Caterpillar Posts $70-Million Loss

Caterpillar Tractor, Peoria, Ill., citing seasonally low winter sales, on Wednesday reported a $70-million loss for the first fiscal quarter, pushing the company’s cumulative deficits since the start of 1982 to more than $1 billion.

The builder of road-construction machinery said the loss came on revenue of $1.48 billion during the first three months of this year. Caterpillar said first-quarter revenue improved by $90 million over the same period a year ago.

The world’s leading heavy-equipment maker said the first-quarter loss compared to a $109-million deficit for the same period of 1984. In its latest annual report, Caterpillar had predicted a first-quarter loss for 1985 but expressed confidence that it could turn a profit for the full year.

Also Wednesday, Caterpillar stockholders, at their annual meeting in San Francisco, elected a new president to replace retiring Robert E. Gillmore. Peter P. Donis, the company’s executive vice president, will take over as chief operating officer June 1, the company said. Gillmore, who has reached Caterpillar’s mandatory retirement age of 65, will leave his post at the end of May but will continue on the company’s board of directors.

J. P. Morgan Has 12.7% Gain in 1st-Quarter Net

J. P. Morgan & Co., the nation’s fifth-largest banking company, said that higher interest earnings helped it post a 12.7% gain in its first-quarter profit compared to a year ago.

It was the first major banking company to report earnings for the first three months of 1985.

New York-based Morgan, the parent of the fifth-largest U.S. bank, Morgan Guaranty Trust, said it had a profit of $164.6 million for the three months ended March 31, compared to a profit of $146 million a year earlier.

The 1984 results also had included a one-time gain of $12 million reflecting a change in how the company accounts for results from its foreign operations.

Lawrence Cohn, who follows the banking industry for the investment firm of Dean Witter Reynolds, said that, because of the special item in last year’s earnings results, he had expected that Morgan’s latest earnings would be about the same as a year ago.

“We thought they would have a flat quarter because it is such a tough comparison, but these numbers are exceptional,” he said.

He said Morgan’s results reflected good performances in a number of areas, including cost control.

Morgan said its net interest earnings rose 15.2% to $428.5 million in the latest quarter. Its net yield--the difference between the average rate on its interest-earning assets and the average cost of funding those assets--rose to 3.07 percentage points from 2.86 percentage points a year earlier.

Offsetting part of this gain, the banking company said, were lower non-interest operating income and higher income taxes.

Total assets averaged $65 billion during the quarter, compared to $59.7 billion in the first three months of 1984.

Its net credit charge-offs amounted to $14 million, compared to $13 million in the first quarter of 1984. Its loan-loss reserve was $598 million at the end of the quarter, compared to $509 million a year earlier.

Non-accrual loans--generally those on which interest or principal payments are 90 days past due--were $870 million as of March 31, compared to $604 million a year ago and $878 million at the end of the previous quarter.

Kaiser Aluminum Has Loss of $18.5 Million in Quarter

Kaiser Aluminum & Chemical reported a net loss of $18.5 million for the first quarter, compared to net income of $14.6 million for the first quarter of 1984, the Oakland-based company said. Sales rose to $816.6 million from $696.8 million, however, due primarily to increased trading activity.

Chairman Cornell C. Maier said Kaiser’s real estate subsidiary, Kaiser Development, more than doubled its pretax earnings to $24.9 million, but this failed to offset the operating loss from aluminum activities.

Both fabricated-products sales volume and prices were down substantially in the quarter, Maier said, and last year’s first quarter included earnings from the delivery and sales of primary aluminum bought earlier at favorable prices.

“Because of the recent low market price for primary metal, we made only selective ingot sales this year,” he said.

The aluminum division’s $56.3-million pretax operating loss was substantially below that of 1984’s fourth quarter, Maier noted, mainly because of a drop in unprofitable ingot sales. He said “the very important benefits” the company expects to realize from modernization of its rolling mill in Trentwood, Wash. are now beginning to be felt in improved productivity. Aluminum shipments totaled 168,500 tons, 10% below the same period last year, with about 95% of the shipments in the form of fabricated products, up from 80% last year.

Maier said the company’s new, lower-cost contract with the United Steelworkers of America, which became effective this month, will help move aluminum operations toward profitability, along with reduced corporate overhead and improved operating efficiency at Trentwood and elsewhere.

Earnings from Kaiser’s industrial chemicals business declined because of price weakness in most of its markets, he said.

1st-Quarter Net Rises to $87.8 Million at Raytheon

Paced by the robust market for electronic defense systems and equipment, Raytheon reported that its first-quarter earnings from continuing operations were 10.3% higher than a year ago.

The diversified electronics company earned $87.8 million on sales of $1.53 billion in the first quarter ended March 31, compared to earnings of $79.6 million on sales of $1.5 billion during the same period a year earlier.

First-quarter net income grew to $87.8 million from $79.1 million a year ago.

Orders for defense electronic systems and equipment reached a new high in January when government contracts valued at $1.1 billion were received. The Patriot and Sparrow missile programs represented the bulk of those orders.

The company’s backlog of U.S. government orders stood at a record $5 billion at the end of March, compared to $4.3 billion a year earlier. Total backlog was a record $7 billion, compared to $6.4 billion last year.

Raytheon’s Beech Aircraft subsidiary, bolstered by lower operating costs and improved margins, increased its sales modestly despite the soft world market for business aircraft.

Major appliance sales were slightly below the record performance last year, while sales in the energy services division dropped due to lack of volume in the company’s petroleum-related businesses and the reduced level of construction at the Seabrook power plant.

Westinghouse Revenue, Net Rise in 1st Quarter

Pittsburgh-based Westinghouse Electric reported that its revenue and earnings increased in the first quarter of 1985 over the same period last year.

Earnings in the first quarter this year were $129.7 million on revenue of $2.31 billion, compared to 1984 first-quarter earnings of $116.6 million on revenue of $2.27 billion.

Company Chairman Douglas D. Danforth said he was “particularly pleased” with the improvement.

“This gives us a good start on the year ahead,” he said. “While sales were up only slightly, productivity and quality improvements are contributing to higher operating margins.”

Higher sales were recorded by the industries, energy and advanced technology and broadcasting and cable groups. Sales of the commercial group declined from the 1984 level, the company said.

Corporate operating profit improved, with broadcasting and cable showing the greatest increase, industries and the energy and advanced technologies group also doing better and the commercial group lower, the company said.

Other income increased slightly over the first quarter of last year, including higher income of Westinghouse Credit, the finance subsidiary.

For detailed data and results of other companies, please see tables, Page 10.