DUBLIN – Intelligent power management company Eaton Corporation plc announced that earnings per share were $2.04 for the first quarter of 2024, a first quarter record and up 28% over the first quarter of 2023. Excluding charges of $0.21 per share related to intangible amortization, $0.12 per share related to a multi-year restructuring program, and $0.03 per share related to acquisitions and divestitures, adjusted earnings per share of $2.40 were also a first quarter record and up 28% over the first quarter of 2023.
Sales in the quarter were $5.9 billion, a first quarter record and up 8% from the first quarter of 2023, driven entirely by organic sales growth.
Segment margins were 23.1%, a first quarter record and a 340-basis point improvement over the first quarter of 2023.
Operating cash flow was $475 million and free cash flow was $292 million, up 42% and 40%, respectively, over the same period in 2023.
Craig Arnold, Eaton chairman and chief executive officer, said, “Growth drivers like increased project activity tied to megatrends, reindustrialization and infrastructure spending continue to drive demand for Eaton’s solutions across our markets, and we remain very confident in our teams’ ability to execute on our increased targets for the year. We capitalized on strong growth in our business to start the year, resulting in strong order growth in Electrical and Aerospace and first quarter record segment margins.”
Guidance
For the full year 2024, the company is raising:
- Organic growth guidance from 6.5-8.5% to 7-9%
- Segment margin guidance from 22.4-22.8% to 22.8-23.2%
- Earnings per share guidance to between $8.95 and $9.35, up 14% at the midpoint over the prior year
- Adjusted earnings per share guidance to between $10.20 and $10.60, up 14% at the midpoint over the prior year.
- Organic growth of 6.5-8.5%
- Segment margins of 22.4-22.8%
- Earnings per share between $2.19 and $2.29
- Adjusted earnings per share between $2.52 and $2.62.
Business Segment Results
Sales for the Electrical Americas segment were a record $2.7 billion, up 17% from the first quarter of 2023, driven entirely by organic sales growth. Operating profits were a record $785 million, up 50% over the first quarter of 2023. Operating margins in the quarter were a record 29.2%, up 630 basis points over the first quarter of 2023.
The twelve-month rolling average of orders in the first quarter was up 8% organically, with particular strength in the data center market. Backlog at the end of March remained at record levels, up 31% organically over March 2023.
Sales for the Electrical Global segment were $1.5 billion, flat to the first quarter of 2023. Organic sales were up 1%, which was offset by 1% from negative currency translation. Operating profits were $274 million and operating margins in the quarter were 18.3%.
The twelve-month rolling average of orders in the first quarter was up 4% organically, with particular strength in the data center and utility markets. Backlog at the end of March was up 12% organically over March 2023.
On a rolling twelve-month basis, the book-to-bill ratio for the Electrical businesses remained strong at 1.2.
Aerospace segment sales were a first quarter record $871 million, up 9% from the first quarter of 2023, driven entirely by organic sales growth. Operating profits were $201 million, a first quarter record and up 12% from the first quarter of 2023. Operating margins in the quarter were 23.1%, a first quarter record and up 60 basis points over the first quarter of 2023.
The twelve-month rolling average of orders in the first quarter was up 2% organically, with particular strength in commercial OEM, commercial aftermarket and defense aftermarket. The backlog at the end of March was up 11% over March 2023. On a rolling twelve-month basis, the book-to-bill ratio for the Aerospace segment remained strong at 1.1.
The Vehicle segment posted sales of $724 million, down 2% from the first quarter of 2023. Organic sales were down 3%, which was partially offset by 1% from favorable foreign exchange. Operating profits were $116 million, up 8% over the first quarter of 2023. Operating margins in the quarter were 16.0%, up 150 basis points over the first quarter of 2023.
eMobility segment sales were a first quarter record $158 million, up 7% over the first quarter of 2023, driven entirely by organic sales growth. The segment recorded an operating loss of $4 million, reflecting the timing of program start-up costs to support future volume growth.