Eaton Corporation plc (ETN) has reported a 17.26 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $523 million, or $1.15 a share in the quarter, compared with $446 million, or $0.96 a share for the same period last year.
Revenue during the quarter dropped 4.15 percent to $4,987 million from $5,203 million in the previous year period. Gross margin for the quarter expanded 154 basis points over the previous year period to 32.40 percent. Total expenses were 87.63 percent of quarterly revenues, down from 89.56 percent for the same period last year. This has led to an improvement of 194 basis points in operating margin to 12.37 percent.
Operating income for the quarter was $617 million, compared with $543 million in the previous year period.
Craig Arnold, Eaton chairman and chief executive officer, said, "Our third quarter operating earnings per share were at the midpoint of our guidance despite third quarter sales coming in 1 percent lower than our expectations. We had previously expected organic sales for the third quarter to be the same as in the second quarter. "Our operating cash flow in the third quarter was $798 million, keeping us on trajectory to meet our cash flow guidance for the year," said Arnold. "We continued to return substantial cash to our shareholders, repurchasing $243 million of our shares in the quarter. "Looking at full-year 2016, we now expect a decline in organic revenue of approximately 4 percent," said Arnold. "We are maintaining our estimate of the impact of negative currency translation at $225 million. "We anticipate net income and operating earnings per share for the fourth quarter of 2016 to be between $1.05 and $1.15," said Arnold. "For the full year, we expect net income and operating earnings per share to be between $4.15 and $4.25, a decline of 2 percent at the midpoint from our prior guidance. "As a result, we anticipate expanding our 2017 restructuring program to a cost of $180 million, compared to our prior guidance of $130 million."
Working capital remains almost stable
Eaton Corporation plc has recorded an increase in the working capital over the last year. It stood at $2,492 million as at Sep. 30, 2016, up 0.52 percent or $13 million from $2,479 million on Sep. 30, 2015. Current ratio was at 1.54 as on Sep. 30, 2016, up from 1.49 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 50 days for the quarter from 78 days for the last year period. Days sales outstanding went up to 69 days for the quarter compared with 66 days for the same period last year.
Days inventory outstanding has decreased to 32 days for the quarter compared with 62 days for the previous year period. At the same time, days payable outstanding was almost stable at 51 days for the quarter, when compared with the previous year period.
Debt comes down marginally
Eaton Corporation plc has recorded a decline in total debt over the last one year. It stood at $8,432 million as on Sep. 30, 2016, down 2.77 percent or $240 million from $8,672 million on Sep. 30, 2015. Total debt was 26.99 percent of total assets as on Sep. 30, 2016, compared with 26.93 percent on Sep. 30, 2015. Debt to equity ratio was at 0.55 as on Sep. 30, 2016, down from 0.56 as on Sep. 30, 2015. Interest coverage ratio improved to 10.46 for the quarter from 9.20 for the same period last year.
Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
