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Cat clears lowered estimate
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January 21, 2000: 9:09 a.m. ET
Difficult year ends with 4Q profits down 20.6%, although it predicts better 2000
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NEW YORK (CNNfn) - Caterpillar Inc. beat lowered earnings expectations for the fourth quarter Friday, ending a difficult year that saw consistent pressure on revenue and profits.
The Dow Jones industrial average component posted net income of $239 million, or 67 cents a diluted share, down 20.6 percent from the $301 million, or 84 cents a share, it posted a year earlier. Analysts surveyed by First Call had lowered their consensus estimate to 64 cents a share.
That estimate came after the company issued a statement Nov. 19 saying profits would only be slightly above the 61 cents a share it made in the third quarter. Analysts had been expected 97 cents a share before that, and $1.10 a share before the company had some cautions in its third-quarter earnings statement.
The Peoria, Ill., manufacturer of heavy equipment said the reason for the decline was weak machine sales in the second half of 1999 and ongoing price competition. Sales in the quarter fell 7 percent to $5.02 billion.
The company repeated earlier statements that it is looking for gains in both revenue and sales in 2000, although it said that it believes North American sales will decline.
"In the United States, we expect industry demand for machines to decline, but company sales are expected to be about flat as machine shipments come back into line with retail demand," said the company's statement. "Engine sales in North America also are expected to remain near 1999 levels as higher commercial engine sales offset lower industry demand for on-highway truck engines."
North America accounted for 56 percent of its machine and engines sales in 1999.
For the full year, net income was $946 million, or $2.63 a share, compared with $1.5 billion, or $4.11 a share, in 1998. Sales fell to $18.56 billion from $19.72 billion in 1998.
In trading Thursday, Caterpillar (CAT) shares were down 2-3/16 to 47-1/8. 
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Caterpillar
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