increased its earnings outlook for the year as strong machine sales in a buoyant global economy offset the increased tariffs on raw material costs.
The world's largest manufacturer of heavy machinery for mining, construction and energy companies reported that second-quarter earnings more than doubled year-on-year, exceeding analyst expectations, as higher volumes and higher prices bolstered results ,
imposed duties to raise material costs by about $ 1
Caterpillar and other US manufacturers have seen steel costs rise since the Trump government imposed tariffs on metal imports. The companies have also paid more for logistics and transport costs because truck drivers are in short supply and fuel prices are higher. Caterpillar said its manufacturing costs rose in the last quarter as both steel prices and freight costs rose.
Some manufacturers have stated that they would pass on the costs through price increases.
The Deerfield, Illinois-based company said its dredger, bulldozer and other equipment sales increased 25% to $ 13.28 billion in the second quarter, driven by strong demand for oil and gas and mining customers.
Adjusted earnings The increase in sales was offset by higher manufacturing and raw material costs.
Caterpillar's stock rose 3.1% on Monday as the company announced a $ 10 billion share repurchase program
Caterpillar's earnings outlook for the year in the markets The company is leaving Adjusted earnings per share for the year will be between $ 11.2 and $ 11.25.  Caterpillar, whose products are sold in more than 190 countries, said that the increased outlook does not take into account the potential for further increases in trade barriers.
With higher commodity prices, the company's mining customers invested in their equipment fleets and expansions. Caterpillar said its mine customers had not yet started on a full fleet replacement.
In North America, growth was supported by demand for construction equipment related to demand from the oil and gas sector.
Increased construction and infrastructure investment in China and a stronger Chinese yuan supported Caterpillar's Asia results.
Total revenue, including revenue from the Company's financial products, increased 24% to $ 14.01 billion.
Overall, the company reported a second quarter profit of $ 1.71 billion, or $ 2.82 per share, compared to $ 802 million or $ 1.35 per share a year earlier. On an adjusted basis, profits increased to $ 2.97 per share.
Analysts surveyed by Thomson Reuters had forecast $ 13.83 billion in adjusted earnings of $ 2.73 per share for $ 13.88 billion.
Caterpillar's new share repurchase program is due to begin next year. The company's current plan, which expires this year, had $ 4.5 billion left over from its original $ 10 billion. Caterpillar bought back $ 750 million worth of shares in the second quarter.
The number of domestic employees at the end of June was 68,400, compared with 62,700 a year ago.