Cooper Industries' Fourth-Quarter Profit Rises 17 Percent

Jan. 26, 2006
Cooper Industries Ltd., Houston, said its fourth-quarter profit increased 17 percent.

Cooper Industries Ltd., Houston, said its fourth-quarter profit increased 17 percent. Earnings increased to $104 million, up from the year-ago quarter’s profit of $88.9 million. Revenue edged up 3 percent to $1.19 billion from $1.15 billion.

"We delivered a strong finish to an outstanding year, with good revenue growth, continued margin expansion and excellent cash flow in the fourth quarter," said Kirk S. Hachigian, the company’s president and chief executive officer . "Initiatives focused on joint-marketing programs, geographic expansion and overall productivity each contributed solid results, even in light of continued pressures in raw materials and energy costs. The business performed well overall."

Electrical products segment revenues for the fourth quarter of 2005 increased approximately 4 percent to $991.1 million, compared with $950.4 million in the fourth quarter of 2004. Segment operating earnings were $143.2 million, an increase of approximately 10 percent from $129.8 million in the prior year’s fourth quarter. The increase in revenues for the electrical products segment reflects solid growth against a strong fourth quarter in 2004. The improvement was driven by continued robust industrial demand and sustained activity in the commercial construction markets. Utility markets also remained healthy. Sales to the retail channel were off slightly against significantly strong sales comparables in the 2004 fourth quarter. Repair and reconstruction activity as a result of the U.S. Gulf Coast hurricanes also contributed to demand for the quarter.

Looking ahead, Cooper said it expects 2006 earnings per share growth of 12 percent to 15 percent, with revenue gains in the range of 4 percent to 6 percent.

"With strong economic conditions worldwide, we are optimistic about our prospects for 2006," said Hachigian. "Industrial markets remain resilient, and there are indications that non-residential construction will again become a contributor to growth. We continue to see opportunities in international markets, particularly in Eastern Europe, the Middle East and Asia. Although we expect residential markets may slow, the decline should be moderate."