Caterpillar Inc. (Peoria, IL) today boosted its sales outlook while saying it will spend more to close plants and cut jobs.
The company, as part of its first-quarter earnings report, said it expects revenue of $38 billion to $41 billion. That’s an increase from a January forecast of $36 billion to $39 billion.
However, the maker of earth-moving equipment and other machinery forecast a profit of $2.10 a share. That’s based on the midpoint of its revised revenue estimate. The forecast compares with a previous outlook of $2.30 a share.
Caterpillar said it expects to spend $1.25 billion in restructuring costs, an increase of $750 million from its previous forecast. Last month, Caterpillar announced plant closings in Aurora, IL, and Gosselies, Belgium.
The company said the financial picture is better when excluding restructuring costs.
On that basis, Caterpillar it expects a 2017 per-share profit of $3.75 a share. That’s an increase from a previous forecast of $2.90 a share.
Caterpillar is “benefiting from our significant cost reduction and restructuring actions,” Chief Executive Officer Jim Umpleby said in a statement. The company pared its global full-time workforce to 95,300 as of March 31 compared with 101,400 a year earlier.
The executive said machinery, energy and transportation, key markets for Caterpillar, are improving. He also issued a caveat.
There “continues to be uncertainty across the globe, potential for volatility in commodity prices, and weaknesses in key markets,” Umpleby said.
For the first quarter, Caterpillar reported a profit of $192 million, or 32 cents a share, down from $271 million, or 46 cents a year earlier. Revenue for the three months ended March 31 increased to $9.82 billion from $9.46 billion a year earlier.
Excluding restructuring costs, the company said it had a per-share profit of $1.28 for the quarter, up from 64 cents for 2016’s first quarter.