Heavy equipment maker Caterpillar Inc. said Tuesday it will increase machinery and engine prices in January, citing a global upswing in construction, mining and energy exploration that continues to fuel demand for its products.
Caterpillar shares rose $2.41 _ or nearly 3.6 per cent _ to close the day at US$69.68 on the New York Stock Exchange. Shares have traded in a 52-week range of $48.25 to $82.03.
Peoria-based Caterpillar said in a document filed Tuesday with the U.S. Securities and Exchange Commission that machinery prices will increase in January up to five per cent and engine prices will rise up to seven per cent.
Caterpillar spokesman Rusty Dunn said the price increases reflect an ongoing sales surge that helped Caterpillar post record earnings last year, followed by its strongest results in at least four decades for the first half of 2006.
``When you look at the global mining, energy and construction markets we serve, there is continuing strength in those areas, so demand is strong,'' Dunn said.
Caterpillar's planned price increases are comparable to five others imposed since 2004, most recently in January, Dunn said.
The company predicts 2006 earnings and sales will top last year's record results, when Caterpillar posted more than $2.8 billion in profits on sales that topped $36.3 billion. Caterpillar forecasts profit per share will rise from $4.04 in 2005 to between $5.25 and $5.50 this year on sales growth of 12 per cent to 15 per cent.