Caterpillar misses by $0.01, reports revs in-line; lowers FY16 EPS guidance, above consensus, lowers revs in-line
- Reports Q1 (Mar) earnings of $0.67 per share, ex-items, $0.01 worse than the Capital IQ Consensus of $0.68; revenues fell 25.5% year/year to $9.46 bln vs the $9.45 bln Capital IQ Consensus.
- Co guided Q1 EPS $0.65-0.70 vs. $0.95 consensus on March 17
- "While first-quarter results were about as we expected, sales and profit were well below the first quarter of 2015. Sales declined across the company with substantial reductions in construction, oil and gas, mining and rail. While many of the industries we serve are challenged, we remain focused on what we can control: the quality of our products, our market position, safety in our facilities and continued restructuring and cost reduction. In fact, our period costs and variable manufacturing costs in the quarter were nearly $500 million lower than the first quarter of 2015," said Caterpillar Chairman and Chief Executive Officer Doug Oberhelman.
- The decrease was primarily due to lower sales volume. While sales for both new equipment and aftermarket parts declined in all segments, most of the decrease was for new equipment. The unfavorable impact of price realization and currency also contributed to the decline
- Sales declined in all regions. Sales decreased in all segments.
- Overall machine market position better i n Q1 of 2016 than this point last year; continues to improve in China. Focus remains on quality, safety and cost reduction
- Co lowers EPSguidance for FY16 to $3.70, ex-items, vs. $3.60 Capital IQ Consensus Estimate, from $4.00; lowers FY16 revs guidance to $40-42 bln vs. $41.08 bln Capital IQ Consensus Estimate, down from $40-44 bln
- The decline in the midpoint of the sales and revenues outlook range is a result of several factors that, while not individually large in the context of the outlook, collectively add up to about $1 billion
- Those factors include lower transportation sales (rail, marine and the ending of production of on-highway vocational trucks), lowermining sales and weaker pricerealization than previously expected.