3 Min Read
CHICAGO (Reuters) - Caterpillar Inc (CAT.N) said on Monday that dealer sales of its heavy equipment, diesel engines and gas turbines continued to be weak in August though many markets showed signs of stabilization.
The world's largest maker of earth-moving equipment said worldwide dealer sales of those machines fell 49 percent in the three months that ended August 31, unchanged from the three months that ended July 31, as modestly better sales in the developed world offset modestly worse results in developing regions.
"The decline rate stabilization continues to suggest global demand may have found a very low bottom," Wells Fargo analyst Andrew Casey said in a note, though he cautioned that new demand might be slow in coming because of the huge amount of used equipment idled as a result of the worldwide downturn.
Caterpillar shares were down $1.04 or 1.95 percent at $52.38 on the New York Stock Exchange, off an earlier low at $51.85, on Monday afternoon. Over the past six months, its stock has risen nearly 95 percent, outperforming peers such as Deere & Co (DE.N), Paccar Inc (PCAR.O) and Cummins Inc (CMI.N).
Worldwide dealer sales of Caterpillar's reciprocating and turbine engines, meanwhile, fell 27 percent in the three months ended August 31. That represented an improvement over the three months that ended July 31, when sales fell 33 percent.
All engine segments improved during the quarter except sales to industrial users, where sales fell 47 percent in the three months that ended August 31, compared with a decline of 46 percent in the three months that ended July 31.
The biggest improvement came in sales of marine engines, which jumped 13 percent in the three months ended August 31.
In 2008, worldwide machinery sales accounted for $31.8 billion, or about 62 percent, of Caterpillar's overall sales and revenue of $51.3 billion. Last year, engine sales accounted for $16.2 billion, or 31 percent, of Caterpillar's total revenue.
Revenue from the company's financial services, logistics and other service businesses accounted for the rest.
Reporting by James B. Kelleher, additional reporting by Scott Malone in Boston; editing by Gerald E. McCormick and Matthew Lewis