Eaton Sees Q1 Earnings Below View; Expands Restructuring, Share Repurchase Plan

(RTTNews) - While reporting its fourth-quarter financial results today, power management company Eaton Corporation plc (ETN) forecast operating earnings for the first quarer below analysts' expectations, and fiscal 2016 earnings in line with their estimates. The company also announced an expanded $400 million restructuring program and $3 billion share repurchase plan.

For the first quarter, Eaton forecast operating earnings per share between $0.80 and $0.90 per share. The quarter's results will be impacted by restructuring costs of about $70 million, as the company implements the second phase of the restructuring plan announced last year.

On average, analysts polled by Thomson Reuters expect earnings of $0.92 per share for the quarter. Analysts' estimates typically exclude special items.

For the full year 2016, the company forecast operating earnings per share between $4.15 and $4.45 per share. The Street expects earnings of $4.24 per share for the year.

Eaton noted that building upon the effective restructuring activity it undertook in 2015, it has increased its three-year restructuring program, bringing the 2015 through 2017 program to a total cost of $400 million, with mature year savings estimated at approximately a similar amount.

The company also expects to continue to deploy the bulk of its excess funds to share repurchases, resulting in anticipated repurchases totaling approximately $3 billion from 2015 through 2018.