Caterpillar Financial Services (Cat FS) has reported a 17% year-on-year profit increase and 22% growth in new business for the third quarter of the year.

The captive finance arm of construction equipment manufacturer Caterpillar reported net profit of $109m (€84m) for the quarter compared to $93m for the same period in 2011 and recorded total new business for the period of $3.2bn, up from $2.6bn.

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There was also year-on-year growth in the year-to-date figures with net profit up 18% to $333m and new business up 22% to just over $10bn for the nine months to 30 September 2012.

A slight increase in revenue, up 1% to $678m, was attributed by Cat FS to a $63m boost from higher average earning assets, partially offset by a $44m from lower average financing rates on new and existing finance receivables and operating leases and a $9m loss on returned or repossessed equipment.

The increase in new business was attributed to growth across all operating segments, with the largest increase occurring in the Caterpillar Power Finance operating segment and in Europe, according to Cat FS.

European negative

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Despite the European growth and despite posting overall net profit of $1.7bn for the third quarter, 49% up on the 2011 figure of $1.14bn, Caterpillar held a negative outlook for the region.

The company statement accompanying the results described the eurozone crisis as the most significant risk to the 2013 economic outlook and expressed concern some countries may withdraw from the currency zone.

The statement said: "We do not see signs that governments in the eurozone and the European Central Bank will change economic policies to deal with recession, record unemployment and social unrest.

"Consequently, we are expecting only marginal growth in 2013, and construction activity will likely remain weak."

Past dues and write-offs

The report also stated past dues were down at 2.8% at the end of the third quarter compared to 3.35% at the end of the previous quarter and 3.54% at the end of the third quarter in 2011.

Write-offs were $29m for the third quarter of 2012, down 42% from $50m in the third quarter of 2011.

Kent Adams, Cat Financial president and vice president of Caterpillar, said: "Cat Financial’s business continues to perform well, and we are especially pleased with the continued improvement in the performance of our portfolio.

"Past dues and write-offs are down from the third quarter of last year, and the global Cat Financial team remains focused on helping Cat customers and dealers succeed through financial services excellence."