Eaton Corp. reported third quarter net income, before unusual items, of $47 million versus $77 million for the same period in 2000.
Sales for the quarter were $1.75 billion versus $2.01 billion a year ago. After all unusual items in both years, third quarter net income was $40 million versus $69 million.
Eaton Chairman and CEO Alexander Cutler said earnings were about as expected in the wake of the Sept. 11 terrorist attacks. He noted that it’s too early to accurately assess the full impact of the tragedy, but the company remains comfortable with earlier expectations for fourth quarter 2001 and full year 2002.
“The rough parallel to the current situation that we have found is the Gulf War of 1990-1991,” he said. “If the analogy holds, the overall U.S. economy will decline again in the fourth quarter and then should begin to regain its bearings sometime next spring, with a recovery that is aided by the full impact of a year’s monetary easing, low inflation, tax cuts and additional fiscal stimulus.”
Eaton Truck segment sales were $253 million for the quarter, down 24% from third quarter 2000. The company noted that NAFTA heavy truck production for the quarter was down 34%, NAFTA medium duty truck production was off 22%, European truck output was down 9%, and South American commercial truck production was down 24%. Before restructuring, the segment operated at breakeven compared to a $7 million profit for the same period last year.
“Considering the extraordinarily depressed industry conditions, the performance of Truck this quarter was excellent, fully reflecting the benefits of this year’s earlier restructuring,” Cutler said.
Automotive sales were $349 million, up 1% despite a 10% decline in NAFTA auto production and flat European automotive output. Profits in that segment were up 8%. Sales of Eaton’s largest segment, Fluid Power, were $600 million, down 5% from last year. Industrial & Commercial Control sales were $548, down 12% from last year.
Sales for the quarter were $1.75 billion versus $2.01 billion a year ago. After all unusual items in both years, third quarter net income was $40 million versus $69 million.
Eaton Chairman and CEO Alexander Cutler said earnings were about as expected in the wake of the Sept. 11 terrorist attacks. He noted that it’s too early to accurately assess the full impact of the tragedy, but the company remains comfortable with earlier expectations for fourth quarter 2001 and full year 2002.
“The rough parallel to the current situation that we have found is the Gulf War of 1990-1991,” he said. “If the analogy holds, the overall U.S. economy will decline again in the fourth quarter and then should begin to regain its bearings sometime next spring, with a recovery that is aided by the full impact of a year’s monetary easing, low inflation, tax cuts and additional fiscal stimulus.”
Eaton Truck segment sales were $253 million for the quarter, down 24% from third quarter 2000. The company noted that NAFTA heavy truck production for the quarter was down 34%, NAFTA medium duty truck production was off 22%, European truck output was down 9%, and South American commercial truck production was down 24%. Before restructuring, the segment operated at breakeven compared to a $7 million profit for the same period last year.
“Considering the extraordinarily depressed industry conditions, the performance of Truck this quarter was excellent, fully reflecting the benefits of this year’s earlier restructuring,” Cutler said.
Automotive sales were $349 million, up 1% despite a 10% decline in NAFTA auto production and flat European automotive output. Profits in that segment were up 8%. Sales of Eaton’s largest segment, Fluid Power, were $600 million, down 5% from last year. Industrial & Commercial Control sales were $548, down 12% from last year.
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