Caterpillar Inc. Chairman and Chief Executive Officer Doug Oberhelman said the largest maker of construction and mining equipment has “a lot more to do” to improve performance after its sales fell for the first time in five years.
Caterpillar is making “strategy tweaks,” he said in a presentation to analysts at the CONEXPO-CON/AGG construction industry conference in Las Vegas today. The manufacturer’s “big imperatives” to drive earnings growth through 2018 include improving dealer performance and to “win” in China, the world’s biggest construction equipment market, he said.
There’s the potential for adding $9 billion to $18 billion of additional revenue by improving Peoria, Illinois-based Caterpillar’s dealership performance, Group President Stu Levenick also said during the presentation.
Oberhelman said the company will be focused on improving its cost flexibility from trough to peak in economic cycles and improving inventory management. It’s aiming to achieve profit growth of 15 percent and incremental operating profit of about 25 percent over the entire cycle, Chief Financial Officer Brad Halverson said at the event.
Caterpillar’s sales fell 16 percent in 2013 as mining customers reduced purchases of shovels and trucks used to dig up and haul coal, iron ore and copper.