Eaton Corp. (Cleveland, OH) announced net income per share of $1.16 for the fourth quarter of 2004, an increase of 61% over net income per share of $0.72 in the fourth quarter of 2003. Sales in the quarter were $2.63 billion, 26% above the same period in 2003 and a quarterly record. Net income was $183 million compared to $114 million in 2003, an increase of 61%.
Net income in both periods included charges related to restructuring activities. Before restructuring charges, operating earnings per share in the fourth quarter of 2004 were $1.23 versus $0.77 per share in 2003, an increase of 60%. Operating earnings for the fourth quarter of 2004 were $194 million compared to $122 million in 2003, an increase of 59%.
Net income and operating earnings in the fourth quarter were impacted by a $30 million after-tax gain from resolution of tax issues, a $10 million after-tax charge to exit a legacy tire and refrigeration valve manufacturing business that does not fit Eaton's long-term strategy, and an $8 million after-tax contribution to Eaton's charitable fund. These items increased net income and operating earnings in the quarter by $0.08 per share.
For the full year 2004, sales were $9.82 billion, 22% above 2003. Net income of $648 million increased 68% over 2003, and net income per share of $4.13 rose 61%. Operating earnings per share for 2004 of $4.30 rose 58% above 2003. Operating earnings in 2004 totaled $675 million versus $410 million in 2003, an increase of 65%.