New orders for heavy trucks and other equipment are working their way through the supply chain, boosting earnings at truck component maker Eaton.
The company's net income rose like a missile from the depths of the recession last year, increasing almost 700 percent year over year to $226 million.
Second quarter sales increased 16 percent from a year ago, rising to $3.38 billion.
Stronger domestic and international markets pumped up the business, said Alexander M. Cutler, chairman and CEO of the Cleveland, Ohio-based company.
"Sales in the second quarter were 9 percent higher than in the first quarter of 2010, reflecting the continued expansion in our markets around the world," he said.
Increased demand for heavy trucks is fueling that expansion. Net orders for Class 8 trucks rose 95 percent in June from a year ago, according to ACT Research.
Sales at Eaton's truck segment increased 53 percent to $492 million. The division makes transmissions, hybrid power systems and other truck components.
Its sales in the U.S. were up 32 percent and in non-U.S. markets, 24 percent. The division reported an operating profit of $59 million compared with a $3 million loss a year ago.
Cutler said he expects truck production to continue to increase in the second half of 2010, and said Eaton's trucking business is set to grow 23 percent for the full year.
"Freight growth and the aging truck fleet are finally starting to generate an increase in truck orders," he said.
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