April 27, 2023
Cat Financial Announces First-Quarter 2023 Results
Cat Financial reported first-quarter 2023 revenues of $768 million, an increase of $116 million, or 18%, compared with $652 million in the first quarter of 2022. First-quarter 2023 profit was $149 million, an increase of $6 million, or 4%, compared with $143 million in the first quarter of 2022. The increase in revenues was primarily due to a $123 million favorable impact from higher average financing rates.
First-quarter 2023 profit before income taxes was $204 million, an increase of $11 million, or 6%, compared with $193 million in the first quarter of 2022. The increase was mainly due to a $20 million increase in net yield on average earning assets and an $18 million favorable impact from a lower provision for credit losses. These favorable impacts were partially offset by a $13 million unfavorable impact from currency exchange losses and a $9 million unfavorable impact from mark-to-market adjustments on derivative contracts.
The provision for income taxes reflected an estimated annual tax rate of 26% in the first quarter of 2023, compared with 25% in the first quarter of 2022.
During the first quarter of 2023, retail new business volume was $2.46 billion, a decrease of $315 million, or 11%, compared with $2.78 billion in the first quarter of 2022. The decrease was primarily driven by lower volume in North America and Asia/Pacific, partially offset by increases in Power Finance and Mining.
At the end of the first quarter of 2023, past dues at Cat Financial were 2.00%, compared with 2.05% at the end of the first quarter of 2022. Write-offs, net of recoveries, were $10 million for the first quarter of 2023, compared with $8 million for the first quarter of 2022. As of March 31, 2023, Cat Financial's allowance for credit losses totaled $348 million, or 1.27% of finance receivables, compared with $346 million, or 1.29% of finance receivables at December 31, 2022.
"Cat Financial delivered strong results driven by a continued focus on the execution of our strategy and strong portfolio health,” said Dave Walton, President of Cat Financial and Senior Vice President with responsibility for the Financial Products Division of Caterpillar Inc. "The Cat Financial team remains committed to serving our customers worldwide through financial services solutions.”
About Cat Financial
Cat Financial is a subsidiary of Caterpillar, the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. Cat Financial provides a wide range of financing solutions to customers and Cat® dealers for machines, engines, Solar® turbines, genuine Cat parts and services. Headquartered in Nashville, Tennessee, Cat Financial serves customers globally with offices and subsidiaries located throughout North and South America, Asia, Australia, Europe and Africa. Visit cat.com to learn more about Cat Financial.
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