CLEVELAND — Eaton Corp. said Monday that its fourth-quarter profit rose as the economy stabilized and the manufacturing company said it believes business will grow this year.
The Cleveland company, which makes hydraulics and electrical equipment used in a range of industries, also provided full-year adjusted earnings and revenue forecasts above Wall Street’s expectations.
The company expects its markets will grow 5 percent in 2010 and about also about $450 million of growth from foreign exchange.
Eaton’s fourth-quarter earnings climbed 29 percent to $211 million, or $1.25 per share, compared with $163 million, or 98 cents per share, a year ago.
Removing acquisition charges, operating profit was $1.35 per share.
Some of those profits were derived from a slimmer work force and sales for the three months ended Dec. 31 slipped 10 percent to $3.13 billion. Sales declined for electrical work, as well as in the hydraulics and aerospace divisions.
Still, the performance surpassed the estimates of analysts polled by Thomson Reuters, who forecast earnings of $1.23 per share on revenue of $3.07 billion. These estimates normally remove one-time items.
“Our markets improved very modestly in the fourth quarter, reflecting a continuation of the slow global economic recovery,” said Chairman and CEO Alexander Cutler.
For the year, Eaton’s profit slid to $383 million, or $2.27 per share, from $1.06 billion, or $6.52 per share, in the previous year.
Adjusted operating earnings were $2.59 per share.
Annual sales declined 23 percent to $11.87 billion from $15.38 billion.
Eaton expects 2010 adjusted earnings of $3.70 to $4 per share on revenue growth of 11 percent. Based on 2009 sales of $11.87 billion, this would imply revenue of approximately $13.2 billion for the year.
The company anticipates first-quarter adjusted profit of 75 cents to 85 cents per share.
Analysts predict a full-year profit of $3.65 per share on sales of $12.39 billion. For the first quarter, Wall Street estimates earnings of 78 cents per share.
Eaton said it paid off more than $750 million in debt during the year, giving the company much more cash on hand.
Kevin Jones of The Trucker staff can be reached for comment at email@example.com.
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