US equipment giant raises forecasts on global recovery

US construction supplier Caterpillar has posted record profits for the first quarter and increased its sales forecast on the strength of the recovery in the world economy.

The US company saw first quarter profits rise more than 400%, to £1.23bn, as market rebounded, raising its sales expectations for the whole year by 4-8%, to up to £54bn.

The increase was despite a £300m hit to its business from the earthquake and tsunami in Japan, it said.

Chairman and chief executive Doug Oberhelman said: “We expect that the pace of world economic growth will support continued recovery in the key industries we serve. The continuing improvement in our outlook validates our strategy to aggressively invest in additional capacity for key products.”