Caterpillar Reports Record Sales and Profit for the Fourth Quarter and Full-Year 2011- Profit up 83 Percent from 2010

Caterpillar Inc.

4Q 2011 Earnings Release

FOR IMMEDIATE RELEASE

• Momentum Carries into 2012 with Sales and Revenues Outlook Raised to $68 to $72 Billion
• Driven by outstanding execution and stronger global demand, Caterpillar Inc. (NYSE: CAT) delivered record-breaking 2011 sales and revenues of $60.138 billion, an increase of 41 percent from $42.588 billion in 2010.
• Profit in 2011 was $4.928 billion, an increase of 83 percent from $2.700 billion in 2010.
• Profit per share of $7.40 was up 78 percent from $4.15 in 2010. Excluding the impact of the acquisition of Bucyrus International, Inc. (Bucyrus), 2011 profit was $7.79 per share, up 88 percent from a year ago.
• Fourth-quarter sales and revenues in 2011 were an all-time quarterly record at $17.243 billion, an increase of 35 percent compared with $12.807 billion in the fourth quarter of 2010.
• Fourth-quarter profit was $1.547 billion compared with $968 million in the fourth quarter of 2010.
• Profit of $2.32 per share was 58 percent higher than the $1.47 per share in the fourth quarter of 2010.

“Our strategy is squarely focused on customers, and in 2011 our employees, suppliers and dealers delivered. We improved product quality, invested significantly in manufacturing capacity and product development, and improved our market position. We completed two large acquisitions—Bucyrus and Motoren-Werke Mannheim Holding GmbH (MWM)—in important growth industries that are a great strategic fit and provide our customers an even broader range of products,” said Caterpillar Chairman and Chief Executive Officer Doug Oberhelman.

“We also delivered for stockholders with outstanding financial results, beating our previous 2008 profit record of $5.66 per share by more than 30 percent. It was a great year for cash generation as well with our Machinery and Power Systems (M&PS) operating cash flow near $8 billion—our best year ever,”

“The 2011 increase in sales and revenues was the largest percentage increase in any year since 1947, and much of it was driven by demand for Caterpillar products and services outside of the United States. As a result, 2011 was a record-breaking year for U.S. exports at nearly $20 billion, which supported thousands of jobs in the United States, demonstrating the tangible benefits of free trade. Sales and export growth creates jobs, both in the United States and around the world. Not including acquisitions, our global workforce grew by more than 14,000 in 2011, and since the start of 2010, we have increased our workforce by more than 33,000, with more than 14,000 of those jobs in the United States,” Oberhelman added.

2011 Accomplishments

• Strong growth in most of the industries we serve and a focus on executing our updated strategy provided the foundation of our record-breaking financial results in 2011. Our strategy is centered on operational excellence that drives value for our customers, and in 2011 we improved in a wide range of operational areas around the company.
• The Caterpillar Production System (CPS) is the way of life at Caterpillar and has been a principal driver in improvements in safety, quality, velocity and efficiency. We continued to improve in each of these areas in 2011 and achieved new records in many areas.
• The safety of our workforce, contractors and visitors is a fundamental value for Caterpillar, and we are pleased that our enterprise safety metrics improved again in 2011—an 83-percent improvement in safety performance since 2003.
• Product quality is important to customers, and in 2011 we continued to see meaningful improvements in product reliability.
• Given the sizable increase in demand in 2011, we stretched our factories and our suppliers to produce more.
• The results were outstanding, and we were able to significantly increase production and improve our on-time delivery performance. We thank our suppliers for a remarkable year in support of our business.
• For many of our products, demand in 2011 was very strong and above capacity. Throughout the year at our factories around the world, we, along with many of our suppliers, invested in production capacity to support customers. Despite the increases in capacity and expected additions in 2012, we are still very tight on many products and are currently quoting extended delivery times for some products. For example, we are now quoting delivery times into 2014 for many models of large trucks.
• 2011 saw significant new product introductions related to new emissions requirements in the United States and Europe and continued the most extensive new product development program in Caterpillar history. The introduction of these new products has gone well, and feedback from dealers and customers has been very positive.
• Another important consideration for customers is aftermarket parts availability, and we made notable improvements in delivery performance in 2011.
• While it was a good year for the industries we serve, it was an even better year for Caterpillar. In the aggregate, and for most of our products, our sales increased at a faster rate than the overall industry. Better quality, good delivery performance, our investment in capacity, the performance of our suppliers and modest price increases all helped drive better value for our customers and better performance for Caterpillar.

For more information on our range of Cat Compact Equipment for sale and hire please call 0845 262 2280.