Caterpillar Reports Second-Quarter 2024 Results

Author's Avatar
Aug 06, 2024

PR Newswire

  • Second-quarter 2024 profit per share of $5.48; adjusted profit per share of $5.99
  • Enterprise operating cash flow was $3.0 billion in the second quarter of 2024
  • Deployed $2.5 billion of cash for share repurchases and dividends in the second quarter

Second Quarter

($ in billions except profit per share)

2024

2023

Sales and Revenues

$16.7

$17.3

Profit Per Share

$5.48

$5.67

Adjusted Profit Per Share

$5.99

$5.55

Please see a reconciliation of GAAP to non-GAAP financial measures in the appendix on pages 13 and 14.

IRVING, Texas, Aug. 6, 2024 /PRNewswire/ -- Caterpillar Inc. (NYSE: CAT) announced second-quarter 2024 results. Sales and revenues for the second quarter of 2024 were $16.7 billion, a 4% decrease compared with $17.3 billion in the second quarter of 2023. The decrease was primarily due to lower sales volume, partially offset by favorable price realization.

Operating profit margin was 20.9% for the second quarter of 2024, compared with 21.1% for the second quarter of 2023. Adjusted operating profit margin was 22.4% for the second quarter of 2024, compared with 21.3% for the second quarter of 2023. Second-quarter 2024 profit per share was $5.48, compared with second-quarter 2023 profit per share of $5.67. Adjusted profit per share in the second quarter of 2024 was $5.99, compared with second-quarter 2023 adjusted profit per share of $5.55. For the second quarter of 2024 and 2023, adjusted operating profit margin and adjusted profit per share excluded restructuring costs. Second-quarter 2023 adjusted profit per share also excluded a discrete tax benefit to adjust deferred tax balances.

For the second quarter of 2024, enterprise operating cash flow was $3.0 billion, and the company ended the second quarter with $4.3 billion of enterprise cash. In the quarter, the company deployed $1.8 billion of cash for repurchases of Caterpillar common stock and $0.6 billion of cash for dividends.

"I'd like to thank our team for delivering another strong quarter, including higher adjusted operating profit margin, record adjusted profit per share and robust ME&T free cash flow," said Chairman and CEO Jim Umpleby. "Our results continue to reflect the benefit of the diversity of our end markets as well as the disciplined execution of our strategy for long-term profitable growth."

CONSOLIDATED RESULTS

Consolidated Sales and Revenues

Consolidated Sales and Revenues Comparison
Second Quarter 2024 vs. Second Quarter 2023

To access this chart, go to https://investors.caterpillar.com/financials/quarterly-results/default.aspx for the downloadable version of Caterpillar second-quarter 2024 earnings.

The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the second quarter of 2023 (at left) and the second quarter of 2024 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company's board of directors and employees.

Total sales and revenues for the second quarter of 2024 were $16.689 billion, a decrease of $629 million, or 4%, compared with $17.318 billion in the second quarter of 2023. The decrease was primarily due to lower sales volume of $1.206 billion, partially offset by favorable price realization of $578 million. The decrease in sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased during the second quarter of 2024, compared with an increase during the second quarter of 2023.

In the three primary segments, sales were lower in Construction Industries and Resource Industries and higher in Energy & Transportation.

Sales and Revenues by Segment

(Millions of dollars)

Second
Quarter
2023

Sales

Volume

Price

Realization

Currency

Inter-
Segment /
Other

Second
Quarter
2024

$

Change

%

Change

Construction Industries

$ 7,154

$ (588)

$ 178

$ (55)

$ (6)

$ 6,683

$ (471)

(7 %)

Resource Industries

3,563

(475)

133

(9)

(6)

3,206

(357)

(10 %)

Energy & Transportation

7,219

(129)

264

(12)

(5)

7,337

118

2 %

All Other Segment

116

(7)

3

(1)

(3)

108

(8)

(7 %)

Corporate Items and Eliminations

(1,507)

(7)

β€”

β€”

20

(1,494)

13

Machinery, Energy & Transportation

16,545

(1,206)

578

(77)

β€”

15,840

(705)

(4 %)

Financial Products Segment

923

β€”

β€”

β€”

81

1,004

81

9 %

Corporate Items and Eliminations

(150)

β€”

β€”

β€”

(5)

(155)

(5)

Financial Products Revenues

773

β€”

β€”

β€”

76

849

76

10 %

Consolidated Sales and Revenues

$ 17,318

$ (1,206)

$ 578

$ (77)

$ 76

$ 16,689

$ (629)

(4 %)

Sales and Revenues by Geographic Region

North America

Latin America

EAME

Asia/Pacific

External Sales
and Revenues

Inter-Segment

Total Sales
and Revenues

(Millions of dollars)

$

% Chg

$

% Chg

$

% Chg

$

% Chg

$

% Chg

$

% Chg

$

% Chg

Second Quarter 2024

Construction Industries

$ 3,957

β€” %

$ 677

20 %

$ 1,047

(27 %)

$ 975

(15 %)

$ 6,656

(7 %)

$ 27

(18 %)

$ 6,683

(7 %)

Resource Industries

1,206

(10 %)

524

(3 %)

442

(15 %)

950

(12 %)

3,122

(10 %)

84

(7 %)

3,206

(10 %)

Energy & Transportation

3,308

6 %

439

(4 %)

1,421

(4 %)

912

1 %

6,080

2 %

1,257

β€” %

7,337

2 %

All Other Segment

13

(19 %)

β€”

β€” %

4

β€” %

12

(14 %)

29

(15 %)

79

(4 %)

108

(7 %)

Corporate Items and Eliminations

(20)

(1)

(21)

(5)

(47)

(1,447)

(1,494)

Machinery, Energy & Transportation

8,464

1 %

1,639

5 %

2,893

(16 %)

2,844

(9 %)

15,840

(4 %)

β€”

β€” %

15,840

(4 %)

Financial Products Segment

668

13 %

101

(1 %)

124

5 %

111

1 %

1,004

9 %

β€”

β€” %

1,004

9 %

Corporate Items and Eliminations

(89)

(21)

(20)

(25)

(155)

β€”

(155)

Financial Products Revenues

579

14 %

80

(1 %)

104

7 %

86

(1 %)

849

10 %

β€”

β€” %

849

10 %

Consolidated Sales and Revenues

$ 9,043

1 %

$ 1,719

5 %

$ 2,997

(15 %)

$ 2,930

(9 %)

$ 16,689

(4 %)

$ β€”

β€” %

$ 16,689

(4 %)

Second Quarter 2023

Construction Industries

$ 3,968

$ 566

$ 1,438

$ 1,149

$ 7,121

$ 33

$ 7,154

Resource Industries

1,342

538

517

1,076

3,473

90

3,563

Energy & Transportation

3,120

459

1,479

899

5,957

1,262

7,219

All Other Segment

16

β€”

4

14

34

82

116

Corporate Items and Eliminations

(32)

(2)

(2)

(4)

(40)

(1,467)

(1,507)

Machinery, Energy & Transportation

8,414

1,561

3,436

3,134

16,545

β€”

16,545

Financial Products Segment

593

102

118

110

923

β€”

923

Corporate Items and Eliminations

(85)

(21)

(21)

(23)

(150)

β€”

(150)

Financial Products Revenues

508

81

97

87

773

β€”

773

Consolidated Sales and Revenues

$ 8,922

$ 1,642

$ 3,533

$ 3,221

$ 17,318

$ β€”

$ 17,318

Consolidated Operating Profit

Consolidated Operating Profit Comparison
Second Quarter 2024 vs. Second Quarter 2023

To access this chart, go to https://investors.caterpillar.com/financials/quarterly-results/default.aspx for the downloadable version of Caterpillar second-quarter 2024 earnings.

The chart above graphically illustrates reasons for the change in consolidated operating profit between the second quarter of 2023 (at left) and the second quarter of 2024 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company's board of directors and employees. The bar titled Other includes consolidating adjustments and Machinery, Energy & Transportation's other operating (income) expenses.

Operating profit for the second quarter of 2024 was $3.482 billion, a decrease of $170 million, or 5%, compared with $3.652 billion in the second quarter of 2023. Favorable price realization of $578 million was more than offset by the profit impact of lower sales volume of $431 million, higher restructuring costs of $227 million and higher selling, general and administrative (SG&A) and research and development (R&D) expenses of $79 million. The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives.

In the second quarter of 2024, restructuring costs increased primarily due to the divestiture of two non-U.S. entities.

Profit (Loss) by Segment

(Millions of dollars)

Second Quarter
2024

Second Quarter
2023

$

Change

%

Change

Construction Industries

$ 1,741

$ 1,803

$ (62)

(3 %)

Resource Industries

718

740

(22)

(3 %)

Energy & Transportation

1,525

1,269

256

20 %

All Other Segment

21

10

11

110 %

Corporate Items and Eliminations

(344)

(272)

(72)

Machinery, Energy & Transportation

3,661

3,550

111

3 %

Financial Products Segment

227

240

(13)

(5 %)

Corporate Items and Eliminations

(243)

17

(260)

Financial Products

(16)

257

(273)

(106 %)

Consolidating Adjustments

(163)

(155)

(8)

Consolidated Operating Profit

$ 3,482

$ 3,652

$ (170)

(5 %)

Other Profit/Loss and Tax Items

  • Other income (expense) in the second quarter of 2024 was income of $155 million, compared with income of $127 million in the second quarter of 2023. The change was primarily driven by favorable impacts from commodity hedges.
  • The effective tax rate for the second quarter of 2024 was 23.9% compared to 20.6% for the second quarter of 2023. Excluding the discrete items discussed below, the second quarter 2024 estimated annual tax rate was 22.5% compared with 23.0% for the second quarter of 2023.

    The 2024 estimated annual tax rate excludes the impact of second-quarter losses of $228 million for the divestiture of two non-U.S. entities with no related tax benefit. In addition, a discrete tax benefit of $4 million was recorded in the second quarter of 2024 for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense. In the second quarter of 2023, the company recorded a discrete tax benefit of $88 million due to a change in the valuation allowance for certain deferred tax assets.

    Please see a reconciliation of GAAP to non-GAAP financial measures in the appendix on pages 13 and 14.

CONSTRUCTION INDUSTRIES

(Millions of dollars)

Segment Sales

Second
Quarter 2023

Sales
Volume

Price
Realization

Currency

Inter-
Segment

Second
Quarter 2024

$

Change

%

Change

Total Sales

$ 7,154

$ (588)

$ 178

$ (55)

$ (6)

$ 6,683

$ (471)

(7 %)

Sales by Geographic Region

Second
Quarter 2024

Second
Quarter 2023

$

Change

%

Change

North America

$ 3,957

$ 3,968

$ (11)

β€” %

Latin America

677

566

111

20 %

EAME

1,047

1,438

(391)

(27 %)

Asia/Pacific

975

1,149

(174)

(15 %)

External Sales

6,656

7,121

(465)

(7 %)

Inter-segment

27

33

(6)

(18 %)

Total Sales

$ 6,683

$ 7,154

$ (471)

(7 %)

Segment Profit

Second
Quarter 2024

Second
Quarter 2023

Change

%

Change

Segment Profit

$ 1,741

$ 1,803

$ (62)

(3 %)

Segment Profit Margin

26.1 %

25.2 %

0.9 pts

Construction Industries' total sales were $6.683 billion in the second quarter of 2024, a decrease of $471 million, or 7%, compared with $7.154 billion in the second quarter of 2023. The decrease was primarily due to lower sales volume of $588 million, partially offset by favorable price realization of $178 million. The decrease in sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory remained about flat during the second quarter of 2024, compared to an increase during the second quarter of 2023.

  • Sales in North America were about flat. Lower sales volume was offset by favorable price realization. Lower sales volume was mainly driven by lower sales of equipment to end users.
  • Sales increased in Latin America mainly due to higher sales volume. Higher sales volume was primarily driven by the impact from changes in dealer inventories. Dealer inventory increased during the second quarter of 2024, compared with a decrease during the second quarter of 2023.
  • In EAME, sales decreased primarily due to lower sales volume. Lower sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased during the second quarter of 2024, compared with an increase during the second quarter of 2023.
  • Sales decreased in Asia/Pacific mainly due to lower sales volume and unfavorable currency impacts primarily related to the Japanese yen. Lower sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased during the second quarter of 2024, compared with an increase during the second quarter of 2023.

Construction Industries' segment profit was $1.741 billion in the second quarter of 2024, a decrease of $62 million, or 3%, compared with $1.803 billion in the second quarter of 2023. The decrease was mainly due to the profit impact of lower sales volume of $288 million and higher SG&A/R&D expenses of $30 million, partially offset by favorable price realization of $178 million, favorable manufacturing costs of $62 million and favorable other segment items of $16 million. The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives. Favorable manufacturing costs largely reflected lower material costs. Favorable other segment items primarily consisted of favorable currency impacts.

RESOURCE INDUSTRIES

(Millions of dollars)

Segment Sales

Second
Quarter 2023

Sales
Volume

Price
Realization

Currency

Inter-
Segment

Second
Quarter 2024

$

Change

%

Change

Total Sales

$ 3,563

$ (475)

$ 133

$ (9)

$ (6)

$ 3,206

$ (357)

(10 %)

Sales by Geographic Region

Second
Quarter 2024

Second
Quarter 2023

$

Change

%

Change

North America

$ 1,206

$ 1,342

$ (136)

(10 %)

Latin America

524

538

(14)

(3 %)

EAME

442

517

(75)

(15 %)

Asia/Pacific

950

1,076

(126)

(12 %)

External Sales

3,122

3,473

(351)

(10 %)

Inter-segment

84

90

(6)

(7 %)

Total Sales

$ 3,206

$ 3,563

$ (357)

(10 %)

Segment Profit

Second
Quarter 2024

Second
Quarter 2023

Change

%

Change

Segment Profit

$ 718

$ 740

$ (22)

(3 %)

Segment Profit Margin

22.4 %

20.8 %

1.6 pts

Resource Industries' total sales were $3.206 billion in the second quarter of 2024, a decrease of $357 million, or 10%, compared with $3.563 billion in the second quarter of 2023. The decrease was primarily due to lower sales volume of $475 million, partially offset by favorable price realization of $133 million. The decrease in sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased more during the second quarter of 2024 than during the second quarter of 2023.

Resource Industries' segment profit was $718 million in the second quarter of 2024, a decrease of $22 million, or 3%, compared with $740 million in the second quarter of 2023. The decrease was mainly due to the profit impact of lower sales volume of $169 million, unfavorable other segment items of $16 million and higher SG&A/R&D expenses of $14 million, partially offset by favorable price realization of $133 million and favorable manufacturing costs of $44 million. Unfavorable other segment items primarily consisted of unfavorable currency impacts. The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives. Favorable manufacturing costs largely reflected lower freight.

ENERGY & TRANSPORTATION

(Millions of dollars)

Segment Sales

Second
Quarter 2023

Sales
Volume

Price
Realization

Currency

Inter-
Segment

Second
Quarter 2024

$

Change

%

Change

Total Sales

$ 7,219

$ (129)

$ 264

$ (12)

$ (5)

$ 7,337

$ 118

2 %

Sales by Application

Second
Quarter 2024

Second
Quarter 2023

$

Change

%

Change

Oil and Gas

$ 1,829

$ 1,760

$ 69

4 %

Power Generation

1,885

1,645

240

15 %

Industrial

1,045

1,318

(273)

(21 %)

Transportation

1,321

1,234

87

7 %

External Sales

6,080

5,957

123

2 %

Inter-segment

1,257

1,262

(5)

β€” %

Total Sales

$ 7,337

$ 7,219

$ 118

2 %

Segment Profit

Second
Quarter 2024

Second
Quarter 2023

Change

%

Change

Segment Profit

$ 1,525

$ 1,269

$ 256

20 %

Segment Profit Margin

20.8 %

17.6 %

3.2 pts

Energy & Transportation's total sales were $7.337 billion in the second quarter of 2024, an increase of $118 million, or 2%, compared with $7.219 billion in the second quarter of 2023. Sales increased across all applications except Industrial. The increase in sales was primarily due to favorable price realization of $264 million, partially offset by lower sales volume of $129 million.

  • Oil and Gas – Sales increased for turbines and turbine-related services.
  • Power Generation – Sales increased in large reciprocating engines, primarily data center applications. Turbines and turbine-related services increased as well.
  • Industrial – Sales decreased in EAME and North America.
  • Transportation – Sales increased in rail services and marine.

Energy & Transportation's segment profit was $1.525 billion in the second quarter of 2024, an increase of $256 million, or 20%, compared with $1.269 billion in the second quarter of 2023. The increase was mainly due to favorable price realization of $264 million.

FINANCIAL PRODUCTS SEGMENT

(Millions of dollars)

Revenues by Geographic Region

Second
Quarter 2024

Second
Quarter 2023

$

Change

%

Change

North America

$ 668

$ 593

$ 75

13 %

Latin America

101

102

(1)

(1 %)

EAME

124

118

6

5 %

Asia/Pacific

111

110

1

1 %

Total Revenues

$ 1,004

$ 923

$ 81

9 %

Segment Profit

Second
Quarter 2024

Second
Quarter 2023

Change

%

Change

Segment Profit

$ 227

$ 240

$ (13)

(5 %)

Financial Products' segment revenues were $1.004 billion in the second quarter of 2024, an increase of $81 million, or 9%, compared with $923 million in the second quarter of 2023. The increase was primarily due to a favorable impact from higher average financing rates across all regions of $50 million and a favorable impact from higher average earning assets driven by North America of $32 million.

Financial Products' segment profit was $227 million in the second quarter of 2024, a decrease of $13 million, or 5%, compared with $240 million in the second quarter of 2023. The decrease was mainly due to higher provision for credit losses at Cat Financial of $27 million and an increase in SG&A expenses of $15 million, partially offset by the absence of prior year unfavorable currency impacts of $14 million and a favorable impact from higher average earning assets of $12 million.

At the end of the second quarter of 2024, past dues at Cat Financial were 1.74%, compared with 2.15% at the end of the second quarter of 2023. Write-offs, net of recoveries, were $18 million for the second quarter of 2024, compared with $8 million for the second quarter of 2023. As of June 30, 2024, Cat Financial's allowance for credit losses totaled $254 million, or 0.89% of finance receivables, compared with $281 million, or 1.01% of finance receivables at March 31, 2024. The allowance for credit losses at year-end 2023 was $331 million, or 1.18% of finance receivables.

Corporate Items and Eliminations

Expense for corporate items and eliminations was $587 million in the second quarter of 2024, an increase of $332 million from the second quarter of 2023, primarily driven by higher restructuring costs and higher corporate costs.

In the second quarter of 2024, restructuring costs increased primarily due to the divestiture of two non-U.S. entities.

Notes

i. Glossary of terms is included on the Caterpillar website at https://investors.caterpillar.com/overview/default.aspx.
ii. Sales of equipment to end users is demonstrated by the company's Rolling 3 Month Retail Sales Statistics filed in a Form 8-K on Tuesday, Aug. 6, 2024.
iii. Information on non-GAAP financial measures is included in the appendix on pages 13 and 14.
iv. Some amounts within this report are rounded to the millions or billions and may not add.
v. Caterpillar will conduct a teleconference and live webcast, with a slide presentation, beginning at 7:30 a.m. Central Time on Tuesday, Aug. 6, 2024, to discuss its 2024 second-quarter results. The accompanying slides will be available before the webcast on the Caterpillar website at https://investors.caterpillar.com/events-presentations/default.aspx.

About Caterpillar

With 2023 sales and revenues of $67.1 billion, Caterpillar Inc. is the world's leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. For nearly 100 years, we've been helping customers build a better, more sustainable world and are committed and contributing to a reduced-carbon future. Our innovative products and services, backed by our global dealer network, provide exceptional value that helps customers succeed. Caterpillar does business on every continent, principally operating through three primary segments – Construction Industries, Resource Industries and Energy & Transportation – and providing financing and related services through our Financial Products segment. Visit us at caterpillar.com or join the conversation on our social media channels at caterpillar.com/en/news/social-media.html.

Caterpillar's latest financial results are also available online:

https://investors.caterpillar.com/overview/default.aspx

https://investors.caterpillar.com/financials/quarterly-results/default.aspx (live broadcast/replays of quarterly conference call)

Forward-Looking Statements

Certain statements in this press release 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," "will," "would," "expect," "anticipate," "plan," "forecast," "target," "guide," "project," "intend," "could," "should" or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance and speak only as of the date they are made, and we do not undertake to update our forward-looking statements.

Caterpillar's actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global and regional economic conditions and economic conditions in the industries we serve; (ii) commodity price changes, material price increases, fluctuations in demand for our products or significant shortages of material; (iii) government monetary or fiscal policies; (iv) political and economic risks, commercial instability and events beyond our control in the countries in which we operate; (v) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; (vi) our ability to develop, produce and market quality products that meet our customers' needs; (vii) the impact of the highly competitive environment in which we operate on our sales and pricing; (viii) information technology security threats and computer crime; (ix) inventory management decisions and sourcing practices of our dealers and our OEM customers; (x) a failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures or divestitures; (xi) union disputes or other employee relations issues; (xii) adverse effects of unexpected events; (xiii) disruptions or volatility in global financial markets limiting our sources of liquidity or the liquidity of our customers, dealers and suppliers; (xiv) failure to maintain our credit ratings and potential resulting increases to our cost of borrowing and adverse effects on our cost of funds, liquidity, competitive position and access to capital markets; (xv) our Financial Products segment's risks associated with the financial services industry; (xvi) changes in interest rates or market liquidity conditions; (xvii) an increase in delinquencies, repossessions or net losses of Cat Financial's customers; (xviii) currency fluctuations; (xix) our or Cat Financial's compliance with financial and other restrictive covenants in debt agreements; (xx) increased pension plan funding obligations; (xxi) alleged or actual violations of trade or anti-corruption laws and regulations; (xxii) additional tax expense or exposure, including the impact of U.S. tax reform; (xxiii) significant legal proceedings, claims, lawsuits or government investigations; (xxiv) new regulations or changes in financial services regulations; (xxv) compliance with environmental laws and regulations; (xxvi) catastrophic events, including global pandemics such as the COVID-19 pandemic; and (xxvii) other factors described in more detail in Caterpillar's Forms 10-Q, 10-K and other filings with the Securities and Exchange Commission.

APPENDIX

NON-GAAP FINANCIAL MEASURES

The following definitions are provided for the non-GAAP financial measures. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management does not intend these items to be considered in isolation or as a substitute for the related GAAP measures.

The company believes it is important to separately quantify the profit impact of three significant items in order for the company's results to be meaningful to readers. These items consist of (i) restructuring costs related to the divestiture of two non-U.S. entities in 2024, (ii) other restructuring income/costs and (iii) certain deferred tax valuation allowance adjustments in 2023. The company does not consider these items indicative of earnings from ongoing business activities and believes the non-GAAP measure provides investors with useful perspective on underlying business results and trends and aids with assessing the company's period-over-period results. The company intends to discuss adjusted profit per share for the fourth quarter and full-year 2024, excluding mark-to-market gains or losses for remeasurement of pension and other postemployment benefit plans.

Reconciliations of adjusted results to the most directly comparable GAAP measure are as follows:

(Dollars in millions except per share data)

Operating
Profit

Operating
Profit Margin

Profit Before
Taxes

Provision
(Benefit) for
Income Taxes

Profit

Profit per
Share

Three Months Ended June 30, 2024 - U.S. GAAP

$ 3,482

20.9 %

$ 3,500

$ 836

$ 2,681

$ 5.48

Restructuring costs - divestiture of two non-U.S. entities

228

1.3 %

228

β€”

228

0.47

Other restructuring (income) costs

30

0.2 %

30

6

24

0.04

Three Months Ended June 30, 2024 - Adjusted

$ 3,740

22.4 %

$ 3,758

$ 842

$ 2,933

$ 5.99

Three Months Ended June 30, 2023 - U.S. GAAP

$ 3,652

21.1 %

$ 3,652

$ 752

$ 2,922

$ 5.67

Other restructuring (income) costs

31

0.2 %

31

6

25

0.05

Deferred tax valuation allowance adjustments

β€”

β€” %

β€”

88

(88)

(0.17)

Three Months Ended June 30, 2023 - Adjusted

$ 3,683

21.3 %

$ 3,683

$ 846

$ 2,859

$ 5.55

The company believes it is important to separately disclose the annual effective tax rate, excluding discrete items for the results to be meaningful to readers. The annual effective tax rate is discussed using non-GAAP financial measures that exclude the effects of amounts associated with discrete items recorded fully in the quarter they occur. For the three months ended June 30, 2024, and 2023, these items consist of (i) restructuring costs related to the divestiture of two non-U.S. entities in 2024, (ii) certain deferred tax valuation allowance adjustments in 2023 and (iii) settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense. The company believes the non-GAAP measures will provide investors with useful perspective on underlying business results and trends and aids with assessing the company's period-over-period results.

A reconciliation of the effective tax rate to annual effective tax rate, excluding discrete items is below:

(Dollars in millions)

Profit Before
Taxes

Provision
(Benefit) for
Income Taxes

Effective Tax
Rate

Three Months Ended June 30, 2024 - U.S. GAAP

$ 3,500

$ 836

23.9 %

Restructuring costs - divestiture of two non-U.S. entities

228

β€”

Excess stock-based compensation

β€”

4

Annual effective tax rate, excluding discrete items

$ 3,728

$ 840

22.5 %

Excess stock-based compensation

β€”

(4)

Other restructuring (income) costs

30

6

Three Months Ended June 30, 2024 - Adjusted

$ 3,758

$ 842

Three Months Ended June 30, 2023 - U.S. GAAP

$ 3,652

$ 752

20.6 %

Deferred tax valuation allowance adjustments

β€”

88

Annual effective tax rate, excluding discrete items

$ 3,652

$ 840

23.0 %

Other restructuring (income) costs

31

6

Three Months Ended June 30, 2023 - Adjusted

$ 3,683

$ 846

Supplemental Consolidating Data

The company is providing supplemental consolidating data for the purpose of additional analysis. The data has been grouped as follows:

Consolidated – Caterpillar Inc. and its subsidiaries.

Machinery, Energy & Transportation (ME&T) – The company defines ME&T as it is presented in the supplemental data as Caterpillar Inc. and its subsidiaries, excluding Financial Products. ME&T's information relates to the design, manufacturing and marketing of its products.

Financial Products – The company defines Financial Products as it is presented in the supplemental data as its finance and insurance subsidiaries, primarily Caterpillar Financial Services Corporation (Cat Financial) and Caterpillar Insurance Holdings Inc. (Insurance Services). Financial Products' information relates to the financing to customers and dealers for the purchase and lease of Caterpillar and other equipment.

Consolidating Adjustments – Eliminations of transactions between ME&T and Financial Products.

The nature of the ME&T and Financial Products businesses is different, especially with regard to the financial position and cash flow items. Caterpillar management utilizes this presentation internally to highlight these differences. The company believes this presentation will assist readers in understanding its business.

Pages 16 to 26 reconcile ME&T and Financial Products to Caterpillar Inc. consolidated financial information.

Caterpillar Inc.

Condensed Consolidated Statement of Results of Operations

(Unaudited)

(Dollars in millions except per share data)

Three Months Ended
June 30,

Six Months Ended
June 30,

2024

2023

2024

2023

Sales and revenues:

Sales of Machinery, Energy & Transportation

$ 15,840

$ 16,545

$ 30,800

$ 31,644

Revenues of Financial Products

849

773

1,688

1,536

Total sales and revenues

16,689

17,318

32,488

33,180

Operating costs:

Cost of goods sold

10,150

11,065

19,812

21,168

Selling, general and administrative expenses

1,652

1,528

3,229

2,991

Research and development expenses

535

528

1,055

1,000

Interest expense of Financial Products

314

245

612

462

Other operating (income) expenses

556

300

779

1,176

Total operating costs

13,207

13,666

25,487

26,797

Operating profit

3,482

3,652

7,001

6,383

Interest expense excluding Financial Products

137

127

280

256

Other income (expense)

155

127

311

159

Consolidated profit before taxes

3,500

3,652

7,032

6,286

Provision (benefit) for income taxes

836

752

1,524

1,460

Profit of consolidated companies

2,664

2,900

5,508

4,826

Equity in profit (loss) of unconsolidated affiliated companies

17

24

27

40

Profit of consolidated and affiliated companies

2,681

2,924

5,535

4,866

Less: Profit (loss) attributable to noncontrolling interests

β€”

2

(2)

1

Profit 1

$ 2,681

$ 2,922

$ 5,537

$ 4,865

Profit per common share

$ 5.50

$ 5.70

$ 11.28

$ 9.46

Profit per common share β€” diluted 2

$ 5.48

$ 5.67

$ 11.23

$ 9.41

Weighted-average common shares outstanding (millions)

– Basic

487.2

512.9

490.7

514.3

– Diluted 2

489.5

515.0

493.3

517.1

1

Profit attributable to common shareholders.

2

Diluted by assumed exercise of stock-based compensation awards using the treasury stock method.

Caterpillar Inc.

Condensed Consolidated Statement of Financial Position

(Unaudited)

(Millions of dollars)

June 30,
2024

December 31,
2023

Assets

Current assets:

Cash and cash equivalents

$ 4,341

$ 6,978

Receivables – trade and other

9,421

9,310

Receivables – finance

9,516

9,510

Prepaid expenses and other current assets

2,736

4,586

Inventories

17,082

16,565

Total current assets

43,096

46,949

Property, plant and equipment – net

12,582

12,680

Long-term receivables – trade and other

1,181

1,238

Long-term receivables – finance

12,797

12,664

Noncurrent deferred and refundable income taxes

2,920

2,816

Intangible assets

488

564

Goodwill

5,264

5,308

Other assets

5,008

5,257

Total assets

$ 83,336

$ 87,476

Liabilities

Current liabilities:

Short-term borrowings:

-- Machinery, Energy & Transportation

$ β€”

$ β€”

-- Financial Products

5,298

4,643

Accounts payable

7,575

7,906

Accrued expenses

4,947

4,958

Accrued wages, salaries and employee benefits

1,677

2,757

Customer advances

2,324

1,929

Dividends payable

684

649

Other current liabilities

2,882

3,123

Long-term debt due within one year:

-- Machinery, Energy & Transportation

45

1,044

-- Financial Products

8,132

7,719

Total current liabilities

33,564

34,728

Long-term debt due after one year:

-- Machinery, Energy & Transportation

8,537

8,579

-- Financial Products

15,299

15,893

Liability for postemployment benefits

3,993

4,098

Other liabilities

4,807

4,675

Total liabilities

66,200

67,973

Shareholders' equity

Common stock

5,517

6,403

Treasury stock

(41,612)

(36,339)

Profit employed in the business

55,455

51,250

Accumulated other comprehensive income (loss)

(2,230)

(1,820)

Noncontrolling interests

6

9

Total shareholders' equity

17,136

19,503

Total liabilities and shareholders' equity

$ 83,336

$ 87,476

Caterpillar Inc.

Condensed Consolidated Statement of Cash Flow

(Unaudited)

(Millions of dollars)

Six Months Ended

June 30,

2024

2023

Cash flow from operating activities:

Profit of consolidated and affiliated companies

$ 5,535

$ 4,866

Adjustments to reconcile profit to net cash provided by operating activities:

Depreciation and amortization

1,055

1,074

Provision (benefit) for deferred income taxes

(133)

(355)

(Gain) loss on divestiture

164

572

Other

105

106

Changes in assets and liabilities, net of acquisitions and divestitures:

Receivables – trade and other

(245)

(465)

Inventories

(643)

(1,560)

Accounts payable

(21)

34

Accrued expenses

69

381

Accrued wages, salaries and employee benefits

(1,056)

(562)

Customer advances

341

284

Other assets – net

20

81

Other liabilities – net

(118)

366

Net cash provided by (used for) operating activities

5,073

4,822

Cash flow from investing activities:

Capital expenditures – excluding equipment leased to others

(841)

(683)

Expenditures for equipment leased to others

(614)

(774)

Proceeds from disposals of leased assets and property, plant and equipment

342

368

Additions to finance receivables

(7,446)

(6,973)

Collections of finance receivables

6,743

6,759

Proceeds from sale of finance receivables

37

29

Investments and acquisitions (net of cash acquired)

(32)

(20)

Proceeds from sale of businesses and investments (net of cash sold)

(61)

(14)

Proceeds from maturities and sale of securities

2,574

463

Investments in securities

(523)

(1,078)

Other – net

57

41

Net cash provided by (used for) investing activities

236

(1,882)

Cash flow from financing activities:

Dividends paid

(1,283)

(1,238)

Common stock issued, including treasury shares reissued

8

(22)

Payments to purchase common stock

(6,275)

(1,829)

Proceeds from debt issued (original maturities greater than three months)

4,151

3,299

Payments on debt (original maturities greater than three months)

(5,217)

(2,303)

Short-term borrowings – net (original maturities three months or less)

687

(406)

Net cash provided by (used for) financing activities

(7,929)

(2,499)

Effect of exchange rate changes on cash

(17)

(60)

Increase (decrease) in cash, cash equivalents and restricted cash

(2,637)

381

Cash, cash equivalents and restricted cash at beginning of period

6,985

7,013

Cash, cash equivalents and restricted cash at end of period

$ 4,348

$ 7,394

Cash equivalents primarily represent short-term, highly liquid investments with original maturities of generally three months or less.

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Three Months Ended June 30, 2024

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,
Energy &
Transportation

Financial

Products

Consolidating

Adjustments

Sales and revenues:

Sales of Machinery, Energy & Transportation

$ 15,840

$ 15,840

$ β€”

$ β€”

Revenues of Financial Products

849

β€”

1,043

(194)

1

Total sales and revenues

16,689

15,840

1,043

(194)

Operating costs:

Cost of goods sold

10,150

10,152

β€”

(2)

2

Selling, general and administrative expenses

1,652

1,449

185

18

2

Research and development expenses

535

535

β€”

β€”

Interest expense of Financial Products

314

β€”

314

β€”

Other operating (income) expenses

556

43

560

(47)

2

Total operating costs

13,207

12,179

1,059

(31)

Operating profit

3,482

3,661

(16)

(163)

Interest expense excluding Financial Products

137

137

β€”

β€”

Other income (expense)

155

(21)

13

163

3

Consolidated profit before taxes

3,500

3,503

(3)

β€”

Provision (benefit) for income taxes

836

786

50

β€”

Profit of consolidated companies

2,664

2,717

(53)

β€”

Equity in profit (loss) of unconsolidated affiliated companies

17

17

β€”

β€”

Profit of consolidated and affiliated companies

2,681

2,734

(53)

β€”

Less: Profit (loss) attributable to noncontrolling interests

β€”

β€”

β€”

β€”

Profit 4

$ 2,681

$ 2,734

$ (53)

$ β€”

1

Elimination of Financial Products' revenues earned from ME&T.

2

Elimination of net expenses recorded between ME&T and Financial Products.

3

Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.

4

Profit attributable to common shareholders.

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Three Months Ended June 30, 2023

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,
Energy &
Transportation

Financial

Products

Consolidating

Adjustments

Sales and revenues:

Sales of Machinery, Energy & Transportation

$ 16,545

$ 16,545

$ β€”

$ β€”

Revenues of Financial Products

773

β€”

955

(182)

1

Total sales and revenues

17,318

16,545

955

(182)

Operating costs:

Cost of goods sold

11,065

11,068

β€”

(3)

2

Selling, general and administrative expenses

1,528

1,389

143

(4)

2

Research and development expenses

528

528

β€”

β€”

Interest expense of Financial Products

245

β€”

245

β€”

Other operating (income) expenses

300

10

310

(20)

2

Total operating costs

13,666

12,995

698

(27)

Operating profit

3,652

3,550

257

(155)

Interest expense excluding Financial Products

127

127

β€”

β€”

Other income (expense)

127

(10)

(18)

155

3

Consolidated profit before taxes

3,652

3,413

239

β€”

Provision (benefit) for income taxes

752

691

61

β€”

Profit of consolidated companies

2,900

2,722

178

β€”

Equity in profit (loss) of unconsolidated affiliated companies

24

24

β€”

β€”

Profit of consolidated and affiliated companies

2,924

2,746

178

β€”

Less: Profit (loss) attributable to noncontrolling interests

2

(1)

3

β€”

Profit 4

$ 2,922

$ 2,747

$ 175

$ β€”

1

Elimination of Financial Products' revenues earned from ME&T

2

Elimination of net expenses recorded by ME&T paid to Financial Products

3

Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T

4

Profit attributable to common shareholders

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Six Months Ended June 30, 2024

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,
Energy &
Transportation

Financial

Products

Consolidating

Adjustments

Sales and revenues:

Sales of Machinery, Energy & Transportation

$ 30,800

$ 30,800

$ β€”

$ β€”

Revenues of Financial Products

1,688

β€”

2,072

(384)

1

Total sales and revenues

32,488

30,800

2,072

(384)

Operating costs:

Cost of goods sold

19,812

19,816

β€”

(4)

2

Selling, general and administrative expenses

3,229

2,862

363

4

2

Research and development expenses

1,055

1,055

β€”

β€”

Interest expense of Financial Products

612

β€”

612

β€”

Other operating (income) expenses

779

2

845

(68)

2

Total operating costs

25,487

23,735

1,820

(68)

Operating profit

7,001

7,065

252

(316)

Interest expense excluding Financial Products

280

280

β€”

β€”

Other income (expense)

311

(41)

36

316

3

Consolidated profit before taxes

7,032

6,744

288

β€”

Provision (benefit) for income taxes

1,524

1,401

123

β€”

Profit of consolidated companies

5,508

5,343

165

β€”

Equity in profit (loss) of unconsolidated affiliated companies

27

27

β€”

β€”

Profit of consolidated and affiliated companies

5,535

5,370

165

β€”

Less: Profit (loss) attributable to noncontrolling interests

(2)

(3)

1

β€”

Profit 4

$ 5,537

$ 5,373

$ 164

$ β€”

1

Elimination of Financial Products' revenues earned from ME&T.

2

Elimination of net expenses recorded between ME&T and Financial Products.

3

Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.

4

Profit attributable to common shareholders.

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Six Months Ended June 30, 2023

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,
Energy &
Transportation

Financial

Products

Consolidating

Adjustments

Sales and revenues:

Sales of Machinery, Energy & Transportation

$ 31,644

$ 31,644

$ β€”

$ β€”

Revenues of Financial Products

1,536

β€”

1,890

(354)

1

Total sales and revenues

33,180

31,644

1,890

(354)

Operating costs:

Cost of goods sold

21,168

21,172

β€”

(4)

2

Selling, general and administrative expenses

2,991

2,709

301

(19)

2

Research and development expenses

1,000

1,000

β€”

β€”

Interest expense of Financial Products

462

β€”

462

β€”

Other operating (income) expenses

1,176

599

613

(36)

2

Total operating costs

26,797

25,480

1,376

(59)

Operating profit

6,383

6,164

514

(295)

Interest expense excluding Financial Products

256

256

β€”

β€”

Other income (expense)

159

(24)

(37)

220

3

Consolidated profit before taxes

6,286

5,884

477

(75)

Provision (benefit) for income taxes

1,460

1,339

121

β€”

Profit of consolidated companies

4,826

4,545

356

(75)

Equity in profit (loss) of unconsolidated affiliated companies

40

43

β€”

(3)

4

Profit of consolidated and affiliated companies

4,866

4,588

356

(78)

Less: Profit (loss) attributable to noncontrolling interests

1

(1)

5

(3)

5

Profit 6

$ 4,865

$ 4,589

$ 351

$ (75)

1

Elimination of Financial Products' revenues earned from ME&T.

2

Elimination of net expenses recorded by ME&T paid to Financial Products.

3

Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.

4

Elimination of equity profit (loss) earned from Financial Products' subsidiaries partially owned by ME&T subsidiaries.

5

Elimination of noncontrolling interest profit (loss) recorded by Financial Products for subsidiaries partially owned by ME&T subsidiaries.

6

Profit attributable to common shareholders.

Caterpillar Inc.

Supplemental Data for Financial Position

At June 30, 2024

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,

Energy &

Transportation

Financial

Products

Consolidating

Adjustments

Assets

Current assets:

Cash and cash equivalents

$ 4,341

$ 3,481

$ 860

$ β€”

Receivables – trade and other

9,421

3,672

643

5,106

1,2

Receivables – finance

9,516

β€”

14,826

(5,310)

2

Prepaid expenses and other current assets

2,736

2,549

390

(203)

3

Inventories

17,082

17,082

β€”

β€”

Total current assets

43,096

26,784

16,719

(407)

Property, plant and equipment – net

12,582

8,653

3,929

β€”

Long-term receivables – trade and other

1,181

501

55

625

1,2

Long-term receivables – finance

12,797

β€”

13,490

(693)

2

Noncurrent deferred and refundable income taxes

2,920

3,433

120

(633)

4

Intangible assets

488

488

β€”

β€”

Goodwill

5,264

5,264

β€”

β€”

Other assets

5,008

3,934

2,112

(1,038)

5

Total assets

$ 83,336

$ 49,057

$ 36,425

$ (2,146)

Liabilities

Current liabilities:

Short-term borrowings

$ 5,298

$ β€”

$ 5,298

$ β€”

Accounts payable

7,575

7,523

274

(222)

6,7

Accrued expenses

4,947

4,315

632

β€”

Accrued wages, salaries and employee benefits

1,677

1,637

40

β€”

Customer advances

2,324

2,303

3

18

7

Dividends payable

684

684

β€”

β€”

Other current liabilities

2,882

2,365

744

(227)

4,8

Long-term debt due within one year

8,177

45

8,132

β€”

Total current liabilities

33,564

18,872

15,123

(431)

Long-term debt due after one year

23,836

8,605

15,299

(68)

9

Liability for postemployment benefits

3,993

3,993

β€”

β€”

Other liabilities

4,807

3,931

1,550

(674)

4

Total liabilities

66,200

35,401

31,972

(1,173)

Shareholders' equity

Common stock

5,517

5,517

905

(905)

10

Treasury stock

(41,612)

(41,612)

β€”

β€”

Profit employed in the business

55,455

50,824

4,621

10

10

Accumulated other comprehensive income (loss)

(2,230)

(1,082)

(1,148)

β€”

Noncontrolling interests

6

9

75

(78)

10

Total shareholders' equity

17,136

13,656

4,453

(973)

Total liabilities and shareholders' equity

$ 83,336

$ 49,057

$ 36,425

$ (2,146)

1

Elimination of receivables between ME&T and Financial Products.

2

Reclassification of ME&T's trade receivables purchased by Financial Products and Financial Products' wholesale inventory receivables.

3

Elimination of ME&T's insurance premiums that are prepaid to Financial Products.

4

Reclassification reflecting required netting of deferred tax assets/liabilities by taxing jurisdiction.

5

Elimination of other intercompany assets between ME&T and Financial Products.

6

Elimination of payables between ME&T and Financial Products.

7

Reclassification of Financial Products' payables to customer advances.

8

Elimination of prepaid insurance in Financial Products' other liabilities.

9

Elimination of debt between ME&T and Financial Products.

10

Eliminations associated with ME&T's investments in Financial Products' subsidiaries.

Caterpillar Inc.

Supplemental Data for Financial Position

At December 31, 2023

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,

Energy &

Transportation

Financial

Products

Consolidating

Adjustments

Assets

Current assets:

Cash and cash equivalents

$ 6,978

$ 6,106

$ 872

$ β€”

Receivables – trade and other

9,310

3,971

570

4,769

1,2

Receivables – finance

9,510

β€”

14,499

(4,989)

2

Prepaid expenses and other current assets

4,586

4,327

341

(82)

3

Inventories

16,565

16,565

β€”

β€”

Total current assets

46,949

30,969

16,282

(302)

Property, plant and equipment – net

12,680

8,694

3,986

β€”

Long-term receivables – trade and other

1,238

565

85

588

1,2

Long-term receivables – finance

12,664

β€”

13,299

(635)

2

Noncurrent deferred and refundable income taxes

2,816

3,360

148

(692)

4

Intangible assets

564

564

β€”

β€”

Goodwill

5,308

5,308

β€”

β€”

Other assets

5,257

4,218

2,082

(1,043)

5

Total assets

$ 87,476

$ 53,678

$ 35,882

$ (2,084)

Liabilities

Current liabilities:

Short-term borrowings

$ 4,643

$ β€”

$ 4,643

$ β€”

Accounts payable

7,906

7,827

314

(235)

6,7

Accrued expenses

4,958

4,361

597

β€”

Accrued wages, salaries and employee benefits

2,757

2,696

61

β€”

Customer advances

1,929

1,912

2

15

7

Dividends payable

649

649

β€”

β€”

Other current liabilities

3,123

2,583

647

(107)

4,8

Long-term debt due within one year

8,763

1,044

7,719

β€”

Total current liabilities

34,728

21,072

13,983

(327)

Long-term debt due after one year

24,472

8,626

15,893

(47)

9

Liability for postemployment benefits

4,098

4,098

β€”

β€”

Other liabilities

4,675

3,806

1,607

(738)

4

Total liabilities

67,973

37,602

31,483

(1,112)

Shareholders' equity

Common stock

6,403

6,403

905

(905)

10

Treasury stock

(36,339)

(36,339)

β€”

β€”

Profit employed in the business

51,250

46,783

4,457

10

10

Accumulated other comprehensive income (loss)

(1,820)

(783)

(1,037)

β€”

Noncontrolling interests

9

12

74

(77)

10

Total shareholders' equity

19,503

16,076

4,399

(972)

Total liabilities and shareholders' equity

$ 87,476

$ 53,678

$ 35,882

$ (2,084)

1

Elimination of receivables between ME&T and Financial Products.

2

Reclassification of ME&T's trade receivables purchased by Financial Products and Financial Products' wholesale inventory receivables.

3

Elimination of ME&T's insurance premiums that are prepaid to Financial Products.

4

Reclassification reflecting required netting of deferred tax assets/liabilities by taxing jurisdiction.

5

Elimination of other intercompany assets between ME&T and Financial Products.

6

Elimination of payables between ME&T and Financial Products.

7

Reclassification of Financial Products' payables to customer advances.

8

Elimination of prepaid insurance in Financial Products' other liabilities.

9

Elimination of debt between ME&T and Financial Products.

10

Eliminations associated with ME&T's investments in Financial Products' subsidiaries.

Caterpillar Inc.

Supplemental Data for Cash Flow

For the Six Months Ended June 30, 2024

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,
Energy &
Transportation

Financial

Products

Consolidating

Adjustments

Cash flow from operating activities:

Profit of consolidated and affiliated companies

$ 5,535

$ 5,370

$ 165

$ β€”

Adjustments to reconcile profit to net cash provided by operating activities:

Depreciation and amortization

1,055

662

393

β€”

Provision (benefit) for deferred income taxes

(133)

(81)

(52)

β€”

(Gain) loss on divestiture

164

(46)

210

β€”

Other

105

104

(280)

281

1

Changes in assets and liabilities, net of acquisitions and divestitures:

Receivables – trade and other

(245)

195

96

(536)

1,2

Inventories

(643)

(638)

β€”

(5)

1

Accounts payable

(21)

6

(58)

31

1

Accrued expenses

69

(41)

110

β€”

Accrued wages, salaries and employee benefits

(1,056)

(1,035)

(21)

β€”

Customer advances

341

341

β€”

β€”

Other assets – net

20

(108)

5

123

1

Other liabilities – net

(118)

(156)

147

(109)

1

Net cash provided by (used for) operating activities

5,073

4,573

715

(215)

Cash flow from investing activities:

Capital expenditures – excluding equipment leased to others

(841)

(831)

(13)

3

1

Expenditures for equipment leased to others

(614)

(10)

(612)

8

1

Proceeds from disposals of leased assets and property, plant and equipment

342

13

335

(6)

1

Additions to finance receivables

(7,446)

β€”

(7,951)

505

2

Collections of finance receivables

6,743

β€”

7,176

(433)

2

Net intercompany purchased receivables

β€”

β€”

(138)

138

2

Proceeds from sale of finance receivables

37

β€”

37

β€”

Net intercompany borrowings

β€”

β€”

9

(9)

3

Investments and acquisitions (net of cash acquired)

(32)

(32)

β€”

β€”

Proceeds from sale of businesses and investments (net of cash sold)

(61)

92

(153)

β€”

Proceeds from maturities and sale of securities

2,574

2,402

172

β€”

Investments in securities

(523)

(300)

(223)

β€”

Other – net

57

47

10

β€”

Net cash provided by (used for) investing activities

236

1,381

(1,351)

206

Cash flow from financing activities:

Dividends paid

(1,283)

(1,283)

β€”

β€”

Common stock issued, including treasury shares reissued

8

8

β€”

β€”

Payments to purchase common stock

(6,275)

(6,275)

β€”

β€”

Net intercompany borrowings

β€”

(9)

β€”

9

3

Proceeds from debt issued (original maturities greater than three months)

4,151

β€”

4,151

β€”

Payments on debt (original maturities greater than three months)

(5,217)

(1,014)

(4,203)

β€”

Short-term borrowings – net (original maturities three months or less)

687

β€”

687

β€”

Net cash provided by (used for) financing activities

(7,929)

(8,573)

635

9

Effect of exchange rate changes on cash

(17)

(7)

(10)

β€”

Increase (decrease) in cash, cash equivalents and restricted cash

(2,637)

(2,626)

(11)

β€”

Cash, cash equivalents and restricted cash at beginning of period

6,985

6,111

874

β€”

Cash, cash equivalents and restricted cash at end of period

$ 4,348

$ 3,485

$ 863

$ β€”

1

Elimination of non-cash adjustments and changes in assets and liabilities related to consolidated reporting.

2

Reclassification of Financial Products' cash flow activity from investing to operating for receivables that arose from the sale of inventory.

3

Elimination of net proceeds and payments to/from ME&T and Financial Products.

Caterpillar Inc.

Supplemental Data for Cash Flow

For the Six Months Ended June 30, 2023

(Unaudited)

(Millions of dollars)

Supplemental Consolidating Data

Consolidated

Machinery,
Energy &
Transportation

Financial

Products

Consolidating

Adjustments

Cash flow from operating activities:

Profit of consolidated and affiliated companies

$ 4,866

$ 4,588

$ 356

$ (78)

1,5

Adjustments to reconcile profit to net cash provided by operating activities:

Depreciation and amortization

1,074

690

384

β€”

Provision (benefit) for deferred income taxes

(355)

(338)

(17)

β€”

(Gain) loss on divestiture

572

572

β€”

β€”

Other

106

198

(368)

276

2

Changes in assets and liabilities, net of acquisitions and divestitures:

Receivables – trade and other

(465)

132

57

(654)

2,3

Inventories

(1,560)

(1,558)

β€”

(2)

2

Accounts payable

34

(28)

2

60

2

Accrued expenses

381

318

63

β€”

Accrued wages, salaries and employee benefits

(562)

(550)

(12)

β€”

Customer advances

284

283

1

β€”

Other assets – net

81

149

5

(73)

2

Other liabilities – net

366

211

71

84

2

Net cash provided by (used for) operating activities

4,822

4,667

542

(387)

Cash flow from investing activities:

Capital expenditures – excluding equipment leased to others

(683)

(678)

(11)

6

2

Expenditures for equipment leased to others

(774)

(7)

(772)

5

2

Proceeds from disposals of leased assets and property, plant and equipment

368

27

350

(9)

2

Additions to finance receivables

(6,973)

β€”

(7,957)

984

3

Collections of finance receivables

6,759

β€”

7,516

(757)

3

Net intercompany purchased receivables

β€”

β€”

(83)

83

3

Proceeds from sale of finance receivables

29

β€”

29

β€”

Net intercompany borrowings

β€”

β€”

4

(4)

4

Investments and acquisitions (net of cash acquired)

(20)

(20)

β€”

β€”

Proceeds from sale of businesses and investments (net of cash sold)

(14)

(14)

β€”

β€”

Proceeds from sale of securities

463

332

131

β€”

Investments in securities

(1,078)

(866)

(212)

β€”

Other – net

41

41

β€”

β€”

Net cash provided by (used for) investing activities

(1,882)

(1,185)

(1,005)

308

Cash flow from financing activities:

Dividends paid

(1,238)

(1,238)

(75)

75

5

Common stock issued, including treasury shares reissued

(22)

(22)

β€”

β€”

Payments to purchase common stock

(1,829)

(1,829)

β€”

β€”

Net intercompany borrowings

β€”

(4)

β€”

4

4

Proceeds from debt issued (original maturities greater than three months)

3,299

β€”

3,299

β€”

Payments on debt (original maturities greater than three months)

(2,303)

(95)

(2,208)

β€”

Short-term borrowings – net (original maturities three months or less)

(406)

(3)

(403)

β€”

Net cash provided by (used for) financing activities

(2,499)

(3,191)

613

79

Effect of exchange rate changes on cash

(60)

(12)

(48)

β€”

Increase (decrease) in cash, cash equivalents and restricted cash

381

279

102

β€”

Cash, cash equivalents and restricted cash at beginning of period

7,013

6,049

964

β€”

Cash, cash equivalents and restricted cash at end of period

$ 7,394

$ 6,328

$ 1,066

$ β€”

1

Elimination of equity profit earned from Financial Products' subsidiaries partially owned by ME&T subsidiaries.

2

Elimination of non-cash adjustments and changes in assets and liabilities related to consolidated reporting.

3

Reclassification of Financial Products' cash flow activity from investing to operating for receivables that arose from the sale of inventory.

4

Elimination of net proceeds and payments to/from ME&T and Financial Products.

5

Elimination of dividend activity between Financial Products and ME&T.

favicon.png?sn=CG76558&sd=2024-08-06 View original content:https://www.prnewswire.com/news-releases/caterpillar-reports-second-quarter-2024-results-302215400.html

SOURCE Caterpillar Inc.

rt.gif?NewsItemId=CG76558&Transmission_Id=202408060630PR_NEWS_USPR_____CG76558&DateId=20240806