Caterpillar reported a jump in fourth-quarter earnings Friday on surging demand for industrial equipment, but warned that supply chain problems will probably continue to weigh on results in 2022.
The company, which manufactures and sells equipment to heavy industries such as construction and mining, saw higher sales across its businesses amid broad-based demand growth.
But Chief Executive Jim Umpleby said on a conference call with analysts that the company's revenues would have been even higher had it not faced supply chain problems that pinched production.
Umpleby said the company had kept underutilized factories open to meet customer demand despite higher expenses. Higher freight costs also cut into profit margins.
"Demand remains strong as represented by robust orders," Umpleby said. "The key variable remains the supply chain, meaning to what degree can we meet end-demand growth?"
Net income for the quarter was $2.1 billion, more than double the level in the 2020 period off of a 23 percent increase in revenues to $13.8 billion.
Caterpillar said it expects strong sales in the first quarter of 2022 compared with the year-ago period but that its profit margins faced "headwinds," according to a PowerPoint presentation.
The company said it expects price increases to offset manufacturing costs increases in 2022.
Shares fell 2.1 percent to $207.64 in pre-market trading.
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