Eaton 2Q Sales Down 0.5% - Modern Distribution Management

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Eaton 2Q Sales Down 0.5%

Profit increased 13.7 percent to $382 million.

Diversified industrial manufacturer Eaton Corp. (NYSE: ETN), Cleveland, OH, reported sales for the second quarter of $4.1 billion, a slight decrease over the same period a year ago. Profit increased 13.7 percent to $382 million.

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Business Segment Results
Second quarter sales for the Electrical Americas segment were $1.1 billion, up 10 percent compared to 2011. Excluding acquisition integration charges of $2 million, operating profits were $192 million, up 32 percent compared to the same period last year.

Sales for the Electrical Rest of World segment were $683 million, a 13 percent decrease year-over-year. Excluding acquisition integration charges of $3 million, operating profits totaled $55 million, a decrease of 29 percent year-over-year.

Hydraulics segment sales were $769 million, up 6 percent compared to the same period a year earlier. Excluding $3 million acquisition integration charges, operating profits in the second quarter were $126 million, 5 percent above 2011 levels.

Aerospace segment sales were $436 million, up 7 percent year-over-year. Operating profits were $59 million, up 18 percent over 2011.

The Truck segment posted quarterly sales of $625 million, a decline of 7 percent from 2011 levels. Operating profits were $120 million, unchanged from the prior year.

The Automotive segment posted sales of $422 million, down 8 percent. Operating profits were $48 million, a 13 percent decrease from year-earlier levels.

For the first six months of 2012, sales for Eaton Corp. totaled $8 billion, a 1.7 percent increase over the prior-year period. Profit rose 11.2 percent to $693 million.

“The uncertainty in Europe, as well as slower economic growth rates in China, India and Brazil, resulted in weakness in a number of our end markets,” said Alexander M. Cutler, Eaton chairman and CEO. “We now believe our end markets for the year are likely to grow by 3 to 4 percent, a reduction from the 5 percent growth we had forecast in April. We also anticipate that the impact of foreign exchange rates on revenue will be more negative than previously forecast. Fortunately, our improved margins and our lower tax rate are expected to partially offset these factors.”

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