St. LOUIS - heavy equipment manufacturer Caterpillar Inc. said Friday its profit in the first quarter grew more five times and its financial perspectives for the year as was raised by a growing economic recovery boosted demand for its construction and mining equipment.
The results blew past analysts expectations and its shares rose $ 2.72, or 2.4%, $115.36 in exchange for midi.
Caterpillar earnings are a bellwether for the global economy, he sells the sort of type of the expensive, heavy machinery used for the construction, mining and forestry.
Its profit in the first quarter reflects an industrial sector that is growing once again, with the greater part of its turnover from the sale of big machines. When the recession hit in 2007, mining companies and construction cut spending on heavy machinery first, Mike DeWalt, Director of Caterpillar of the analysts said investors Friday.
For more than two years, companies retained their investment. But they appear now to have no choice but to replace aging machines, boosting sales of Caterpillar, DeWalt said. This means that expenses will likely continue as companies to replace more vehicles and even expand on demand.
"Let us be clear: this is not a kind of bubble,"DeWalt said."".We believe (are) basically buying enough to keep their fleets continue to deteriorate. ?
The Peoria, Illinois, company said its net income reached a record of 1.23 billion dollars, or $ 1.84 per share for the quarter ended March 31. That is $ 233 million, or 36 cents per share, a year ago. Revenues increased by 57% 12.95 billion $ 8.24 billion a year ago.
Analysts had expected earnings of $1.30 per share on revenue of $ 11.43 billion.
Back to machinery and division Caterpillar power systems grew to 12.29 billion $ 7.55 billion during the same period last year.
Based on its sales higher than expected, Caterpillar has relaunched its 2011 Outlook, forecast revenue between $52 and 54 billion and a net profit between $6.25 and $6.75 per share. Revenues over $ 50 billion and net income of about $6 per action already planned. The company said that its projection does not include its recent MWM Holding GmbH or Bucyrus International, Inc. acquisitions, because trade agreements have not yet closed.
Caterpillar, said prospects would have been higher if not for the earthquake and the tsunami in the Japan, including good number of its suppliers damaged. Disruption of supply and delays will likely cost the company 300 million in lost sales and $ 100 million in lost profits.
Still, the underlying economy look good for the increase in the future profits to Caterpillar, said Bill Selesky, an analyst with Argus Research. The increase in global demand, mining, construction and forestry companies should have to buy more equipment.
"You have a multinational company big with a global footprint all around the world demand a greater," said Selesky. "That gives me hope that we are dealing with a growing economic recovery that we hope is sustainable and which will improve over time.".
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