Sales and Revenues: Remained about flat at $15.8 billion for Q1.
Adjusted Operating Profit: Increased by 5% to $3.5 billion.
Adjusted Operating Profit Margin: Improved to 22.2%, up 110 basis points versus last year.
Adjusted Profit Per Share: Reached a record of $5.60, up 14%.
ME&T Free Cash Flow: Strong at $1.3 billion.
Backlog: Increased to $27.9 billion, up $400 million from Q4 2023.
Future Guidance
2024 Sales and Revenue: Expected to be broadly similar to the record 2023 level.
Adjusted Operating Profit Margin and ME&T Free Cash Flow: Anticipated to be in the top half of target ranges.
Services Revenue: Expected to be higher in 2024, targeting a $28 billion goal by 2026.
Capital Expenditures: Estimated to be between $2 billion and $2.5 billion for the full year, focusing on AACE (autonomy, alternative fuels, connectivity and digital, electrification).
Cash Deployment: Continued commitment to return substantially all ME&T free cash flow to shareholders through dividends and share repurchases.
Trends, Market Conditions, Sentiment
Demand: Continued healthy demand for products and services across most end markets.
Construction Industries: Mixed outcomes with strength in North America offset by weakness in Europe due to economic conditions and uncertainty in the residential construction sector.
Energy & Transportation: Strong performance expected to continue, particularly in oil and gas, with increased sales of large engines and services.
Mining and Resource Industries: Anticipating a lower machine volume against a very strong previous year, with high customer fleet utilization and interest in autonomous solutions.
Dealer Inventory: Increases align with normal seasonal patterns; however, no significant change in inventory is anticipated for 2024 compared to a $700 million increase in 2023.
Sustainability: Ongoing investments in electrification and strategic agreements, like with CRH, to advance deployment of zero-exhaust-emission solutions emphasize Caterpillar’s commitment to sustainability.
Market Sentiment: Overall optimistic, backed by strong earnings, a robust backlog, and strategic investments aligning with long-term growth and sustainable initiatives.
Notable Quotes
”Our strong balance sheet and ME&T free cash flow allowed us to deploy a record $5.1 billion of cash for share repurchases and dividends in the first quarter.” – Jim Umpleby, Chairman and CEO
”We remain focused on executing our strategy and continuing to invest for long-term profitable growth.” – Jim Umpleby
”We continue to expect to return substantially all ME&T free cash flow to shareholders over time through dividends and share repurchases.” – Andrew R. Bonfield, Chief Financial Officer
”For the year, we continue to expect adjusted operating profit margin in ME&T free cash flow to be in the top half of our target ranges.” – Jim Umpleby
