CLEVELAND, OHIO...Eaton Corporation today announced its fifth consecutive quarter of record financial performance and said if current forecasts for the remainder of the year hold up, 1995 will be the best in the company's history.
First quarter sales increased 26 percent to $1.7 billion, compared with $1.4 billion in the first quarter of 1994. Net income was $108 million, a 46 percent increase over the $74 million earned during the comparable period of 1994. Earnings per share for the first quarter were $1.39, a 38 percent increase over 1994, when the company earned $1.01 per share.
William E. Butler, Chairman and Chief Executive Officer, said, "Based on the excellent performance of our businesses in the first quarter and the outlook for our markets, we believe that 1995 will be our second consecutive year of record results. Demand in virtually all of our North American markets remains excellent, and we are experiencing sales increases from the European economic recovery.
"We're making steady progress toward our long-term goal of building sustainable earnings growth throughout the economic cycle, while continuing to invest in the restructuring of some of our businesses," Butler said.
"North American factory sales of heavy trucks-which set records in 1994-were 22 percent higher in the first quarter on a year-to-year basis. Our profit margins in this business are improving as our manufacturing facilities adjust to the higher demand. Although North American sales of passenger cars and light trucks have leveled off, production remains healthy," Butler said.
In Eaton's largest business segment, Electrical and Electronic Controls, Butler said sales increased 31 percent in the quarter, aided by the inclusion in 1995 of all three months' sales from the acquired Westinghouse Distribution and Controls Business Unit. In the prior year, Eaton recorded two months of sales from the acquired unit following its acquisition on January 31, 1994. He said the integration of the acquisition continues to be ahead of schedule.
"Higher interest rates have slowed residential construction from the levels of a year ago, but we expect the robust recovery now underway in non-residential construction to bring substantial benefit to our Cutler-Hammer unit. This business is also benefiting from the current boom in capital spending, which we expect to show double-digit growth this year, as it did in 1994," Butler said. He noted that Eaton's own capital spending budget exceeds $350 million, the largest in company history and 31 percent higher than last year.
"Sales also improved in the company's specialty controls product lines, due primarily to the semiconductor equipment division, which is benefiting from worldwide demand for semiconductors and several new successful products," Butler said. "Sales of Eaton ion implanters are at an all-time high."
On April 13, Eaton agreed to acquire the electrical switchgear and controls business from the Australian-based company, Email Ltd. This business manufactures and distributes a wide range of electrical equipment, including circuit breakers, panelboards, contactors and switchgear. The business, which will extend Cutler-Hammer's international presence, had sales of approximately $30 million in 1994. It has 500 employees in Australia, New Zealand, Singapore and the Philippines.
Eaton Corporation is a global manufacturer of highly engineered products which serve vehicle, industrial, construction, commercial, aerospace and marine markets. Principal products include truck transmissions and axles, engine components, hydraulic products, electrical power distribution and control equipment, ion implanters and a wide variety of controls. Headquartered at Eaton Center in Cleveland, the company has 51,000 employees and 150 manufacturing sites in 18 countries around the world. Sales for 1994 were $6.1 billion.