by Bianca Flowers and Shivansh Tiwary
(Reuters) – Caterpillar reported a rise in third-quarter profit on Tuesday, driven by significant investments in infrastructure in key markets, boosting demand for its high-end construction equipment.
Demand for heavy equipment is on the rise as the United States upgrades roads, railways and other transportation infrastructure through a $1 trillion program approved by the Senate in 2021 under the Biden administration.
Cost controls also contributed to Caterpillar’s profits, with price increases protecting margins despite persistent inflation pressure.
Profit margins were supported by a full order book for construction equipment and strong demand from customers in the oil and gas, power generation, rail and defense sectors.
Strong demand for heavy machinery in the construction and mining sectors is expected to place the operating margin for the year at the high end of the range previously forecast.
Caterpillar’s third-quarter revenue increased across all equipment segments, with the construction division seeing the largest increase (+12%) driven by solid demand in North America, the company’s infrastructure bill. as the Biden administration boosted spending on roads, railways and bridges in the United States.
Revenue at the group, seen as a barometer of economic activity, rose 12% to $16.8 billion in the quarter that ended in September.
Its profit reached $2.79 billion, or $5.45 per share, compared to $2.04 billion, or $3.87 per share, a year earlier.
(Reporting Shivansh Tiwary in Bangalore; Nathan Vifflin, edited by Blandine Hénault)
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