Slide 1: Fourth Quarter and Full Year 2023 Financial Review
Fourth Quarter and Full Year 2023 Financial Review February 5, 2024
Slide 2: Forward-Looking Statements
4Q 2023 EARNINGS RELEASE Forward-Looking Statements Certain statements in this financial review relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “estimate,” “will be,” “wil
Slide 3: Strong Performance
4Q 2023 EARNINGS RELEASE Strong Performance THANK YOU TO OUR EXECUTING OUR GLOBAL TEAM HEALTHY DEMAND STRATEGY FOR BEST YEAR1 IN ACROSS MOST LONG-TERM OUR 98-YEAR END MARKETS PROFITABLE HISTORY GROWTH 1 Record full-year sales and revenues; adjusted profit per share; and ME&T free cash flow. 3
Slide 4: Key Takeaways: Fourth Quarter 2023 vs. Fourth Quarter 2022
4Q 2023 EARNINGS RELEASE Key Takeaways Fourth Quarter 2023 vs. Fourth Quarter 2022 $17.1B $3.1B $3.2B $5.28 $5.23 3% 87% 15% 89% 35% Sales & Operating Adjusted Profit Per Adjusted Revenues Profit Operating Share Profit Per Profit1 Share2 1 Adjusted operating profit is a non-GAAP measure, and a recon
Slide 5: Key Takeaways: Full Year 2023 vs. Full Year 2022
4Q 2023 EARNINGS RELEASE Key Takeaways Full Year 2023 vs. Full Year 2022 $67.1B $13.0B $13.7B $20.12 $21.21 13% 64% 51% 59% 53% Sales & Operating Adjusted Profit Per Adjusted Revenues Profit Operating Share Profit Per Profit1 Share2 Record Record Record Record Record 1 Adjusted operating profit is a
Slide 6: ME&T Free Cash Flow and Capital Deployment
4Q 2023 EARNINGS RELEASE ME&T Free Cash Flow1 and Capital Deployment 30 $10.0B $7.5B Years 2023 ME&T Returned to Shareholders Dividend Free Cash Flow1 in 2023 Aristocrat Full-year record ME&T Free Cash Flow1 Including $5.0B in share Paid higher annual dividends and above target range2 repurchases an
Slide 7: End Market Commentary
4Q 2023 EARNINGS RELEASE End Market Commentary CONSTRUCTION INDUSTRIES RESOURCE INDUSTRIES ENERGY & TRANSPORTATION 7
Slide 8: Sustainability
4Q 2023 EARNINGS RELEASE Sustainability 420 XE Backhoe Loader Microsoft and Ballard Power Systems Lower fuel consumption and emissions Reliable and sustainable backup power for data centers 8
Slide 9: Financial Results Summary
4Q 2023 EARNINGS RELEASE Financial Results Summary Fourth Quarter 2023 vs. Fourth Quarter 2022 SALES & REVENUES OPERATING PROFIT ADJUSTED PROFIT (in billions of dollars) (in billions of dollars) PER SHARE1 (in dollars) $17.1 $3.1 $16.6 $5.23 $3.86 $1.7 2022 2022 4Q 2022 1Q 2022 1Q 2023 4Q 2023 2022
Slide 10: Consolidated Sales and Revenues
4Q 2023 EARNINGS RELEASE Consolidated Sales and Revenues Fourth Quarter 2023 vs. Fourth Quarter 2022 4th Quarter Highlights Sales & Revenues Increased $473M or 3% • Favorable impact from price realization • Partially offset by lower sales volume • Dealer inventory1 decreased $0.9B overall in the fou
Slide 11: Consolidated Operating Profit
4Q 2023 EARNINGS RELEASE Consolidated Operating Profit Fourth Quarter 2023 vs. Fourth Quarter 2022 4th Quarter Highlights Operating Profit Increased $1.5B or 87% • Favorable price realization, manufacturing costs and absence of 2022 goodwill impairment • Partially offset by higher SG&A/R&D expenses
Slide 12: Construction Industries
4Q 2023 EARNINGS RELEASE Construction Industries Fourth Quarter 2023 vs. Fourth Quarter 2022 Total Sales* Segment Profit Segment Profit 4th Quarter Highlights (in billions of dollars) (in millions of dollars) as a percent of total sales* Total Sales Decreased by $326M or 5% 23.5% • North America – F
Slide 13: Resource Industries
4Q 2023 EARNINGS RELEASE Resource Industries Fourth Quarter 2023 vs. Fourth Quarter 2022 Total Sales* Segment Profit Segment Profit 4th Quarter Highlights (in billions of dollars) (in millions of dollars) as a percent of total sales* Total Sales Decreased $194M or 6% 18.5% • Lower sales volume, part
Slide 14: Energy & Transportation
4Q 2023 EARNINGS RELEASE Energy & Transportation Fourth Quarter 2023 vs. Fourth Quarter 2022 4th Quarter Highlights Total Sales* Segment Profit Segment Profit Total Sales Increased $846M or 12% (in billions of dollars) (in millions of dollars) as a percent of total sales* • Oil and Gas – Increase in
Slide 15: Financial Products
4Q 2023 EARNINGS RELEASE Financial Products Fourth Quarter 2023 vs. Fourth Quarter 2022 Total Revenues* Segment Profit 4th Quarter Highlights (in millions of dollars) (in millions of dollars) Total Revenues Increased $128M or 15% $234 • Higher average financing rates across all regions and $981 high
Slide 16: ME&T Free Cash Flow and Capital Deployment
4Q 2023 EARNINGS RELEASE ME&T Free Cash Flow1 and Capital Deployment $3.2B $3.4B $7.0B 4Q 2023 ME&T Returned to Shareholders Enterprise Cash Free Cash Flow1 in 4Q 2023 Balance Increase of $200M versus 4Q 2022 Including $2.8B in In addition, $3.8B in liquid share repurchases marketable securities 1 M
Slide 17: Increasing Adjusted Operating Profit Margin Target Range
4Q 2023 EARNINGS RELEASE Increasing Adjusted Operating Profit Margin1 Target Range • Progressive adjusted operating profit margin1 target range 25% 22.0% Adjusted Operating Profit Margin %1 20.0% • Increasing top end of the target range by 100 bps relative to 20% 18.0% corresponding level of sales a
Slide 18: Raising ME&T Free Cash Flow Target Range
4Q 2023 EARNINGS RELEASE Raising ME&T Free Cash Flow1 Target Range Previous Target New Target ME&T Free 1 $4-8B $5-10B Cash Flow Return substantially all ME&T free cash flow1 to shareholders over time Capital Allocation Strong balance sheet and liquidity 1 ME&T free cash flow represents ME&T operati
Slide 19: Key Thoughts for Full-Year 2024
4Q 2023 EARNINGS RELEASE Key Thoughts for Full-Year 2024 • Anticipate 2024 full-year sales and revenues to be broadly similar to 2023 • Do not expect a significant change in machine dealer inventory1 by the end of 2024, as compared to a build in 2023 • Expect 2024 full-year adjusted operating profit
Slide 20: Key Thoughts for First-Quarter 2024
4Q 2023 EARNINGS RELEASE Key Thoughts for First-Quarter 2024 • Expect first-quarter 2024 sales and revenues to be broadly similar to the first quarter of 2023 • Anticipate favorable price realization and slightly lower machine dealer inventory 1 build versus the first quarter of 2023 • Expect first-
Slide 21: Key Takeaways
4Q 2023 EARNINGS RELEASE Key Takeaways 2023 PERFORMANCE REVISED TARGET EXECUTING OUR BEST YEAR1 RANGES2 STRATEGY IN OUR INCREASED ADJ. OPERATING FOR LONG-TERM 98-YEAR HISTORY PROFIT MARGIN3 PROFITABLE GROWTH RAISED ME&T FREE CASH FLOW4 1Record full-year sales and revenues; adjusted profit per share;
Slide 22: Q&A
4Q 2023 EARNINGS RELEASE Q&A 22
Slide 23: 2024 Caterpillar Earnings Call Schedule
4Q 2023 EARNINGS RELEASE 2024 Caterpillar Earnings Call Schedule Earnings Quarter Release Date Call Time 1st Quarter 2024 Thursday, April 25, 2024 8:30 a.m. Eastern 2nd Quarter 2024 Tuesday, August 6, 2024 8:30 a.m. Eastern 3rd Quarter 2024 Wednesday, October 30, 2024 8:30 a.m. Eastern 23
Slide 24: Dealer Inventories, Order Backlog and ME&T Services
4Q 2023 EARNINGS RELEASE Decreased Increased Unfavorable Dealer $0.9B $0.7B $1.6B Inventories1 4Q 2023 4Q 2022 4Q 2023 1 Dealers are independent businesses and control their own inventory. Note: Amounts may not add due to rounding. vs. 3Q 2023 vs. 3Q 2022 Impact on Total Sales Decreased Decreased De
Slide 25: Non-GAAP Financial Measures
4Q 2023 EARNINGS RELEASE Non-GAAP Financial Measures Note: Amounts may not add due to rounding. 25
Slide 26: Reconciliation to U.S. GAAP
4Q 2023 EARNINGS RELEASE Reconciliation to U.S. GAAP Reconciliation of ME&T Cash Flow from Operations to ME&T Free Cash Flow (USD in billions) 4Q 2022 4Q 2023 2022 2023 ME&T cash flow from operations $ 3.2 $ 3.7 $ 6.4 $ 11.7 ME&T capital expenditures (0.4) (0.6) (1.3) (1.7) Payments made related to
Slide 27: Consolidated Full Year Sales and Revenues
4Q 2023 EARNINGS RELEASE Consolidated Full Year Sales and Revenues Full Year 2023 vs. Full Year 2022 70,000 5,596 (279) 338 67,060 1,978 60,000 59,427 - 50,000 Millions of $ 40,000 30,000 20,000 10,000 0 Full Year 2022 Sales Volume Price Realization Currency Financial Products Full Year 2023 Sales &
Slide 28: Consolidated Full Year Operating Profit
4Q 2023 EARNINGS RELEASE Consolidated Full Year Operating Profit Full Year 2023 vs. Full Year 2022 16,000 5,596 (789) 14,000 (1,005) 925 (586) 37 32 105 (200) 12,966 12,000 Millions of $ 10,000 947 8,000 7,904 6,000 4,000 2,000 0 Full Year 2022 Sales Volume Price Manufacturing SG&A / R&D Currency Fi
Slide 29: Additional Key Thoughts for Full-Year 2024
4Q 2023 EARNINGS RELEASE Additional Key Thoughts for Full-Year 2024 • Capital expenditures expected range of $2B to $2.5B • Short-term incentive compensation expense anticipated to be about $1.2B in 2024 compared to about $1.7B in 2023 • Expected short-term incentive compensation expense benefit is