Caterpillar reports lower profit in third quarter

The world’s largest maker of heavy machinery had net income of $ 946 million in the period, down from 1,700 million in the same quarter last year.

Caterpillar reported lower-than-expected earnings in the third quarter and cut its outlook for the year due to lower demand for its mining customers continue hitting the heavy equipment maker.

The company based in Peoria, Ill., also delivered its first sales forecast for next year, which expects revenues are essentially flat, as it would rise or fall a range of 5% compared to 2013.

Caterpillar said it had reduced its workforce by 3,000 full-time employees during the third quarter and warned that more cuts may be recorded.

Ann Duignan, an analyst at JPM organ Securities, said the latest downgrade earnings estimates for the company in 2013 suggest that layoffs and licenses and other cost reduction strategies and objectives were violating the "no cost are shrinking as fast as expected."

In an interview with CNBC, the executive board and president of Caterpillar, Doug Oberhelman said he is confident that mining customers start ordering again, but acknowledged that he has no idea when it would happen.

"Long-term, miner clients I've talked to are very optimistic lately, as I am, and I have to build on what they tell me," Oberhelman said. "But not if the long run in the next year, in five or ten years. But they will return (orders). I have seen every time, "he added.

Caterpillar, the world's biggest heavy equipment maker, posted earnings of $ 946 million in the third quarter, or $ 1.45 per share, down from 1,700 million, or $ 2.54 per share, a year earlier.

Analysts had expected a profit of $ 1.66 per share, according to a survey by Thomson Reuters I / B / E / S. Total sales and revenues fell 18% to 13,400 million. The mining equipment is the most profitable category of Caterpillar products.

The higher margin was one of the reasons why the company made the mine’s equipment a focus of activity in mergers and acquisitions in recent years.

In 2010, he bought Bucyrus, a U.S. manufacturer of excavators and shovels, for 7,600 million, and in 2012 he acquired ERA Mining, a Chinese mining equipment company, for $ 654 million.

In January, Caterpillar said it discovered a "willful, coordinated, multi-year accounting practice" was a subsidiary of Mining, leading to the cancellation of most of the value of the deal.

In response, the company said it had temporarily closed some plants and reduced its workforce by 3,000 full-time employees during the third quarter. Over the past year, the company cut 13,000 jobs, about 10 percent of its global work force.

Without an expected rebound in orders, Caterpillar said it now expects 2013 earnings of $ 5.50 per share on sales of nearly 55,000 million, down from a previous forecast of $ 6.50 per share on sales of between 56,000 and 58,000 million.

The revised sales outlook is almost 11,000 million less than last year Caterpillar reported. In pre-market trading, shares of Caterpillar fell 5%.

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