Caterpillar Earnings Call Nuggets: Company Inventory and the Pricing Outlook
David Raso – ISI Group: ISI. For 2013 sales mid-point, if we strip out Cat financial we are speaking about $61 billion. So, that said, a question on the Company inventory, your Company inventory as a percent of trailing sales looking at the equipment company just came down from over 27 percentage trailing sale to not below 25. So, when we think about 2013, the target for Company inventory, are we comfortable with that 25% level? I’m just trying to get a feel for how much more company inventory do you expect to take out in 2013?
Mike DeWalt – Corporate Controller: Yeah. A good question David and honestly we don’t track it as a percent of sales. What we’re targeting is inventory turns, which is essentially related to cost of sales, not so much sales although of course they are tied together. I think to a large degree in terms of dollars where we end up on inventory at the end of 2013 will kind of depend to some degree on where we’re at in terms of the outlook. If we’re at the bottom of the outlook or the top of the outlook I suspect that the inventory number will look different. If you just start with where we are today in terms of inventory, there’s more to come out in the first quarter. I certainly don’t think it will be on this scale. We’re not predicting it will be on the scale of what came out in the fourth quarter, $2 billion, but certainly there’s more coming out in the first quarter. So it’s going to come down from here.
David Raso – ISI Group: But at the midpoint do we feel there’s more inventory to come out?
Doug Oberhelman – Chairman and CEO: Yes.
David Raso – ISI Group: Okay. And then related to that, the guidance by segment, if I look at construction industries you said flat to up slightly. Now you use 3%, Power flat, I assume all other, pullout Cat Logistics, and it’s small number, call it flat after you pull that Cat Logistics out. It would seem to be implying Resource Industries down, call it, 10%, 11%, 12% on revenues for the year. Is that a fair characterization of how you’re looking at Resource Industries? And how do we square that revenue guidance up with the orders for the equipment have been down more than that the last two quarters?
Doug Oberhelman – Chairman and CEO: Yes. A couple of things. One, we gave general direction on the segments and I think the way you described it in terms of general direction is absolutely correct. It is Resource Industries that is going to have, again, other than the absence of logistics really all the decline. How that squares up with orders? We’re starting the year with actually a reasonable backlog of four, the big product, but we do need to take – we need to take on more orders over the course of the next maybe two quarters to make the forecast. So, it’s not a case where orders can stay at the level that they have been during the second half of ’12. So they will need to go up. But it looks to us like the bottom is actually the third and the fourth quarter of last year, we have already seen pretty substantial pickup in construction orders in the fourth quarter. Most of the decline in orders that we saw I think 2012 and the second half of the year are in construction was related to dealers willing to take out inventory. Hope that helps, David we probably need to move on to the next person on.
The Pricing Outlook
Jerry Revich – Goldman Sachs: My two questions are on the pricing outlook. Mike first, how would you characterize the pricing environment on new resource industries booking today compared to what you are shipping out of backlog. Do you expect positive price realization out of that business? And second, does the pricing outlook include any benefit for your construction equipment business from the next export position out of Japan given the recent move in the yen?
Mike DeWalt – Corporate Controller: I think in general, I will say we are cautious on pricing next year. Our outlook reflects something around 1%. We did better than that in 2012. I think we were actually a bit surprised as we went through the year at how well pricing held up. We don’t have a big difference looking forward to next year between the segments. We have small improvements baked into each of them, nothing big. I think given another year of relative weakness in the global economy, I mean, my goodness, 2.5% is nothing to jump up and down about and the world economy is pretty weak. I think we are sounding a fairly cautious tone on pricing, but by the same token, we are not trying to be alarmist here. No, it’s not as though as you have big cuts anywhere. It’s just weak economic growth and caution on our part.
Doug Oberhelman – Chairman and CEO: I would like to add to that Mike just a little bit on kind of our business model and strategy, and we are really working on market share, (field) population around the world to make sure that cedes our business model, and that plays also into kind of pricing philosophy we have because we are trying to juggle that much better as we go after an increasing (field) population, which then drives our aftermarket, drives our dealers as you all know. So, that plays into that equation as well.
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