NEW YORK, July 24 – Industrial giant Caterpillar Thursday reported slightly higher quarterly profits as gains in its construction segment overcame continued declines in mining.
Caterpillar, which sells machinery to a range of sectors including construction, oil and gas, and housing, said second quarter profits were $999 million, up four percent from the year ago period.
Chief executive Doug Oberhelman said Caterpillar now projects “a roughly flat” year for sales in 2014 compared with 2013.
“While we’d certainly like to see improvement in economies around the world, and more specifically, the mining industry, the stability that we’ve seen this year has helped,” he said.
“Even though sales and revenues are relatively flat compared to last year, we’ve improved the bottom line with better execution and continued focus on costs.”
Caterpillar’s workforce was 115,292 at the end of the second quarter, down 5.8 percent from a year ago.
Revenues in the resources segment tumbled 28.5 percent as giant mining companies continued to refrain from major new projects to boost metals production.
On the flip side, revenues in the construction segment jumped 10.9 percent. The company attributed the gain primarily to higher activity in North America.
Caterpillar lowered its 2014 revenue forecast from $56 billion to a range of $54-56 billion, reflecting a weaker outlook for construction in China, the Commonwealth of Independent States region made up of ex-Soviet countries and Africa/Middle East.
Caterpillar said net income would be slightly higher than previously forecast. The company now projects adjusted earnings of $6.20 per share, up 10 cents.
Earnings for the second quarter translated into $1.57 per share. Excluding restructuring costs, earnings were $1.69 per share. Analysts had forecast $1.52 per share.
Revenues dropped 3.2 percent to $14.15 billion, below the $14.46 billion projected by analysts.
Shares dipped 1.3 percent to $107 in pre-market trade.