Cat Financial Announces Third-Quarter 2023 Results

Cat Financial Announces Third-Quarter 2023 Results

Cat Financial reported third-quarter 2023 revenues of $846 million, an increase of $156 million, or 23%, compared with $690 million in the third quarter of 2022. The increase in revenues was primarily due to a $118 million favorable impact from higher average financing rates. Third-quarter 2023 profit was $98 million, a decrease of $33 million, or 25%, compared with $131 million in the third quarter of 2022.

Third-quarter 2023 profit before income taxes was $170 million, a decrease of $18 million, or 10%, compared with $188 million in the third quarter of 2022. The decrease was mainly due to a $51 million unfavorable impact from a higher provision for credit losses mostly driven by the absence of prior year reserve releases, partially offset by a $24 million favorable impact from mark-to-market adjustments on derivative contracts.

The provision for income taxes reflected an estimated annual tax rate of 26% for the third quarter of 2023 compared with 27% in the third quarter of 2022. In addition, a discrete tax expense of $27 million was recorded in the third quarter of 2023 for the repatriation of non-U.S. earnings and the change in the reinvestment position of a non-U.S. subsidiary.

During the third quarter of 2023, retail new business volume was $2.89 billion, an increase of $169 million, or 6%, compared with $2.73 billion in the third quarter of 2022. The increase was primarily driven by higher volume in North America.

At the end of the third quarter of 2023, past dues at Cat Financial were 1.96%, compared with 2.00% at the end of the third quarter of 2022. Write-offs, net of recoveries, were $9 million for the third quarter of 2023, compared with $13 million for the third quarter of 2022. As of September 30, 2023, Cat Financial's allowance for credit losses totaled $340 million, or 1.23% of finance receivables, compared with $320 million, or 1.15% of finance receivables at June 30, 2023. The allowance for credit losses at year-end 2022 was $346 million, or 1.29% of finance receivables.

"Cat Financial delivered another solid quarter with strong portfolio performance reflected in historically low past dues and write-offs,” said Dave Walton, President of Cat Financial and Senior Vice President with responsibility for the Financial Products Division of Caterpillar Inc. "The global Cat Financial team remains focused on executing our strategy and supporting our customers and dealers worldwide.”

About Cat Financial

Cat Financial is a subsidiary of Caterpillar, the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. Cat Financial provides a wide range of financing solutions to customers and Cat® dealers for machines, engines, Solar® turbines, genuine Cat parts and services. Headquartered in Nashville, Tennessee, Cat Financial serves customers globally with offices and subsidiaries located throughout North and South America, Asia, Australia, Europe and Africa. Visit cat.com to learn more about Cat Financial.