Caterpillar Inc. (Peoria, IL), the maker of heavy equipment, reported its second-quarter earnings surged while automaker General Motors Co. (Detroit) reported its profit sagged.
Caterpillar has been a poster child for how manufacturers have been impacted by a slowing economy in China and other markets.
However, Cat said today its profit for the quarter totaled $802 million, or $1.35 a share, a 46% increase from $550 million, or 93 cents a share, a year earlier. Revenue for the quarter rose to $11.3 billion from $10.3 billion in 2016’s second quarter.
Excluding restructuring costs and a gain on a sale of investment in e-commerce website IronPlanet, Caterpillar reported an adjusted profit per share of $1.49 compared with $1.09 in 2016’s second quarter.
The company cited improved sales in its machinery, energy and transportation group, with all regions showing an increase.
“As demand increased, we continued to control costs and generated higher profit margins,” CEO Jim Umpleby said in a statement.
Caterpillar raised its 2017 revenue forecast to a range of $42 billion to $44 billion. That’s up from an April forecast of $38 billion to $41 billion.
The company boosted its 2017 per-share profit forecast to $3.50 at the midpoint of the revised revenue forecast. Cat raised its per-share adjusted profit forecast to $5. The previous profit forecast was $2.10 a share at the midpoint of the revenue estimate and $3.75 a share adjusted profit forecast.
Slowing Vehicle Sales
GM said its second-quarter earnings fell 42% to $1.66 billion, or $1.09 a share, from $2.87 billion, or $1.81 a year earlier.
The automaker said it had a profit from continuing operations of $2.4 billion, or $1.60 a share. That figure excludes a loss in its European unit, which GM has agreed to sell to France’s PSA Group.
GM is looking to complete the sale later this year. The automaker has endured almost two decades of losses in the region.
The company faces slowing light-vehicle sales in its home market. GM’s US deliveries fell 1.8% in the first’s first half, with a 19% plunge in car sales and a 5.8% increase in light truck sales, according to Autodata Corp. That compares with an industrywide 2.1% decline in deliveries with an 11% drop in car sales and a 4.6% rise in truck sales.