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Diversified industrial manufacturer Eaton Corporation, Cleveland, OH, sales for the third quarter 2006 were up 13% from the same period a year ago. Sales were $3.12 billion. Net income rose 25% to $248 million.
'We expect the growth rate in our overall end markets to weaken slightly in the fourth quarter, id=bwanpa11>' said Chairman and CEO Alexander M. Cutler. id=bwanpa12>'While the non-residential electrical and hydraulics markets remain strong, and the heavy-duty truck market should post a strong finish to the year, markets likely to weaken during the quarter are the residential construction market for our electrical products, North American and Brazilian automotive production, and Brazilian agricultural equipment production."
id=bwanpa13>Business Segment Results
Third quarter sales for the Electrical segment were $1.08 billion, up 10% over 2005. 'End markets for our electrical business grew about 6% during the third quarter, id=bwanpa32>' said Cutler. id=bwanpa33>'While we expect the non-residential construction markets to remain very strong, the decline in the residential construction market is continuing. As a result, we expect end market growth in the Electrical segment over the balance of the year to be slightly lower, at about 5%.
id=bwanpa34>'Our margins were impacted during the quarter by the high level of copper prices. The higher prices reduced third quarter operating profit in the Electrical segment by $9 million compared to our plan at the start of the year."
id=bwanpa37>In the Fluid Power segment, third quarter sales were $998 million, 29% above the third quarter of 2005. Excluding the impact of acquisitions, the Fluid Power segment grew 9% during the quarter. Fluid Power markets in the third quarter grew 5% compared to the same period in 2005, with global hydraulics shipments up an estimated 7%, commercial aerospace markets up 13%, defense aerospace markets flat, and European automotive production down 4%.
'The global hydraulics markets posted another quarter of strong growth, driven by continued investment in industrial and construction equipment worldwide, id=bwanpa42>' said Cutler. id=bwanpa43>'We anticipate that the global hydraulics markets are likely to continue to grow over the balance of 2006 at the pace seen in the third quarter. The commercial aerospace market showed very strong growth in the quarter, while defense aerospace remained flat."
id=bwanpa44>The Truck segment posted sales of $647 million in the third quarter, up 8% compared to 2005. In the third quarter, NAFTA heavy-duty truck production was up 11% compared to 2005, NAFTA medium-duty production was up 13%, European truck production was up 11%, Brazilian vehicle production was up 1%, and Brazilian agricultural equipment production was down 18%.
id=bwanpa48>The Automotive segment posted third quarter sales of $394 million, 5% less than the comparable quarter of 2005. Automotive production in NAFTA was down 9% while European production was down 4% compared to the third quarter of 2005.
Eaton Corporation is a diversified industrial manufacturer with 2005 sales of $11.1 billion in electrical systems and components for power quality, distribution and control; fluid power systems and services for industrial, mobile and aircraft equipment; truck drivetrain systems for safety and fuel economy; and automotive engine air management systems, powertrain solutions and specialty controls. Eaton has sells products in more than 125 countries.