October 31, 2012 / 11:55 AM / in 5 years

UPDATE 1-Fiat Industrial nudges up 2012 targets

By Jennifer Clark

MILAN, Oct 31 (Reuters) - Italy-based truck and tractor maker Fiat Industrial nudged up its 2012 targets after a strong performance at its agricultural equipment business offset poor truck sales and lifted third-quarter profit.

By contrast, U.S. rival Caterpillar Inc, the world’s largest maker of tractors and excavators, slashed its 2012 forecast for the second time this year on Oct. 22.

Fiat Industrial said on Wednesday it was now aiming to beat its 2012 revenue target of 25 billion euros ($32.4 billion) and deliver a trading profit above 2 billion euros, compared with an earlier goal of 1.9-2.1 billion.

The company, which was spun off from Fiat in 2011, also said it will continue merger talks with its CNH tractor subsidiary. Fiat Industrial wants to buy the 12 percent stake in CNH it does not already own through an all-paper share swap.

The plan, which aims to make the combined group’s stock more attractive to investors, was rejected by a committee of advisors to the CNH board in mid-October.

Fiat Industrial said it has asked for a meeting with CNH’s advisory committee, without specifying when it would take place.

At 1152 GMT, shares were 3.5 percent higher at 8.39 euros.

“The market likes the upgrade in revenues and trading profit guidance,” said a trader.

Third-quarter revenue rose 7.9 percent to 6.3 billion euros. Trading profit was up 91 percent to 575 billion euros.

Sales for the agricultural equipment business rose 27 percent, while construction equipment sales fell by 10 percent.

Sales at its Iveco trucks unit fell 7.3 percent to 2.1 billion euros, reflecting a deterioration in most major European markets and temporary weakness in Latin America, the company said.

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