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Caterpillar reports fourth quarter, full year 2018 results

Fourth quarter 2018 profit was $1.78 per share, compared with a loss of $2.18 per share in the fourth quarter of 2017.

Caterpillar’s sales and revenues in the fourth quarter of 2018 were $14.3 billion, compared with $12.9 billion in the fourth quarter of 2017, an 11% increase, according to fourth quarter and full year results for 2018 released Jan. 28, 2019.

Key results:

  • Fourth quarter 2018 profit was $1.78 per share, compared with a loss of $2.18 per share in the fourth quarter of 2017.
  • Adjusted profit per share in the fourth quarter of 2018 was $2.55, compared with fourth quarter 2017 adjusted profit per share of $2.16, up 18%.
  • Full-year sales and revenues in 2018 were $54.7 billion, up 20% from $45.5 billion in 2017.
  • Full-year profit was $10.26 per share in 2018, compared with profit of $1.26 per share in 2017.
  • Adjusted profit per share in 2018 was $11.22, up 63% compared with 2017 adjusted profit per share of $6.88.
  • Adjusted profit per share excludes several adjustments consisting of restructuring costs, mark-to-market losses for remeasurement of pension and other postemployment benefit plans, certain deferred tax valuation allowance adjustments, the impact of U.S. tax reform and a gain on sale of an equity investment in 2017.
  • Fourth quarter 2018 Machinery, Energy & Transportation (ME&T) operating cash flow was $2.5 billion.
  • In the fourth quarter of 2018, the company repurchased $1.8 billion of Caterpillar common stock and paid dividends of $507 million.
  • For the full year of 2018, ME&T operating cash flow was $6.3 billion. During the year the company deployed significant capital, including the repurchase of $3.8 billion of Caterpillar common stock, dividend payments of $2.0 billion and a discretionary pension contribution of $1.0 billion.
  • After returning $5.8 billion of capital to shareholders, the enterprise cash balance was $7.9 billion at the end of 2018, compared with $8.3 billion at the end of 2017.

“In 2018, Caterpillar achieved record profit per share and returned significant levels of capital to shareholders,” said Caterpillar Chairman and CEO Jim Umpleby.

2019 Outlook

Following a record year for profit per share, Caterpillar expects 2019 profit to increase to a range of $11.75 to $12.75 per share.

“Our outlook assumes a modest sales increase based on the fundamentals of our diverse end markets as well as the macroeconomic and geopolitical environment,” Umpleby said.

What others are saying:

A slowdown in China is hurting Caterpillar and investors aren’t happy. – CNN Business

Caterpillar stock skidded Monday after the company reported earnings that were sharply lower than expected and guidance that was much weaker than expected. – CNBC

Caterpillar’s results came in at 14.5% below expectations, sending Caterpillar’s stock lower and helping to drag the Dow down 380 points. That’s not to say that Caterpillar’s earnings are all that bad. - Quartz

Source: Caterpillar, which is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset.

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