BEACHWOOD, Ohio—Power management company Eaton Corp. P.L.C. said its earnings per share were $1.07 for the first quarter of 2020. Excluding charges of 2 cents per share related to acquisitions and divestitures, Eaton said adjusted earnings per share were $1.09—a figure that was reduced by 14 cents due to the impact of the COVID-19 pandemic.
Sales in the first quarter were $4.8 billion, down 10 percent from the first quarter of 2019. Organic sales were down 7 percent, including a reduction of 4 percent from the impact of the coronavirus. Acquisitions added 2 percent to sales, Eaton said, but that was offset by 3.5 percent from divestitures, and negative currency translation reduced sales by 1.5 percent.
"Despite the lower revenues, we are pleased with our first-quarter segment margins, which were 15.8 percent," Craig Arnold, Eaton's chairman and CEO, said in a statement.
"As we go forward, we will continue to focus on ensuring the safety of our work force, implementing cost controls to offset the volume declines, and maximizing our free cash flow," Arnold said. "Among the cost actions we have already taken are significant reductions in salaries and incentive compensation, elimination of merit increases for the year, sharp reductions in all categories of discretionary expenses, and elimination of all nonessential capital spending."
Arnold said the reduction in global growth and economic uncertainty "will have a significant impact on our outlook for Q2 and the rest of the year." As a result, Eaton has withdrawn its full-year 2020 adjusted earnings per share guidance.