Caterpillar, Inc. · NYSE:CAT
Caterpillar — Baird Industrial Conference 2016
18 slides from Caterpillar's conference presentation, Nov 10, 2016
Slide 1: Baird Conference
Baird Conference November 10, 2016 Denise Johnson – Caterpillar Group President – Resource Industries Amy Campbell – Caterpillar IR Director CUSTOMERS. PEOPLE. STOCKHOLDERS. 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements 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,” “w
Slide 3: Discussion
Discussion • 3rd Quarter 2016 Results / 2016 Outlook Amy Campbell • Resource Industries Denise Johnson • Q&A CUSTOMERS. PEOPLE. STOCKHOLDERS. 3
Slide 4: Full-Year Outlook for 2016
Full-Year Outlook for 2016 Previous Outlook1 Current Outlook2 Sales and revenues $40.0 to $40.5 billion About $39 billion Profit Per Share $2.75 $2.35 Restructuring Costs $700 million $800 million Profit Per Share Excluding $3.55 $3.25 Restructuring Costs • Sales expectations lowered across our thre
Slide 5: Preliminary 2017 Sales and Revenues Outlook
Preliminary 20171 Cautious about the first half of the year, with potential Sales and Revenues Outlook for improvement later in 2017 and beyond if commodity-related industries begin to recover • We usually provide a preliminary view of the following year’s sales and revenues with our 3rd Quarter fin
Slide 6: Discussion Points
Discussion Points • Not much recent change in the industries we serve with the exception of North American Construction – More stable commodity prices, but no significant rebound in order activity in mining or oil and gas yet … rail continues to be weak in North America. • Good operational performan
Slide 7: Non-GAAP Financial Measures
Non-GAAP Financial Measures The following definition is provided for “non-GAAP financial measures” in connection with Regulation G issued by the Securities and Exchange Commission. The non-GAAP financial measures we use have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely
Slide 8: Discussion
Discussion • 3rd Quarter 2016 Results / 2016 Outlook Amy Campbell • Resource Industries Denise Johnson • Q&A CUSTOMERS. PEOPLE. STOCKHOLDERS. 8
Slide 9: Resource Industries Has an Expansive Reach
Resource Industries Has an Expansive Reach Products, Parts, Services, and Support Ultra Class Material Handling Underground CUSTOMERS. PEOPLE. STOCKHOLDERS. 9
Slide 10: Commodity Decline Places Resource Industries at its Deepest Trough
Commodity Decline Among the Fastest in Past 132 Years and Places Resource Industries at its Deepest Trough Commodity Dollar Index Cat Mining Machine End User Demand 220 Average Sales to End Users 2006 - 16E 200 180 Cat End-User Demand 160 140 120 100 80 60 1887 1893 1899 1905 1911 1917 1923 1929 193
Slide 11: What Have We Done to Mitigate the Sales Drop?
What Have We Done to Mitigate the Sales Drop? Since 2012 Resource Industries has… • Closed or announced the exit of 17 manufacturing facilities • Downsized 5 other facilities • Reduced its headcount – Accounting for almost half of the overall Caterpillar reductions of 34,000 • Lowered the breakeven
Slide 12: Large Mining Trucks are Going Back to Work
Large Mining Trucks are Going Back to Work Cat Large Mining Truck Parked Fleet % • Parked fleet of Caterpillar Late 2015 machines peaked in 2015 Oct 2016 • Since then, there has been a steady decrease in the percentage of the truck population considered “parked” • Trucks are being put back to work 2
Slide 13: The Portfolio is Positioned for Growth with New Technologies and New Products
The Portfolio is Positioned for Growth with New Technologies and New Products Autonomous Capabilities Hard Rock Cutting New Products CUSTOMERS. PEOPLE. STOCKHOLDERS. 13
Slide 14: Autonomous Capabilities
Autonomous Capabilities • Tremendous customer pull to improve safety and productivity • “Command for Hauling is 20 percent more productive than a manned fleet of trucks of the same type” Customer quote • Can retrofit trucks or provide on new units • Applications for drills, tractors and underground
Slide 15: Hard Rock Cutting
Hard Rock Cutting • Strong customer interest for continuous mining systems • Rock Straight System • First commercial continuous mining and hauling system for underground hard rock applications • Disrupt old drill and blast by using our patent protected activated undercutting technology CUSTOMERS. PE
Slide 16: New Products
New Products • Hydraulic Mining Shovels • 6015B • 6020B • Large Mining Trucks • 794AC • Surface Rock Drills • MD6420C • Articulated Truck • 745C CUSTOMERS. PEOPLE. STOCKHOLDERS. 16
Slide 17: State of the Mining Business
State of the Mining Business • Customers have expressed increased optimism • Machine replacements should be needed assuming no increase in commodity production levels • New machine introductions being favorably received by the marketplace • Increasingly, technology is becoming a differentiator among
Slide 18: Baird Conference
Baird Conference CUSTOMERS. PEOPLE. STOCKHOLDERS. 18