Caterpillar’s revenues for 2014 were US$ 55.2 billion, a -1% fall on the figure of US$ 55.7 billion seen in 2013. Similarly, the company’s sales for the fourth quarter of 2014 were almost unchanged from the same period in 2013 at US$ 14.2 billion.
However, the company’s profit per share in 2014 improved by +2% over 2013 levels to US$ 5.99. This was despite a dip in profitability in the fourth quarter.
Caterpillar Chairman and CEO Doug Oberhelman said, “Overall, we had many positives and a better year in 2014 than 2013. Our emphasis on cost management, operational execution and cash flow helped us deliver better profit per share than both 2013 and the 2014 outlook we provided at the start of the year.”
He continued, “Sales were also up and profit improved substantially in Construction Industries. The increase in Construction Industries’ sales was primarily in North America and was partially offset by sales declines in other regions. While our construction sales were up in 2014, the industry is still well below prior peaks in every major region due to relatively weak economic growth for most of the world.”
Revenues for the company’s Construction Industries division came in at US$ 4.42 billion for the fourth quarter, a -9% decline on the same period last year. The only region to see an increase in revenues was North America, which was up +13%. This improvement was offset by declines in Latin America, EAME (Europe, Africa and the Middle East) and Asia/Pacific of -24%, -10% and -30% respectively.
Operating profit for the Construction Industries division in the fourth quarter was US$ 362 million, a -26% decline on the same period in 2013.
Looking ahead to this year, the company is forecasting a 10% decline in revenues. “We expect world economic growth to only improve modestly in 2015. The relatively slow growth in the world economy and continued weakness in commodity prices—particularly oil, copper, coal and iron ore—are expected to be negative for our sales,” it said in a statement.
It added that it expects to incur about US$ 150 million in restructuring costs this year, but that even excluding these, profit per share is likely to come in between US$ 4.60 and US$ 4.75 – at worst a near -25% decline on 2014’s performance.
Mr Oberhelman said, “While we are, without a doubt, facing a tough year in 2015, we’re driving cost management through additional restructuring actions and continued operational improvements gained from our focus on Lean Management. While 2015 will be difficult, the work we’ve done to improve our cost structure, market position and quality will position us for better results when the world economy and the key industries we serve improve.”