Earnings Roundup: Eaton Corp. and SKF
Industrial Distribution staff -- Industrial Distribution, 7/15/2008 1:57:00 AM
Diversified manufacturer Eaton Corp. and Swedish bearings maker SKF released second-quarter sales and earnings results.Eaton Corp.
The Cleveland-based diversified industrial manufacturer posted sales of $4.28 billion during the second quarter, up 31.7 percent compared with $3.25 billion during the same period last year.
Eaton’s net income surged 35.4 percent to $333 million for the quarter, compared with $246 million during the second quarter of 2007.
“Our businesses performed extremely well in the second quarter, generating strong sales growth and record profits. We were able to achieve these results despite the nearly 40 percent rise in oil prices during the quarter, which caused significant turmoil in our transportation-related end markets. With 20 percent of our revenue from emerging countries and with continued strength in many of our product markets, we believe we are well-positioned to deal with the reduced growth outlook for the U.S. and European economies caused by higher fuel prices,” chairman and CEO Alexander Cutler said. “Sales growth in the second quarter of 32 percent consisted of 19 percent from acquisitions, 8 percent from organic growth and 5 percent from exchange rates. … We outgrew our end markets by 2 percentage points, as our end markets grew 6 percent in the quarter.”
Cutler said higher oil prices prompted the company to scale back its forecast for the rest of the year.
“We now anticipate our overall end markets to grow at 3 percent, 1 percentage point lower than our prior forecast. We see growth in our U.S. markets at 1 percent compared to our prior estimate of 2 percent, while our non-U.S. markets are expected to grow 5 percent compared to our prior estimate of 6 percent,” he said. “Based on this guidance, our operating earnings per share in 2008 are expected to grow between 12 percent and 16 percent over 2007.”
SKF
The Stockholm-based bearings manufacturer reported a net sales increase of 7.5 percent to $2.7 billion for the second quarter, compared with $2.5 billion during the same period last year.
SKF posted net profits of $232.7 million for the quarter, up 7.5 percent compared with $216.6 million during the second quarter of 2007.
The company said sales were significantly higher in Europe, Asia and Latin America; sales in North America were flat. Looking ahead, SKF said it expects demand to increase during the third quarter in Europe, Asia and Latin America, but to decline slightly in North America.
SKF also said it spent about $68 million to expand its Göteborg, Sweden, bearings plant. The expansion, which increases the company’s capacity to produce large-size bearings and will add 40 employees to its workforce, is expected to be completed by the end of the year.
Related Content
Related Content
Sponsored Links
View All Blogs
