(Reuters) -Caterpillar reported a rise in third-quarter profit on Tuesday, as strong infrastructure investments across key markets boosted demand for its high-end construction equipment.
Demand for heavy equipment has been on the rise as the United States upgrades its roads, railways and other transportation infrastructure under a $1 trillion package approved by the Senate in 2021 under the Biden Administration.
Caterpillar’s profit has also benefited from effective cost controls and price hikes shielding margins amid ongoing inflationary pressures.
The manufacturer’s profit margins have been aided by a strong order backlog for construction equipment and robust demand from customers in oil and gas, power generation, rail and defense.
Last quarter executives said solid demand for heavy machinery from construction and mining industries was expected to drive full-year operating margin toward the top end of its prior forecast.
Caterpillar’s sales and revenue was up across all equipment segments with its construction division recording the highest bump a 12% rise in sales on the back of healthy demand in North America, as the Biden Administration’s $1.2 trillion infrastructure law has spurred spending on U.S. roads, railways and bridges.
Its profit rose to $2.79 billion, or $5.45 per share, from $2.04 billion, or $3.87 per share, a year earlier.
The industry bellwether’s sales for the quarter through September rose 12% to $16.8 billion.
(Reporting by Shivansh Tiwary in Bengaluru; Editing by Devika Syamnath and Louise Heavens)
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