EATON CORP

CIK:0000031277|SEC Filings

Consolidated Statements of Income (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Income Statement [Abstract]
Net sales	$ 3,950	$ 4,123	$ 11,978	$ 12,016
Cost of products sold	2,747	2,900	8,316	8,444
Selling and administrative expense	687	668	2,079	2,031
Research and development expense	102	104	313	316
Interest expense-net	42	29	100	92
Other (income) expense-net	(4)	(10)	7	(30)
Income before income taxes	376	432	1,163	1,163
Income tax expense	29	65	123	172
Net income	347	367	1,040	991
Less net income for noncontrolling interests	(2)	(2)	(2)	(3)
Net income attributable to Eaton common shareholders	$ 345	$ 365	$ 1,038	$ 988
Net income per common share
Diluted	$ 1.02	$ 1.07	$ 3.05	$ 2.86
Basic	$ 1.02	$ 1.07	$ 3.08	$ 2.90
Weighted-average number of common shares outstanding
Diluted	339.8	341.9	339.7	344.4
Basic	337.6	338.1	336.7	339.7
Cash dividends declared per common share	$ 0.76	$ 0.34	$ 1.52	$ 1.02

Condensed Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Operating activities
Net income	$ 1,040	$ 991
Adjustments to reconcile to net cash provided by operating activities
Depreciation and amortization	419	419
Pension expense	205	170
Contributions to pension plans	(383)	(341)
Contributions to other postretirement benefits plans	(34)	(150)
Changes in working capital	(318)	(290)
Other-net	48	(110)
Net cash provided by operating activities	977	689
Investing activities
Cash paid for acquisitions of businesses	(554)	(298)
Capital expenditures for property, plant and equipment	(357)	(384)
Sales of short-term investments-net	89	272
Other-net	(35)	1
Net cash used in investing activities	(857)	(409)
Borrowings with original maturities of more than three months
Proceeds	600	352
Payments	(319)	(14)
Payments with original maturities of less than three months-net	(2)	(38)
Deferred financing costs	(63)	0
Cash dividends paid	(384)	(348)
Exercise of equity-based awards	54	66
Repurchase of shares	0	(343)
Excess tax benefit from equity-based compensation	18	0
Other-net	0	(4)
Net cash used in financing activities	(96)	(329)
Effect of foreign exchange rate changes on cash	16	(6)
Total increase (decrease) in cash	40	(55)
Cash at the beginning of the period	385	333
Cash at the end of the period	$ 425	$ 278

Condensed Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Current assets
Cash	$ 425	$ 385
Short-term investments	620	699
Accounts receivable-net	2,645	2,444
Inventory	1,801	1,701
Other current assets	704	597
Total current assets	6,195	5,826
Property, plant and equipment-net	2,794	2,602
Other noncurrent assets
Goodwill	5,838	5,537
Other intangible assets	2,253	2,192
Deferred income taxes	1,064	1,134
Other assets	656	582
Total assets	18,800	17,873
Current liabilities
Short-term debt	108	86
Current portion of long-term debt	307	321
Accounts payable	1,441	1,491
Accrued compensation	385	420
Other current liabilities	1,467	1,319
Total current liabilities	3,708	3,637
Noncurrent liabilities
Long-term debt	3,690	3,366
Pension liabilities	1,509	1,793
Other postretirement benefits liabilities	645	642
Deferred income taxes	569	442
Other noncurrent liabilities	437	501
Total noncurrent liabilities	6,850	6,744
Shareholders' equity
Eaton shareholders' equity	8,220	7,469
Noncontrolling interests	22	23
Total equity	8,242	7,492
Total liabilities and equity	$ 18,800	$ 17,873