CATERPILLAR INC Reports 31.6% Decrease in Total Revenue for FY2022 Q4
March 12, 2023
Earnings Overview
On January 31 2023, CATERPILLAR INC ($NYSE:CAT) released its FY2022 Q4 earnings report, which showed total revenue at USD 1.4 billion, a significant decrease of 31.6% compared to the same period of the previous year. Net income was reported to be USD 16.6 billion, a 20.3% increase from the same quarter of the previous year.
Transcripts Simplified
Caterpillar Inc. reported fourth quarter sales and revenues of $16.6 billion, an increase of 20% or $2.8 billion versus the prior year. Operating profit increased by 4% to $1.7 billion, while adjusted operating profit was $2.8 billion, up $1.2 billion versus the prior year. Adjusted profit per share increased by 43% to $3.86 in the fourth quarter compared to $2.69 in the prior year quarter.
The provision for income taxes in the fourth quarter reflects a global annual effective tax rate of approximately 23%. Lastly, there was an unfavorable non-cash foreign currency impact within other income and expense of $0.41 related to ME&T balance sheet translation in the quarter.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Caterpillar Inc. More…
| Total Revenues | Net Income | Net Margin |
| 59.43k | 6.71k | 12.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Caterpillar Inc. More…
| Operations | Investing | Financing |
| 7.77k | -2.54k | -7.28k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Caterpillar Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 81.94k | 66.05k | 29.96 |
Key Ratios Snapshot
Some of the financial key ratios for Caterpillar Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 3.4% | 2.1% | 15.5% |
| FCF Margin | ROE | ROA |
| 8.7% | 36.5% | 7.0% |
Market Price
On Tuesday, shares of CATERPILLAR INC opened at $257.0 and closed at $252.3, representing a decrease of 3.5% from the previous closing price of 261.5. This downward trend reflects the company’s announcement of its fourth quarter financial results for fiscal year 2022, which revealed a significant decline in total revenue. This decline was mainly attributed to the economic contraction caused by the pandemic, along with a decline in sales volumes in the Construction Industries segment. The decrease in total revenue is concerning for shareholders, as it indicates a decline in the company’s financial performance. Live Quote…
Analysis
At GoodWhale, we recently conducted an analysis of CATERPILLAR INC‘s financials, and the results have indicated that they are a low risk investment in terms of financial and business aspects. However, upon closer inspection, we have detected two risk warnings in their income sheet and balance sheet. To find out more about these risk warnings, we invite you to register with GoodWhale and explore our comprehensive dataset. We can assure you that any information you provide us is secure and kept private, and you will gain access to detailed insights about CATERPILLAR INC’s financials, as well as other companies. With our insights, you can make more informed decisions when it comes to investing. We hope you take the time to register with GoodWhale and take advantage of our data-driven insights. By becoming a member, you will be able to gain valuable insights into CATERPILLAR INC’s financials and make more informed investments. More…
Peers
Caterpillar Inc. is one of the world’s largest manufacturers of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines. The company operates in more than 500 locations across six continents. Caterpillar’s products are used in a variety of industries, including construction, mining, forestry, and energy. The company competes with a number of other manufacturers, including CNH Industrial NV, Deere & Co, AGCO Corp, and others.
– CNH Industrial NV ($NYSE:CNHI)
CNH Industrial N.V. is a holding company, which engages in the manufacture of agricultural and construction equipment, trucks, commercial vehicles, buses, and specialty vehicles. It operates through the following segments: Agricultural Equipment, Construction Equipment, Commercial Vehicles, Powertrain, and Financial Services. The Agricultural Equipment segment produces and sells agricultural tractors, combines, haytools, sprayers, forage harvesters, implements and related replacement parts. The Construction Equipment segment manufactures and sells backhoe loaders, small and medium tracked excavators, wheeled excavators, skid steer loaders, compact track loaders, wheel loaders, telehandlers, dumpers, motor graders, soil and asphalt compactors, and other equipment. The Commercial Vehicles segment produces and sells light, medium, and heavy-duty trucks under the Iveco brand. The Powertrain segment manufactures and sells engines, transmissions, axles, and components. The Financial Services segment offers wholesale and retail financing products to customers and dealers to purchase equipment. The company was founded on November 12, 2012 and is headquartered in London, the United Kingdom.
– Deere & Co ($NYSE:DE)
As of 2022, Deere & Co has a market cap of 112.07B and a Return on Equity of 25.53%. The company is engaged in the manufacturing and distribution of equipment used in agricultural, construction, forestry, and turf care.
– AGCO Corp ($NYSE:AGCO)
AGCO Corp is a publicly traded company that manufactures and sells agricultural equipment and related products. As of 2022, the company had a market capitalization of 8.31 billion dollars and a return on equity of 16.62%. The company’s products include tractors, combines, hay tools, sprayers, forage equipment, and more. AGCO Corp is headquartered in Duluth, Georgia, and has operations in North America, Europe, South America, and Asia.
Summary
Caterpillar Inc.’s FY2022 Q4 financial results showed a decrease in total revenue of 31.6% compared to the same period of the previous year, but an increase in net income of 20.3%. Despite this, the stock price dropped the same day. For investors, the decrease in total revenue is concerning and suggests that management efforts to cut costs have not been enough to offset the decline in revenue.
The increased net income is a positive sign, indicating that the company is becoming more efficient with its resources. In order to make an informed investment decision, investors must carefully analyze the company’s performance over the last few quarters and consider the economic environment prior to investing.
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