Update: Here is the Journal Sentinel story.
Caterpillar has lowered its profit expectations, with the company saying it expects “fairly anemic and modest growth through 2015.”
Check out coverage from Bloomberg and Reuters. From Reuters:
The company now expects to earn $12 to $18 per share in 2015, down from its previous forecast of $15 to $20.
“It’s prudent, especially with what’s happened in 2011 and 2012 in the economy, to readjust,” Oberhelman said. “I, for one, am still thinking $15 to $20 (earnings per share by 2015), but we need better economic growth.” …
The new forecast comes a year after Caterpillar paid $7.6 billion for mining equipment maker Bucyrus International, the most in Caterpillar’s 87-year history.
The buyout added mining shovels and draglines to the company’s lineup of trucks and excavators to become the world’s largest producer of mining equipment. Given the weak economy, though, some on Wall Street have questioned the timing of the deal.
Among the world’s eight largest miners, only three are boosting capex spending next year. Vale (VALE5.SA), which has the largest capex budget among miners, plans to cut its 2013 mining budget by 4 percent from 2012 levels.
Capital expenditures in the mining sector could slip at least 10 percent by 2014, JPMorgan estimates.
Since roughly 70 percent of spending in mines is for large trucks, capex cuts are not good news for Caterpillar and peers that include Komatsu (6301.T).
Caterpillar spends roughly 30 percent of its own capex and most of its research and development dollars on mining products.
Also, Caterpillar’s new $37 million Visitors Center is expected to open next month in Peoria, Ill. Learn more in the Peoria Journal Star.
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