Caterpillar Inc. (NYSE:CAT) Q2 2020 Earnings Conference Call - Final Transcript

Jul 31, 2020 • 08:30 am ET

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Caterpillar Inc. (NYSE:CAT) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by. And welcome to the Q2 2020 Caterpillar Inc. Earnings Conference Call.

[Operator Instructions]

I would now like to hand the conference over to your speaker today. Jennifer, please go ahead.

Executive
Jennifer Driscoll

Thank you. Good morning, everyone. And welcome to Caterpillar's second-quarter earnings call.

Joining our call today are Jim Umpleby, Chairman of the Board and CEO, Andrew Bonfield, Chief Financial Officer, Kyle Epley, Vice President of our Global Finance Services Division, and Rob Rengel, Senior IR Manager.

The call today builds on our earnings release, which we issued earlier this morning. You may find the slides that accompany today's presentation, along with the news release on our recently relaunched Investor Relations website in the Investors Section of caterpillar.com. When you have some time, please take a moment to check out the new look and improved organization. We welcome your feedback on any ways that we can make it a better tool for you.

Moving on to Slide 2. The forward-looking statements we make today are subject to risks and uncertainties. We'll also make assumptions that could cause our actual results to be different than the information we discuss today. Please refer to our recent SEC filings and the forward-looking statements reminder in the news release for details on factors that, individually or in aggregate, could cause our actual results to vary materially from our forecast.

Caterpillar has copyrighted this call. We prohibit use of any portion of it without a prior written approval. This year's quarter included a $0.19 per share remeasurement loss resulting from the settlement of pension obligations. We provide a non-GAAP reconciliation in the appendix to this morning's news release.

Now let's flip to Slide 3 and turn the call over to our Chairman and CEO Jim Umpleby. Jim?

Executive
Jim Umpleby

Thank you, Jennifer. And good morning, everyone. The second quarter brought unprecedented challenges for our customers, dealers, employees and suppliers. We thank those in healthcare, as well as the first responders helping fight the pandemic on the front line.

We also want to thank Caterpillar's global workforce for their commitment to support our customers while keeping each other safe. Working with our dealers, Caterpillar is delivering products and services that enable our customers to provide critical infrastructure that is essential to support society during the pandemic. During this time, Caterpillar is leveraging our strong safety culture and remains dedicated to the safety, health and well-being of our employees. Our workforce is successfully navigating this uncertain environment by focusing on keeping period costs down, managing inefficiencies and continuing to meet customer needs.

The execution of our strategy, including the disciplined management of structural costs during the last three years, is also helping us weather the storm created by COVID-19. We've reduced discretionary expenses, including consulting, travel and entertainment. Effective July 1, to support our employees, we reinstated 2020 base salary increases, except for our most senior executives. Short-term incentive compensation plans for 2020 will remain suspended for most salaried management employees and all