Cat Financial Q2 retail new business volume rose 8.8% YoY

Cat Financial reported improved results in the second quarter as higher average earning assets supported revenue and profit growth and retail new business volume increased across all segments.

The Caterpillar finance subsidiary‘s higher average earning assets were the primary driver of revenue growth and contributed $44 million to the increase in pretax profit, according to an earnings release today. That benefit was partially offset by a $22 million increase in the provision for credit losses.

Portfolio performance also strengthened during the quarter as the past-due rate declined from a year earlier. Net write-offs and the allowance for credit losses increased, although the allowance represented a smaller share of finance receivables than at the end of the first quarter.

“Cat Financial delivered another solid quarter, with continued strong retail new business volume and strong portfolio performance,” Cat Financial President and Chief Executive Dave Walton said in the release.

By the numbers

• Revenue was $991 million, up 10.2% year over year;
• Total profit rose to $145 million, up 5.8% YoY;
• Retail new business volume was $3.9 billion, up 8.8% YoY;
• Total assets increased to $40.5 billion, up 5.6% YoY;
• Past-dues dropped to 1.31%, down 31 basis points YoY;
• Net write-offs totaled $20 million, up 11.1% YoY; and
• Allowance for credit losses was $294 million, up 3.9% YoY.

Nashville, Tenn.-based Cat Financial provides financing for Caterpillar equipment, engines, parts and services to customers and dealers worldwide.

Shares of Caterpillar [NYSE: CAT] were up 5.6% from market open to $876.54 as of market close today. It has a market capitalization of $403.73 billion.

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