Caterpillar Inc. (NYSE:CAT) chief executive Jim Owens called the recently ended
third quarter the "low point for Caterpillar sales and revenue." The heavy equipment manufacturer reported sales of $7.29 billion for the quarter, down 44% from the same period a year earlier. Profit for the quarter dropped to $404 million, from $868 million.
It's been a brutal year for CAT, which in early 2009 posted its
first quarterly loss in 17 years. The company responded with a restructuring initiative that included 20,000 job cuts. In announcing 3Q09 results, Owens said those cuts helped offset the severe decline in sales. The downturn, however, didn't keep CAT from pursuing growth opportunities.
The company has expanded its business and pursued creative cost cutting this year through a handful of alliances. It
expanded a relationship with Navistar International Corp. (NYSE:NAV) with NC2 Global LLC, a joint venture to pursue business in China. NC2 has already signed a JV of its own with a Chinese partner to make and sell heavy equipment in the country. It also entered a
unique partnership with Walgreen Co. (NYSE:WAG) in September to help reduce prescription drug costs.
Going forward, CAT predicts a rebound in 2010, with sales rising between 10% and 25%. "We've already started planning for an upturn," said Owens in the 3Q09 earnings release. "When it comes, it can come quickly, and we ... will be prepared." - Suzanne Stevens
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