By Ben Fox Rubin
Eaton Corp. PLC said fourth-quarter earnings surged, with its
sales continuing to grow due to its recent acquisition of
electrical-gear maker Cooper Industries.
The manufacturer, which relocated its headquarters from the U.S.
to Ireland after acquiring Cooper, in October warned that sales in
its overall markets were likely to be flat in 2013 compared with
the year earlier, due to weakness in the truck market and the
global-hydraulics market.
Eaton's exposure to difficult markets for construction and
mining machinery and commercial trucks have weighed on the company,
which expanded its electrical-business lines to make itself less
susceptible to highly cyclical industrial sectors.
Eaton has been counting on strengthening demand for its circuit
breakers, fuses, lighting and other electrical gear to support its
$11.8 billion acquisition of Cooper Industries in 2012, which made
it a much stronger competitor in electrical products.
The Cooper acquisition helped sales of Eaton's electrical
products, which include light fixtures and circuit breakers, to
rise 57% to $1.79 billion. Meanwhile, sales from electrical
services and custom-designed electrical systems for buildings grew
38% to $1.65 billion.
Overall, Eaton reported a profit of $479 million, or $1 a share,
up from $179 million, or 46 cents a share, a year earlier.
Excluding acquisition charges and other items, per-share operating
earnings rose to $1.08 from 82 cents.
The company in October projected operating earnings of $1 to
$1.10 a share, below analyst estimates at the time.
Sales rose 28% to $5.53 billion, narrowly trailing estimates of
$5.55 billion.
Sales from Eaton's hydraulics unit, which supplies systems to
Caterpillar Inc. and other construction machinery makers, rose 3%
to $714 million.
For the new year, Eaton expects operating earnings of $4.50 to
$4.90 a share, in-line with estimates of $4.88 a share from
analysts polled by Thomson Reuters. The company also predicted
first-quarter operating earnings of 95 cents to $1.05 a share,
compared with market estimates of $1.03.
Write to Ben Fox Rubin at ben.rubin@wsj.com
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