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TheStreet Open House

Eaton Reports Fourth Quarter Net Income Of $0.46 Per Share

On October 10, 2012, Cooper and Danaher announced they had entered into a definitive agreement to sell Apex to Bain Capital for approximately $1.6 billion subject to post-closing adjustments. On February 1, 2013, the sale of Apex was completed.

Note 2. ACQUISITION INTEGRATION CHARGES AND TRANSACTION COSTS

Eaton incurs integration charges and transaction costs related to acquired businesses. A summary of these charges follows:

       

Acquisitionintegration charges andtransaction costs

   

Operating profitas reported

   

Operating profitexcluding acquisitionintegration charges

Three months ended December 31
2012   2011     2012   2011     2012   2011
Acquisition integration charges
Electrical Americas $ 3 $ 1 $ 190 $ 173 $ 193 $ 174
Electrical Rest of World 3 1 68 69 71 70
Cooper 2 66 68
Hydraulics 7 3 44 103 51 106
Aerospace 45 78 45 78
Truck 81 137 81 137
Automotive 17 42 17 42
Total business segments 15 5 $ 511 $ 602 $ 526 $ 607
Corporate integration charges 9
Total acquisition integration charges $ 24 $ 5
 
Transaction costs
Corporate transaction costs $ 90 $
Financing fees 62
Total transaction costs $ 152 $
 

Total acquisition integration charges and transaction costs before income taxes

$ 176 $ 5
Total after income taxes $ 137 $ 4
Per common share - diluted $ 0.36 $ 0.01
 
Year ended December 31
2012 2011 2012 2011 2012 2011
Acquisition integration charges
Electrical Americas $ 7 $ 8 $ 749 $ 605 $ 756 $ 613
Electrical Rest of World 8 2 249 278 257 280
Cooper 2 66 68
Hydraulics 16 4 369 438 385 442
Aerospace 213 244 213 244
Truck 420 486 420 486
Automotive 150 209 150 209
Total business segments 33 14 $ 2,216 $ 2,260 $ 2,249 $ 2,274
Corporate integration charges 11
Total acquisition integration charges $ 44 $ 14
 
Transaction costs
Corporate transaction costs $ 106 $
Financing fees 72
Total transaction costs $ 178 $
 

Total acquisition integration charges and transaction costs before income taxes

$ 222 $ 14
Total after income taxes $ 167 $ 10
Per common share - diluted $ 0.48 $ 0.03
 

Integration charges for the fourth quarter of 2012 were related primarily to Polimer Kaucuk Sanayi ve Pazarlama (SEL), Cooper and Jeil Hydraulics. Integration charges for the full year of 2012 were related primarily to SEL, Jeil Hydraulics, The Moeller Group, Cooper and Internormen Technology Group. Integration charges in 2011 were related primarily to CopperLogic, Tuthill Coupling Group, Wright Line Holding, EMC Engineers and Internormen Technology Group. These charges were included in Cost of products sold or Selling and administrative expense, as appropriate.

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