Caterpillar Profit, Revenue Blow Past Expectations

Caterpillar reported a 58 percent rise in quarterly earnings on Thursday that blew away Wall Street expectations and it projected strong growth for 2012 despite global economic uncertainly.

Douglas C. Pizac / AP

Caterpillar's results cap a record 2011 in terms of sales and profits. Acquisitions, increased demand for mining equipment, favorable commodity prices, and growth in construction machinery and parts sales supported the company during the year.

Investors reacted positively to the report, with Caterpillar shares

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Peoria, Illinois-based Caterpillar said it would continue to break records in 2012, with profit expected to rise 25 percent to $9.25 a share, and revenue projected to increase between 30 percent and 19 percent.

“We're expecting 2012 to be another year of good growth,” Caterpillar Chief Executive Doug Oberhelman said in a press release. “We have to be prepared for recovery in the developed world beyond 2012 and continued growth in emerging markets.”

The world's largest heavy machinery maker said net income for the fourth quarter was $1.55 billion, or $2.32 per share, compared with $968 million, or $1.47 per share, a year ago. That result was 59 cents above the analysts' average estimate of $1.73 a share, according to Thomson Reuters I/B/E/S.

Sales rose 35 percent to $17.24 billion, above Wall Street estimates of $16.05 billion.

Caterpillar's forecast for 2012 is above current Wall Street estimates. Caterpillar warned that costs will rise to meet production needs, and the company is facing production capacity constraints. Oberhelman said construction markets in the United States and Europe will remain “depressed.”

Caterpillar will invest about $4 billion on capital expenditures in 2012, compared with $2.6 billion in 2011.

Still, the company is enjoying solid growth in its resource-equipment sector due to solid demand and favorable prices in the commodities markets. It also is seeing steady demand for after-market parts needed for equipment already in use.

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