Eaton (NYSE:ETN) on Monday posted 49% growth in second-quarter profit that topped Wall Street estimates as sales across its main segments continued to widen, leading the company to reveal a higher fiscal forecast and sending its shares higher.
The Cleveland, Ohio-based maker of electronic components and systems for mobile equipment, commercial and military use booked net income of $336 million, or 97 cents a share, compared with $226 million, or 66 cents, in the same quarter last year.
Analysts on average had been expecting a slightly weaker profit of 95 cents a share.
The company set a new segment operating margin record during the period of 13.9%.
Revenue for the three months ended June 30 was $4.09 billion, up 21% from $3.38 billion a year ago, narrowly beating the Streets view of $4.02 billion.
We are pleased with our second quarter results, which exceeded the high end of our guidance for the quarter, Eaton CEO Alexander Cutler said in a statement, adding that the sales growth reflects the continued expansion of our markets around the world.
In light of the impressive performance, Eaton raised its fiscal forecast, now expecting overall end markets to grow by 11%, up from its earlier view of 10%. Cutler said he anticipates 2011 to be a year of record sales and record profits.
The company raised its earnings prediction by 15 cents to a range of $3.86 to $4.06 a share. Eaton sees non-GAAP earnings between $3.90 and $4.10 a share. Analysts are looking for a profit of $3.92 a share.
Earnings in the second quarter were lifted by 10% growth in Electrical Americas segment and an 18% improvement in the Electrical Rest of World unit. Hydraulics sales climbed 28% with growth across all regions.
Global sales in the aerospace, truck and automotive segments increased 11%, 37% and 18%, respectively.