UPDATE 4-Caterpillar slashes revenue forecast, cutting up to 10000 jobs

25 Sep 2015 | Author: | No comments yet »

Caterpillar lowers 2015 revenue outlook, announces deep job cuts.

Construction and mining equipment maker Caterpillar plans to lay off 10,000 workers — or more — in a bid to save $1.5 billion a year in operating costs, it announced Thursday.Caterpillar slashed its 2015 revenue forecast and said it could cut up to 10,000 jobs through 2018, joining a list of big US industrial companies grappling with the shock waves from the mining and energy downturn.Jim Cramer answered viewers’ Twitter questions from the floor of the New York Stock Exchange and addressed Caterpillar’s (CAT) announcement that it has lowered its revenue outlook and plans to cut 10,000 jobs. ‘These numbers were chilling,’ he said.

And nearly half of those job losses — 4,000 to 5,000 salaried and management employees — will come before the end of 2016, with most completed this year and a “significant” proportion in Illinois, the company said. Caterpillar also warned that total layoffs could climb to more than 10,000 through 2018 and that sales and revenue could drop in 2016 for a record fourth straight year.

Caterpillar expects revenue to fall in 2015, for the third straight year, to $48 billion (€42.74bn), below the average analyst estimate of $48.82 billion. Caterpillar spokeswoman Rachel Potts tells the (Peoria) Journal Star (http://bit.ly/1Kxh9Ig ) that “given the current conditions, now is not the time to start, and we cannot say now when that will happen.”

The big loss in Caterpillar, which is viewed as a proxy for global economic health and a component of the 30-stock Dow Jones industrial average, dragged down the Dow. Most will take place this year at more than 20 international plants across its three key businesses – construction, resources, and energy and transportation. As British mining giant Anglo-American prepared to shave as many as 53,000 jobs, chief executive Mark Cutifani told the Wall Street Journal, “We’re looking at every dollar and pulling everything back.” In the United States, Bureau of Labor statistics indicate that employment in mining has fallen by as much as 90,000 since its peak in December. It now plans a “restructuring” at 20 more of its 103 plants worldwide that will involve some closings, a move that will cut its total manufacturing space by about 10 percent, it said.

But the company also had kept a more positive outlook than its competitors about its end markets for much of this year, said Kwame Webb, an analyst who covers Caterpillar for Morningstar. But the majority of Caterpillar’s plants are overseas, in Asia, Europe and South America. “We recognize today’s news and actions taken in recent years are difficult for our employees, their families and the communities where we’re located. Caterpillar executives said Thursday in a statement that industries like mining, oil and gas and construction are the right businesses to be in for the long term, even with a history that includes prolonged downturns. The company didn’t update its 2015 profit forecast, but it noted that the lower sales outlook and higher restructuring costs will hurt its bottom line. Last month, stocks hit a particularly bad slump as the price of oil dropped to its lowest in more than four months, reported The Los Angeles Times. “The energy sector is down 15 percent this year, making it easily the worst performing industry group in the S&P 500 index.

We don’t make these decisions lightly, but I’m confident these additional steps will better position Caterpillar to deliver solid results when demand improves.” The company had warned of headwinds in its second-quarter earnings report issued back in mid-July. Those include low oil prices, which have reduced demand for Caterpillar engines and equipment used on oil rigs, and to pump and transport oil, as well as a “hangover” in the mining industry, which has excess capacity after years of heavy investment, according to Mircea Dobre, an analyst with Robert W. If sales drop again in 2016, that would mark the first time in Caterpillar’s 90-year history that the company’s topline figure has decreased four years in a row. In February, Caterpillar said that it would stay in Peoria and develop a 31-acre campus over the coming decade, a development hailed at the time by Gov.

Ardis placed the coming layoffs in the context of recent major manufacturing job losses across Illinois. “Our state is hemorrhaging manufacturing jobs, and it has been for some time,” he said. “We’ve lost 300,000 manufacturing jobs since 2000.” Still, he said, he believes Caterpillar has “a good handle” on the steps it needs to take, adding that he was “very confident” that Caterpillar will rebound. Peoria Mayor Jim Ardis said Thursday that he expects the city and region to absorb a sizable hit from the latest round of job cuts, though he said the company has not shared specifics. Caterpillar said in February that it had decided to keep its global headquarters in Peoria, about 160 miles southwest of Chicago, after considering other locations. Rauner spokeswoman Catherine Kelly described Caterpillar as “an important economic engine in Illinois” and said the planned job losses underscore “the need to help improve the state’s economic climate.” Shoeshine man George Manias — a downtown Peoria institution for 68 years — said he’s concerned about the impact on his business, George’s Shoeshine and Hatters World Headquarters. “I hope they don’t lay off too many people,” said Manias, who says he has been polishing Oberhelman’s shoes for 30 years. “If they lay of 10,000 people, there’ll be nothing left in Peoria.”

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UPDATE 1-Western Refining to buy rest of Northern Tier

20 Jan 2016 | Author: | No comments yet »

JPMorgan Chase & Co. Upgrades Northern Tier Energy LP (NTI) to “Neutral”.

Under the deal, Northern Tier unit holders would receive $15 a unit in cash and 0.2986 Western Refining share for each common unit held, or roughly $26.21 a unit based on Monday’s close. EL PASO, Texas and TEMPE, Ariz., Dec. 21, 2015 (GLOBE NEWSWIRE) — Western Refining, Inc. (NYSE:WNR) and Northern Tier Energy LP (NYSE:NTI) today jointly announced that they have entered into a merger agreement whereby Western will acquire all of NTI’s outstanding common units not already owned by Western. Northern Tier Chief Executive Dave Lamp in prepared remarks Monday said that the MLP model “has not been rewarded by the equity market, as evidenced by the historical disconnect between NTI’s high yield and low unit price.” “With a simplified corporate structure and diverse geographic base, the new Western will be well positioned to unlock additional value for shareholders,” Mr. As an alternative to the cash and stock consideration, each NTI unitholder may elect to receive, per NTI unit, either $26.06 in cash or 0.7036 of a share of WNR.

Assuming completion of the proposed transaction, NTI will become a wholly-owned subsidiary of WNR and NTI common units will cease to be publicly traded. Jeff Stevens, President and CEO of WNR said, “The merger of Western and NTI will result in the combined entity owning three of the most profitable independent refineries on a gross margin per barrel basis, with direct pipeline access to advantaged crude oil combined with an integrated retail and wholesale distribution network. The terms of the merger agreement were approved by the WNR Board of Directors and the Conflicts Committee of the Board of Directors of NTI’s general partner, which negotiated the terms on behalf of NTI. Four investment analysts have rated the stock with a hold rating, five have assigned a buy rating and one has issued a strong buy rating to the stock.

The call and slide presentation can be accessed on the Investor Relations section of Western’s website, www.wnr.com, and on the Investor Relations section of Northern Tier’s website at www.northerntier.com. The Company has refining, retail and logistics operations that serve the Petroleum Administration for Defense District II (PADD II) region of the United States. Goldman Sachs & Co. acted as financial advisor to Western, and Vinson & Elkins, Davis Polk & Wardwell and Richards Layton & Finger acted as legal counsel to Western. This press release includes “forward-looking statements” by Western (which are protected as forward-looking statements under the Private Securities Litigation Reform Act of 1995) and by NTI.

The Company’s retail segment operated 165 convenience stores under the SuperAmerica brand and also supported 89 franchised convenience stores, which are also operated under the SuperAmerica brand. These statements are subject to the risk that the merger is not consummated at all, including due to the inability of Western or NTI to obtain all approvals necessary or the failure of other closing conditions, as well as to the general risks inherent in Western’s and NTI’s businesses and the merged company’s ability to compete in a highly competitive industry.

If you are reading this article on another website, that means this article was illegally copied and re-published to this website in violation of U.S. and International copyright law. In addition, Western’s and Northern Tier’s business and operations involve numerous risks and uncertainties, many of which are beyond Western’s and NTI’s control, which could materially affect their respective financial condition, results of operations and cash flows and those of the merged company.

The forward-looking statements are only as of the date made, and neither Western nor NTI undertake any obligation to (and each expressly disclaims any obligation to) update any forward-looking statements to reflect events or circumstances after the date such statements were made, or to reflect the occurrence of unanticipated events. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval in any jurisdiction where such an offer or solicitation is unlawful. Any such offer will be made only by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, pursuant to a registration statement filed with the SEC. The retail segment includes retail service stations, convenience stores, and unmanned fleet fueling locations in Arizona, Colorado, New Mexico, and Texas. Beyersdorfer (602) 286-1530 Michelle Clemente (602) 286-1533 Northern Tier Investor and Analyst Contact: Paul Anderson (651) 458-6494 Alpha IR Group (651) 769-6700 nti@alpha-ir.com Media Contact: Gary Hanson (602) 286-1777

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