Redundancies push Cat into first quarter loss

The equipment major said it was the $558 million in redundancy costs that pushed it into negative territory, implying the company would have made a profit of $446 million without the costs of cutting staff. The $112 million loss compares with the $922 million profit recorded for the first calendar quarter of 2008 – down a whopping $1.034 billion.Caterpillar’s revenue for the quarter was $9.225 billion, down 22% from $11.796 billion in the first quarter of 2008.”This is an extremely difficult time for employees affected by this severe economic downturn, and providing them with financial assistance and transitional support is important,” Caterpillar chairman Jim Owens said. “While redundancy costs have been a considerable expense, it’s the right thing to do for our people.”Our business units are making the tough decisions necessary to respond to this widespread and sharp global recession.”Caterpillar has lowered its outlook for calendar 2009, and is now expecting revenue of approximately $35 billion for the year, down from the $40 billion forecast in January.

Send this to a friend