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1 Other adjustments are comprised primarily of foreign currency translation.
2 Includes All Other Segment (See Note 16).
8.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Other U.S. and non-U.S. government bonds | | | | | | | | | | | | | () | | | | |
| | | | | | | | | | | |
| Corporate debt securities | | | | | | | | | | | |
| Corporate bonds and other debt securities | | | | | | | | | | | | | () | | | | |
| Asset-backed securities | | | | () | | | | | | | | | () | | | | |
| | | | | | | | | | | |
| Mortgage-backed debt securities | | | | | | | | | | | |
| U.S. governmental agency | | | | () | | | | | | | | | () | | | | |
| Residential | | | | | | | | | | | | | () | | | | |
| Commercial | | | | () | | | | | | | | | () | | | | |
| Total available-for-sale debt securities | $ | | | | $ | () | | | $ | | | | $ | | | | $ | () | | | $ | | |
| | | | | | | | | | | |
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | | | |
| | | | | | | | | | | |
| Corporate debt securities | | | | | | | | | | | |
| Corporate bonds | | | | | | | | | | | | | | | | | |
| Asset-backed securities | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
| Mortgage-backed debt securities | | | | | | | | | | | |
| U.S. governmental agency | | | | | | | | | | | | | | | | | |
| | | |
| Commercial | | | | | | | | | | | | | | | | | |
| Total | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Corporate debt securities | | | | | | | | | | | |
| Corporate bonds | | | | | | | | | | | | | | | | | |
| Asset-backed securities | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
| Mortgage-backed debt securities | | | | | | | | | | | |
| U.S. governmental agency | | | | | | | | | | | | | | | | | |
| | | |
| Commercial | | | | | | | | | | | | | | | | | |
| Total | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | |
1 Indicates the length of time that individual securities have been in a continuous unrealized loss position. |
| | | | | | | | | | | |
The unrealized losses on our investments in government debt securities, corporate debt securities, and mortgage-backed debt securities relate to changes in underlying interest rates and credit spreads since time of purchase. We do not intend to sell the investments, and it is not likely that we will be required to sell the investments before recovery of their respective amortized cost basis. In addition, we did not expect credit-related losses on these investments as of September 30, 2024.
The cost basis and fair value of available-for-sale debt securities at September 30, 2024, by contractual maturity, are shown below.
| | $ | | | | Due after one year through five years | | | | | |
| Due after five years through ten years | | | | | |
| Due after ten years | | | | | |
| U.S. governmental agency mortgage-backed securities | | | | | |
| Residential mortgage-backed securities | | | | | |
| Commercial mortgage-backed securities | | | | | |
| Total debt securities – available-for-sale | $ | | | | $ | | |
| | | | |
| | $ | | | | $ | | | | $ | | | | Gross gains from the sale of available-for-sale securities | $ | | | | $ | | | | $ | | | | $ | | |
| Gross losses from the sale of available-for-sale securities | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | |
In addition, we had $ million of investments in time deposits classified as held-to-maturity debt securities as of December 31, 2023. We did have any investments classified as held-to-maturity debt securities as of September 30, 2024. These investments matured within one year and were included in Prepaid expenses and other current assets in the Consolidated Statement of Financial Position. We record held-to-maturity debt securities at amortized cost, which approximates fair value.
For the three months ended September 30, 2024 and 2023, the net unrealized gains (losses) for equity securities held at September 30, 2024 and 2023 were $ million and $() million, respectively. For the nine months ended September 30, 2024 and 2023, the net unrealized gains (losses) for equity securities held at September 30, 2024 and 2023 were $ million and $() million, respectively.
9.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Interest cost | | | | | | | | | | | | | | | | | |
| Expected return on plan assets | () | | | () | | | () | | | () | | | () | | | () | |
| Amortization of prior service cost (credit) | | | | | | | | | | | | | () | | | () | |
| | | |
| | | |
Net periodic benefit cost (benefit) 1 | $ | () | | | $ | () | | | $ | () | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | |
| For the nine months ended: | | | | | | | | | | | |
| Components of net periodic benefit cost: | | | | | | | | | | | |
| Service cost | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Interest cost | | | | | | | | | | | | | | | | | |
| Expected return on plan assets | () | | | () | | | () | | | () | | | () | | | () | |
| Amortization of prior service cost (credit) | | | | | | | | | | | | | () | | | () | |
| | | |
| | | |
Net periodic benefit cost (benefit) 1 | $ | () | | | $ | () | | | $ | () | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | | 1 The service cost component is included in Operating costs. All other components are included in Other income (expense).
We made $ million and $ million of contributions to our pension and other postretirement plans during the three and nine months ended September 30, 2024, respectively. We currently anticipate full-year 2024 contributions of approximately $ million.
| | $ | | | | $ | | | | $ | | |
| Non-U.S. Plans | | | | | | | | | | | |
| | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | |
1 Includes costs related to our non-qualified deferred compensation plans. We utilize total return swaps to economically hedge this exposure to offset the related costs. See Note 5 for additional information.
10.
| | $ | | | | $ | | | | $ | | | | Operating lease revenue | | | | | | | | | | | | |
| Total | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | |
11.
million and $ million at September 30, 2024 and December 31, 2023, respectively.
No significant loss has been experienced or is anticipated under any of these guarantees.
Cat Financial provides guarantees to purchase certain loans of Caterpillar dealers from a special-purpose corporation (SPC) that qualifies as a variable interest entity. Cat Financial receives a fee for providing this guarantee. The purpose of the SPC is to provide short-term working capital loans to Caterpillar dealers. This SPC issues commercial paper and uses the proceeds to fund its loan program. Cat Financial is the primary beneficiary of the SPC as its guarantees result in Cat Financial having both the power to direct the activities that most significantly impact the SPC’s economic performance and the obligation to absorb losses, and therefore Cat Financial has consolidated the financial statements of the SPC. As of September 30, 2024 and December 31, 2023, the SPC’s assets of $ billion and $ billion, respectively, were primarily comprised of loans to dealers, and the SPC’s liabilities of $ billion and $ billion, respectively, were primarily comprised of commercial paper. The assets of the SPC are not available to pay Cat
| | $ | | | | Reduction in liability (payments) | () | | | () | |
| Increase in liability (new warranties) | | | | | |
| Warranty liability, end of period | $ | | | | $ | | |
| | | | |
12.
| | $ | | | | $ | | | | $ | | |
| Determination of shares (in millions): | | | | | | | |
| Weighted-average number of common shares outstanding (B) | | | | | | | |
| Shares issuable on exercise of stock awards, net of shares assumed to be purchased out of proceeds at average market price | | | | | | | |
Average common shares outstanding for fully diluted computation (C) 2 | | | | | | | |
| Profit per share of common stock: | | | | | | | |
| Assuming no dilution (A/B) | $ | | | | $ | | | | $ | | | | $ | | |
Assuming full dilution (A/C) 2 | $ | | | | $ | | | | $ | | | | $ | | |
| Shares outstanding as of September 30, (in millions) | | | | | | | | | |
| | | | | | | |
1 Profit attributable to common shareholders. | | | | | | | |
2 Diluted by assumed exercise of stock-based compensation awards using the treasury stock method. |
| | | | | | | | | |
For the three and nine months ended September 30, 2024, we excluded million and million of outstanding stock options, respectively, from the computation of diluted earnings per share because the effect would have been antidilutive. For the three and nine months ended September 30, 2023, we excluded million and million of outstanding stock options, respectively, from the computation of diluted earnings per share because the effect would have been antidilutive.
For the three and nine months ended September 30, 2024, we repurchased million and million shares of Caterpillar common stock, respectively, at an aggregate cost of $ billion and $ billion, respectively. For the three and nine months ended September 30, 2023, we repurchased million and million shares of Caterpillar common stock, respectively, at an aggregate cost of $ billion and $ billion, respectively. We made these purchases through the combination of accelerated share repurchase (ASR) agreements with third-party financial institutions and open market transactions in 2024 and 2023.
billion of common stock. We advanced the $ billion and received approximately million shares of Caterpillar common stock with a value of $ billion. In the second quarter of 2024, we entered into ASR agreements to repurchase an aggregate of $ billion of common stock. We advanced the $ billion and received approximately million shares of Caterpillar common stock with a value of $ million. These ASR agreements will last into the fourth quarter of 2024. The final number of shares to ultimately be purchased will be based on the average of the daily volume-weighted average prices of our common stock during the term of the ASR agreements, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR agreements. The remaining $ billion was evaluated as unsettled forward contracts and was classified as a reduction to Common stock within the Consolidated Statement of Financial Position.
13.
) | | $ | () | | | $ | () | | | $ | () | | |
|
| Gains (losses) on foreign currency translation | | | | () | | | | | | () | |
| Less: Tax provision /(benefit) | () | | | | | | () | | | () | |
| Net gains (losses) on foreign currency translation | | | | () | | | | | | () | |
| (Gains) losses reclassified to earnings | | | | () | | | | | | | |
| Less: Tax provision /(benefit) | | | | | | | | | | | |
| Net (gains) losses reclassified to earnings | | | | () | | | | | | | |
| Other comprehensive income (loss), net of tax | | | | () | | | | | | | |
| Ending balance | $ | () | | | $ | () | | | $ | () | | | $ | () | |
|
| | |
|
| Pension and other postretirement benefits | | | | | | | |
| Beginning balance | $ | () | | | $ | () | | | $ | () | | | $ | () | |
|
|
| Current year prior service credit (cost) | | | | | | | | | | | |
| Less: Tax provision /(benefit) | | | | | | | | | | | |
| Net current year prior service credit (cost) | | | | | | | | | | | |
| Amortization of prior service (credit) cost | () | | | () | | | () | | | () | |
| Less: Tax provision /(benefit) | | | | | | | () | | | () | |
| Net amortization of prior service (credit) cost | () | | | () | | | () | | | () | |
| Other comprehensive income (loss), net of tax | () | | | () | | | () | | | () | |
| Ending balance | $ | () | | | $ | () | | | $ | () | | | $ | () | |
| Derivative financial instruments | | | | | | | |
| Beginning balance | $ | | | | $ | | | | $ | | | | $ | | |
|
|
| Gains (losses) deferred | | | | | | | | | | | |
| Less: Tax provision /(benefit) | | | | | | | | | | | |
| Net gains (losses) deferred | | | | | | | | | | | |
| (Gains) losses reclassified to earnings | | | | () | | | () | | | () | |
| Less: Tax provision /(benefit) | | | | () | | | () | | | () | |
| Net (gains) losses reclassified to earnings | | | | () | | | () | | | () | |
| Other comprehensive income (loss), net of tax | | | | () | | | () | | | () | |
| Ending balance | $ | | | | $ | | | | $ | | | | $ | | |
|
| | |
|
| Available-for-sale securities | | | | | | | |
| Beginning balance | $ | () | | | $ | () | | | $ | () | | | $ | () | |
|
|
| Gains (losses) deferred | | | | () | | | | | | () | |
| Less: Tax provision /(benefit) | | | | () | | | | | | () | |
| Net gains (losses) deferred | | | | () | | | | | | () | |
| (Gains) losses reclassified to earnings | | | | | | | | | | | |
| Less: Tax provision /(benefit) | | | | | | | | | | | |
| Net (gains) losses reclassified to earnings | | | | | | | | | | | |
| Other comprehensive income (loss), net of tax | | | | () | | | | | | () | |
| Ending balance | $ | () | | | $ | () | | | $ | () | | | $ | () | |
| | | | | | | |
Total AOCI Ending Balance at September 30, | $ | () | | | $ | () | | | $ | () | | | $ | () | |
| | | | | | | |
14.
15.
percent compared to percent for the three months ended September 30, 2023. The effective tax rate for the nine months ended September 30, 2024 was percent compared to percent for the nine months ended September 30, 2023.
16.
Group Presidents, a Chief Financial Officer (CFO), a Chief Legal Officer and General Counsel and a Chief Human Resources Officer. The COO, Group Presidents and CFO are accountable for a related set of end-to-end businesses that they manage. The Chief Legal Officer and General Counsel leads the Law, Security and Public Policy Division. The Chief Human Resources Officer leads the Human Resources Organization. The CEO allocates resources and manages performance at the COO/Group President/CFO level. As such, the CEO serves as our Chief Operating Decision Maker, and operating segments are primarily based on the COO/Group President/CFO reporting structure.
of our operating segments, Construction Industries, Resource Industries and Energy & Transportation are led by Group Presidents. operating segment, Financial Products, is led by the CFO who also has responsibility for Corporate Services. Corporate Services is a cost center primarily responsible for the performance of certain support functions globally and to provide centralized services; it does not meet the definition of an operating segment. Group President leads smaller operating segment that is included in the All Other Segment. The Law, Security and Public Policy Division and the Human Resources Organization are cost centers and do not meet the definition of an operating segment.
B. Description of segments
We have operating segments, of which are reportable segments. Following is a brief description of our reportable segments and the business activities included in the All Other Segment:
Construction Industries: A segment primarily responsible for supporting customers using machinery in infrastructure and building construction applications. Responsibilities include business strategy, product design, product management and development, manufacturing, marketing and sales and product support. The product portfolio includes asphalt pavers; backhoe loaders; cold planers; compactors; compact track loaders; forestry machines; material handlers; motor graders; pipelayers; road reclaimers; skid steer loaders; telehandlers; track-type loaders; track-type tractors (small, medium); track excavators (mini, small, medium, large); wheel excavators; wheel loaders (compact, small, medium); and related parts and work tools. Inter-segment sales are a source of revenue for this segment.
Resource Industries: A segment primarily responsible for supporting customers using machinery in mining, heavy construction and quarry and aggregates. Responsibilities include business strategy, product design, product management and development, manufacturing, marketing and sales and product support. The product portfolio includes large track-type tractors; large mining trucks; hard rock vehicles; electric rope shovels; draglines; hydraulic shovels; rotary drills; large wheel loaders; off-highway trucks; articulated trucks; wheel tractor scrapers; wheel dozers; landfill compactors; soil compactors; wide-body trucks; select work tools; machinery components; electronics and control systems and related parts. In addition to equipment, Resource Industries also develops and sells technology products and services to provide customers fleet management, equipment management analytics, autonomous machine capabilities, safety services and mining performance solutions. Resource Industries also manages areas that provide services to other parts of the company, including strategic procurement, lean center of excellence, integrated manufacturing, research and development for hydraulic systems, automation, electronics and software for Caterpillar machines and engines. Inter-segment sales are a source of revenue for this segment.
Energy & Transportation: A segment primarily responsible for supporting customers using reciprocating engines, turbines, diesel-electric locomotives and related services across industries serving Oil and Gas, Power Generation, Industrial and Transportation applications, including marine- and rail-related businesses as well as product support of on-highway engines. Responsibilities include business strategy, product design, product management, development and testing, manufacturing, marketing and sales and product support. The product and services portfolio includes turbines, centrifugal gas compressors, and turbine-related services; reciprocating engine-powered generator sets; integrated systems and solutions used in the electric power generation industry; reciprocating engines, drivetrain and integrated systems and solutions for the marine and oil and gas industries; reciprocating engines, drivetrain and integrated systems and solutions supplied to the industrial industry as well as Caterpillar machines; electrified powertrain and zero-emission power sources and service solutions development; and diesel-electric locomotives and components and other rail-related products and services, including remanufacturing and leasing. Responsibilities also include the remanufacturing of Caterpillar reciprocating engines and components and remanufacturing services for other companies. Inter-segment sales are a source of revenue for this segment.
Financial Products Segment: Provides financing alternatives to customers and dealers around the world for Caterpillar products and services, as well as financing for power generation facilities that, in most cases, incorporate Caterpillar products. Financing plans include operating and finance leases, revolving charge accounts, installment sale contracts, repair/rebuild financing, working capital loans and wholesale financing plans. The segment also provides insurance and risk management products and services that help customers and dealers manage their business risk. Insurance and risk management products offered include physical damage insurance, inventory protection plans, extended service coverage and maintenance plans for machines and engines, and dealer property and casualty insurance. The various forms of financing, insurance and risk management products offered to customers and dealers help support the purchase and lease of Caterpillar equipment. The segment also earns revenues from ME&T, but the related costs are not allocated to operating segments. Financial Products’ segment profit is determined on a pretax basis and includes other income/expense items.
-year useful life. This methodology difference only impacts segment assets. We do not include goodwill amortization expense in segment profit. In addition, we have allocated to segments only a portion of goodwill for certain acquisitions made in 2011 or later.
•We generally manage currency exposures for ME&T at the corporate level and do not include in segment profit the effects of changes in exchange rates on results of operations within the year. We report the net difference created in the translation of revenues and costs between exchange rates used for U.S. GAAP reporting and exchange rates used for segment reporting as a methodology difference.
•We do not include stock-based compensation expense in segment profit.
•Postretirement benefit expenses are split; segments are generally responsible for service costs, with the remaining elements of net periodic benefit cost included as a methodology difference.
•We determine ME&T segment profit on a pretax basis and exclude interest expense and most other income/expense items. We determine Financial Products Segment profit on a pretax basis and include other income/expense items.
Reconciling items are created based on accounting differences between segment reporting and our consolidated external reporting. Please refer to pages 32 to 33 for financial information regarding significant reconciling items. Most of our reconciling items are self-explanatory given the above explanations. For the reconciliation of profit, we have grouped the reconciling items as follows:
•Corporate costs: These costs are related to corporate requirements primarily for compliance and legal functions for the benefit of the entire organization.
•Restructuring income/costs: May include costs for employee separation, long-lived asset impairments, contract terminations and (gains)/losses on divestitures. These costs are included in Other operating (income) expenses except for defined-benefit plan curtailment losses and special termination benefits, which are included in Other income (expense). Restructuring costs also include other exit-related costs, which may consist of accelerated depreciation, inventory write-downs, building demolition, equipment relocation and project management costs and LIFO inventory decrement benefits from inventory liquidations at closed facilities, all of which are primarily included in Cost of goods sold. See Note 20 for more information.
•Methodology differences: See previous discussion of significant accounting differences between segment reporting and consolidated external reporting.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Resource Industries | | | | | | | | | | | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | | | | | | 1 | | | | | |
| Total sales and revenues from reportable segments | | | | | | | | | | | | | | | | | | | | | |
| All Other Segment | | | | | | | | | | | | | | | | | | | | | |
| Corporate Items and Eliminations | | () | | | () | | | () | | | () | | | () | | | () | | | () | |
| Total Sales and Revenues | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | — | | | $ | | |
| | | | | | | | | | | | | | |
| Three Months Ended September 30, 2023 | | | | | | | | | | | | | | |
| Construction Industries | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Resource Industries | | | | | | | | | | | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | | | | | | 1 | | | | | |
| Total sales and revenues from reportable segments | | | | | | | | | | | | | | | | | | | | | |
| All Other Segment | | | | | () | | | | | | | | | | | | | | | | |
| Corporate Items and Eliminations | | () | | | () | | | () | | | () | | | () | | | () | | | () | |
| Total Sales and Revenues | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | — | | | $ | | |
| | | | | | | | | | | | | | |
1 Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $ million and $ million in the three months ended September 30, 2024 and 2023, respectively.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Resource Industries | | | | | | | | | | | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | | | | | | 1 | | | | | |
| Total sales and revenues from reportable segments | | | | | | | | | | | | | | | | | | | | | |
| All Other Segment | | | | | () | | | | | | | | | | | | | | | | |
| Corporate Items and Eliminations | | () | | | () | | | () | | | () | | | () | | | () | | | () | |
| Total Sales and Revenues | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | — | | | $ | | |
| | | | | | | | | | | | | | |
| Nine Months Ended September 30, 2023 | | | | | | | | | | | | | | |
| Construction Industries | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Resource Industries | | | | | | | | | | | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | | | | | | 1 | | | | | |
| Total sales and revenues from reportable segments | | | | | | | | | | | | | | | | | | | | | |
| All Other Segment | | | | | () | | | | | | | | | | | | | | | | |
| Corporate Items and Eliminations | | () | | | () | | | () | | | () | | | () | | | () | | | () | |
| Total Sales and Revenues | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | — | | | $ | | |
| | | | | | | | | | | | | | |
1 Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $ million and $ million in the nine months ended September 30, 2024 and 2023, respectively.
| | $ | | | | $ | | | | $ | | | | Power generation | | | | | | | | | | | | |
| Industrial | | | | | | | | | | | | |
| Transportation | | | | | | | | | | | | |
| Energy & Transportation External Sales | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | |
| | $ | | | | $ | | | | $ | | | | Resource Industries | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | |
| Total profit from reportable segments | | | | | | | | | | | |
| Profit (loss) from All Other Segment | () | | | | | | | | | | |
| Cost centers | () | | | | | | | | | | |
| Corporate costs | () | | | () | | | () | | | () | |
| Timing | () | | | | | | | | | () | |
| Restructuring income (costs) | () | | | () | | | () | | | () | |
| Methodology differences: | | | | | | | |
| Inventory/cost of sales | | | | () | | | | | | | |
| Postretirement benefit expense | () | | | () | | | () | | | () | |
| Stock-based compensation expense | () | | | () | | | () | | | () | |
| Financing costs | () | | | () | | | () | | | () | |
| Currency | () | | | | | | | | | | |
| Other income/expense methodology differences | () | | | () | | | () | | | () | |
| Other methodology differences | () | | | () | | | () | | | () | |
| Total consolidated profit before taxes | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | |
| | $ | | | | Resource Industries | | | | | |
| Energy & Transportation | | | | | |
| Financial Products Segment | | | | | |
| Total assets from reportable segments | | | | | |
| Assets from All Other Segment | | | | | |
| Items not included in segment assets: | | | |
| Cash and cash equivalents | | | | | |
| Deferred income taxes | | | | | |
| Goodwill and intangible assets | | | | | |
| Property, plant and equipment – net and other assets | | | | | |
| Inventory methodology differences | () | | | () | |
| Liabilities included in segment assets | | | | | |
| Other | () | | | () | |
| Total assets | $ | | | | $ | | |
|
| | $ | | | | $ | | | | $ | | | | Resource Industries | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | |
| Total depreciation and amortization from reportable segments | | | | | | | | | | | |
| Items not included in segment depreciation and amortization: | | | | | | | |
| All Other Segment | | | | | | | | | | | |
| Cost centers | | | | | | | | | | | |
| Other | () | | | () | | | () | | | | |
| Total depreciation and amortization | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | |
| | $ | | | | $ | | | | $ | | | | Resource Industries | | | | | | | | | | | |
| Energy & Transportation | | | | | | | | | | | |
| Financial Products Segment | | | | | | | | | | | |
| Total capital expenditures from reportable segments | | | | | | | | | | | |
| Items not included in segment capital expenditures: | | | | | | | |
| All Other Segment | | | | | | | | | | | |
| Cost centers | | | | | | | | | | | |
| Timing | () | | | | | | | | | | |
| Other | () | | | () | | | () | | | () | |
| Total capital expenditures | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | |
17.
months with an average remaining term of approximately months as of September 30, 2024.
Cat Financial typically maintains a security interest in financed equipment and generally requires physical damage insurance coverage on the financed equipment, both of which provide Cat Financial with certain rights and protections. If Cat Financial's collection efforts fail to bring a defaulted account current, Cat Financial generally can repossess the financed equipment, after satisfying local legal requirements, and sell it within the Caterpillar dealer network or through third-party auctions.
Cat Financial estimates the allowance for credit losses related to its customer finance receivables based on loss forecast models utilizing probabilities of default and the estimated loss given default based on past loss experience adjusted for current conditions and reasonable and supportable forecasts capturing country and industry-specific economic factors.
During the three and nine months ended September 30, 2024, Cat Financial's forecasts reflected a continuation of the trend of historically low unemployment rates as well as low delinquencies within their portfolio. However, industry delinquencies show an increasing trend as the central bank actions aimed at reducing inflation have weakened global economic growth. The company believes the economic forecasts employed represent reasonable and supportable forecasts, followed by a reversion to long-term trends.
Dealer
Cat Financial provides financing to Caterpillar dealers in the form of wholesale financing plans. Cat Financial's wholesale financing plans provide assistance to dealers by financing their mostly new Caterpillar equipment inventory and rental fleets on a secured and unsecured basis. In addition, Cat Financial provides a variety of secured and unsecured loans to Caterpillar dealers.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Write-offs | () | | | | | | () | | | () | | | | | | () | |
| Recoveries | | | | | | | | | | | | | | | | | |
Provision for credit losses 1 | | | | | | | | | | | | | | | | | |
| Other | | | | | | | | | | () | | | | | | () | |
| Ending balance | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | |
| Nine Months Ended September 30, 2024 | | Nine Months Ended September 30, 2023 |
| Customer | | Dealer | | Total | | Customer | | Dealer | | Total |
| Beginning balance | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | |
| Write-offs | () | | | () | | | () | | | () | | | | | | () | |
| Recoveries | | | | | | | | | | | | | | | | | |
Provision for credit losses 1 | | | | | | | | | | | | | () | | | | |
| Other | () | | | | | | () | | | () | | | | | | () | |
| Ending balance | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | |
| Finance Receivables | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | |
1 Excludes provision for credit losses on unfunded commitments and other miscellaneous receivables. |
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | EAME | | | | | | | | | | | | | | | | | | | | | | | |
| Asia/Pacific | | | | | | | | | | | | | | | | | | | | | | | |
| Mining | | | | | | | | | | | | | | | | | | | | | | | |
| Latin America | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| Total | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | | | | | |
| Three Months Ended September 30, 2023 |
| 2023 | | 2022 | | 2021 | | 2020 | | 2019 | | Prior | | Revolving
Finance
Receivables | | Total |
| North America | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| EAME | | | | | | | | | | | | | | | | | | | | | | | |
| Asia/Pacific | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| Latin America | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| Total | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | | | | | |
| Nine Months Ended September 30, 2024 |
| 2024 | | 2023 | | 2022 | | 2021 | | 2020 | | Prior | | Revolving
Finance
Receivables | | Total |
| North America | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| EAME | | | | | | | | | | | | | | | | | | | | | | | |
| Asia/Pacific | | | | | | | | | | | | | | | | | | | | | | | |
| Mining | | | | | | | | | | | | | | | | | | | | | | | |
| Latin America | | | | | | | | | | | | | | | | | | | | | | | |
| | |
|
|
|
|
|
|
|
|
|
|
| | | | |
|
|
|
|
|
|
|
|
|
|
| | | | |
|
Finance receivables in Cat Financial's Customer portfolio segment are substantially secured by collateral, primarily in the form of Caterpillar and other equipment. For those contracts where the borrower is experiencing financial difficulty, repayment of the outstanding amounts is generally expected to be provided through the operation or repossession and sale of the equipment.
million that was 91+ days past due in Latin America, all of which originated prior to 2019.
Non-accrual finance receivables
Recognition of income is suspended and the finance receivable is placed on non-accrual status when management determines that collection of future income is not probable. Contracts on non-accrual status are generally more than days past due. Recognition is resumed and previously suspended income is recognized when collection is considered probable. Payments received while the finance receivable is on non-accrual status are applied to interest and principal in accordance with the contractual terms. Interest earned but uncollected prior to the receivable being placed on non-accrual status is written off through Provision for credit losses when, in the judgment of management, it is considered uncollectible.
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | | | |
| | | | | | | | | | | | | | | | |
There were finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status as of September 30, 2024. There were $ million in finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status as of December 31, 2023, all of which was in Latin America.
Modifications
Cat Financial periodically modifies the terms of their finance receivable agreements. Typically, the types of modifications granted are payment deferrals, interest-only payment periods and/or term extensions. Many modifications Cat Financial grants are for commercial reasons or for borrowers experiencing some form of short-term financial stress and may result in insignificant payment delays. Cat Financial does not consider these borrowers to be experiencing financial difficulty. Modifications for borrowers Cat Financial does consider to be experiencing financial difficulty typically result in payment deferrals and/or reduced payments for a period of or longer, term extension of or longer or a combination of both.
During the three and nine months ended September 30, 2024 and 2023, there were finance receivable modifications granted to borrowers experiencing financial difficulty in Cat Financial's Dealer portfolio segment. The amortized cost basis of finance receivables modified for borrowers experiencing financial difficulty in the Customer portfolio segment during the three months ended September 30, 2024 and 2023, was $ million and $ million, respectively. Total modifications with borrowers experiencing financial difficulty represented percent and percent of Cat Financial's Customer portfolio for the same periods, respectively. The amortized cost basis of finance receivables modified for borrowers experiencing financial difficulty in the Customer portfolio segment during the nine months
million and $ million, respectively. Total modifications with borrowers experiencing financial difficulty represented percent and percent of Cat Financial's Customer portfolio for the same periods, respectively.
For the three months ended September 30, 2024 and 2023, the financial effects of term extensions for borrowers experiencing financial difficulty added a weighted average of and months, respectively, to the terms of modified contracts. For the nine months ended September 30, 2024 and 2023, the financial effects of term extensions for borrowers experiencing financial difficulty added a weighted average of and months, respectively, to the terms of modified contracts. For the three months ended September 30, 2024 and 2023, the financial effects of payment delays for borrowers experiencing financial difficulty resulted in weighted average payment deferrals and/or interest only payment periods of and months, respectively. For the nine months ended September 30, 2024 and 2023, the financial effects of payment delays for borrowers experiencing financial difficulty resulted in weighted average payment deferrals and/or interest only payment periods of and months, respectively.
After Cat Financial modifies a finance receivable, they continue to track its performance under its most recent modified terms. As of September 30, 2024 and 2023, defaults of loans modified in the prior twelve months were not significant.
The effect of most modifications made to finance receivables for borrowers experiencing financial difficulty is already included in the allowance for credit losses based on the methodologies used to estimate the allowance; therefore, a change to the allowance for credit losses is generally not recorded upon modification. On rare occasions when principal forgiveness is provided, the amount forgiven is written off against the allowance for credit losses.
18.
See Note 5 for additional information.
| | $ | | | | $ | | | | $ | | | | $ | | |
| Other U.S. and non-U.S. government bonds | | | | | | | | | | | | | | |
| Corporate debt securities | | | | | | | | | |
| Corporate bonds and other debt securities | | | | | | | | | | | | | | |
| Asset-backed securities | | | | | | | | | | | | | | |
| Mortgage-backed debt securities | | | | | | | | | |
| U.S. governmental agency | | | | | | | | | | | | | | |
| Residential | | | | | | | | | | | | | | |
| Commercial | | | | | | | | | | | | | | |
| Total debt securities | | | | | | | | | | | | | | |
| Equity securities | | | | | | | | | |
| Large capitalization value | | | | | | | | | | | | | | |
| Smaller company growth | | | | | | | | | | | | | | |
| REIT | | | | | | | | | | | | | | |
| Total equity securities | | | | | | | | | | | | | | |
| Derivative financial instruments - assets | | | | | | | | | |
| Foreign currency contracts - net | | | | | | | | | | | | | | |
| |
| Commodity contracts - net | | | | | | | | | | | | | | |
| Total return swap contracts - net | | | | | | | | | | | | | | |
| Total assets | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Liabilities | | | | | | | | | |
| Derivative financial instruments - liabilities | | | | | | | | | |
| |
| Interest rate contracts - net | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| |
| Total liabilities | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| |
| | | | | | | | | |
| | $ | | | | $ | | | | $ | | | | $ | | | | Other U.S. and non-U.S. government bonds | | | | | | | | | | | | | | |
| Corporate debt securities | | | | | | | | | |
| Corporate bonds and other debt securities | | | | | | | | | | | | | | |
| Asset-backed securities | | | | | | | | | | | | | | |
| Mortgage-backed debt securities | | | | | | | | | |
| U.S. governmental agency | | | | | | | | | | | | | | |
| Residential | | | | | | | | | | | | | | |
| Commercial | | | | | | | | | | | | | | |
| Total debt securities | | | | | | | | | | | | | | |
| Equity securities | | | | | | | | | |
| Large capitalization value | | | | | | | | | | | | | | |
| Smaller company growth | | | | | | | | | | | | | | |
| REIT | | | | | | | | | | | | | | |
| Total equity securities | | | | | | | | | | | | | | |
| Derivative financial instruments - assets | | | | | | | | | |
| Foreign currency contracts - net | | | | | | | | | | | | | | |
| |
| Commodity contracts - net | | | | | | | | | | | | | | |
| |
| Total Assets | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Liabilities | | | | | | | | | |
| Derivative financial instruments - liabilities | | | | | | | | | |
| Interest rate contracts - net | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Total liabilities | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | |
| | | | | | | | | |
In addition to the amounts above, certain Cat Financial loans are subject to measurement at fair value on a nonrecurring basis and are classified as Level 3 measurements. A loan is measured at fair value when management determines that collection of contractual amounts due is not probable and the loan is individually evaluated. In these cases, an allowance for credit losses may be established based either on the present value of expected future cash flows discounted at the receivables’ effective interest rate, the fair value of the collateral for collateral-dependent receivables, or the observable market price of the receivable. In determining collateral value, Cat Financial estimates the current fair market value of the collateral less selling costs. Cat Financial had loans carried at fair value of $ million and $ million as of September 30, 2024 and December 31, 2023, respectively.
B. Fair values of financial instruments
| | $ | | | | $ | | | | $ | | | | 3 | | Note 17 | Wholesale inventory receivables – net (excluding finance leases 1) | | | | | | | | | | | | | | 3 | | |
| | | | | | | | | | | | |
| Liabilities | | | | | | | | | | | | |
Long-term debt (including amounts due within one year) | | | | | | | | | | |
| Machinery, Energy & Transportation | | | | | | | | | | | | | | 2 | | |
| Financial Products | | | | | | | | | | | | | | 2 | | |
1 Represents finance leases and failed sale leasebacks of $ million and $ million at September 30, 2024 and December 31, 2023, respectively.
19.
| | $ | | | | $ | | | | $ | | | Foreign exchange gains (losses) 1 | () | | | | | | () | | | () | |
| License fee income | | | | | | | | | | | |
| Net periodic pension and OPEB income (cost), excluding service cost | | | | () | | | | | | () | |
| Gains (losses) on securities | | | | | | | | | | () | |
| Miscellaneous income (loss) | | | | | | | () | | | () | |
| Total | $ | | | | $ | | | | $ | | | | $ | | |
1 Includes gains (losses) from foreign exchange derivative contracts. See Note 5 for further details.
20.
| | $ | | | | $ | | | | $ | | |
Divestitures 1 | | | | | | | | | | | | |
Contract terminations 1 | | | | | | | | | | | | |
Long-lived asset impairments 1 | | | | | | | | | | | | |
|
Other 2 | | | | | | | | | | | | |
| Total restructuring (income) costs | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | |
| | | | | | | | |
1 Recognized in Other operating (income) expenses. | | | | |
2 Represents costs related to our restructuring programs, primarily for inventory write-downs, project management, equipment relocation and accelerated depreciation, all of which are primarily included in Cost of goods sold. |
| | | |
|
| 2,464 | | | $ | 5.06 | |
| |
| | 0.11 | |
| |
|
| | 0.07 | |
| |
| |
|
| | 0.26 | |
| |
| |
|
| | 0.17 | |
| |
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| % |
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| % |
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| % |
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| 7,726 | | | $ | 7,955 | |
| | | | | |
| | (1,108) | |
| | | | | |
| 6,442 | | | $ | 6,847 | |
1 See reconciliation of ME&T net cash provided by operating activities to consolidated net cash provided by operating activities on pages 75 - 76. |
| | | |
Supplemental Consolidating Data
We are 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 – We define 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 our products.
Financial Products – We define Financial Products as it is presented in the supplemental data as our 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. We believe this presentation will assist readers in understanding our business.
Pages 69 to 76 reconcile ME&T and Financial Products to Caterpillar Inc. consolidated financial information. Certain amounts for prior periods have been reclassified to conform to the current period presentation.
Caterpillar Inc.
Supplemental Data for Results of Operations
For the Three Months Ended September 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 | $ | 15,231 | | | $ | 15,231 | | | $ | — | | | $ | — | | |
| Revenues of Financial Products | 875 | | | — | | | 1,078 | | | (203) | | 1 |
| Total sales and revenues | 16,106 | | | 15,231 | | | 1,078 | | | (203) | | |
| | | | | | | | |
| Operating costs: | | | | | | | | |
| Cost of goods sold | 10,066 | | | 10,067 | | | — | | | (1) | | 2 |
| Selling, general and administrative expenses | 1,669 | | | 1,484 | | | 197 | | | (12) | | 2 |
| Research and development expenses | 533 | | | 533 | | | — | | | — | | |
| Interest expense of Financial Products | 336 | | | — | | | 336 | | | — | | |
| Other operating (income) expenses | 355 | | | 49 | | | 329 | | | (23) | | 2 |
| Total operating costs | 12,959 | | | 12,133 | | | 862 | | | (36) | | |
| | | | | | | | |
| Operating profit | 3,147 | | | 3,098 | | | 216 | | | (167) | | |
| | | | | | | | |
| Interest expense excluding Financial Products | 125 | | | 127 | | | — | | | (2) | | 3 |
| Other income (expense) | 76 | | | (122) | | | 33 | | | 165 | | 4 |
| | | | | | | | |
| Consolidated profit before taxes | 3,098 | | | 2,849 | | | 249 | | | — | | |
| | | | | | | | |
| Provision (benefit) for income taxes | 642 | | | 582 | | | 60 | | | — | | |
| Profit of consolidated companies | 2,456 | | | 2,267 | | | 189 | | | — | | |
| | | | | | | | |
| Equity in profit (loss) of unconsolidated affiliated companies | 7 | | | 7 | | | — | | | — | | |
|
| | | | | | | | |
| Profit of consolidated and affiliated companies | 2,463 | | | 2,274 | | | 189 | | | — | | |
| | | | | | | | |
| Less: Profit (loss) attributable to noncontrolling interests | (1) | | | (1) | | | — | | | — | | |
| | | | | | | | |
Profit 5 | $ | 2,464 | | | $ | 2,275 | | | $ | 189 | | | $ | — | | |
1Elimination of Financial Products’ revenues earned from ME&T.
2Elimination of net expenses recorded between ME&T and Financial Products.
3Elimination of interest expense recorded between Financial Products and ME&T.
4Elimination 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.
5Profit attributable to common shareholders.
Caterpillar Inc.
Supplemental Data for Results of Operations
For the Nine Months Ended September 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 | $ | 46,031 | | | $ | 46,031 | | | $ | — | | | $ | — | | |
| Revenues of Financial Products | 2,563 | | | — | | | 3,150 | | | (587) | | 1 |
| Total sales and revenues | 48,594 | | | 46,031 | | | 3,150 | | | (587) | | |
| | | | | | | | |
| Operating costs: | | | | | | | | |
| Cost of goods sold | 29,878 | | | 29,883 | | | — | | | (5) | | 2 |
| Selling, general and administrative expenses | 4,898 | | | 4,346 | | | 560 | | | (8) | | 2 |
| Research and development expenses | 1,588 | | | 1,588 | | | — | | | — | | |
| Interest expense of Financial Products | 948 | | | — | | | 948 | | | — | |
|
| Other operating (income) expenses | 1,134 | | | 51 | | | 1,174 | | | (91) | | 2 |
| Total operating costs | 38,446 | | | 35,868 | | | 2,682 | | | (104) | | |
| | | | | | | | |
| Operating profit | 10,148 | | | 10,163 | | | 468 | | | (483) | | |
| | | | | | | | |
| Interest expense excluding Financial Products | 405 | | | 407 | | | — | | | (2) | | 3 |
| Other income (expense) | 387 | | | (163) | | | 69 | | | 481 | | 4 |
| | | | | | | | |
| Consolidated profit before taxes | 10,130 | | | 9,593 | | | 537 | | | — | | |
| | | | | | | | |
| Provision (benefit) for income taxes | 2,166 | | | 1,983 | | | 183 | | | — | | |
| Profit of consolidated companies | 7,964 | | | 7,610 | | | 354 | | | — | | |
| | | | | | | | |
| Equity in profit (loss) of unconsolidated affiliated companies | 34 | | | 34 | | | — | | | — | | |
|
| | | | | | | | |
| Profit of consolidated and affiliated companies | 7,998 | | | 7,644 | | | 354 | | | — | | |
| | | | | | | | |
| Less: Profit (loss) attributable to noncontrolling interests | (3) | | | (4) | | | 1 | | | — | | |
| | | | | | | | |
Profit 5 | $ | 8,001 | | | $ | 7,648 | | | $ | 353 | | | $ | — | | |
1Elimination of Financial Products’ revenues earned from ME&T.
2Elimination of net expenses recorded between ME&T and Financial Products.
3Elimination of interest expense recorded between Financial Products and ME&T.
4Elimination 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.
5Profit attributable to common shareholders.
Caterpillar Inc.
Supplemental Data for Results of Operations
For the Three Months Ended September 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 | $ | 15,988 | | | $ | 15,988 | | | $ | — | | | $ | — | | |
| Revenues of Financial Products | 822 | | | — | | | 1,017 | | | (195) | | 1 |
| Total sales and revenues | 16,810 | | | 15,988 | | | 1,017 | | | (195) | | |
| | | | | | | | |
| Operating costs: | | | | | | | | |
| Cost of goods sold | 10,583 | | | 10,586 | | | — | | | (3) | | 2 |
| Selling, general and administrative expenses | 1,624 | | | 1,430 | | | 206 | | | (12) | | 2 |
| Research and development expenses | 554 | | | 554 | | | — | | | — | | |
| Interest expense of Financial Products | 280 | | | — | | | 280 | | | — | |
|
| Other operating (income) expenses | 320 | | | 25 | | | 310 | | | (15) | | 2 |
| Total operating costs | 13,361 | | | 12,595 | | | 796 | | | (30) | | |
| | | | | | | | |
| Operating profit | 3,449 | | | 3,393 | | | 221 | | | (165) | | |
| | | | | | | | |
| Interest expense excluding Financial Products | 129 | | | 129 | | | — | | | — | | |
| Other income (expense) | 195 | | | 42 | | | (12) | | | 165 | | 3 |
| | | | | | | | |
| Consolidated profit before taxes | 3,515 | | | 3,306 | | | 209 | | | — | | |
| | | | | | | | |
| Provision (benefit) for income taxes | 734 | | | 654 | | | 80 | | | — | | |
| Profit of consolidated companies | 2,781 | | | 2,652 | | | 129 | | | — | | |
| | | | | | | | |
| Equity in profit (loss) of unconsolidated affiliated companies | 12 | | | 12 | | | — | | | — | | |
|
| | | | | | | | |
| Profit of consolidated and affiliated companies | 2,793 | | | 2,664 | | | 129 | | | — | | |
| | | | | | | | |
| Less: Profit (loss) attributable to noncontrolling interests | (1) | | | (1) | | | — | | | — | | |
| | | | | | | | |
Profit 4 | $ | 2,794 | | | $ | 2,665 | | | $ | 129 | | | $ | — | | |
1Elimination of Financial Products’ revenues earned from ME&T.
2Elimination of net expenses recorded by ME&T paid to Financial Products.
3Elimination 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.
4Profit attributable to common shareholders.
Caterpillar Inc.
Supplemental Data for Results of Operations
For the Nine Months Ended September 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 | $ | 47,632 | | | $ | 47,632 | | | $ | — | | | $ | — | | |
| Revenues of Financial Products | 2,358 | | | — | | | 2,907 | | | (549) | | 1 |
| Total sales and revenues | 49,990 | | | 47,632 | | | 2,907 | | | (549) | | |
| | | | | | | | |
| Operating costs: | | | | | | | | |
| Cost of goods sold | 31,751 | | | 31,758 | | | — | | | (7) | | 2 |
| Selling, general and administrative expenses | 4,615 | | | 4,139 | | | 507 | | | (31) | | 2 |
| Research and development expenses | 1,554 | | | 1,554 | | | — | | | — | | |
| Interest expense of Financial Products | 742 | | | — | | | 742 | | | — | | |
| Other operating (income) expenses | 1,496 | | | 624 | | | 923 | | | (51) | | 2 |
| Total operating costs | 40,158 | | | 38,075 | | | 2,172 | | | (89) | | |
| | | | | | | | |
| Operating profit | 9,832 | | | 9,557 | | | 735 | | | (460) | | |
| | | | | | | | |
| Interest expense excluding Financial Products | 385 | | | 385 | | | — | | | — | | |
| Other income (expense) | 354 | | | 18 | | | (49) | | | 385 | | 3 |
| | | | | | | | |
| Consolidated profit before taxes | 9,801 | | | 9,190 | | | 686 | | | (75) | | |
| | | | | | | | |
| Provision (benefit) for income taxes | 2,194 | | | 1,993 | | | 201 | | | — | | |
| Profit of consolidated companies | 7,607 | | | 7,197 | | | 485 | | | (75) | | |
| | | | | | | | |
| Equity in profit (loss) of unconsolidated affiliated companies | 52 | | | 55 | | | — | | | (3) | | 4 |
|
| | | | | | | | |
| Profit of consolidated and affiliated companies | 7,659 | | | 7,252 | | | 485 | | | (78) | | |
| | | | | | | | |
| Less: Profit (loss) attributable to noncontrolling interests | — | | | (2) | | | 5 | | | (3) | | 5 |
| | | | | | | | |
Profit 6 | $ | 7,659 | | | $ | 7,254 | | | $ | 480 | | | $ | (75) | | |
1Elimination of Financial Products’ revenues earned from ME&T.
2Elimination of net expenses recorded by ME&T paid to Financial Products.
3Elimination 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.
4Elimination of equity profit (loss) earned from Financial Products’ subsidiaries partially owned by ME&T subsidiaries.
5Elimination of noncontrolling interest profit (loss) recorded by Financial Products for subsidiaries partially owned by ME&T subsidiaries.
6Profit attributable to common shareholders.
Caterpillar Inc.
Supplemental Data for Financial Position
At September 30, 2024
(Unaudited)
(Millions of dollars)
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Supplemental Consolidating Data | |
| | Consolidated | | Machinery,
Energy &
Transportation | | Financial
Products | | Consolidating
Adjustments | |
| Assets | | | | | | | | |
| Current assets: | | | | | | | | |
| Cash and cash equivalents | $ | 5,638 | | | $ | 4,760 | | | $ | 878 | | | $ | — | | |
| Receivables – trade and other | 9,086 | | | 3,421 | | | 489 | | | 5,176 | | 1,2 |
| Receivables – finance | 9,816 | | | — | | | 15,188 | | | (5,372) | | 2 |
|
| Prepaid expenses and other current assets | 3,094 | | | 2,941 | | | 417 | | | (264) | | 3 |
| Inventories | 17,312 | | | 17,312 | | | — | | | — | | |
| Total current assets | 44,946 | | | 28,434 | | | 16,972 | | | (460) | | |
| | | | | | | | |
| Property, plant and equipment – net | 12,837 | | | 8,943 | | | 3,894 | | | — | | |
| Long-term receivables – trade and other | 1,346 | | | 582 | | | 128 | | | 636 | | 1,2 |
| Long-term receivables – finance | 13,263 | | | — | | | 14,003 | | | (740) | | 2 |
|
| Noncurrent deferred and refundable income taxes | 3,050 | | | 3,553 | | | 112 | | | (615) | | 4 |
| Intangible assets | 448 | | | 448 | | | — | | | — | | |
| Goodwill | 5,317 | | | 5,317 | | | — | | | — | | |
| Other assets | 5,066 | | | 3,828 | | | 2,271 | | | (1,033) | | 5 |
| Total assets | $ | 86,273 | | | $ | 51,105 | | | $ | 37,380 | | | $ | (2,212) | | |
| | | | | | | | |
| Liabilities | | | | | | | | |
| Current liabilities: | | | | | | | | |
| Short-term borrowings | $ | 3,725 | | | $ | — | | | $ | 3,725 | | | $ | — | | |
|
| Accounts payable | 7,705 | | | 7,630 | | | 287 | | | (212) | | 6,7 |
| Accrued expenses | 4,980 | | | 4,351 | | | 629 | | | — | | |
| Accrued wages, salaries and employee benefits | 2,078 | | | 2,028 | | | 50 | | | — | | |
| Customer advances | 2,404 | | | 2,385 | | | 3 | | | 16 | | 7 |
|
| Other current liabilities | 2,934 | | | 2,407 | | | 813 | | | (286) | | 4,5,8 |
| Long-term debt due within one year | 8,392 | | | 46 | | | 8,346 | | | — | | |
| Total current liabilities | 32,218 | | | 18,847 | | | 13,853 | | | (482) | | |
| | | | | | | | |
| Long-term debt due after one year | 25,784 | | | 8,738 | | | 17,150 | | | (104) | | 9 |
| Liability for postemployment benefits | 4,029 | | | 4,029 | | | — | | | — | | |
| Other liabilities | 4,839 | | | 3,970 | | | 1,522 | | | (653) | | 4,5 |
| Total liabilities | 66,870 | | | 35,584 | | | 32,525 | | | (1,239) | | |
| Commitments and contingencies | | | | | | | | |
| Shareholders’ equity | | | | | | | | |
| Common stock | 5,584 | | | 5,584 | | | 905 | | | (905) | | 10 |
| Treasury stock | (42,390) | | | (42,390) | | | — | | | — | | |
| Profit employed in the business | 57,920 | | | 53,100 | | | 4,810 | | | 10 | | 10 |
| Accumulated other comprehensive income (loss) | (1,717) | | | (781) | | | (936) | | | — | | |
| Noncontrolling interests | 6 | | | 8 | | | 76 | | | (78) | | 10 |
| Total shareholders’ equity | 19,403 | | | 15,521 | | | 4,855 | | | (973) | | |
| Total liabilities and shareholders’ equity | $ | 86,273 | | | $ | 51,105 | | | $ | 37,380 | | | $ | (2,212) | | |
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 and liabilities 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 | | | $ | — | | |
| Receivables – trade and other | 9,310 | | | 3,971 | | | 570 | | | 4,769 | | 1,2 |
| Receivables – finance | 9,510 | | | — | | | 14,499 | | | (4,989) | | 2 |
|
| Prepaid expenses and other current assets | 4,586 | | | 4,327 | | | 341 | | | (82) | | 3 |
| Inventories | 16,565 | | | 16,565 | | | — | | | — | | |
| Total current assets | 46,949 | | | 30,969 | | | 16,282 | | | (302) | | |
| | | | | | | | |
| Property, plant and equipment – net | 12,680 | | | 8,694 | | | 3,986 | | | — | | |
| Long-term receivables – trade and other | 1,238 | | | 565 | | | 85 | | | 588 | | 1,2 |
| Long-term receivables – finance | 12,664 | | | — | | | 13,299 | | | (635) | | 2 |
|
|
| Noncurrent deferred and refundable income taxes | 2,816 | | | 3,360 | | | 148 | | | (692) | | 4 |
| Intangible assets | 564 | | | 564 | | | — | | | — | | |
| Goodwill | 5,308 | | | 5,308 | | | — | | | — | | |
| 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 | | | $ | — | | | $ | 4,643 | | | $ | — | | |
|
| Accounts payable | 7,906 | | | 7,827 | | | 314 | | | (235) | | 6,7 |
| Accrued expenses | 4,958 | | | 4,361 | | | 597 | | | — | |
|
| Accrued wages, salaries and employee benefits | 2,757 | | | 2,696 | | | 61 | | | — | | |
| Customer advances | 1,929 | | | 1,912 | | | 2 | | | 15 | | 7 |
| Dividends payable | 649 | | | 649 | | | — | | | — | | |
| Other current liabilities | 3,123 | | | 2,583 | | | 647 | | | (107) | | 4,8 |
| Long-term debt due within one year | 8,763 | | | 1,044 | | | 7,719 | | | — | | |
| 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 | | | — | | | — | | |
| Other liabilities | 4,675 | | | 3,806 | | | 1,607 | | | (738) | | 4 |
| Total liabilities | 67,973 | | | 37,602 | | | 31,483 | | | (1,112) | | |
| Commitments and contingencies | | | | | | | | |
| Shareholders’ equity | | | | | | | | |
| Common stock | 6,403 | | | 6,403 | | | 905 | | | (905) | | 10 |
| Treasury stock | (36,339) | | | (36,339) | | | — | | | — | | |
| Profit employed in the business | 51,250 | | | 46,783 | | | 4,457 | | | 10 | | 10 |
| Accumulated other comprehensive income (loss) | (1,820) | | | (783) | | | (1,037) | | | — | | |
| 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 Nine Months Ended September 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 | $ | 7,998 | | | $ | 7,644 | | | $ | 354 | | | $ | — | |
|
| Adjustments to reconcile profit to net cash provided by operating activities: | | | | | | | | |
| Depreciation and amortization | 1,598 | | | 1,010 | | | 588 | | | — | | |
|
|
|
| Provision (benefit) for deferred income taxes | (329) | | | (277) | | | (52) | | | — | | |
| (Gain) loss on divestiture | 164 | | | (46) | | | 210 | | | — | | |
| Other | 221 | | | 236 | | | (447) | | | 432 | | 1 |
| Changes in assets and liabilities, net of acquisitions and divestitures: | | | | | | | | |
| Receivables – trade and other | (30) | | | 554 | | | (17) | | | (567) | | 1,2 |
| Inventories | (781) | | | (770) | | | — | | | (11) | | 1 |
| Accounts payable | (96) | | | (79) | | | (40) | | | 23 | | 1 |
| Accrued expenses | 9 | | | — | | | 9 | | | — | | |
| Accrued wages, salaries and employee benefits | (671) | | | (660) | | | (11) | | | — | | |
| Customer advances | 476 | | | 475 | | | 1 | | | — | | |
| Other assets – net | 120 | | | (226) | | | 191 | | | 155 | | 1 |
| Other liabilities – net | (37) | | | (135) | | | 232 | | | (134) | | 1 |
| Net cash provided by (used for) operating activities | 8,642 | | | 7,726 | | | 1,018 | | | (102) | | |
| | | | | | | | |
| Cash flow from investing activities: | | | | | | | | |
| Capital expenditures – excluding equipment leased to others | (1,285) | | | (1,264) | | | (25) | | | 4 | | 1 |
| Expenditures for equipment leased to others | (893) | | | (20) | | | (889) | | | 16 | | 1 |
| Proceeds from disposals of leased assets and property, plant and equipment | 541 | | | 25 | | | 525 | | | (9) | | 1 |
| Additions to finance receivables | (11,457) | | | — | | | (12,271) | | | 814 | | 2 |
| Collections of finance receivables | 10,234 | | | — | | | 10,889 | | | (655) | | 2 |
| Net intercompany purchased receivables | — | | | — | | | 68 | | | (68) | | 2 |
| Proceeds from sale of finance receivables | 69 | | | — | | | 69 | | | — | | |
| Net intercompany borrowings | — | | | — | | | 15 | | | (15) | | 3 |
| Investments and acquisitions (net of cash acquired) | (32) | | | (32) | | | — | | | — | | |
| Proceeds from sale of businesses and investments (net of cash sold) | (67) | | | 86 | | | (153) | | | — | | |
| Proceeds from maturities and sale of securities | 2,841 | | | 2,565 | | | 276 | | | — | | |
| Investments in securities | (892) | | | (469) | | | (423) | | | — | | |
| Other – net | 137 | | | 118 | | | 19 | | | — | | |
| Net cash provided by (used for) investing activities | (804) | | | 1,009 | | | (1,900) | | | 87 | | |
| | | | | | | | |
| Cash flow from financing activities: | | | | | | | | |
| Dividends paid | (1,966) | | | (1,966) | | | — | | | — | | |
| Common stock issued, including treasury shares reissued | 15 | | | 15 | | | — | | | — | | |
| Payments to purchase common stock | (7,057) | | | (7,057) | | | — | | | — | | |
|
| Net intercompany borrowings | — | | | (15) | | | — | | | 15 | | 3 |
| Proceeds from debt issued (original maturities greater than three months) | 7,579 | | | — | | | 7,579 | | | — | | |
| Payments on debt (original maturities greater than three months) | (6,862) | | | (1,021) | | | (5,841) | | | — | | |
| Short-term borrowings – net (original maturities three months or less) | (848) | | | — | | | (848) | | | — | | |
|
| Net cash provided by (used for) financing activities | (9,139) | | | (10,044) | | | 890 | | | 15 | | |
| Effect of exchange rate changes on cash | (39) | | | (37) | | | (2) | | | — | | |
| Increase (decrease) in cash, cash equivalents and restricted cash | (1,340) | | | (1,346) | | | 6 | | | — | | |
| Cash, cash equivalents and restricted cash at beginning of period | 6,985 | | | 6,111 | | | 874 | | | — | | |
| Cash, cash equivalents and restricted cash at end of period | $ | 5,645 | | | $ | 4,765 | | | $ | 880 | | | $ | — | | |
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 Nine Months Ended September 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 | $ | 7,659 | | | $ | 7,252 | | | $ | 485 | | | $ | (78) | | 1,5 |
| Adjustments to reconcile profit to net cash provided by operating activities: | | | | | | | | |
| Depreciation and amortization | 1,599 | | | 1,015 | | | 584 | | | — | | |
|
|
| Provision (benefit) for deferred income taxes | (448) | | | (456) | | | 8 | | | — | | |
| (Gain) loss on divestiture | 572 | | | 572 | | | — | | | — | | |
| Other | 205 | | | 309 | | | (463) | | | 359 | | 2 |
| Changes in assets and liabilities, net of acquisitions and divestitures: | | | | | | | | |
| Receivables – trade and other | (319) | | | (46) | | | 70 | | | (343) | | 2,3 |
| Inventories | (1,424) | | | (1,420) | | | — | | | (4) | | 2 |
| Accounts payable | (532) | | | (628) | | | 26 | | | 70 | | 2 |
| Accrued expenses | 588 | | | 557 | | | 31 | | | — | | |
| Accrued wages, salaries and employee benefits | — | | | 1 | | | (1) | | | — | | |
| Customer advances | 516 | | | 515 | | | 1 | | | — | | |
| Other assets – net | 128 | | | 107 | | | 17 | | | 4 | | 2 |
| Other liabilities – net | 338 | | | 177 | | | 147 | | | 14 | | 2 |
| Net cash provided by (used for) operating activities | 8,882 | | | 7,955 | | | 905 | | | 22 | | |
| | | | | | | | |
| Cash flow from investing activities: | | | | | | | | |
| Capital expenditures – excluding equipment leased to others | (1,061) | | | (1,088) | | | (16) | | | 43 | | 2 |
| Expenditures for equipment leased to others | (1,177) | | | (20) | | | (1,165) | | | 8 | | 2 |
| Proceeds from disposals of leased assets and property, plant and equipment | 563 | | | 46 | | | 564 | | | (47) | | 2 |
| Additions to finance receivables | (11,082) | | | — | | | (12,493) | | | 1,411 | | 3 |
| Collections of finance receivables | 10,391 | | | — | | | 11,554 | | | (1,163) | | 3 |
| Net intercompany purchased receivables | — | | | — | | | 429 | | | (429) | | 3 |
| Proceeds from sale of finance receivables | 40 | | | — | | | 40 | | | — | | |
| Net intercompany borrowings | — | | | — | | | 7 | | | (7) | | 4 |
| Investments and acquisitions (net of cash acquired) | (67) | | | (67) | | | — | | | — | | |
| Proceeds from sale of businesses and investments (net of cash sold) | (14) | | | (14) | | | — | | | — | | |
| Proceeds from sale of securities | 747 | | | 553 | | | 194 | | | — | | |
| Investments in securities | (3,689) | | | (3,340) | | | (349) | | | — | | |
| Other – net | 32 | | | 43 | | | (11) | | | — | | |
| Net cash provided by (used for) investing activities | (5,317) | | | (3,887) | | | (1,246) | | | (184) | | |
| | | | | | | | |
| Cash flow from financing activities: | | | | | | | | |
| Dividends paid | (1,901) | | | (1,901) | | | (155) | | | 155 | | 5 |
| Common stock issued, including treasury shares reissued | 36 | | | 36 | | | — | | | — | | |
| Payments to purchase common stock | (2,209) | | | (2,209) | | | — | | | — | | |
|
| Net intercompany borrowings | — | | | (7) | | | — | | | 7 | | 4 |
| Proceeds from debt issued (original maturities greater than three months) | 6,360 | | | — | | | 6,360 | | | — | | |
| Payments on debt (original maturities greater than three months) | (4,459) | | | (99) | | | (4,360) | | | — | | |
| Short-term borrowings – net (original maturities three months or less) | (1,726) | | | (3) | | | (1,723) | | | — | | |
|
| Net cash provided by (used for) financing activities | (3,899) | | | (4,183) | | | 122 | | | 162 | | |
| Effect of exchange rate changes on cash | (119) | | | (55) | | | (64) | | | — | | |
| Increase (decrease) in cash, cash equivalents and restricted cash | (453) | | | (170) | | | (283) | | | — | | |
| Cash, cash equivalents and restricted cash at beginning of period | 7,013 | | | 6,049 | | | 964 | | | — | | |
| Cash, cash equivalents and restricted cash at end of period | $ | 6,560 | | | $ | 5,879 | | | $ | 681 | | | $ | — | | |
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.
Forward-looking Statements
Certain statements in this Form 10-Q 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 under the section entitled "Part I - Item 1A. Risk Factors" of Caterpillar's Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as such factors may be updated from time to time in Caterpillar's periodic filings with the Securities and Exchange Commission.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The information required by this Item is incorporated by reference from Note 5 – “Derivative financial instruments and risk management” included in Part I, Item 1 and Management’s Discussion and Analysis included in Part I, Item 2 of this Form 10-Q.
Item 4. Controls and Procedures
Evaluation of disclosure controls and procedures
An evaluation was performed under the supervision and with the participation of the company’s management, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of the company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, as of the end of the period covered by this quarterly report. Based on that evaluation, the CEO and CFO concluded that the company’s disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.
Changes in internal control over financial reporting
During the third quarter of 2024, there has been no change in the company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The information required by this Item is incorporated by reference from Note 14 – “Environmental and legal matters” included in Part I, Item 1 of this Form 10-Q.
Item 1A. Risk Factors
There have been no material changes to the risk factors we previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchases of Equity Securities
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| Period | | Total Number
of Shares
Purchased | | Average Price Paid per Share | | Total Number
of Shares Purchased
as Part of Publicly Announced Program | | Approximate Dollar Value of Shares that May Yet be Purchased under the Program (in billions)1 |
| July 1-31, 2024 | | 920,856 | | | $ | 336.62 | | | 920,856 | | | $ | 21.240 | |
| August 1-31, 2024 | | 840,267 | | | $ | 335.67 | | | 840,267 | | | $ | 20.958 | |
| September 1-30, 2024 | | 536,592 | | | $ | 353.98 | | | 536,592 | | | $ | 20.768 | |
| Total | | 2,297,715 | | | $ | 340.33 | | | 2,297,715 | | | |
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1 In May 2022, the Board approved a share repurchase authorization (the 2022 Authorization) of up to $15.0 billion of Caterpillar common stock effective August 1, 2022, with no expiration. In June 2024, the Board approved an additional share repurchase authorization (the 2024 Authorization) of up to $20.0 billion of Caterpillar common stock, effective June 12, 2024, with no expiration. As of September 30, 2024, approximately $20.8 billion remained available under the 2024 and 2022 Authorizations. |
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Non-U.S. Employee Stock Purchase Plans
As of September 30, 2024, we had 38 employee stock purchase plans (the “EIP Plans”) that are administered outside the United States for our non-U.S. employees, which had approximately 16,000 active participants in the aggregate. During the third quarter of 2024, approximately 51,000 shares of Caterpillar common stock were purchased by the EIP Plans pursuant to the terms of such plans.
Item 5. Other Information
, , , into a sales plan intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Securities Exchange Act of 1934, as amended. The sales plan will be in effect until the earlier of (1) and (2) the date on which an aggregate of shares of our common stock have been sold under the plan.
Item 6. Exhibits
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| 10.1 | | |
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| 10.2 | | |
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| 10.5 | | |
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| 31.1 | | |
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| 31.2 | | |
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| 32 | | |
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| 101.INS | | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) |
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| 101.SCH | | Inline XBRL Taxonomy Extension Schema Document |
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| 101.CAL | | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
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| 101.DEF | | Inline XBRL Taxonomy Extension Definition Linkbase Document |
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| 101.LAB | | Inline XBRL Taxonomy Extension Label Linkbase Document |
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| 101.PRE | | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
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| 104 | | Cover Page Interactive File (embedded within the Inline XBRL document and included in Exhibit 101) |
The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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| | CATERPILLAR INC. | |
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| November 6, 2024 | /s/ D. James Umpleby III | Chairman of the Board and Chief Executive Officer |
| | D. James Umpleby III | |
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| November 6, 2024 | /s/ Andrew R.J. Bonfield | Chief Financial Officer |
| | Andrew R.J. Bonfield | |
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| November 6, 2024 | /s/ Derek Owens | Chief Legal Officer and General Counsel |
| | Derek Owens | |
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| November 6, 2024 | /s/ William E. Schaupp | Vice President and Chief Accounting Officer |
| | William E. Schaupp | |
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