Eaton Sales, Profit Sink In Q3
Global technology provider Eaton reported its 2015 Q3 financials on Oct. 30, posting considerable declines in sales and profit.The Dublin, Ireland-based company had Q3 revenue of $5.2 billion, down 9 percent from Q3 2014.
Net earnings of $445 million were down 26.1 percent from last year’s $602 million.Easton said the sales decline consisted of 6 percent from negative currency headwinds and 3 percent from a decline in organic sales. “Our sales in the third quarter were approximately $300 million lower than we had expected at the start of the quarter, with organic sales lower by $240 million and negative currency translation reducing sales by $60 million,” said Alexander Cutler, Easton CEO. “The majority of our markets experienced weaker conditions in the quarter, which makes us cautious about the sales outlook looking forward.”Eaton’s Hydraulics business segment had Q3 sales of $599 million, an 18 percent decrease from Q3 last year. Hydraulics organic sales were down 10 percent, with currency headwinds contributing a negative 8 percent. Hydraulics’ operating profit of $44 million was down 49 percent.Eaton’s largest business segment, Electrical Products, had sales of $1.8 billion, down 6 percent from last year. Electrical Systems and Services sales were $1.5 billion, down 10 percent. Eaton’s Vehicle segment sales of $897 million were down 11 percent.Eaton’s Aerospace sales of $449 million were flat, down 1 percent from a year ago.”As we begin to plan for 2016, it is apparent that markets are likely to remain soft,” Cutler said. “To deal with such weak markets, we will be expanding our 2016 restructuring program. We had been planning on this second restructuring program, in addition to the $145 million program we announced in the second quarter of 2015, to be on the order of $50 million to $60 million, but in light of current market weakness we are expanding the program to between $90 million and $100 million.”
Source: Eaton Sales, Profit Sink In Q3