Caterpillar Inc.'s sales performance worsened as demand for mining equipment continued to plunge.
The Peoria, Ill. -based maker of construction and mining equipment, which is due to report first-quarter results Thursday, said in a securities filing Wednesday that retail sales of its machinery fell 12% from a year earlier in the three months ended March 31 . That compared with declines of 8% in the three- month periods ended in February and January.
In a research note, Ann Duignan of J.P. Morgan said Caterpillar shares--up about 16% so far this year---have been buoyed by hopes for signs of a recovery in the company's first-quarter results. "We believe there is downside risk" to the quarterly results, largely because of weakness in South America , particularly Brazil , she wrote.
The declines in the latest three-month period were 20% in the Asia-Pacific region and 21% in both Latin America and Europe , the Middle East and Africa . The bright spot was North America , where sales increased 6%.
World-wide mining equipment sales plummeted 46%, after falling 37% in the three-month periods ending in the prior two months. Construction equipment rose 9%, matching its performance in the prior two periods. Sale of energy and transportation engines were up 7% in the latest period.
Caterpillar has been chopping costs to cope with falling demand for mining equipment. In the U.S., Caterpillar over the past year has closed or announced plans to close plants in Pulaski, Va. ; Beckley, W.Va. ; Kilgore, Texas ; Summerville, S.C. , and Owatonna, Minn. , as well as one near Toronto and another in Sudbury, Canada .
In early 2013, Caterpillar announced plans to eliminate 1,400 jobs at a plant in Gosselies, Belgium . Last week, Caterpillar said it aims to close a plant in Rantigny, France , that makes equipment for road paving, including compactors, planers and pavers.
