CLEVELAND (Oct. 31, 2012)—Diversified manufacturer Eaton Corp. reported third-quarter earnings fell 5 percent from a year ago and said its business for all of 2012 will grow more slowly than previously anticipated.
The Cleveland-based maker of electrical and hydraulic systems said it earned $345 million, or $1.02 per share, in the third quarter compared with earnings of $365 million, or $1.07 per share, in the like period a year ago. Sales in the third quarter were $3.95 billion, 4 percent below the third quarter of 2011.
Alexander M. Cutler, Eaton's chairman and CEO, said in a statement that the third-quarter “results came in very close to our expectations despite the slowdown in economic growth.”
He said economic growth in the European Union and China “remained subdued during the quarter,” while industrial activity in the U.S. “decelerated during the quarter, reflecting uncertainties over fiscal reforms that have led customers to hold back on purchases.”
As a result, Cutler said, “We expect our markets for full year 2012 will show less growth than we had anticipated earlier in the year, with our markets for the year now estimated to grow between 1 to 2 percent.”
He said shareholders of Eaton and Cooper Industries plc of Dublin, Ireland, Oct. 26, approved Eaton's purchase of the electrical equipment supplier. Two additional regulatory approvals are needed, Cutler said, and the $11.8 billion acquisition is on target to close in the fourth quarter.
Results in the fourth quarter will be affected by the Cooper acquisition, he said.
“We expect our fourth quarter results to contain a partial quarter of Cooper operating results, purchase price accounting adjustments, and financing costs and the additional share count associated with closing the Cooper transaction,” Cutler said. “As a result, we anticipate to incur certain expenses in the fourth quarter related to the acquisition originally forecast to be incurred in 2013.”