The company also made a full year profit forecast that was higher than anything analysts had predicted thanks to the rising demand from the mining sector for shovels and trucks. Caterpillar expects the profits in 2012 to be close to $9.25 per share.
This is based on the fact that as major mining companies around the world spruce up their mining operations Caterpillar has a record $29.8 billion worth backlog of orders at the end of 2011. Its capacity is likely to constrain the sales of the company in 2012. The announcement saw its stocks go up by 2.5% in trading on the New York Stock exchange.
Larry De Maria, a New York-based analyst for William Blair & Co. said that it was a very solid report. He added that it was well ahead of expectations, driven by top-line growth and operational execution. The outlook is especially robust, driven by mining and construction equipment replacement he said.
Chief Financial Officer Ed Rapp said that the balance sheets were in pretty good shape. He added that companies like Caterpillar were more willing to invest product development, additional capacity and making acquisitions. These factors impacted their business.
CEO Doug Oberhelman said that they expected 2012 to be a new sales record at a time when construction activity in the United States and Europe, two large markets for them, were still depressed. He added that their investments in capital expenditures and R&D will certainly add cost in 2012, but it was the right thing to do.For the latest updates on the stock market, visit Stock Market Today For the latest updates PRESS CTR + D or visit Stock Market news Today
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