Caterpillar yesterday issued a downbeat outlook on the “challenging” economic environment saying it would have to wait till 2018 before benefits materialized from tax reform and infrastructure spending under US President Donald Trump.
Caterpillar reported sales and revenues down 13% to $9.6bn, shy of the $9.8bn analysts had expected, in its fourth quarter results.
The company’s losses widened to $1.2bn, or $2 a share, in the three months ended in December, from $94m, or 16 cents a share, in the year-ago period.
Caterpillar’s shares, which fell to a five-and-a-half year low at the start of 2016, finished last year up 35 per cent, with the bulk of the gains coming toward the end of the year on expectations that Trump’s infrastructure spending plans would spur demand for its machines.
Caterpillar’s shares have gained 6% so far this year but Caterpillar said “while better economic growth and increased infrastructure spending may be on the horizon” the availability of used equipment could continue to have a negative impact on sales in construction industries next year.