FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File No. 0-13295
CATERPILLAR FINANCIAL SERVICES CORPORATION
(Exact name of Registrant as specified in its
charter)
DELAWARE
37-1105865
(State or other jurisdiction of (I.R.S.
Employer
incorporation or organization) Identification
No.)
3322 WEST END AVENUE, NASHVILLE, TENNESSEE 37203-0983
(Address of principal executive offices)
Registrant's telephone number, including area code:
(615) 386-5800
Indicate by a check mark whether the Registrant (1) has
filed all
reports required to be filed by Section 13 or 15(d) of the
Securities
Exchange Act of 1934 during the preceding 12 months (or for
such shorter
period that the Registrant was required to file such
reports), and (2)
has been subject to such filing requirements for the past 90
days.
Yes X No
The Registrant complies with the conditions set forth in
General
Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore
filing this
form with the reduced disclosure format.
At June 30, 1995, one share of common stock of the
Registrant was
outstanding.
Caterpillar Financial Services Corporation
Form 10-Q for the Quarter Ended June 30, 1995
Index
PART I. FINANCIAL INFORMATION
Page No.
Item 1. Financial Statements (Unaudited)
Consolidated Statement of Financial Position
3
Consolidated Statement of Income
4
Consolidated Statement of Cash Flows
5
Notes to Consolidated Financial Statements
6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
7-11
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
12
Signatures
13
Exhibit Index
14
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Caterpillar Financial Services Corporation
Consolidated Statement of Financial Position
(Unaudited)
(Millions of Dollars)
June 30, Dec. 31,
June 30,
1995 1994
1994
Assets:
Cash and cash equivalents $ 37.2 $ 16.3
$ 16.9
Finance receivables:
Wholesale notes receivable 1,019.0 516.0
394.9
Retail notes receivable 1,233.7 1,105.9
1,069.0
Investment in finance receivables 3,337.3 2,831.4
2,405.6
5,590.0 4,453.3
3,869.5
Less: Unearned income 503.3 415.5
355.6
Allowance for credit losses 50.1 49.5
43.5
5,036.6 3,988.3
3,470.4
Equipment on operating leases,
less accumulated depreciation 433.0 425.0
383.7
Other assets 117.4 81.6
78.4
Total assets $5,624.2 $4,511.2
$3,949.4
Liabilities and stockholder's equity:
Payable to dealers and others $ 74.0 $ 42.9
$ 18.4
Payable to Caterpillar Inc. 3.1 3.2
3.3
Accrued interest payable 42.7 37.8
33.8
Income tax payable 30.2 21.6
35.8
Other liabilities 2.4 25.5
19.8
Short-term borrowings 2,056.2 1,383.1
1,168.3
Current maturities of long-term debt 765.7 807.6
714.4
Long-term debt 2,061.0 1,675.7
1,488.5
Deferred income taxes 17.1 10.7
3.9
Total liabilities 5,052.4 4,008.1
3,486.2
Common stock - $1 par value
Authorized: 2,000 shares
Issued & outstanding: one share 325.0 295.0
275.0
Profit employed in the business 241.1 207.7
190.4
Foreign currency translation
adjustment 5.7 .4
(2.2)
Total stockholder's equity 571.8 503.1
463.2
Total liabilities and stockholder's
equity $5,624.2 $4,511.2
$3,949.4
(See Notes to Consolidated Financial Statements)
Caterpillar Financial Services Corporation
Consolidated Statement of Income
(Unaudited)
(Millions of Dollars)
Three Months Ended Six
Months Ended
June 30, June 30, June 30,
June 30,
1995 1994 1995
1994
Revenues:
Wholesale finance income $ 14.7 $ 5.7 $ 25.4 $
8.1
Retail finance income 88.8 67.7 171.3
133.8
Rental income 36.1 30.1 71.1
59.1
Other income 13.2 5.4 28.2
10.0
Total revenues 152.8 108.9 296.0
211.0
Expenses:
Interest 73.8 51.7 140.1
97.7
Depreciation 27.7 22.7 54.3
44.6
General, operating, and
administrative 14.3 11.1 28.4
21.6
Provision for credit losses 10.3 5.7 16.4
10.8
Other expense 0.9 4.7 2.2
13.6
Total expenses 127.0 95.9 241.4
188.3
Income before income taxes and
minority interest 25.8 13.0 54.6
22.7
Provision for income taxes 10.2 4.7 21.3
8.2
Minority interest in losses
of subsidiary - .2 -
.4
Net Income $ 15.6 $ 8.5 $ 33.3 $
14.9
(See Notes to Consolidated Financial Statements)<PAGE>
Caterpillar Financial Services Corporation
Consolidated Statement of Cash Flows
(Unaudited)
(Millions of Dollars)
Six Months
Ended
June 30, June
30,
1995 1994
Cash flows from operating activities:
Net income $ 33.3 $
14.9
Adjustments for noncash items:
Depreciation 54.3
44.6
Provision for credit losses 16.4
10.8
Mark-to-market adjustment (10.9)
13.2
Other (2.0)
(4.0)
Change in assets and liabilities:
Receivables from customers and others (31.1)
(27.1)
Deferred income taxes 6.7
(9.4)
Payable to dealers and others 28.9
3.3
Payable to Caterpillar Inc. (.1)
(.6)
Accrued interest payable 4.6
(.2)
Income tax payable 8.6
(.3)
Other, net (12.1)
.9
Net cash provided by operating
activities 96.6
46.1
Cash flows from investing activities:
Additions to equipment (79.3)
(78.4)
Disposal of equipment 34.2
45.6
Additions to finance receivables (2,570.2)
(1,351.3)
Collections of finance receivables 1,154.3
782.4
Proceeds from sale of receivables, net 386.9
241.4
Other, net (2.0)
.5
Net cash used for investing
activities (1,076.1)
(359.8)
Cash flows from financing activities:
Additional paid-in capital 30.0
25.0
Proceeds from long-term debt issues 906.5
556.6
Payments on long-term debt (568.8)
(259.2)
Short-term borrowings, net 631.9
(7.7)
Net cash provided by financing
activities 999.6
314.7
Effect of exchange rate changes on cash .8
.3
Net change in cash and cash equivalents 20.9
1.3
Cash and cash equivalents at beginning
of year 16.3
15.6
Cash and cash equivalents at end of quarter $ 37.2 $
16.9
(See Notes to Consolidated Financial Statements)<PAGE>
Notes to Consolidated Financial Statements
(Dollar Amounts in Millions)
1. The accompanying unaudited consolidated financial
statements have
been prepared by Caterpillar Financial Services Corporation
(the
"Company") pursuant to the rules and regulations of the
Securities and
Exchange Commission. Although the Company believes the
disclosures are
adequate, it is suggested that these financial statements be
read in
conjunction with the financial statements and the notes
thereto
presented in the Company's 1994 Annual Report and the
Company's Annual
Report on Form 10-K. Unless the context otherwise requires,
the term
"Company" includes subsidiary companies.
The information furnished reflects, in the opinion of
management,
all adjustments, which include normal and recurring
accruals, necessary
for a fair presentation of the consolidated statements of
financial
position, income, and cash flows for the periods presented.
The results
for interim periods are not necessarily indicative of the
results to be
expected for the year.
2. Income on financing leases, installment sale contracts,
and customer
and dealer loans (retail finance income) is recognized over
the term of
the contract at a constant rate of return on the scheduled
uncollected
principal balance. Income on dealer floor planning and
rental fleet
financing (wholesale finance income) is recognized based on
the daily
balance of wholesale receivables outstanding and the
applicable
effective interest rate. Income on operating leases (rental
income) is
reported over the life of the operating lease in the period
earned.
Loan origination fees and commitment fees in excess of $500
are
amortized to finance income using the interest method over
the
contractual lives of the finance receivables.
3. The Company has a tax sharing agreement with Caterpillar
Inc.
("Caterpillar") in which Caterpillar collects from or pays
to the
Company its allocated share of any consolidated U.S. income
tax
liability or credit applicable to any period for which the
Company is
included as a member of the consolidated group. A similar
agreement
exists between Caterpillar Financial Australia Limited and
Caterpillar
of Australia Ltd. with respect to taxes payable in
Australia.
4. During the first six months of 1995, the Company
publicly issued
$893.7 million of medium-term notes. The notes are offered
on a
continuous basis through agents and have maturities ranging
from nine
months to 15 years. Interest rates on fixed-rate
medium-term notes are
established by the Company as of the date of issuance.
Interest rates
on floating-rate medium-term notes are primarily indexed to
LIBOR or
treasury bill rates swapped to LIBOR. The weighted average
interest
rate on all outstanding medium-term notes was 6.5% at June
30, 1995.
Long-term debt outstanding at June 30, 1995, matures as
follows:
1995 $ 340.2
1996 1,029.1
1997 693.6
1998 424.8
1999 155.9
2000 81.8
Thereafter 101.3
Total $2,826.7
As of June 30, 1995, the Company's ratio of debt to
total
stockholder's equity exceeded the ratio specified in its
revolving
credit facility agreement. A waiver and amendment to the
agreement has
been requested.
Item 2. Management's Discussion and Analysis of Financial
Condition and
Results of Operations
A. Consolidated Results of Operations
Three Months Ended June 30, 1995 vs. Three Months Ended
June 30,
1994
Total revenues for the second quarter of 1995 were
$152.8 million, a
40% increase over 1994 second quarter revenues of $108.9
million. The
increase in revenues was primarily the result of earnings
from the
larger portfolio which increased to $5,497.8 million at June
30, 1995
from $3,874.5 million at June 30, 1994. Gains of $5.1
million on
interest rate caps written by the Company also contributed
to the
increase in revenues. These written interest rate caps were
terminated
during the second quarter of 1995.
The Company financed new retail business transactions
totaling
$730.0 million during the second quarter of 1995 compared
with $540.7
million during the second quarter of 1994. New retail
financing in the
second quarter of 1995 was higher than the second quarter of
1994 levels
primarily due to financing increased dealer deliveries of
Caterpillar
construction machines in the United States and Europe. The
Company had
wholesale financing during the second quarter of 1995 of
$892.8 million
compared with $272.0 million for the second quarter of 1994.
The
increase was primarily due to expansion of the Caterpillar
dealer rental
fleet financing program in North America.
The annualized interest rate on finance receivables
(computed by
dividing annualized finance income by the average monthly
finance
receivable balances) was 9.0% for the second quarter of 1995
compared
with 8.6% for the second quarter of 1994. Tax benefits
associated with
governmental lease-purchase contracts and a portion of tax
benefits
associated with long-term tax-oriented leases are not
reflected in such
annualized interest rates.
Other income of $13.2 million for the second quarter of
1995
included gains on interest rate caps written by the Company,
fees,
securitization income, gains on sales of equipment returned
from lease,
and other miscellaneous income. The increase of $7.8
million during the
second quarter of 1995, as compared with the same period in
1994, was
primarily due to recording gains of $5.1 million on interest
rate caps
written by the Company and securitization income of $2.2
million.
Losses on these written caps were recorded in the second
quarter of 1994
and are reflected in Other expense.
Second quarter interest expense of $73.8 million was
$22.1 million
higher than 1994 second quarter interest expense due to
increased
borrowings to support the larger portfolio and higher
borrowing rates,
as the average cost of borrowed funds was 6.7% for the
second quarter of
1995 compared with 6.1% for the second quarter of 1994.
Depreciation expense for the second quarter of 1995 was
$27.7
million, $5.0 million higher than the same period in 1994.
This
increase resulted from additional equipment on operating
leases which,
computed as a monthly average balance, increased 20.6%.
General, operating, and administrative expenses
increased $3.2
million during the second quarter of 1995 compared with the
same period
last year. This increase resulted primarily from
staff-related and
other expenses required to service the larger managed
portfolio. The
Company's full-time employment increased from 390 at June
30, 1994 to
434 at June 30, 1995.
Provision for credit losses during the second quarter of
1995 was
$10.3 million, compared with $5.7 million during the second
quarter last
year, reflecting a higher provision taken for the U.S.
company and the
increased levels of new retail business. Receivables, net
of
recoveries, of $14.8 million were written off against the
allowance for
credit losses during the second quarter of 1995 compared
with $3.2
million during the second quarter of 1994. The increased
write-offs
were primarily attributable to one customer in the fishing
industry.
Receivables past due over 30 days were 2.2% of total
receivables at
June 30, 1995, compared with 3.2% at June 30, 1994. The
allowance for
credit losses is monitored to provide for an amount which,
in
management's judgment, will be adequate to cover
uncollectible
receivables. At June 30, 1995, the allowance for credit
losses was
$50.1 million which was 1.0% of finance receivables, net of
unearned
income (1.2% excluding wholesale receivables), compared with
$43.5
million and 1.2% (1.4% excluding wholesale receivables) at
June 30,
1994, respectively.
Other expense for the second quarter of 1995 was $0.9
million
compared with $4.7 million for the second quarter of 1994.
The decrease
resulted primarily from recording $4.3 million of losses in
the second
quarter of 1994 on interest rate caps and swaptions written
by the
Company. Gains on these written caps were recorded in the
second
quarter of 1995 and are reflected in Other income.
The effective income tax rate for the second quarter of
1995 was
40% compared with 36% for the second quarter of 1994. The
increase was
primarily due to a decrease in the percentage of total
income generated
from tax-exempt municipal leases.
Net income for the second quarter of 1995 was $15.6
million, $7.1
million above 1994 second quarter net income of $8.5
million. The
increase in net income resulted primarily from recording
gains, net of
tax, of $3.1 million on interest rate caps written by the
Company,
compared with a $2.8 million loss, net of tax, for the
second quarter of
1994. Net income excluding these mark-to-market gains and
losses was
$12.5 million, compared with $11.3 million. This increase
of $1.2
million resulted primarily from increased earnings from a
larger
portfolio, partially offset by an increase in the provision
for credit
losses.
Six Months Ended June 30, 1995 vs. Six Months Ended June
30, 1994
Total revenues for the first half of 1995 were $296.0
million, a 40%
increase over the revenues for the first half of 1994 of
$211.0 million.
The increase in revenues was primarily the result of
earnings from the
larger portfolio and from recording gains of $10.9 million
on interest
rate caps written by the Company.
The Company financed new retail business transactions
totaling
$1,339.5 million during the first half of 1995 compared with
$981.9
million during the first half of 1994. New retail financing
in the
first half of the year was higher than 1994 levels primarily
due to
financing increased dealer deliveries of Caterpillar
construction
machines in the United States and Europe. The Company had
wholesale
financing during the first half of 1995 of $1,316.1 million
compared
with $354.3 million for the first half of 1994. The
increase was
primarily due to expansion of the Caterpillar dealer rental
fleet
financing program in North America. It is the Company's
expectation
that dealer rental fleet financing will be lower during the
second half
of the year due to the expected seasonality of the program.
On
March 30, 1995, the Company entered into a $300.0 million
revolving
asset backed securitization agreement for wholesale
receivables.
The annualized interest rate on finance receivables
(computed by
dividing annualized finance income by the average monthly
finance
receivable balances) was 9.0% for the first half of 1995
compared with
8.7% for the first half of 1994. Tax benefits associated
with
governmental lease-purchase contracts and a portion of tax
benefits
associated with long-term tax-oriented leases are not
reflected in such
annualized interest rates.
Other income of $28.2 million for the first half of 1995
included
gains on interest rate caps written by the Company, fees,
gains on sales
of equipment returned from lease, securitization income,
gain on sale of
receivables, and other miscellaneous income. The increase
of $18.2
million during the first six months of 1995, as compared
with the same
period in 1994, was primarily due to recording gains on
interest rate
caps written by the Company and securitization income.
Interest expense for the first half of 1995 was $140.1
million,
$42.4 million higher than the first six months of 1994 due
to increased
borrowings to support the larger portfolio and higher
borrowing rates,
as the average cost of borrowed funds was 6.7% for the first
half of
1995 compared with 6.1% in 1994.
Depreciation expense increased from $44.6 million for
the first half
of 1994 to $54.3 million for the first half of 1995 due to
the increase
in equipment on operating leases which, computed as a
monthly average
balance, increased 21.0%.
General, operating, and administrative expenses for the
first six
months of 1995 increased $6.8 million over the same period
last year
primarily due to staff-related and other expenses required
to service
the larger managed portfolio.
Provision for credit losses during the first six months
of 1995
increased from $10.8 million in the first half of 1994 to
$16.4 million
in the first half of 1995. This increase reflected
increased levels of
new retail business and a higher provision taken for the
U.S. Company.
Receivables, net of recoveries, of $16.6 million were
written off
against the allowance for credit losses during the first
half of 1995
compared with $6.5 million during the first half of 1994.
The increased
write-offs were primarily attributable to one customer in
the fishing
industry.
Other expense for the first half of 1995 was $2.2
million compared
with $13.6 million for the first half of 1994. The decrease
resulted
primarily from recording $13.2 million of losses in the
first half of
1994 on interest rate caps and swaptions written by the
Company. Gains
on these written caps were recorded in the first half of
1995 and are
reflected in Other income.
The effective income tax rate for the first half of 1995
was 39%
compared with 36% for the first half of 1994. The increase
was
primarily due to a decrease in the percentage of total
income generated
from tax-exempt municipal leases.
Net income for the first half of 1995 was $33.3 million
compared
with $14.9 million in the first half of 1994. The increase
in net
income resulted primarily from recording gains, net of tax,
of $6.8
million on interest rate caps written by the Company,
compared with a
$8.1 million loss, net of tax, for the first half of 1994,
as well as a
larger portfolio. Net income excluding the mark-to-market
gains and
losses was $26.5 million, compared with $23.0 million. This
increase of
$3.5 million resulted primarily from increased earnings from
a larger
portfolio, partially offset by an increase in the provision
for credit
losses.
B. Capital Resources and Liquidity
The Company's operations were primarily funded with a
combination of
medium-term notes, commercial paper, bank borrowings,
proceeds from sale
of receivables, additional equity capital of $30.0 million
invested by
Caterpillar, and retained earnings. The ratio of debt to
equity at
June 30, 1995 was 8.5 to 1 compared with 7.7 to 1 at
December 31, 1994.
Total debt outstanding as of June 30, 1995 was $4,882.9
million, an
increase of $1,016.5 million over that at December 31, 1994,
and was
primarily comprised of $2,738.2 million of medium-term
notes, $1,373.6
million of commercial paper, and $656.9 million of notes
payable to
banks. The increase in debt and the funds provided by
Caterpillar and
by operations were used to finance the increase in the
portfolio.
The net amount of sold receivables serviced by the
Company was
$417.9 million at June 30, 1995 which consisted of $300.0
million of
wholesale receivables and $117.9 million of retail
receivables. The
Company expects to sell an additional $400-$500 million of
retail
receivables during the third quarter of 1995.
At June 30, 1995, the Company had available a total of
$1,363.2
million of short-term credit lines which expire at various
dates through
the first half of 1996, and a $29.1 million long-term credit
line which
expires May 1997. These credit lines are with a number of
banks and are
considered support for the Company's outstanding commercial
paper,
commercial paper guarantees, the discounting of bank and
trade bills,
and bank borrowings at various interest rates. At June 30,
1995, there
were $646.9 million of these lines utilized for bank
borrowings in
Australia and Europe.
The Company also participates with Caterpillar in two
syndicated
revolving credit facilities aggregating $1.8 billion,
consisting of a
$1.2 billion five-year facility and a $600.0 million 364-day
revolving
facility. The Company's allocation is $1,440.0 million,
consisting of a
$960.0 million five-year revolving credit and a $480.0
million 364-day
revolving credit. The Company has the ability to request a
change in
its allocation to maintain the required amount of support
for the
Company's outstanding commercial paper and commercial paper
guarantees.
These facilities provide for borrowing at interest rates
which vary
according to LIBOR or money market rates. At June 30, 1995,
there were
no borrowings under these facilities.
The Company's revolving credit facilities were amended
at the
request of the Company. The changes 1) increased the total
debt to
total stockholder's equity ratio required to a maximum of
8.35 to 1 from
May 31, 1995 through October 1, 1995 and 8.0 to 1
thereafter; and 2)
established a minimum ratio of consolidated profit before
taxes plus
fixed charges to fixed charges of 1.15 to 1. Due to record
volumes of
new business for the quarter and particularly in the month
of June, the
Company exceeded the debt to equity ratio and has requested
a waiver and
amendment to the agreement.
In connection with its match funding objectives, the
Company
utilizes a variety of interest rate contracts including swap
and forward
rate agreements. All of these interest rate agreements are
held or
issued for purposes other than trading. The agreements are
entered
into with major financial institutions and are utilized for
two
principal reasons: 1) To modify the Company's debt structure
in order to
match fund its receivable portfolio which reduces the risk
of
deteriorating margins between its interest-earning assets
and interest-
bearing liabilities, and 2) To gain an economic/competitive
advantage
through lowering the cost of borrowed funds by either
changing the
characteristics of existing debt instruments or entering
into agreements
in combination with the issuance of debt.
As of June 30, 1995, the Company had outstanding
interest rate swap
contracts with notional amounts totaling $1,522.8 million
that are
either designated as hedges of specific debt issuances or of
commercial
paper. These swap agreements have terms generally ranging
up to five
years, which effectively change $974.8 million of floating
rate debt to
fixed rate debt, $281.0 million of fixed rate debt to
floating rate
debt, and $267.0 million of floating rate debt to floating
rate debt
having different characteristics. The interest rate swaps
designated to
commercial paper provide the ability to obtain fixed rate
term debt
utilizing short-term debt markets. The Company also had
swaps having
future effective dates with a total notional amount of $47.5
million,
which will effectively change $33.0 million of fixed rate
debt to
floating rate debt and $14.5 million of floating rate debt
to fixed rate
debt. The effective dates of the future dated swaps range
from 1995
through 1998 with terms of these swaps ranging up to two
years.
The Company's outstanding forward rate agreements
totaled $89.7
million at the end of the second quarter of 1995. These
agreements have
terms generally ranging up to six months.
The Company has forward exchange contracts to hedge its
U.S. dollar
denominated obligations in Australia against currency
fluctuations.
These contracts have terms generally ranging up to three
months and do
not subject the Company to risk due to exchange rate
movements, because
the gains and losses on the contracts offset the losses and
gains on the
liabilities being hedged. At June 30, 1995, the Company had
forward
exchange contracts totaling $176.3 million, all with
Caterpillar.
To supplement external debt financing sources, the
Company has
variable amount lending agreements with Caterpillar
(including one of
its subsidiaries). Under these agreements, which may be
amended from
time to time, the Company may borrow up to $85.5 million
from
Caterpillar, and Caterpillar may borrow up to $85.5 million
from the
Company. All of the variable amount lending agreements are
effective
for indefinite terms and may be terminated by either party
upon 30 days'
notice. At June 30, 1995, December 31, 1994, and June 30,
1994, the
Company had no outstanding borrowings or loans receivable
under these
agreements.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Description
12 Statement Setting
Forth
Computation of Ratio
of Profit to
Fixed Charges
(The ratios of profit
before taxes
plus fixed charges to
fixed
charges for the
quarters ending
June 30, 1995, and
June 30, 1994,
were 1.34 and 1.24,
respectively,
and for the six months
ending
June 30, 1995, and
June 30, 1994,
were 1.38 and 1.23,
respectively.)
(b) Reports on Form 8-K
A report on Form 8-K dated June 6, 1995, was filed
by the
Company, in which the Company reported that it had
executed a
Distribution Agreement relating to the sale of up
to
$2,000,000,000 of its Medium-Term Notes, Series E,
and filed
the Distribution Agreement dated June 5, 1995.
A report on Form 8-K dated June 14, 1995, was
filed by the
Company, in which the Company reported an
amendment to the
Support Agreement with Caterpillar effective June
14, 1995.
Signatures
Pursuant to the requirements of the Securities Exchange
Act of 1934,
the Registrant has duly caused this report to be signed on
its behalf by
the undersigned, thereunto duly authorized.
Caterpillar Financial Services Corporation
(Registrant)
Date: August 9, 1995 By: /s/K.C. Springer
K.C. Springer, Controller
and
Principal Accounting
Officer
Date: August 9, 1995 By: /s/J.S. Beard
J.S. Beard, President
EXHIBIT INDEX
Sequentially
Exhibit
Numbered
Number Description
Page
12 Statement Setting Forth Computation of
15
Ratio of Profit to Fixed Charges
EXHIBIT 12
CATERPILLAR FINANCIAL SERVICES CORPORATION
STATEMENT SETTING FORTH COMPUTATION OF
RATIO OF PROFIT TO FIXED CHARGES
(Unaudited)
(Dollars in Millions)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1995 1994 1995 1994
Net Income $ 15.6 $ 8.5 $ 33.3 $ 14.9
Add:
Provision for income taxes 10.2 4.7 21.3 8.2
Deduct:
Equity in profit of
partnerships (.5) (.5) (.7) (.9)
Profit before taxes $ 25.3 $ 12.7 $ 53.9 $ 22.2
Fixed charges:
Interest on borrowed
funds $ 73.8 $ 51.7 $140.1 $ 97.7
Rentals--at computed
interest* .4 .3 .7 .6
Total fixed charges $ 74.2 $ 52.0 $140.8 $ 98.3
Profit before taxes plus
fixed charges $ 99.5 $ 64.7 $194.7 $120.5
Ratio of profit before
taxes plus fixed charges
to fixed charges 1.34 1.24 1.38 1.23
*Those portions of rent expense that are representative of interest
cost.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE
COMPANY'S SECOND QUARTER 1995 10-Q AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-END> JUN-30-1995
<CASH> 37,200
<SECURITIES> 0
<RECEIVABLES> 5,086,700
<ALLOWANCES> 50,100
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 641,400
<DEPRECIATION> 208,400
<TOTAL-ASSETS> 5,624,200
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 2,826,700<F2>
<COMMON> 325,000
0
0
<OTHER-SE> 246,800
<TOTAL-LIABILITY-AND-EQUITY> 5,624,200
<SALES> 0
<TOTAL-REVENUES> 296,000
<CGS> 0
<TOTAL-COSTS> 82,700
<OTHER-EXPENSES> 2,200
<LOSS-PROVISION> 16,400
<INTEREST-EXPENSE> 140,100
<INCOME-PRETAX> 54,600
<INCOME-TAX> 21,300
<INCOME-CONTINUING> 33,300
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 33,300
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>THE COMPANY IS A CAPTIVE FINANCE SUBSIDIARY WHICH DOES NOT
HAVE A CLASSIFIED
BALANCE SHEET.
<F2>INCLUDES CURRENT AND NONCURRENT MATURITIES OF LONG-TERM DEBT.
</FN>
</TABLE>
