CHICAGO — Caterpillar Inc., the world’s largest maker of construction and mining equipment, forecast sales growth for 2013 that is the slowest in four years, as the global economy decelerates.
Sales could range from an increase of 5 percent to a drop of 5 percent next year, the Peoria, Ill.-based company said Monday in a statement. That compares with year-over-year sales growth of 31 percent in 2010, 41 percent in 2011 and an estimated 13 percent this year.
“Caterpillar is facing several headwinds, the biggest of which is the macro environment, which has led to significantly lower commodity prices … which will hurt orders and revenues,” Joel Levington, managing director of corporate credit for Brookfield Investment Management, said in an email. “Inventory levels remain elevated, which could also pressure volumes on the manufacturing floor.”
Chairman and Chief Executive Officer Doug Oberhelman has invested in Caterpillar’s factories and announced about $10.3 billion in deals since becoming CEO in July 2010. The company has greatly expanded its manufacturing facilities in North Carolina, where Caterpillar employs nearly 2,000 workers at a half-dozen locations, including sites in Clayton, Sanford and Winston-Salem.
Oberhelman’s expansion plans are facing hurdles as the European debt crisis persists and economic growth slows in emerging markets from China to Brazil.
Third-quarter net income increased to $1.7 billion, or $2.54 a share, from $1.14 billion, or $1.71, a year earlier, the company said in the statement. Sales increased to $16.4 billion, from $15.7 billion.
The company said that profit this year will be $9 to $9.25 a share on sales of about $66 billion – lower than a July forecast for per-share earnings of about $9.60 on sales of $68 billion to $70 billion.
Last month, Oberhelman cut Caterpillar’s profit target for 2015 to $12 to $18 a share, from an earlier projection of $15 to $20, and said revenue this year may be around $2 billion lower than forecast.
Caterpillar said last week its global retail machine sales growth reported by dealers slowed to 6 percent in the third quarter on declines in Latin America and the region that includes Europe, the Middle East and Africa.
The company’s growth rate also slowed in the Asia-Pacific region and North America. In comparison, retail machine sales grew 13 percent for the three months through August and 14 percent for the three months through July.
China’s growth rate dipped to 7.4 percent in the third quarter, its lowest rate since 2009. The world economy will expand 3.3 percent this year, the slowest pace since the 2009 recession, and expand 3.6 percent next year, the International Monetary Fund said Oct. 9.
Bank of Israel Governor Stanley Fischer said Oct. 15 that the world is “awfully close” to a recession.
Staff writer David Bracken contributed.