The earnings outlook is a switch from January, when the company forecast profits near 1996 levels, and is the result of better economic growth and higher machine industry demand in the US and Canada. Earnings per share for the year are expected to be moderately higher, reflecting the benefit of the companys share repurchase programme, Caterpillar said. Margins rose to 26.8 per cent in the first quarter from 24.5 per cent a year ago. The increase was primarily due to price increases over the past year, higher physical sales volume, a favourable change in geographic sales mix, lower sales discounts and the net effect of the stronger dollar. This is just a very, very solid operating quarter, Mr J. Blair Brumley, analyst at Dain Bosworth, said. Caterpillar shares were up $2 3 /8 at $81 3 /4.
