Eaton announced its fourth-quarter 2009 net income was up 29 percent over the same quarter a year ago, although figures for the full year were lower than 2008.


Net income was $211 million in the fourth quarter, compared to $163 million in 2008, an increase of 29 percent. Sales in the quarter were $3.1 billion, 10 percent below the same period in 2008.

"We had a strong fourth quarter, with earnings considerably higher than our guidance at the start of the quarter due principally to improved operating performance," said Alexander M. Cutler, Eaton chairman and chief executive officer. "As we anticipated, our markets improved very modestly in the fourth quarter, reflecting a continuation of the slow global economic recovery."

For the full year 2009, sales were $11.9 billion, 23 percent less than 2008. Net income was $383 million, a decrease of 64 percent over 2008, and net income per share of $2.27 was 65 percent less than in 2008. Operating earnings in 2009 totaled $437 million versus $1.109 billion in 2008, a decrease of 61 percent. Operating earnings per share for 2009 of $2.59 were 62 percent lower than in 2008.

"Looking at 2009 as a whole, our earnings were significantly affected by the decline in our revenues due to the market downturn," said Cutler. "We believe the steps we took to deal with the downturn effectively adjusted our cost structure to ensure we can operate profitably at these lower volumes and realize attractive incremental profits on revenue gains."

"We estimate our markets for all of 2010 will grow 5 percent, and we expect to outgrow our end markets in 2010 by approximately $300 million," said Cutler. "We also expect approximately $450 million of growth from foreign exchange. In total, we anticipate our revenues in 2010 will likely grow by 11 percent compared to 2009."

The Truck segment posted sales of $443 million in the fourth quarter, up 1 percent compared to 2008. Truck markets in the fourth quarter declined 8 percent, with U.S. markets down 22 percent and non-U.S. markets up 10 percent. Operating profits were $51 million, an increase of 24 percent compared to the fourth quarter of 2008.

"We were pleased with the 11.5 percent Truck segment operating margin in the fourth quarter," said Cutler. "Our business is operating at good margins despite low activity levels. As evidence of just how low activity levels have been, the truck market during 2009 declined by 27 percent, with the NAFTA Class 8 market at levels not seen since 1991.

"For 2010, we expect good market growth, although volumes are likely to still be at depressed levels," said Cutler. "We anticipate our overall truck markets will grow at 19 percent, with U.S. markets growing at 26 percent and non-U.S. markets growing at 10 percent."