Caterpillar North America Sales Expand on Replacement Demand
Caterpillar Inc. (CAT), the largest construction and mining-equipment maker, said North American retail sales in the past three months rose 47 percent from a year ago as customers replaced old machinery.
Global sales in the three months ending January rose 27 percent from a year earlier, the Peoria, Illinois-based company said in a filing with the U.S. Securities and Exchange Commission today. The gain in North America was less than the 51 percent increase reported for the three months through December.
The North American sales increase was “still pretty strong,” considering January is usually a slower month, Larry De Maria, a New York-based analyst for William Blair & Co., who has an “outperform rating,” said in an interview today. North American sales “continue to have solid momentum and display strength driven largely by replacement buying,” he said.
Machine sales through January increased at a slower pace than in the three months ending in December in all of the company’s reporting regions except for Latin America, according to the filing. Caterpillar releases three-month rolling retail sales reports provided by its independent dealers each month.
Asia-Pacific machine retail sales expanded 25 percent through January, down from 31 percent in the three months through December. The Chinese Lunar New Year celebration probably slowed sales in the region last month, De Maria said.
Caterpillar Chief Financial Officer Ed Rapp on Feb. 2 said he expected a “tailwind” in the U.S. and Europe on replacement demand as the economy recovers. North America is the company’s largest region by sales followed by Asia-Pacific, Europe, Africa and the Middle East.
The company on Jan. 26 forecast 2012 earnings will rise 25 percent to a record $9.25 a share. Sales will reach as much as $72 billion this year, up 20 percent from $60.14 billion last year, the company said.
To contact the editor responsible for this story: Simon Casey at email@example.com.