Manufacturers Still StrongCED, April 2008
Article Date: 04-01-2008
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Although the housing market is weak, the GDP is down, construction spending has taken a nosedive and manufacturing is the lowest it's been in five years, construction equipment manufacturers have continued to report record results. Caterpillar reported the fifth straight year of record sales and revenues and the fourth consecutive year of record profit for 2007. For 2007, sales and revenues were $44.958 billion, up 8 percent, and profit per share was $5.37, up 4 percent from 2006. The company also reported record fourth quarter sales and revenues of $12.144 billion, 10 percent higher than the fourth quarter of 2006, and profit per share of $1.50, up 14 percent from a year ago.Terex also reported a strong year in terms of financial results for 2007, with the highest sales coming in the fourth quarter. "We achieved a full year operating margin of 10.5 percent, net sales grew 19.5 percent and income from continuing operations was up 55 percent when compared with 2006," said Ron DeFeo, Terex chairman and CEO. Deere & Co. reported an 18 percent increase in worldwide net sales and revenues for the first quarter of 2008. Net sales of the worldwide equipment operations increased 19 percent for the quarter, including positive effects for currency translation and price changes of 6 percent. Equipment sales in the U.S. and Canada were up 9 percent for the quarter. Deere's equipment divisions reported operating profit of $457 million for the quarter compared with $270 million last year. The improvement was largely due to the favorable impact of higher sales and production volumes and improved price realization, partially offset by higher selling, administrative and general expenses and raw-material costs. The company projected a 17 percent increase in equipment sales for the full-year 2008, and approximately a 23 percent increase for the second quarter. Deere & Co. and Cummins Inc. both declared a regular quarterly dividend, and the board of CNH may declare a doubled dividend payable mid-April.
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