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Caterpillar Just Slashed Its Outlook for 2016

April 22, 2016, 1:55 PM UTC
Construction Ahead Of Housing Starts Figures
A Caterpillar Inc. 953C track loader moves soil to a dump truck as contractors work during the construction of residential housing in the Norton Commons subdivision in Louisville, Kentucky, U.S., on Monday, Nov. 16, 2015. The U.S. Census Bureau is scheduled to release housing starts figures on November 18. Photographer: Luke Sharrett/Bloomberg via Getty Images
Photograph by Luke Sharrett—Bloomberg via Getty Images

Caterpillar Inc. lowered its 2016 sales and earnings outlook and posted a lower first-quarter net profit on Friday as revenues declined in the company’s construction, oil and gas, mining and rail business segments.

The company said it expects 2016 sales in a range of $40 billion to $42 billion against a previously forecast $40 billion to $44 billion.

Caterpillar now expects 2016 earnings per share at $3.00, or $3.70 per share excluding restructuring costs. The previous forecast was $3.50 per share, or $4.00 per share excluding restructuring costs.

The world’s largest heavy machinery manufacturer reported a net income of $494 million, or 67 cents per share in the first quarter, down from a revised $1.70 billion, or $2.07 a share, a year ago. Analysts had expected earnings per share of 68 cents.

Including restructuring costs, Caterpillar earned 46 cents per share, compared with a revised $2.03 a year earlier. Revenue fell to $9.46 billion from $12.7 billion a year ago.