Caterpillar Inc. reported its first quarterly loss in 16 years, but expects to be profitable later in the year.
The company reported a loss of $0.19 per share, down $1.64 per share from the first quarter of 2008. The first-quarter loss of $112 million was down $1.03 billion from a $922 million profit in the first quarter of 2008. The decrease was largely a result of lower sales and revenues and $558 million of redundancy costs.
Sales and revenues were $9.23 billion, down 22 percent from $11.8 billion in the first quarter 2008. If you exclude redundancy costs related to reducing employment, the company notes, first quarter profit was $0.39 per share.
"These results demonstrate significant reduction in our cost structure as a result of swift deployment of the economic trough strategy we introduced in 2005. I'm proud of Team Caterpillar's response to these challenging economic conditions," said Chairman and Chief Executive Officer Jim Owens. "Our business units are making the tough decisions necessary to respond to this widespread and sharp global recession. By taking aggressive and decisive actions now, we're positioning the company not only for success in the short-term, but to be even more competitive in the long-term when the global economy recovers."
The company expects to be profitable in 2009 throughout the sales and revenues outlook range excluding redundancy costs, and at the midpoint, expects profit of about $1.25 per share excluding redundancy costs. Redundancy costs are expected to be about $0.75 per share for 2009 and, including these costs, Caterpillar expects to earn about 50 cents per share at the midpoint.
"A great deal of uncertainty exists in the global economy, making it extremely difficult to know how our customers will respond during the remainder of 2009," said Owens.
The company reported a loss of $0.19 per share, down $1.64 per share from the first quarter of 2008. The first-quarter loss of $112 million was down $1.03 billion from a $922 million profit in the first quarter of 2008. The decrease was largely a result of lower sales and revenues and $558 million of redundancy costs.
Sales and revenues were $9.23 billion, down 22 percent from $11.8 billion in the first quarter 2008. If you exclude redundancy costs related to reducing employment, the company notes, first quarter profit was $0.39 per share.
"These results demonstrate significant reduction in our cost structure as a result of swift deployment of the economic trough strategy we introduced in 2005. I'm proud of Team Caterpillar's response to these challenging economic conditions," said Chairman and Chief Executive Officer Jim Owens. "Our business units are making the tough decisions necessary to respond to this widespread and sharp global recession. By taking aggressive and decisive actions now, we're positioning the company not only for success in the short-term, but to be even more competitive in the long-term when the global economy recovers."
The company expects to be profitable in 2009 throughout the sales and revenues outlook range excluding redundancy costs, and at the midpoint, expects profit of about $1.25 per share excluding redundancy costs. Redundancy costs are expected to be about $0.75 per share for 2009 and, including these costs, Caterpillar expects to earn about 50 cents per share at the midpoint.
"A great deal of uncertainty exists in the global economy, making it extremely difficult to know how our customers will respond during the remainder of 2009," said Owens.
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