Additionally, Caterpillar announced that it will buy back $1.5 billion of common stock in the third quarter, on top of the previously announced $1.5 billion buyback and the $4.2 billion repurchased in past year.
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Caterpillar earned net profit of $710 million in the second quarter, down 28% from the same period a year earlier.
“While economic conditions in the United States are modestly positive, the global economy remains relatively stagnant”, said Chief Executive Doug Oberhelman.
Sales fell 13 percent to $12.3 billion for the maker of equipment for the construction, mining and oil sectors, considered a bellwether of the global economy. Numerous key industries we serve remain weak, and we haven’t seen sustained signs of improvement. They continued to expect GAAP earnings of about $4.70 per share and non-GAAP earnings of about $5 per share.
As of this writing, shares of Caterpillar were down 3.31% at $77.10 per share in premarket trades. The company had revenue of $12.30 billion for the quarter, compared to the consensus estimate of $12.67 billion. Excluding non-recurring restructuring costs, adjusted earnings per share came in at $1.27, matching the FactSet consensus. It has reported a beat on the Street’s earnings per share (EPS) estimates for the quarter, while missing on revenue.
The company also recently declared a quarterly dividend, which will be paid on Thursday, August 20th. Energy and transportation equipment sales were down 12% to $4.54 billion.
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Caterpillar now foresees revenue of about $49 billion, a billion less that previous guidance. Caterpillar, for its part, saw “continuing economic weakness in China”, which runs a bit counter to official government data out of China that indicates GDP growth held up better than expected. BHP Billiton Ltd., the world’s largest mining company, said Wednesday it will cut production of petroleum, copper and coal in its 2016 fiscal year. (NYSE:CAT) filed a lawsuit against certain directors of Caterpillar Inc alleging that the company’s board concealed foul play by auditor PricewaterhouseCoopers in connection with tax evasion allegations.
