Page last updated at 22:50 GMT, Tuesday, 20 October 2009 23:50 UK

Caterpillar sees recovery signs

Caterpillar machines
The firm believes the third quarter of 2009 marked a low point

Caterpillar, the world's largest maker of construction and mining equipment, has said it sees "encouraging signs" of economic recovery.

Caterpillar reported a stronger-than-expected profit of $404m (£245m) for the third quarter, although this was down 54% from a year earlier.

Revenue fell 44% to $7.3bn. The firm said it expected sales and revenues to increase by 10-25% next year.

The news sent Caterpillar shares up by 3% in Tuesday trading on Wall Street.

The company has reduced its headcount by 34,000 workers globally over the past year after demand for its equipment waned.

"We believe the third quarter marked the low point for Caterpillar sales and revenues in what has been the toughest recession since the 1930s," said chairman and chief executive Jim Owens.

"We are seeing encouraging signs that indicate a recovery may be underway," he added.

"However, the world economy is still facing significant challenges. There is uncertainty about the timing and strength of recovery."

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