Eaton Corp. (ETN) Tops Q1 EPS by 1c; Reaffirms FY EPS

Eaton Corp. (NYSE: ETN) reported Q1 EPS of $1.01, $0.01 better than the analyst estimate of $1.00. Revenue for the quarter came in at $5.49 billion versus the consensus estimate of $5.49 billion.

Eaton Corp. maintains FY2014 EPS of $4.50-$4.90, versus the consensus of $4.81.

Alexander M. Cutler, Eaton chairman and chief executive officer, said, “Our first quarter results are a solid start to the year, coming in slightly above the midpoint of our range in spite of the negative impact from the severe winter weather we encountered in North America. We estimate the severe weather reduced earnings in the quarter by $0.03 per share.

“Our 3½ percent sales growth in the first quarter consisted of a healthy increase of 4½ percent in core sales, partially offset by a 1 percent decline from currency translation,” said Cutler.

“We entered 2014 expecting it would be a year of modest global economic growth, leading to 3 percent growth in our markets,” said Cutler. “We continue to believe our markets will grow 3 percent in 2014.

“We anticipate operating earnings per share for the second quarter of 2014, which exclude an estimated $35 million of charges to integrate our recent acquisitions, to be between $1.05 and $1.15,” said Cutler. “This guidance excludes the impact on our earnings from the sale of our two aerospace businesses, which we expect to close in the middle of the second quarter.

“Our Cooper integration remains on track to generate an increase of $95 million in operating earnings in 2014 over 2013 and an additional $150 million of operating earnings in 2015,” said Cutler. “In order to generate enhanced efficiencies in the Industrial Sector (the Hydraulics, Aerospace, and Vehicle business segments), we expect to incur restructuring costs of $40 million, or $0.08 per share, during the second quarter of 2014. We anticipate the savings generated in 2015 by the restructuring will be $35 million, or $0.07 per share.

“We are maintaining our guidance for full year 2014 operating earnings per share of between $4.50 and $4.90,” said Cutler. “This guidance includes the impact of the restructuring charges in the Industrial Sector.

For earnings history and earnings-related data on Eaton Corp. (ETN) click here.

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