678

 

537

 

141

 

-

Provision (benefit) for income taxes

 

227

 

190

 

37

 

-

Profit of consolidated companies

 

451

 

347

 

104

 

-

Equity in profit (loss) of unconsolidated affiliated companies

 

8

 

8

 

-

 

-

Equity in profit of Financial Products' subsidiaries

 

-

 

99

 

-

 

(99) 5

Profit of consolidated and affiliated companies

 

459

 

454

 

104

 

(99)

Less: Profit (loss) attributable to noncontrolling interests

 

1

 

(4)

 

5

 

-

Profit 6

$

458

$

458

$

99

$

(99)

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of Financial Products' revenues earned from Machinery, Energy & Transportation.

3 Elimination of net expenses recorded by Machinery, Energy & Transportation paid to Financial Products.

4 Elimination of discount recorded by Machinery, Energy & Transportation on receivables sold to Financial Products and of interest earned between Machinery, Energy & Transportation and Financial Products.

5 Elimination of Financial Products' profit due to equity method of accounting.

6 Profit attributable to common shareholders.

(more)

 

17

Caterpillar Inc.
Supplemental Data for Results of Operations
For the Three Months Ended June 30, 2019
(Unaudited)
(Millions of dollars)

Sales and revenues:

Consolidated

Supplemental Consolidating Data

Machinery,
Energy &
Transportation 1

 

Financial
Products

Consolidating Adjustments

 

 

 

 

 

Sales of Machinery, Energy & Transportation

$ 13,671

$ 13,671

$

- $

-

Revenues of Financial Products

761

-

 

894

2

(133)

Total sales and revenues

14,432

13,671

 

894

(133)

Operating costs:

 

 

 

 

 

Cost of goods sold

9,941

9,943

 

-

3

(2)

Selling, general and administrative expenses

1,309

1,102

 

209

(2) 3

Research and development expenses

441

441

 

-

-

Interest expense of Financial Products

192

-

 

201

4

(9)

Other operating (income) expenses

336

1

 

341

(6) 3

Total operating costs

12,219

11,487

 

751

(19)

Operating profit

2,213

2,184

 

143

(114)

Interest expense excluding Financial Products

103

105

 

-

(2) 4

Other income (expense)

68

(63)

 

19

112 5

Consolidated profit before taxes

2,178

2,016

 

162

-

Provision (benefit) for income taxes

565

502

 

63

-

Profit of consolidated companies

1,613

1,514

 

99

-

Equity in profit (loss) of unconsolidated affiliated companies

6

6

 

-

-

Equity in profit of Financial Products' subsidiaries

-

94

 

-

(94) 6

Profit of consolidated and affiliated companies

1,619

1,614

 

99

(94)

Less: Profit (loss) attributable to noncontrolling interests

(1)

(6)

 

5

-

Profit 7

$ 1,620

$ 1,620

$

94 $

(94)

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of Financial Products' revenues earned from Machinery, Energy & Transportation.

3 Elimination of net expenses recorded by Machinery, Energy & Transportation paid to Financial Products.

4 Elimination of interest expense recorded between Financial Products and Machinery, Energy & Transportation.

5 Elimination of discount recorded by Machinery, Energy & Transportation on receivables sold to Financial Products and of interest earned between Machinery, Energy & Transportation and Financial Products.

6 Elimination of Financial Products' profit due to equity method of accounting.

7 Profit attributable to common shareholders.

(more)

 

18

Caterpillar Inc.
Supplemental Data for Results of Operations
For the Six Months Ended June 30, 2020
(Unaudited)
(Millions of dollars)

Sales and revenues:

Consolidated

Supplemental Consolidating Data

Machinery,
Energy &
Transportation 1

Financial
Products

Consolidating Adjustments

 

 

 

 

Sales of Machinery, Energy & Transportation

$ 19,224

$ 19,224

$ - $ -

Revenues of Financial Products

1,408

-

1,610

(202) 2

Total sales and revenues

20,632

19,224

1,610

(202)

Operating costs:

 

 

 

 

Cost of goods sold

14,379

14,381

-

(2) 3

,

Selling, general and administrative expenses

2,300

1,924

383

(7) 3

Research and development expenses

697

697

-

-

Interest expense of Financial Products

324

-

325

4

(1)

Other operating (income) expenses

744

132

640

(28) 3

Total operating costs

18,444

17,134

1,348

(38)

Operating profit

2,188

2,090

262

(164)

Interest expense excluding Financial Products

248

247

-

1 4

Other income (expense)

251

102

(16)

165 5

Consolidated profit before taxes

2,191

1,945

246

-

Provision (benefit) for income taxes

652

587

65

-

Profit of consolidated companies

1,539

1,358

181

-

Equity in profit (loss) of unconsolidated affiliated companies

13

13

-

-

Equity in profit of Financial Products' subsidiaries

-

172

-

(172) 6

Profit of consolidated and affiliated companies

1,552

1,543

181

(172)

Less: Profit (loss) attributable to noncontrolling interests

2

(7)

9

-

Profit 7

$ 1,550

$ 1,550

$ 172

$ (172)

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of Financial Products' revenues earned from Machinery, Energy & Transportation.

3 Elimination of net expenses recorded by Machinery, Energy & Transportation paid to Financial Products.

4 Elimination of interest expense recorded between Financial Products and Machinery, Energy & Transportation.

5 Elimination of discount recorded by Machinery, Energy & Transportation on receivables sold to Financial Products and of interest earned between Machinery, Energy & Transportation and Financial Products.

6 Elimination of Financial Products' profit due to equity method of accounting.

7 Profit attributable to common shareholders.

(more)

 

19

Caterpillar Inc.
Supplemental Data for Results of Operations
For the Six Months Ended June 30, 2019
(Unaudited)
(Millions of dollars)

Sales and revenues:

Consolidated

Supplemental Consolidating Data

Machinery,
Energy &
Transportation 1

 

Financial
Products

Consolidating Adjustments

 

 

 

 

 

Sales of Machinery, Energy & Transportation

$ 26,395

$ 26,395

$

- $

-

Revenues of Financial Products

1,503

-

 

1,764

2

(261)

Total sales and revenues

27,898

26,395

 

1,764

(261)

Operating costs:

 

 

 

 

 

Cost of goods sold

18,944

18,946

 

-

(2) 3

Selling, general and administrative expenses

2,628

2,229

 

401

(2) 3

Research and development expenses

876

876

 

-

-

Interest expense of Financial Products

382

-

 

401

(19) 4

Other operating (income) expenses

648

11

 

654

(17) 3

Total operating costs

23,478

22,062

 

1,456

(40)

Operating profit

4,420

4,333

 

308

(221)

Interest expense excluding Financial Products

206

215

 

-

(9) 4

Other income (expense)

228

(44)

 

60

212 5

Consolidated profit before taxes

4,442

4,074

 

368

-

Provision (benefit) for income taxes

952

837

 

115

-

Profit of consolidated companies

3,490

3,237

 

253

-

Equity in profit (loss) of unconsolidated affiliated companies

13

13

 

-

-

Equity in profit of Financial Products' subsidiaries

-

242

 

-

(242) 6

Profit of consolidated and affiliated companies

3,503

3,492

 

253

(242)

Less: Profit (loss) attributable to noncontrolling interests

2

(9)

 

11

-

Profit 7

$ 3,501

$ 3,501

$

242 $

(242)

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of Financial Products' revenues earned from Machinery, Energy & Transportation.

3 Elimination of net expenses recorded by Machinery, Energy & Transportation paid to Financial Products.

4 Elimination of interest expense recorded between Financial Products and Machinery, Energy & Transportation.

5 Elimination of discount recorded by Machinery, Energy & Transportation on receivables sold to Financial Products and of interest earned between Machinery, Energy & Transportation and Financial Products.

6 Elimination of Financial Products' profit due to equity method of accounting.

7 Profit attributable to common shareholders.

 

20

Caterpillar Inc.
Supplemental Data for Financial Position
At June 30, 2020
(Unaudited)
(Millions of dollars)

Assets

Current assets:

 

Supplemental Consolidating Data

 

Consolidated

Machinery,
Energy &
Transportation 1

Financial
Products

Consolidating Adjustments

 

 

 

 

Cash and short-term investments

$ 8,784 $

8,030

$ 754

$ -

 

Receivables - trade and other

7,134

2,599

506

4,029

2,3

Receivables - finance

8,781

-

13,064

(4,283)

3

Prepaid expenses and other current assets

1,792

1,185

618

(11)

4

Inventories

11,371

11,371

-

-

 

Total current assets

37,862

23,185

14,942

(265)

 

Property, plant and equipment - net

12,357

8,250

4,107

-

 

Long-term receivables - trade and other

1,167

274

194

699

2,3

Long-term receivables - finance

12,560

-

13,277

(717)

3

Investments in Financial Products subsidiaries

-

4,257

-

(4,257)

5

Noncurrent deferred and refundable income taxes

1,459

1,990

106

(637)

6

Intangible assets

1,420

1,420

-

-

 

Goodwill

6,192

6,192

-

-

 

Other assets

3,549

1,880

1,766

(97)

7

Total assets

$ 76,566 $

47,448

$ 34,392

$ (5,274)

 

Liabilities

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Short-term borrowings

$ 4,314 $

13

$ 4,301

$ -

 

Short-term borrowings with consolidated companies

-

-

99

(99)

8

Accounts payable

5,083

5,046

196

(159)

9

Accrued expenses

3,547

3,239

308

-

 

Accrued wages, salaries and employee benefits

958

943

15

-

 

Customer advances

1,227

1,227

-

-

 

Dividends payable

558

558

-

-

 

Other current liabilities

2,143

1,521

654

(32)

6,10

Long-term debt due within one year

7,401

1,395

6,006

-

 

Total current liabilities

25,231

13,942

11,579

(290)

 

Long-term debt due after one year

26,907

9,743

17,178

(14)

8

Liability for postemployment benefits

6,285

6,284

1

-

 

Other liabilities

4,366

3,702

1,377

(713)

6

Total liabilities

62,789

33,671

30,135

(1,017)

 

Shareholders' equity

 

 

 

 

 

Common stock

6,120

6,120

919

(919)

5

Treasury stock

(25,412)

(25,412)

-

-

 

Profit employed in the business

34,841

34,841

4,136

(4,136)

5

Accumulated other comprehensive income (loss)

(1,815)

(1,815)

(977)

977

5

Noncontrolling interests

43

43

179

(179)

5

Total shareholders' equity

13,777

13,777

4,257

(4,257)

 

Total liabilities and shareholders' equity

$ 76,566 $

47,448

$ 34,392

$ (5,274)

 

 

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of receivables between Machinery, Energy & Transportation and Financial Products.

3 Reclassification of Machinery, Energy & Transportation's trade receivables purchased by Financial Products and Financial Products' wholesale inventory receivables.

4 Elimination of Machinery, Energy & Transportation's insurance premiums that are prepaid to Financial Products.

5 Elimination of Financial Products' equity which is accounted for by Machinery, Energy & Transportation on the equity basis.

6 Reclassification reflecting required netting of deferred tax assets/liabilities by taxing jurisdiction.

7 Elimination of other intercompany assets between Machinery, Energy & Transportation and Financial Products.

8 Elimination of debt between Machinery, Energy & Transportation and Financial Products.

9 Elimination of payables between Machinery, Energy & Transportation and Financial Products.

 

10 Elimination of prepaid insurance in Financial Products' other  liabilities.

(more)

 

21

Caterpillar Inc.
Supplemental Data for Financial Position
At December 31, 2019
(Unaudited)
(Millions of dollars)

Assets

Current assets:

Consolidated

Supplemental Consolidating Data

 

Machinery,
Energy &
Transportation 1

Financial
Products

Consolidating
Adjustments

 

 

 

 

Cash and short-term investments

$ 8,284

$ 7,299

$ 985

$ -

 

Receivables - trade and other

8,568

3,737

451

4,380

2,3

Receivables - finance

9,336

-

14,489

(5,153)

3

Prepaid expenses and other current assets

1,739

1,290

529

(80)

4

Inventories

11,266

11,266

-

-

 

Total current assets

39,193

23,592

16,454

(853)

 

Property, plant and equipment - net

12,904

8,606

4,298

-

 

Long-term receivables - trade and other

1,193

348

152

693

2,3

Long-term receivables - finance

12,651

-

13,354

(703)

3

Investments in Financial Products subsidiaries

-

4,260

-

(4,260)

5

Noncurrent deferred and refundable income taxes

1,411

2,002

117

(708)

6

Intangible assets

1,565

1,565

-

-

 

Goodwill

6,196

6,196

-

-

 

Other assets

3,340

1,868

1,572

(100)

7

Total assets

$ 78,453

$ 48,437

$ 35,947

$ (5,931)

 

Liabilities

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Short-term borrowings

$ 5,166

$ 5

$ 5,161

$ -

 

Short-term borrowings with consolidated companies

-

-

600

(600)

8

Accounts payable

5,957

5,918

212

(173)

9

Accrued expenses

3,750

3,415

335

-

 

Accrued wages, salaries and employee benefits

1,629

1,580

49

-

 

Customer advances

1,187

1,187

-

-

 

Dividends payable

567

567

-

-

 

Other current liabilities

2,155

1,689

566

(100)

6,10

Long-term debt due within one year

6,210

16

6,194

-

 

Total current liabilities

26,621

14,377

13,117

(873)

 

Long-term debt due after one year

26,281

9,151

17,140

(10)

8

Liability for postemployment benefits

6,599

6,599

-

-

 

Other liabilities

4,323

3,681

1,430

(788)

6

Total liabilities

63,824

33,808

31,687

(1,671)

 

Shareholders' equity

 

 

 

 

 

Common stock

5,935

5,935

919

(919)

5

Treasury stock

(24,217)

(24,217)

-

-

 

Profit employed in the business

34,437

34,437

3,997

(3,997)

5

Accumulated other comprehensive income (loss)

(1,567)

(1,567)

(828)

828

5

Noncontrolling interests

41

41

172

(172)

5

Total shareholders' equity

14,629

14,629

4,260

(4,260)

 

Total liabilities and shareholders' equity

$ 78,453

$ 48,437

$ 35,947

$ (5,931)

 

 

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of receivables between Machinery, Energy & Transportation and Financial Products.

3 Reclassification of Machinery, Energy & Transportation's trade receivables purchased by Financial Products and Financial Products' wholesale inventory receivables.

4 Elimination of Machinery, Energy & Transportation's insurance premiums that are prepaid to Financial Products.

5 Elimination of Financial Products' equity which is accounted for by Machinery, Energy & Transportation on the equity basis.

6 Reclassification reflecting required netting of deferred tax assets/liabilities by taxing jurisdiction.

7 Elimination of other intercompany assets between Machinery, Energy & Transportation and Financial Products.

8 Elimination of debt between Machinery, Energy & Transportation and Financial Products.

9 Elimination of payables between Machinery, Energy & Transportation and Financial Products.

10 Elimination of prepaid insurance in Financial Products' other liabilities.

 

(more)

 

22

Caterpillar Inc.
Supplemental Data for Cash Flow
For the Six Months Ended June 30, 2020
(Unaudited)
(Millions of dollars)

 

Cash flow from operating activities:

Consolidated

Supplemental Consolidating Data

Machinery,
Energy &
Transportation 1

 

Financial Products

 

Consolidating Adjustments

 

 

 

 

 

 

Profit of consolidated and affiliated companies

$ 1,552

$ 1,543

$

181

$

(172) 2

Adjustments for non-cash items:

 

 

 

 

 

 

Depreciation and amortization

1,222

805

 

417

 

-

Undistributed profit of Financial Products

-

(152)

 

-

 

152 3

Net gain on remeasurement of pension obligations

(132)

(132)

 

-

 

-

Provision (benefit) for deferred income taxes

(32)

40

 

(72)

 

-

Other

674

347

 

145

 

182 4

Changes in assets and liabilities, net of acquisitions and divestitures:

 

 

 

 

 

 

Receivables - trade and other

1,176

539

 

(77)

 

714 4,

Inventories

(145)

(137)

 

-

 

(8) 4

Accounts payable

(655)

(664)

 

(5)

 

14 4

Accrued expenses

(253)

(237)

 

(16)

 

-

Accrued wages, salaries and employee benefits

(648)

(614)

 

(34)

 

-

Customer advances

(2)

(2)

 

-

 

-

Other assets - net

(7)

30

 

30

 

(67) 4

Other liabilities - net

(229)

(391)

 

84

 

78 4

Net cash provided by (used for) operating activities

2,521

975

 

653

 

893

Cash flow from investing activities:

 

 

 

 

 

 

Capital expenditures - excluding equipment leased to others

(472)

(465)

 

(7)

 

-

Expenditures for equipment leased to others

(526)

1

 

(540)

 

13 4

Proceeds from disposals of leased assets and property, plant and equipment

382

104

 

283

 

(5) 4

Additions to finance receivables

(6,712)

-

 

(7,352)

 

640 5

Collections of finance receivables

6,801

-

 

7,442

 

(641) 5

Net intercompany purchased receivables

-

-

 

920

 

(920) 5

Proceeds from sale of finance receivables

31

-

 

31

 

-

Net intercompany borrowings

-

500

 

2

 

(502) 6

Investments and acquisitions (net of cash acquired)

(49)

(49)

 

-

 

-

Proceeds from sale of businesses and investments (net of cash sold)

13

13

 

-

 

-

Proceeds from sale of securities

151

12

 

139

 

-

Investments in securities

(369)

(10)

 

(359)

 

-

Other - net

7

(15)

 

22

 

-

Net cash provided by (used for) investing activities

(743)

91

 

581

 

(1,415)

Cash flow from financing activities:

 

 

 

 

 

 

Dividends paid

(1,125)

(1,125)

 

(20)

 

20 7

Common stock issued, including treasury shares reissued

(10)

(10)

 

-

 

-

Common shares repurchased

(1,130)

(1,130)

 

-

 

-

Net intercompany borrowings

-

(2)

 

(500)

 

502 6

Proceeds from debt issued > 90 days

6,159

1,991

 

4,168

 

-

Payments on debt > 90 days

(4,629)

(12)

 

(4,617)

 

-

Short-term borrowings - net < 90 days

(477)

8

 

(485)

 

-

Other - net

(1)

(1)

 

-

 

-

Net cash provided by (used for) financing activities

(1,213)

(281)

 

(1,454)

 

522

Effect of exchange rate changes on cash

(66)

(54)

 

(12)

 

-

Increase (decrease) in cash and short-term investments and restricted cash

499

731

 

(232)

 

-

Cash and short-term investments and restricted cash at beginning of period

8,292

7,302

 

990

 

-

Cash and short-term investments and restricted cash at end of period

$ 8,791

$ 8,033

$

758

$

-

 

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of Financial Products' profit after tax due to equity method of accounting.

3 Elimination of non-cash adjustment for the undistributed earnings from Financial Products.

4 Elimination of non-cash adjustments and changes in assets and liabilities related to consolidated reporting.

5 Reclassification of Financial Products' cash flow activity from investing to operating for receivables that arose from the sale of inventory.

6 Elimination of net proceeds and payments to/from Machinery, Energy & Transportation and Financial Products.

7 Elimination of dividend from Financial Products to Machinery, Energy & Transportation.

 

(more)

 

23

Caterpillar Inc.
Supplemental Data for Cash Flow
For the Six Months Ended June 30, 2019
(Unaudited)
(Millions of dollars)

 

Cash flow from operating activities:

Consolidated

Supplemental Consolidating Data

Machinery,
Energy &
Transportation 1

 

Financial Products

Consolidating Adjustments

 

 

 

 

 

Profit of consolidated and affiliated companies

$ 3,503

$ 3,492

$

253 $

(242) 2

Adjustments for non-cash items:

 

 

 

 

 

Depreciation and amortization

1,288

855

 

433

-

Undistributed profit of Financial Products

-

(242)

 

-

242 3

Provision (benefit) for deferred income taxes

(34)

(16)

 

(18)

-

Other

440

264

 

(51)

227 4

Changes in assets and liabilities, net of acquisitions and divestitures:

 

 

 

 

 

Receivables - trade and other

(166)

161

 

(5)

(322) 4,

Inventories

(487)

(489)

 

-

2 4

Accounts payable

134

(94)

 

279

(51) 4

Accrued expenses

151

158

 

(5)

(2) 4

Accrued wages, salaries and employee benefits

(979)

(978)

 

(1)

-

Customer advances

14

18

 

-

(4) 4

Other assets - net

(120)

(165)

 

61

(16) 4

Other liabilities - net

(35)

(144)

 

89

20 4

Net cash provided by (used for) operating activities

3,709

2,820

 

1,035

(146)

Cash flow from investing activities:

 

 

 

 

 

Capital expenditures - excluding equipment leased to others

(479)

(468)

 

(11)

-

Expenditures for equipment leased to others

(746)

(24)

 

(725)

3 4

Proceeds from disposals of leased assets and property, plant and equipment

422

97

 

367

(42) 4

Additions to finance receivables

(6,181)

-

 

(7,027)

846 5

Collections of finance receivables

5,902

-

 

6,548

(646) 5

Net intercompany purchased receivables

-

-

 

15

(15) 5

Proceeds from sale of finance receivables

119

-

 

119

-

Net intercompany borrowings

-

213

 

1

(214) 6

Investments and acquisitions (net of cash acquired)

  1.       

(3)

 

-

-

Proceeds from sale of securities

170

13

 

157

-

Investments in securities

(243)

(12)

 

(231)

-

Other - net

(40)

(9)

 

(31)

-

Net cash provided by (used for) investing activities

(1,079)

(193)

 

(818)

(68)

Cash flow from financing activities:

 

 

 

 

 

Dividends paid

(986)

(986)

 

-

-

Common stock issued, including treasury shares reissued

39

39

 

-

-

Common shares repurchased

(2,105)

(2,105)

 

-

-

Net intercompany borrowings

-

(1)

 

(213)

214 6

Proceeds from debt issued > 90 days

5,340

-

 

5,340

-

Payments on debt > 90 days

(4,901)

(4)

 

(4,897)

-

Short-term borrowings - net < 90 days

(436)

-

 

(436)

-

Other - net

(2)

(2)

 

-

-

Net cash provided by (used for) financing activities

(3,051)

(3,059)

 

(206)

214

Effect of exchange rate changes on cash

(10)

(8)

 

  1.                 

-

Increase (decrease) in cash and short-term investments and restricted cash

(431)

(440)

 

9

-

Cash and short-term investments and restricted cash at beginning of period

7,890

6,994

 

896

-

Cash and short-term investments and restricted cash at end of period

$ 7,459

$ 6,554

$

905 $

-

 

 

1 Represents Caterpillar Inc. and its subsidiaries with Financial Products accounted for on the equity basis.

2 Elimination of Financial Products' profit after tax due to equity method of accounting.

3 Elimination of non-cash adjustment for the undistributed earnings from Financial Products.

4 Elimination of non-cash adjustment and changes in assets and liabilities related to consolidated reporting.

5 Reclassification of Financial Products' cash flow activity from investing to operating for receivables that arose from the sale of inventory.

6 Elimination of net proceeds and payments to/from Machinery, Energy & Transportation and Financial Products.

 

#


Regulatory filing PDF file

File: Caterpillar Inc.: Form 8-K Exhibit 99.1


Language: English
Company: Caterpillar Inc.
510 Lake Cook Road, Suite 100
60015 Deerfield, Illinois
United States
Phone: 224-551-4000
Internet: www.caterpillar.com
ISIN: US1491231015
Euronext Ticker: CATR
AMF Category: Inside information / News release on accounts, results
EQS News ID: 1112489
 
End of Announcement EQS News Service

1112489  07-Aug-2020 CET/CEST

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Financials (USD)
Sales 2020 41 619 M - -
Net income 2020 2 925 M - -
Net Debt 2020 27 559 M - -
P/E ratio 2020 27,3x
Yield 2020 2,84%
Capitalization 79 011 M 79 011 M -
EV / Sales 2020 2,56x
EV / Sales 2021 2,39x
Nbr of Employees 102 300
Free-Float 66,3%
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Mean consensus OUTPERFORM
Number of Analysts 27
Average target price 150,35 $
Last Close Price 145,91 $
Spread / Highest target 38,4%
Spread / Average Target 3,04%
Spread / Lowest Target -23,9%
EPS Revisions
Managers
NameTitle
Donald James Umpleby Chairman & Chief Executive Officer
Andrew Robert John Bonfield Chief Financial Officer
Karl E. Weiss Chief Technology Officer
Jamie Engstrom Chief Information Officer & Vice president
William A. Osborn Independent Director