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Peoria, IL, United States, 2012/07/25 - Cat Financial reported second-quarter 2012 revenues of $668 million, a decrease of $7 million, or 1 percent, compared with the second quarter of 2011 - Caterpillar.com. NYSE: CAT
Second-quarter 2012 profit after tax was $104 million, a $3 million, or 3 percent, decrease from the second quarter of 2011.
The decrease in revenues was principally due to a $28 million unfavorable impact from lower rates on new and existing finance receivables and operating leases and $9 million lower net gains from returned or repossessed equipment, partially offset by a $33 million favorable impact from higher average earning assets (finance receivables and operating leases at constant rates).
Profit before income taxes was $144 million for the second quarter of 2012, compared to $152 million for the second quarter of 2011. The decrease was principally due to $9 million lower net gains from returned or repossessed equipment, a $5 million unfavorable impact from currency gains and losses and a $4 million increase in general, operating and administrative expense. These decreases were partially offset by a $13 million favorable impact from higher average earning assets.
The provision for income taxes in the second quarter of 2012 reflects an estimated annual tax rate of 27 percent compared to 26 percent in the second quarter of 2011.
New retail financing in the second quarter of 2012 was $3.8 billion, an increase of $938 million, or 32 percent, from the second quarter of 2011. The increase was a result of growth across all operating segments, primarily in our Asia/Pacific and Mining operating segments.
At the end of the second quarter of 2012, past dues were 3.35 percent compared with 3.19 percent at the end of the first quarter of 2012, 2.89 percent at the end of 2011 and 3.73 percent at the end of the second quarter of 2011. Although past dues have improved when compared with the second quarter of 2011, the increase from the end of 2011 and from the first quarter of 2012 reflects higher delinquencies in our European marine and China portfolios. Write-offs, net of recoveries, were $16 million for the second quarter of 2012, down from $29 million in the second quarter of 2011.
As of June 30, 2012, Cat Financial's allowance for credit losses totaled $393 million or 1.47 percent of net finance receivables, compared with $369 million or 1.47 percent of net finance receivables at year-end 2011. The allowance for credit losses as of June 30, 2011, was $382 million, which was 1.52 percent of net finance receivables.
"We are very pleased with Cat Financial's performance in the second quarter," said Kent Adams, Cat Financial president and vice president of Caterpillar Inc. "Our portfolio continues to perform well, with lower past dues and a significant reduction in write-offs compared to a year ago. Additionally, our global team continues to focus on our captive finance role to help Caterpillar customers and dealers succeed, resulting in a significant increase in new retail financing during the second quarter."
For over 30 years, Cat Financial, a wholly-owned subsidiary of Caterpillar Inc., has been providing financial service excellence to Cat customers. The company offers a wide range of financing alternatives to customers and Cat dealers for Cat machinery and engines, Solar® gas turbines and other equipment and marine vessels. Cat Financial has offices and subsidiaries located throughout the Americas, Asia, Australia and Europe, with headquarters in Nashville, Tennessee.