2Q 2020 Quarterly Financial Results

Below are key highlights from Caterpillar Inc.’s Second-Quarter 2020 earnings results. For full financial results, please refer to the press release on Caterpillar’s Investor Relations site

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2020 Second-Quarter Financial Results

Second Quarter
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Second Quarter

 

Second-Quarter Highlights:

  • Second-quarter sales and revenues decreased 31%; profit per share declined 70%
  • Strong balance sheet; $8.8 billion of enterprise cash

 

Comments on the second quarter from Caterpillar Chairman & CEO Jim Umpleby

“I am proud of the global team’s continued focus on safety while executing our strategy and serving our customers. In the second quarter, our employees and dealers remained dedicated to providing the essential products and services the world needs under very challenging conditions.”

 

2020 Outlook Highlights

  • Caterpillar’s financial results for the remainder of 2020 will be impacted by continued global economic uncertainty due to the COVID-19 pandemic
  • As such, Caterpillar withdrew its earnings guidance on March 26 and is not providing a financial outlook for 2020 at this time

Further Comments from Caterpillar Chairman & CEO Jim Umpleby

“We are well positioned for these challenging times because of the successful execution of our strategy. We are focused on employee safety and maintaining a competitive and flexible cost structure while continuing to invest in services and expanded offerings to better serve our customers. We will adjust production as conditions warrant and are prepared to respond quickly to any positive or negative changes in customer demand.”

 

Second-Quarter News & Notes

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Our Response to COVID-19

Meet The Doers

Our employees and our dealer network around the globe are doing what they can to help fight the spread of COVID-19

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Meet the Doers

 

Our Strategy at Work

People

Caterpillar Foundation announces Commitment to help fight racism and social injustice

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Caterpillar Foundation

Caterpillar Reports Progress on Enterprise Strategy, Sustainability

Caterpillar illustrates how it's helping customers build a better world in the 2019 Annual and Sustainability Reports

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Annual and Sustainability Report

Profitable Growth

Caterpillar Maintains Dividend

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Dividend

Services

 

Autonomous Truck
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Autonomous Truck

 

Caterpillar achieves 2 billion tonnes hauled with autonomous trucks system

Learn More on Cat.com

Robotic Expertise
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Robotic Expertise

 

Caterpillar announces acquisition of robotic expertise

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Serving our Customers

 

Engine
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Engine

 

Caterpillar Oil & Gas introduces the first gas engine produced at China Tianjin Ltd. (CTL)

Learn More on Cat.com

Progress Rail
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Progress Rail

 

Progress rail signs contract with PT KAI for GT series locomotives

Learn More on ProgressRail.com

Purpose

95 Years

A testament to our incredible global team, global customers and partners

Full Story
95 Years

 

FORWARD-LOOKING STATEMENTS

Certain statements in this press release relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “estimate,” “will be,” “will,” “would,” “expect,” “anticipate,” “plan,” “forecast,” “target,” “guide,” “project,” “intend,” “could,” “should” or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance and speak only as of the date they are made, and we do not undertake to update our forward-looking statements.

Caterpillar’s actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global and regional economic conditions and economic conditions in the industries we serve; (ii) commodity price changes, material price increases, fluctuations in demand for our products or significant shortages of material; (iii) government monetary or fiscal policies; (iv) political and economic risks, commercial instability and events beyond our control in the countries in which we operate; (v) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; (vi) our ability to develop, produce and market quality products that meet our customers’ needs; (vii) the impact of the highly competitive environment in which we operate on our sales and pricing; (viii) information technology security threats and computer crime; (ix) inventory management decisions and sourcing practices of our dealers and our OEM customers; (x) a failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures or divestitures; (xi) union disputes or other employee relations issues; (xii) adverse effects of unexpected events; (xiii) disruptions or volatility in global financial markets limiting our sources of liquidity or the liquidity of our customers, dealers and suppliers; (xiv) failure to maintain our credit ratings and potential resulting increases to our cost of borrowing and adverse effects on our cost of funds, liquidity, competitive position and access to capital markets; (xv) our Financial Products segment’s risks associated with the financial services industry; (xvi) changes in interest rates or market liquidity conditions; (xvii) an increase in delinquencies, repossessions or net losses of Cat Financial’s customers; (xviii) currency fluctuations; (xix) our or Cat Financial’s compliance with financial and other restrictive covenants in debt agreements; (xx) increased pension plan funding obligations; (xxi) alleged or actual violations of trade or anti-corruption laws and regulations; (xxii) additional tax expense or exposure, including the impact of U.S. tax reform; (xxiii) significant legal proceedings, claims, lawsuits or government investigations; (xxiv) new regulations or changes in financial services regulations; (xxv) compliance with environmental laws and regulations; (xxvi) the duration and geographic spread of, business disruptions caused by, and the overall global economic impact of, the COVID-19 pandemic; and (xxvii) other factors described in more detail in Caterpillar’s Forms 10-Q, 10-K and other filings with the Securities and Exchange Commission.

NON-GAAP FINANCIAL MEASURES

The following definitions are provided for the non-GAAP financial measures. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management does not intend these items to be considered in isolation or as a substitute for the related GAAP measures.

ADJUSTED PROFIT PER SHARE

The company believes it is important to separately quantify the profit impact of a significant item in order for the company’s results to be meaningful to readers. This item is remeasurement losses resulting from the settlements of pension obligations in the second quarter of 2020. The company does not consider this item indicative of earnings from ongoing business activities and believes the non-GAAP measure provides investors with useful perspective on underlying business results and trends and aids with assessing the company’s period-over-period results. The company intends to discuss adjusted profit per share for the fourth quarter and full-year 2020, excluding mark-to-market gains or losses for remeasurement of pension and other postemployment benefit plans along with any other discrete items.


 

Reconciliations of adjusted profit per share to the most directly comparable GAAP measure, diluted profit per share, are as follows:

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