24.10.2010

CAT up 53%

Caterpillar has reported third quarter revenues up 53% on the same period in 2009 and is cautiously optimistic for the year and for 2011.

The world’s largest construction equipment manufacturer saw nine month revenues climb 21 percent to $29.8 billion, although sales of machinery and engines increased by almost 25 percent to $27.7 billion. Pre-tax profit for the period was $2.5 billion, an increase of over 560 percent.

For the third quarter the increases were more dramatic, with overall revenues up 53 percent to $11.1 billion, with sales of machinery and engines up 60 percent on the same quarter of 2009. However a closer look at just machinery – everything from excavators to telehandlers – sales increased by 89 percent in the North America, 121 percent in South America 60 percent in Europe and over 80 percent in Asia.

The huge increases are a reflection of the fact that last year its dealers were fully stocked and buying little, while this year sales to end users are up and inventories are growing again. The company is now forecasting that revenues for the full year will be up around 28 percent to between $41 and $42 billion.

It has also said that it expects growth in 2011 to continue with full year revenues likely to come in at or around $50 billion, an increase of over 20 percent ion this year. Caterpillar also says that it has already taken on more than 15,000 extra employees so far this year, of which 6,200 are full time permanent positions.

Vertikal Comment

While Caterpillar is not a major player in the product areas we cover, it is both a good indicator of what is going on in the market place and given the size and sophistication of its forecasting network as good a judge of what to expect in the overall construction equipment for the year ahead as anyone.

The fact therefore that sales of its primarily earthmoving product range, are on the increase and that it expects this to continue in 2011 has to be good news for companies producing or renting lifting equipment which, while it lags behind the ‘dirt’ market does tend to follow it.