Caterpillar’s (CAT) fourth-quarter profit jumped 44% to plow through Wall Street estimates, as cost-cutting moves countered a decline in revenue.

The world’s largest maker of construction and mining equipment also unveiled a new $10 billion stock buyback and provided an upbeat outlook for fiscal 2014.

Shares rallied 6.6% to $91.90 in pre-market trading Monday. The stock has been on a downswing over the last year, sliding 9.8%.

Peoria, Ill.-based Caterpillar reported a profit of $1 billion, compared to $697 million in the same period a year earlier. On a per-share basis, earnings rose to $1.54 from $1.04. Revenue dropped 10% to $14.4 billion, with mining results continuing to lag.

The company beat expectations for both the top and bottom lines. Analysts were looking for earnings of $1.28 a share and revenue of $13.64 billion.

Weakness in coal and other commodities led to soft demand for mining equipment, which weighed on Caterpillar’s results throughout fiscal 2013. On Monday, Caterpillar said the decline in mining sales last year was worse than it originally anticipated.

The equipment maker helped offset the decline by slashing costs. In the fourth- quarter, total operating costs were down 14% year-over-year at $12.95 billion.

Across the board, sales for machinery and power systems decreased 11%. The resource industries segment, which includes mining products, logged a 48% decline in sales to $3.02 billion. Construction sales grew 20% to $4.85 billion, while power systems climbed 5% to $5.57 billion.

“Cost flexibility is critical to our strategy and was a significant focus in 2013 as we took substantial actions to help maintain profitability as sales declined,” said Caterpillar chairman and CEO Doug Oberhelman. “It wasn’t easy, especially for our employees who endured an incredibly tough year, but the actions we initiated helped us deliver strong operational performance in 2013.”

Although the company believes mining companies will further reduce capital expenditures in 2014, Caterpillar does expect a continued rebound in mining production.

Caterpillar projected earnings of $5.30 a share and revenue of $56 billion for the current year, plus or minus 5%. Excluding restructuring costs, adjusted earnings are expected to hit $5.85 a share.

According to Oberhelman, Caterpillar sees some signs of improvement in the world economy, which should bode well for construction and power-systems sales. He added that the company continues to be cautious and is working to position itself to succeed when economic conditions improve and sales bounce back.

The company’s decision to launch a new $10 billion buyback stems from “record cash flow, the strength of our balance sheet and our confidence in the long-term future of Caterpillar,” Oberhelman said.

Caterpillar expects to repurchase $1.7 billion of its shares in the first quarter, completing its previous buyback of $7.5 billion.

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