WASHINGTON (dpa-AFX) - Power management company Eaton Corp. Plc (ETN) Wednesday said third-quarter profit increased from the prior year and topped estimates. Revenue grew marginally, and missed expectations. Further, the company tightened its full year earnings outlook.
Net income attributable to ordinary shareholders advanced to $602 million from $510 million in the previous year. Earnings per share rose to $1.26 from $1.07.
Excluding impact of acquisition integration charges and transaction costs, operating earnings per share totaled $1.29, while it amounted to $1.12 last year. On average, 20 analysts polled by Thomson Reuters expected earnings of $1.23 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales increased 2 percent to $5.728 billion from $5.607 billion in the prior year. Analysts expected revenues of $5.80 billion.
Sales growth consisted of 3 percent growth in core sales which was offset by 1 percent of negative foreign exchange.
Sales for the Electrical Products segment grew 3 percent to $1.9 billion, and the division reported strong operating margins.
In Electrical Systems and Services segment, sales edged up 1 percent to $1.7 billion, and bookings grew 3 percent from last year.
Hydraulics segment sales edged down 1 percent to $733 million. According to the company, pockets of strength in industrial applications were offset by weakness in agricultural equipment globally and construction equipment in China.
Aerospace segment sales rose 1 percent to $454 million, as 6 percent core growth and 1 percent growth from foreign exchange were offset by a 6 percent reduction from the second quarter divestitures.
The Vehicle segment sales grew 5 percent to $1.0 billion, as North American markets were particularly strong in the quarter while South American markets continued to be weak.
Further, reflecting the continued slower growth in markets outside North America, the firm now estimates that its markets in 2014 are likely to grow 2 percent, down from the prior estimate of 3 percent.
The company expects operating earnings per share for the fourth quarter, which exclude an estimated $32 million of charges to integrate recent acquisitions, to be between $1.15 and $1.25. Wall Street looks for earnings of $1.18 per share for the quarter.
The firm updated its guidance for 2014 operating earnings per share to between $4.55 and $4.65, an increase of 11 percent from last year. The outlook issued in July projected operating earnings between $4.50 and $4.70. Analysts look for earnings of $4.54 per share.
The outlook excludes an estimated $154 million in acquisition integration charges, and are also adjusted for the impact of the Aerospace divestitures and the legal settlements.
Alexander Cutler, Eaton chairman and CEO, said, 'We are maintaining the midpoint of our full year 2014 guidance. Strong productivity growth and tight expense control are offsetting the impact of negative foreign exchange and lower market growth.'
ETN closed up 3.6 percent on Tuesday at $64.78.
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