Cat Financial Reports Lower Q2 Profit, New Business Volume



Cat Financial reported Q2/15 revenues of $683 million, a decrease of $45 million, or 6%, compared with Q2/14. After tax Q2/15 profit was $104 million, a $44 million, or 30% decrease from the second quarter of 2014.

Cat Financial said the decrease in revenues was primarily due to a $29 million unfavorable impact from lower average earning assets and an $18 million unfavorable impact from lower average financing rates.

Profit before income taxes was $150 million for the second quarter of 2015, compared with $208 million for the second quarter of 2014. The decrease was primarily due to a $25 million decrease in net yield on average earning assets, an $18 million increase in provision for credit losses and a $14 million unfavorable net impact from lower average earning assets.

Retail new business volume was $2.74 billion in Q2/15, a decrease of $703 million, or 20%, from Q2/14. Cat said the decrease was related to lower volume across all geographic regions, except for North America, which was relatively flat. Year-to-date through June, retail new business volume was $5.21 billion, down 17% from $6.24 billion a year earlier.

At the end of the second quarter of 2015, past dues were 2.97%, compared with 2.77% at the end of the second quarter of 2014. The increase was primarily due to higher delinquencies in the Latin America and Mining portfolios. At the end of 2014, past dues were 2.17%. Write-offs, net of recoveries, were $38 million for the second quarter of 2015, compared with $19 million for the second quarter of 2014.

“Our portfolio performance has remained relatively stable despite challenging market conditions in some of our key segments,” said Kent Adams, president of Cat Financial and vice president with responsibility for the Financial Products Division of Caterpillar. “The global Cat Financial team remains focused on helping Caterpillar customers and Cat dealers succeed through financial services excellence.”


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