Caterpillar’s Profit Drops; Boosts ’09 Forecast

Heavy equipment and diesel engine maker Caterpillar Inc. said Tuesday its second-quarter profit fell by two-thirds, but boosted its full-year earnings forecast.

Caterpillar earned $371 million, or 60 cents per share, down from $1.1 billion, or $1.74, a year ago. Sales fell 41% to $7.98 billion, while engine sales fell 32%.

The boosted its 2009 outlook, predicting sales to be $32 billion to $36 billion, with a profit of 40 cents to $1.50 per share, including redundancy costs of about $700 million, or 75 cents per share.

Excluding redundancy costs, it said its profit would $1.15 to $2.25 per share.

Caterpillar in April reported its first quarterly loss in 17 years, citing slumping sales and the cost of laying off thousands of workers, and lowered its 2009 earnings outlook, the Associated Press reported.

The company said in June 2008 it plans to pull out of the North American Class 8 truck engine market by 2010, except for a severe-duty truck and engine in partnership with Navistar International Corp.