Caterpillar warns weak demand will hit Q1 profits
by The Associated Press
Caterpillar has been struggling with soft demand for equipment, forcing a broader cost-cutting campaign that could affect about 10,000 jobs
NEW YORK—Caterpillar expects its first-quarter results to come in well below Wall Street’s view as it continues to deal with weak product demand.
But the mining and construction equipment maker maintained its full-year forecast, saying in a filing with the Securities and Exchange Commission that it remains “comfortable” with the figures.
Shares edged up in morning trading after falling in premarket dealings Thursday.
The company anticipates a first-quarter adjusted profit between 65 cents and 70 cents per share, with revenue in a range of $9.3 billion to $9.4 billion.
Analysts polled by FactSet predict a profit of 95 cents per share on revenue of $10.34 billion.
Caterpillar Inc., which is based Peoria, Illinois, still expects a profit of $3.50 per share and revenue between $40 billion and $44 billion. Wall Street is looking for a profit of $3.73 per share on revenue of $41.09 billion.
Caterpillar has been struggling with soft demand for mining equipment because of lower mineral prices around the world. In January the company announced that it planned to shutter five plants, causing a loss of about 670 jobs in Illinois and several other states. The move is part of a broader cost-cutting campaign announced last year that’s expected to affect about 10,000 jobs over three years.
Caterpillar’s stock rose 6 cents to $74.40 in morning trading. Its shares are down 5 per cent over the past year.
