Caterpillar Inc reported a 29 percent rise in first-quarter profit on Wednesday and beat analyst expectations thanks to continued demand for replacement machinery in North America and growth in its mining business.

The world's largest maker of construction machinery reported net earnings of $1.6 billion, or $2.37 per share, compared with $1.2 billion, or $1.84 per share, a year earlier.

The company said the first quarter earnings per share figure was its highest on record.

Caterpillar's sales rose 23 percent to $16 billion during the first quarter, the company said.

Analysts on average had projected a profit of $2.13 a share, according to Thomson Reuters I/B/E/S. Revenue, however, fell short of the $16.2 billion that Wall Street had expected.

In a press release, Caterpillar Chief Executive Doug Oberhelman said the company was experiencing a slowing in China and Brazil as those countries took steps in 2011 to slow their economies and bring inflation under control. Strength in the United States was expected to offset that weakness.

The company increased its profit outlook for the year to $9.50 per share from $9.25 previously. Caterpillar, however, kept its outlook for revenue in the range of $68 billion to $70 billion.

Investors have been closely monitoring the company's order backlog, which had grown to nearly $30 billion by the end of 2011. The backlog continued to grow in the first quarter, ending at $30.7 billion, the company said.

(Reporting By John D. Stoll; Editing by John Picinich)