Eaton (NYSE:ETN) revealed on Wednesday a stronger-than-expected 85% improvement in first-quarter profit, led by stronger worldwide demand for electrical and hydraulic products, leading the company to raise its fiscal view.
Cleveland, Ohio-based diversified industrial manufacturer posted net income of $287 million, or 83 cents a share, compared with $155 million, or 46 cents a share, in the same quarter last year.
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Excluding one-time acquisition costs, Eaton earned 84 cents a share, ahead of average analyst estimates polled by Thomson Reuters of 80 cents. Sales were $3.8 billion, up 23% from $3.1 billion a year ago, beating the Street’s view of $3.65 billion.
Eaton CEO Alexander Cutler called the quarterly earnings strong, noting the performance landed above the high end of its increased earnings provided in February.
“Our markets enjoyed strong growth during the first quarter, increasing 14% compared to the first quarter of 2010,” he said. “Our Electrical Americas, Hydraulics, and Truck markets grew more strongly than anticipated and we are increasing our expectations for the growth of these three markets in 2011.”
Fueling the first-quarter performance was a 20% increase in Electrical Americas to $964 million, led by 15% growth in core sales and 4% from acquisitions. Hydraulics grew 40% to $685 billion on higher bookings.
Cutler said the company anticipates its markets for all of 2011 to grow by 10%. Given the optimism, the manufacturer raised its full-year guidance by 15 cents to the range of $3.66 to $3.96 a share. Wall Street is looking for earnings of $3.81 a share.
Eaton sees second-quarter earnings in the range of 89 cents to 95 cents a share, in line with analysts’ view of 93 cents.