Caterpillar Inc (NYSE:CAT, ETR:CAT1) has unveiled lower-than-expected profit for the third quarter on a drop in sales as demand for construction equipment remained downtrodden.
Revenue fell by 4% over the third quarter to $16.1 billion, Caterpillar reported on Wednesday, broadly in line with analysts’ expectations.
Adjusted earnings per share of $5.17 missed estimates for $5.34, having fallen from $5.52 year on year as adjusted profit margins narrowed to 20% from 20.8%.
The drop in revenue came as sales across Caterpillar’s construction and resource segments fell by 9% and 10% respectively, but increased in its energy and transportation wing.
“The decrease in sales volume was mainly driven by lower sales of equipment to end users, Caterpillar said.
“In addition, changes in dealer inventories had an unfavorable impact to sales volumes.”
Sales were said to be on course to come in slightly lower than previously anticipated, though profit guidance was unchanged as price hikes were set to offset the slowdown.
“Our third-quarter results reflect the benefit of the diversity of our end markets,” chief executive Jim Umpleby commented, highlighting “robust” cash flow of $3.6 billion.
Shares fell 1.6% to $381.49 on Wednesday.