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EATON CORPORATION plc
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(Exact name of registrant as specified in its charter)
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Ireland
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98-1059235
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(State or other jurisdiction of incorporation or organization)
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(IRS Employer Identification Number)
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Eaton House,
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30 Pembroke Road,
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Dublin 4,
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Ireland
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D04 Y0C2
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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☑
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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TABLE OF CONTENTS
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Name
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Age
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Position (Date elected to position)
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Craig Arnold
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59
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Chairman of Eaton Corporation plc (June 1, 2016 - present)
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Chief Executive Officer of Eaton Corporation (June 1, 2016 - present)
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Director of Eaton Corporation plc (September 1, 2015 - present)
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President and Chief Operating Officer of Eaton Corporation
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(September 1, 2015 - May 31, 2016)
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Vice Chairman and Chief Operating Officer - Industrial Sector of Eaton Corporation
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(February 1, 2009 - August 31, 2015)
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Richard H. Fearon
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63
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Director of Eaton Corporation plc (September 1, 2015 - present)
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Vice Chairman and Chief Financial and Planning Officer of Eaton Corporation
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(April 24, 2002 - present)
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Uday Yadav
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56
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President and Chief Operating Officer - Electrical Sector of Eaton Corporation
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(July 1, 2019 - present)
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Chief Operating Officer - Industrial Sector of Eaton Corporation
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(September 1, 2015 - June 30, 2019)
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President of Aerospace Group of Eaton Corporation
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(August 1, 2012 - August 31, 2015)
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Heath B. Monesmith
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49
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President and Chief Operating Officer - Industrial Sector of Eaton Corporation
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(July 1, 2019 - present)
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Executive Vice President and General Counsel of Eaton Corporation
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(March 1, 2017 - January 6, 2020)
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Senior Vice President and Deputy General Counsel of Eaton Corporation
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(May 15, 2015 - March 1, 2017)
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Vice President and Chief Counsel - Litigation of Eaton Corporation
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(November 30, 2012 - May 15, 2015)
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April Miller Boise
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51
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Executive Vice President, General Counsel and Secretary of Eaton Corporation
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(January 6, 2020 - present)
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Senior Vice President, Chief Legal Officer and Corporate Secretary of Meritor, Inc.
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(August 15, 2016 - December 13, 2019)
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Senior Vice President, General Counsel, Head of Global Mergers and Acquisitions,
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and Corporate Secretary of Avintiv, Inc. (March 23, 2015 - December 31, 2015)
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Vice President, General Counsel, Corporate Secretary and Chief Privacy Officer of
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Veyance Technologies, Inc. (January 1, 2011 - January 30, 2015)
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Ernest W. Marshall, Jr.
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51
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Executive Vice President and Chief Human Resources Officer of Eaton Corporation
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(July 1, 2018 - present)
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Vice President - Human Resources, Aviation Division of General Electric
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(August 1, 2013 - June 30, 2018)
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Ken D. Semelsberger
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58
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Senior Vice President and Controller of Eaton Corporation
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(November 1, 2013 - present)
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Joao V. Faria
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55
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President - Vehicle Group of Eaton Corporation (May 1, 2017 - present)
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Vice President and General Manager, Latin America, Electrical Sector and
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President, Latin America (August 1, 2013 - April 30, 2017)
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Nandakumar Cheruvatath
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58
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President - Aerospace Group of Eaton Corporation (September 1, 2015 - present)
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Executive Vice President, Eaton Business System (August 1, 2012 - August 31, 2015)
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Paulo Ruiz Sternadt
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45
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President - Hydraulics Group of Eaton Corporation (April 1, 2019 - present)
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Chief Executive Officer - Dresser Rand, a Siemens business
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(October 19, 2017 - March 30, 2019)
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Executive Vice President - Global Solutions and New Technologies & Strategic
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Business Development of Dresser Rand, a Siemens business
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(April 1, 2016 - October 18, 2017)
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Global Segment Head - Business Segment Bushings, Instrument Transformers & Coils,
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Siemens AG (April 1, 2012 - March 30, 2016)
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Brian S. Brickhouse
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56
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President - Americas Region, Electrical Sector of Eaton Corporation
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(July 1, 2019 - present)
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President - Electrical Systems and Services Group of Eaton Corporation
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(July 1, 2018 - June 30, 2019)
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President, Asia Pacific Region, Electrical (May 15, 2015 - June 30, 2018)
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President, Power Quality Division, Electrical Sector - Americas
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(August 15, 2012 - May 14, 2015)
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Month
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Total number of shares purchased
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Average price paid per share
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Total number of shares purchased as part of publicly announced plans or programs
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Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions)
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October
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—
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$
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—
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—
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$
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3,753
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November
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545,499
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$
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90.17
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545,499
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$
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3,704
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December
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19,838
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$
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91.23
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19,838
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$
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3,702
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Total
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565,337
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$
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90.21
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565,337
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(a)
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(1) The reports of the independent registered public accounting firm, consolidated financial statements and notes to consolidated financial statements are included in Item 8 above:
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3 (i)
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3 (ii)
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4.1
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4.2
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4.3
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4.4
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4.5
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4.6
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4.7
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4.8
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Pursuant to Regulation S-K Item 601(b)(4), Eaton agrees to furnish to the SEC, upon request, a copy of the instruments defining the rights of holders of its long-term debt other than those set forth in Exhibits (4.2 - 4.7) hereto
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10
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Material contracts
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(a)
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(b)
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(c)
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(d)
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(e)
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(f)
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(g)
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(h)
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(i)
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(j)
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(k)
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(l)
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(m)
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(n)
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(o)
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(p)
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(q)
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(r)
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(s)
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(t)
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(u)
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(v)
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(w)
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(x)
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(y)
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(z)
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(aa)
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(bb)
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(cc)
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(dd)
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(ee)
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(ff)
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(gg)
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(hh)
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(ii)
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(jj)
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(kk)
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(ll)
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(mm)
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(nn)
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(oo)
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(pp)
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(qq)
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(rr)
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(ss)
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(tt)
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(uu)
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*
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Submitted electronically herewith.
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EATON CORPORATION plc
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Registrant
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Date:
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February 26, 2020
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By:
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/s/ Richard H. Fearon
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Richard H. Fearon
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(On behalf of the registrant and as Principal Financial Officer)
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*By
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/s/ Richard H. Fearon
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Richard H. Fearon, Attorney-in-Fact for the officers
and directors signing in the capacities indicated
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Unrecognized Income Tax Benefits
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Description of the Matter
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As discussed in Note 9 to the consolidated financial statements, the Company had gross unrecognized income tax benefits of $1,001 million related to its uncertain tax positions at December 31, 2019. Unrecognized income tax benefits are recorded under the two-step recognition and measurement principles when a tax position does not meet the more likely than not standard, or if a tax position meets the more likely than not standard, but the financial statement tax benefit is reduced as part of the measurement step.
The balance of unrecognized income tax benefits is comprised of uncertain tax positions which meet the more likely than not standard, but the financial statement tax benefit has been reduced as part of measuring the tax position.
Auditing management’s analysis of its uncertain tax positions and resulting unrecognized income tax benefits is complex as each tax position carries unique facts and circumstances that must be evaluated and ultimate resolution is dependent on uncontrollable factors such as the prospect of retroactive regulations, new case law, the willingness of the income tax authority to settle the issue, including the timing thereof; and other factors.
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How We Addressed the Matter in Our Audit
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We obtained an understanding, evaluated the design and tested the operating effectiveness of management’s controls related to uncertain tax positions. For example, we tested controls over management’s application of the two-step recognition and measurement principles and management’s review of the inputs and resultant calculations of unrecognized income tax benefits, as well as the identification of uncertain tax positions.
We also evaluated the Company’s assessment of its uncertain tax positions. Our audit procedures included evaluating management’s accounting policies and documentation to assess the appropriateness and consistency of the methods and assumptions used to develop its uncertain tax positions and related unrecognized income tax benefit amounts by jurisdiction. We also tested the completeness and accuracy of the underlying data used by the Company. For example, we compared the unrecognized income tax benefits recorded with similar positions in prior periods and assessed management’s consideration of current tax controversy and litigation and trends in similar positions challenged by tax authorities. We also assessed the historical accuracy of management’s estimates of its unrecognized income tax benefits with the resolution of those positions. In addition, we involved tax subject matter professionals to evaluate the application of relevant tax laws in the Company’s recognition determination. Further, we tested the Company’s release of previously recorded unrecognized income tax benefits, which along with the recording of additional unrecognized tax benefits, impacts the Company’s tax provision. We have also evaluated the Company’s income tax disclosures in relation to these matters.
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Reallocation of Goodwill related to the Divestiture of the Lighting Business
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Description of the Matter
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In October 2019, the Company announced the planned sale of its lighting, lighting controls and connected lighting solutions business (collectively referred to as “Lighting”) as discussed further in Notes 2 and 4 to the consolidated financial statements and classified Lighting as held for sale. In conjunction with the classification of Lighting as held for sale, management reassigned goodwill to the Lighting business and the impacted reporting unit using a relative fair value allocation. Goodwill of $470 million was allocated as part of classifying Lighting assets as held for sale in the fourth quarter.
Auditing the Company's allocation of goodwill to the Lighting business was complex due to the significant estimation required to determine the fair value of Lighting and the impacted reporting unit. The fair value estimates were sensitive to significant assumptions such as the weighted average cost of capital, revenue growth rates, operating margins, and perpetual growth rates, which are affected by expectations about future market or economic conditions.
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How We Addressed the Matter in Our Audit
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We obtained an understanding, evaluated the design and tested the operating effectiveness of management’s controls over the goodwill allocation process. For example, we tested controls over management’s review of the significant assumptions described above along with the completeness and accuracy of the data used in the fair value estimates.
To test the estimated fair value of Lighting and the Company’s impacted reporting unit, our audit procedures included, among others, evaluating the Company’s fair value methodology, testing the significant assumptions discussed above and testing the underlying data used by the Company in its analysis. For example, we compared the significant assumptions used by management to current industry and economic trends. We assessed the historical accuracy of management’s estimates and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of Lighting and the impacted reporting unit that would result from changes in assumptions. We also involved a valuation specialist to assist in our evaluation of the weighted average cost of capital. We tested the allocation of goodwill by recalculating the amounts based on the estimated fair value of Lighting and the impacted reporting unit.
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/s/ Craig Arnold
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/s/ Richard H. Fearon
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/s/ Ken D. Semelsberger
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Principal Executive Officer
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Principal Financial Officer
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Principal Accounting Officer
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February 26, 2020
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/s/ Craig Arnold
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/s/ Richard H. Fearon
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/s/ Ken D. Semelsberger
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Principal Executive Officer
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Principal Financial Officer
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Principal Accounting Officer
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February 26, 2020
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Year ended December 31
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(In millions except for per share data)
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2019
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2018
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|
2017
|
||||||
Net sales
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$
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21,390
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$
|
21,609
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$
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20,404
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||||||
Cost of products sold
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14,338
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14,511
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13,756
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Selling and administrative expense
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3,583
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3,548
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3,526
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Research and development expense
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606
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584
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584
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Interest expense - net
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236
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271
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246
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Gain on sale of business
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—
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—
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1,077
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Arbitration decision expense
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—
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275
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—
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|
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Other expense (income) - net
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36
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(4
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)
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|
1
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|
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Income before income taxes
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2,591
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2,424
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3,368
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Income tax expense
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378
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278
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|
|
382
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|
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Net income
|
2,213
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|
|
2,146
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|
2,986
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|
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Less net income for noncontrolling interests
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(2
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)
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(1
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)
|
|
(1
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)
|
|||
Net income attributable to Eaton ordinary shareholders
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$
|
2,211
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|
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$
|
2,145
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$
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2,985
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|
||||||
Net income per share attributable to Eaton ordinary shareholders
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|
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|
||||||
Diluted
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$
|
5.25
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$
|
4.91
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|
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$
|
6.68
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Basic
|
5.28
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|
|
4.93
|
|
|
6.71
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|||
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|
||||||
Weighted-average number of ordinary shares outstanding
|
|
|
|
|
|
||||||
Diluted
|
420.8
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|
|
436.9
|
|
|
447.0
|
|
|||
Basic
|
419.0
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|
|
434.3
|
|
|
444.5
|
|
|||
|
|
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|
||||||
Cash dividends declared per ordinary share
|
$
|
2.84
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|
|
$
|
2.64
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$
|
2.40
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|
|
Year ended December 31
|
||||||||||
(In millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
2,213
|
|
|
$
|
2,146
|
|
|
$
|
2,986
|
|
Less net income for noncontrolling interests
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||
Net income attributable to Eaton ordinary shareholders
|
2,211
|
|
|
2,145
|
|
|
2,985
|
|
|||
|
|
|
|
|
|
||||||
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
||||||
Currency translation and related hedging instruments
|
16
|
|
|
(609
|
)
|
|
807
|
|
|||
Pensions and other postretirement benefits
|
(130
|
)
|
|
(139
|
)
|
|
241
|
|
|||
Cash flow hedges
|
(31
|
)
|
|
7
|
|
|
(4
|
)
|
|||
Other comprehensive income (loss) attributable to Eaton
ordinary shareholders
|
(145
|
)
|
|
(741
|
)
|
|
1,044
|
|
|||
|
|
|
|
|
|
||||||
Total comprehensive income attributable to Eaton ordinary shareholders
|
$
|
2,066
|
|
|
$
|
1,404
|
|
|
$
|
4,029
|
|
|
December 31
|
||||||
(In millions)
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash
|
$
|
370
|
|
|
$
|
283
|
|
Short-term investments
|
221
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|
|
157
|
|
||
Accounts receivable - net
|
3,437
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|
|
3,858
|
|
||
Inventory
|
2,805
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|
|
2,785
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|
||
Assets held for sale
|
1,377
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|
|
—
|
|
||
Prepaid expenses and other current assets
|
518
|
|
|
507
|
|
||
Total current assets
|
8,728
|
|
|
7,590
|
|
||
|
|
|
|
||||
Property, plant and equipment
|
|
|
|
||||
Land and buildings
|
2,440
|
|
|
2,466
|
|
||
Machinery and equipment
|
6,266
|
|
|
6,106
|
|
||
Gross property, plant and equipment
|
8,706
|
|
|
8,572
|
|
||
Accumulated depreciation
|
(5,210
|
)
|
|
(5,105
|
)
|
||
Net property, plant and equipment
|
3,496
|
|
|
3,467
|
|
||
|
|
|
|
||||
Other noncurrent assets
|
|
|
|
||||
Goodwill
|
13,456
|
|
|
13,328
|
|
||
Other intangible assets
|
4,638
|
|
|
4,846
|
|
||
Operating lease assets
|
436
|
|
|
—
|
|
||
Deferred income taxes
|
372
|
|
|
293
|
|
||
Other assets
|
1,679
|
|
|
1,568
|
|
||
Total assets
|
$
|
32,805
|
|
|
$
|
31,092
|
|
|
|
|
|
||||
Liabilities and shareholders’ equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Short-term debt
|
$
|
255
|
|
|
$
|
414
|
|
Current portion of long-term debt
|
248
|
|
|
339
|
|
||
Accounts payable
|
2,114
|
|
|
2,130
|
|
||
Accrued compensation
|
449
|
|
|
457
|
|
||
Liabilities held for sale
|
325
|
|
|
—
|
|
||
Other current liabilities
|
1,741
|
|
|
1,814
|
|
||
Total current liabilities
|
5,132
|
|
|
5,154
|
|
||
|
|
|
|
||||
Noncurrent liabilities
|
|
|
|
||||
Long-term debt
|
7,819
|
|
|
6,768
|
|
||
Pension liabilities
|
1,462
|
|
|
1,304
|
|
||
Other postretirement benefits liabilities
|
328
|
|
|
321
|
|
||
Operating lease liabilities
|
331
|
|
|
—
|
|
||
Deferred income taxes
|
396
|
|
|
349
|
|
||
Other noncurrent liabilities
|
1,204
|
|
|
1,054
|
|
||
Total noncurrent liabilities
|
11,540
|
|
|
9,796
|
|
||
|
|
|
|
||||
Shareholders’ equity
|
|
|
|
||||
Ordinary shares (413.3 million outstanding in 2019 and 423.6 million in 2018)
|
4
|
|
|
4
|
|
||
Capital in excess of par value
|
12,200
|
|
|
12,090
|
|
||
Retained earnings
|
8,170
|
|
|
8,161
|
|
||
Accumulated other comprehensive loss
|
(4,290
|
)
|
|
(4,145
|
)
|
||
Shares held in trust
|
(2
|
)
|
|
(3
|
)
|
||
Total Eaton shareholders’ equity
|
16,082
|
|
|
16,107
|
|
||
Noncontrolling interests
|
51
|
|
|
35
|
|
||
Total equity
|
16,133
|
|
|
16,142
|
|
||
Total liabilities and equity
|
$
|
32,805
|
|
|
$
|
31,092
|
|
|
Year ended December 31
|
||||||||||
(In millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Operating activities
|
|
|
|
|
|
||||||
Net income
|
$
|
2,213
|
|
|
$
|
2,146
|
|
|
$
|
2,986
|
|
Adjustments to reconcile to net cash provided by operating activities
|
|
|
|
|
|
||||||
Depreciation and amortization
|
884
|
|
|
903
|
|
|
914
|
|
|||
Deferred income taxes
|
(71
|
)
|
|
(115
|
)
|
|
(206
|
)
|
|||
Pension and other postretirement benefits expense
|
157
|
|
|
159
|
|
|
208
|
|
|||
Contributions to pension plans
|
(119
|
)
|
|
(126
|
)
|
|
(473
|
)
|
|||
Contributions to other postretirement benefits plans
|
(15
|
)
|
|
(25
|
)
|
|
(20
|
)
|
|||
Loss (gain) on sale of businesses
|
66
|
|
|
—
|
|
|
(843
|
)
|
|||
Changes in working capital
|
|
|
|
|
|
||||||
Accounts receivable - net
|
200
|
|
|
(123
|
)
|
|
(231
|
)
|
|||
Inventory
|
(60
|
)
|
|
(242
|
)
|
|
(202
|
)
|
|||
Accounts payable
|
147
|
|
|
23
|
|
|
388
|
|
|||
Accrued compensation
|
(23
|
)
|
|
23
|
|
|
59
|
|
|||
Accrued income and other taxes
|
(49
|
)
|
|
(31
|
)
|
|
(4
|
)
|
|||
Other current assets
|
(94
|
)
|
|
71
|
|
|
2
|
|
|||
Other current liabilities
|
(57
|
)
|
|
144
|
|
|
(203
|
)
|
|||
Other - net
|
272
|
|
|
(149
|
)
|
|
291
|
|
|||
Net cash provided by operating activities
|
3,451
|
|
|
2,658
|
|
|
2,666
|
|
|||
|
|
|
|
|
|
||||||
Investing activities
|
|
|
|
|
|
||||||
Capital expenditures for property, plant and equipment
|
(587
|
)
|
|
(565
|
)
|
|
(520
|
)
|
|||
Cash paid for acquisitions of businesses, net of cash acquired
|
(1,180
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from (payments for) sales of businesses
|
(36
|
)
|
|
—
|
|
|
607
|
|
|||
Sales (purchases) of short-term investments - net
|
(70
|
)
|
|
355
|
|
|
(298
|
)
|
|||
Proceeds from (payments for) settlement of currency exchange contracts not designated as hedges - net
|
54
|
|
|
(110
|
)
|
|
—
|
|
|||
Other - net
|
(47
|
)
|
|
(78
|
)
|
|
(6
|
)
|
|||
Net cash used in investing activities
|
(1,866
|
)
|
|
(398
|
)
|
|
(217
|
)
|
|||
|
|
|
|
|
|
||||||
Financing activities
|
|
|
|
|
|
||||||
Proceeds from borrowings
|
1,232
|
|
|
410
|
|
|
1,000
|
|
|||
Payments on borrowings
|
(507
|
)
|
|
(574
|
)
|
|
(1,554
|
)
|
|||
Cash dividends paid
|
(1,201
|
)
|
|
(1,149
|
)
|
|
(1,068
|
)
|
|||
Exercise of employee stock options
|
66
|
|
|
29
|
|
|
66
|
|
|||
Repurchase of shares
|
(1,029
|
)
|
|
(1,271
|
)
|
|
(850
|
)
|
|||
Employee taxes paid from shares withheld
|
(46
|
)
|
|
(24
|
)
|
|
(22
|
)
|
|||
Other - net
|
(9
|
)
|
|
(2
|
)
|
|
(14
|
)
|
|||
Net cash used in financing activities
|
(1,494
|
)
|
|
(2,581
|
)
|
|
(2,442
|
)
|
|||
|
|
|
|
|
|
||||||
Effect of currency on cash
|
(4
|
)
|
|
43
|
|
|
11
|
|
|||
Total increase (decrease) in cash
|
87
|
|
|
(278
|
)
|
|
18
|
|
|||
Cash at the beginning of the period
|
283
|
|
|
561
|
|
|
543
|
|
|||
Cash at the end of the period
|
$
|
370
|
|
|
$
|
283
|
|
|
$
|
561
|
|
|
Ordinary shares
|
|
Capital in excess of par value
|
|
Retained earnings
|
|
Accumulated other comprehensive loss
|
|
Shares held in trust
|
|
Total Eaton shareholders' equity
|
|
Noncontrolling interests
|
|
Total equity
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
(In millions)
|
Shares
|
|
Dollars
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at January 1, 2017
|
449.4
|
|
|
$
|
5
|
|
|
$
|
11,845
|
|
|
$
|
7,555
|
|
|
$
|
(4,448
|
)
|
|
$
|
(3
|
)
|
|
$
|
14,954
|
|
|
$
|
44
|
|
|
$
|
14,998
|
|
Cumulative-effect adjustment upon adoption of ASU 2016-09
|
—
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|
—
|
|
|
48
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
2,985
|
|
|
—
|
|
|
—
|
|
|
2,985
|
|
|
1
|
|
|
2,986
|
|
||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
1,044
|
|
|
|
|
1,044
|
|
|
|
|
1,044
|
|
||||||||||||||
Cash dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,068
|
)
|
|
—
|
|
|
—
|
|
|
(1,068
|
)
|
|
(5
|
)
|
|
(1,073
|
)
|
||||||||
Issuance of shares under equity-based compensation plans
|
2.0
|
|
|
—
|
|
|
142
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
140
|
|
|
—
|
|
|
140
|
|
||||||||
Changes in noncontrolling interest of consolidated subsidiaries - net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
||||||||
Repurchase of shares
|
(11.5
|
)
|
|
(1
|
)
|
|
—
|
|
|
(849
|
)
|
|
—
|
|
|
—
|
|
|
(850
|
)
|
|
—
|
|
|
(850
|
)
|
||||||||
Balance at December 31, 2017
|
439.9
|
|
|
4
|
|
|
11,987
|
|
|
8,669
|
|
|
(3,404
|
)
|
|
(3
|
)
|
|
17,253
|
|
|
37
|
|
|
17,290
|
|
||||||||
Cumulative-effect adjustment upon adoption of ASU 2014-09
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||||
Cumulative-effect adjustment upon adoption of ASU 2016-16
|
—
|
|
|
—
|
|
|
—
|
|
|
(199
|
)
|
|
—
|
|
|
—
|
|
|
(199
|
)
|
|
—
|
|
|
(199
|
)
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
2,145
|
|
|
—
|
|
|
—
|
|
|
2,145
|
|
|
1
|
|
|
2,146
|
|
||||||||
Other comprehensive loss, net of tax
|
|
|
|
|
|
|
|
|
(741
|
)
|
|
|
|
(741
|
)
|
|
|
|
|
(741
|
)
|
|||||||||||||
Cash dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,149
|
)
|
|
—
|
|
|
—
|
|
|
(1,149
|
)
|
|
(1
|
)
|
|
(1,150
|
)
|
||||||||
Issuance of shares under equity-based compensation plans
|
1.2
|
|
|
—
|
|
|
103
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
100
|
|
|
—
|
|
|
100
|
|
||||||||
Changes in noncontrolling interest of consolidated subsidiaries - net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
||||||||
Repurchase of shares
|
(17.5
|
)
|
|
—
|
|
|
—
|
|
|
(1,300
|
)
|
|
—
|
|
|
—
|
|
|
(1,300
|
)
|
|
—
|
|
|
(1,300
|
)
|
||||||||
Balance at December 31, 2018
|
423.6
|
|
|
4
|
|
|
12,090
|
|
|
8,161
|
|
|
(4,145
|
)
|
|
(3
|
)
|
|
16,107
|
|
|
35
|
|
|
16,142
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
2,211
|
|
|
—
|
|
|
—
|
|
|
2,211
|
|
|
2
|
|
|
2,213
|
|
||||||||
Other comprehensive loss, net of tax
|
|
|
|
|
|
|
|
|
(145
|
)
|
|
|
|
(145
|
)
|
|
|
|
(145
|
)
|
||||||||||||||
Cash dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,201
|
)
|
|
—
|
|
|
—
|
|
|
(1,201
|
)
|
|
(3
|
)
|
|
(1,204
|
)
|
||||||||
Issuance of shares under equity-based compensation plans
|
2.2
|
|
|
—
|
|
|
110
|
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|
110
|
|
|
—
|
|
|
110
|
|
||||||||
Acquisitions of businesses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
55
|
|
|
55
|
|
||||||||
Acquisition of noncontrolling interest obtained through tender offer
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(33
|
)
|
|
(33
|
)
|
||||||||
Business divestiture
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
||||||||
Changes in noncontrolling interest of consolidated subsidiaries - net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||||||
Repurchase of shares
|
(12.5
|
)
|
|
—
|
|
|
—
|
|
|
(1,000
|
)
|
|
—
|
|
|
—
|
|
|
(1,000
|
)
|
|
—
|
|
|
(1,000
|
)
|
||||||||
Balance at December 31, 2019
|
413.3
|
|
|
$
|
4
|
|
|
$
|
12,200
|
|
|
$
|
8,170
|
|
|
$
|
(4,290
|
)
|
|
$
|
(2
|
)
|
|
$
|
16,082
|
|
|
$
|
51
|
|
|
$
|
16,133
|
|
Note 1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
Note 2.
|
ACQUISITIONS AND DIVESTITURES OF BUSINESSES
|
|
|
December 20, 2019
|
||
Accounts Receivables
|
|
$
|
60
|
|
Inventory
|
|
121
|
|
|
Prepaid expenses and other current assets
|
|
5
|
|
|
Property, plant and equipment
|
|
101
|
|
|
Other intangible assets
|
|
385
|
|
|
Other assets
|
|
8
|
|
|
Accounts payable
|
|
(34
|
)
|
|
Other current liabilities
|
|
(51
|
)
|
|
Other noncurrent liabilities
|
|
(130
|
)
|
|
Total identifiable net assets
|
|
465
|
|
|
Noncontrolling interests
|
|
(4
|
)
|
|
Goodwill
|
|
442
|
|
|
Total consideration, net of cash received
|
|
$
|
903
|
|
Accounts receivable - net
|
|
$
|
220
|
|
Inventory
|
|
161
|
|
|
Prepaid expenses and other current assets
|
|
10
|
|
|
Net property, plant and equipment
|
|
155
|
|
|
Goodwill
|
|
470
|
|
|
Other intangible assets
|
|
330
|
|
|
Operating lease assets
|
|
25
|
|
|
Other noncurrent assets
|
|
6
|
|
|
Assets held for sale - current
|
|
$
|
1,377
|
|
|
|
|
||
Accounts payable
|
|
$
|
184
|
|
Accrued compensation
|
|
7
|
|
|
Other current liabilities
|
|
102
|
|
|
Pension liabilities
|
|
3
|
|
|
Operating lease liabilities
|
|
17
|
|
|
Deferred income taxes
|
|
(1
|
)
|
|
Other noncurrent liabilities
|
|
13
|
|
|
Liabilities held for sale - current
|
|
$
|
325
|
|
|
2019
|
||||||||||
Net sales
|
United States
|
|
Rest of World
|
|
Total
|
||||||
Electrical Products
|
$
|
4,269
|
|
|
$
|
2,879
|
|
|
$
|
7,148
|
|
Electrical Systems and Services
|
4,148
|
|
|
2,139
|
|
|
6,287
|
|
|||
Hydraulics
|
1,112
|
|
|
1,440
|
|
|
2,552
|
|
|||
|
|
|
|
|
|
||||||
|
Original Equipment Manufacturers
|
|
Aftermarket, Distribution and End User
|
|
|
||||||
Aerospace
|
$
|
1,167
|
|
|
$
|
877
|
|
|
2,044
|
|
|
|
|
|
|
|
|
||||||
|
Commercial
|
|
Passenger and Light Duty
|
|
|
||||||
Vehicle
|
$
|
1,538
|
|
|
$
|
1,500
|
|
|
3,038
|
|
|
|
|
|
|
|
|
||||||
eMobility
|
|
|
|
|
321
|
|
|||||
|
|
|
|
|
|
||||||
Total
|
|
|
|
|
$
|
21,390
|
|
|
2018
|
||||||||||
Net sales
|
United States
|
|
Rest of World
|
|
Total
|
||||||
Electrical Products
|
$
|
4,112
|
|
|
$
|
3,012
|
|
|
$
|
7,124
|
|
Electrical Systems and Services
|
3,936
|
|
|
2,088
|
|
|
6,024
|
|
|||
Hydraulics
|
1,190
|
|
|
1,566
|
|
|
2,756
|
|
|||
|
|
|
|
|
|
||||||
|
Original Equipment Manufacturers
|
|
Aftermarket, Distribution and End User
|
|
|
||||||
Aerospace
|
$
|
1,085
|
|
|
$
|
811
|
|
|
1,896
|
|
|
|
|
|
|
|
|
||||||
|
Commercial
|
|
Passenger and Light Duty
|
|
|
||||||
Vehicle
|
$
|
1,759
|
|
|
$
|
1,730
|
|
|
3,489
|
|
|
|
|
|
|
|
|
||||||
eMobility
|
|
|
|
|
320
|
|
|||||
|
|
|
|
|
|
||||||
Total
|
|
|
|
|
$
|
21,609
|
|
|
Deferred Revenue
|
||
Balance at January 1, 2018
|
$
|
227
|
|
Customer deposits and billings
|
967
|
|
|
Revenue recognized in the period
|
(939
|
)
|
|
Translation
|
(7
|
)
|
|
Balance at December 31, 2018
|
$
|
248
|
|
Customer deposits and billings
|
982
|
|
|
Revenue recognized in the period
|
(993
|
)
|
|
Translation
|
3
|
|
|
Deferred revenue reclassified to held for sale
|
(6
|
)
|
|
Balance at December 31, 2019
|
$
|
234
|
|
Note 4.
|
GOODWILL AND OTHER INTANGIBLE ASSETS
|
|
January 1, 2018
|
|
Translation
|
|
December 31, 2018
|
|
Additions
|
|
Goodwill reclassified to held for sale
|
|
Translation
|
|
December 31, 2019
|
||||||||||||||
Electrical Products
|
$
|
6,678
|
|
|
$
|
(116
|
)
|
|
$
|
6,562
|
|
|
$
|
—
|
|
|
$
|
(470
|
)
|
|
$
|
(2
|
)
|
|
$
|
6,090
|
|
Electrical Systems and Services
|
4,311
|
|
|
(70
|
)
|
|
4,241
|
|
|
163
|
|
|
—
|
|
|
6
|
|
|
4,410
|
|
|||||||
Hydraulics
|
1,257
|
|
|
(45
|
)
|
|
1,212
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
1,199
|
|
|||||||
Aerospace
|
947
|
|
|
(6
|
)
|
|
941
|
|
|
442
|
|
|
—
|
|
|
3
|
|
|
1,386
|
|
|||||||
Vehicle
|
294
|
|
|
(2
|
)
|
|
292
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
291
|
|
|||||||
eMobility
|
81
|
|
|
(1
|
)
|
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|||||||
Total
|
$
|
13,568
|
|
|
$
|
(240
|
)
|
|
$
|
13,328
|
|
|
$
|
605
|
|
|
$
|
(470
|
)
|
|
$
|
(7
|
)
|
|
$
|
13,456
|
|
|
2019
|
|
2018
|
||||||||||||
|
Historical
cost
|
|
Accumulated
amortization
|
|
Historical
cost
|
|
Accumulated
amortization
|
||||||||
Intangible assets not subject to amortization
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
$
|
1,516
|
|
|
|
|
$
|
1,626
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Intangible assets subject to amortization
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
$
|
3,260
|
|
|
$
|
1,634
|
|
|
$
|
3,463
|
|
|
$
|
1,600
|
|
Patents and technology
|
1,542
|
|
|
704
|
|
|
1,329
|
|
|
646
|
|
||||
Trademarks
|
1,057
|
|
|
457
|
|
|
1,032
|
|
|
419
|
|
||||
Other
|
92
|
|
|
34
|
|
|
92
|
|
|
31
|
|
||||
Total intangible assets subject to amortization
|
$
|
5,951
|
|
|
$
|
2,829
|
|
|
$
|
5,916
|
|
|
$
|
2,696
|
|
2019
|
$
|
354
|
|
2020
|
351
|
|
|
2021
|
341
|
|
|
2022
|
332
|
|
|
2023
|
286
|
|
|
2024
|
275
|
|
Note 5.
|
LEASES
|
|
2019
|
||
Operating lease cost
|
$
|
166
|
|
Finance lease cost:
|
|
|
|
Amortization of lease assets
|
5
|
|
|
Interest on lease liabilities
|
1
|
|
|
Short-term lease cost
|
46
|
|
|
Variable lease cost
|
22
|
|
|
Sublease income
|
(3
|
)
|
|
Total lease cost
|
$
|
237
|
|
|
2019
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash outflows - payments on operating leases
|
$
|
(168
|
)
|
Operating cash outflows - interest payments on finance leases
|
(1
|
)
|
|
Financing cash outflows - payments on finance lease obligations
|
(6
|
)
|
|
|
|
||
Lease assets obtained in exchange for new lease obligations, including leases acquired:
|
|
||
Operating leases
|
$
|
114
|
|
Finance leases
|
24
|
|
|
December 31, 2019
|
||
Operating Leases
|
|
||
Operating lease assets
|
$
|
436
|
|
|
|
||
Other current liabilities
|
121
|
|
|
Operating lease liabilities
|
331
|
|
|
Total operating lease liabilities
|
$
|
452
|
|
|
|
||
Finance Leases
|
|
||
Land and buildings
|
$
|
24
|
|
Machinery and equipment
|
18
|
|
|
Accumulated depreciation
|
(16
|
)
|
|
Net property, plant and equipment
|
$
|
26
|
|
|
|
||
Current portion of long-term debt
|
$
|
6
|
|
Long-term debt
|
21
|
|
|
Total finance lease liabilities
|
$
|
27
|
|
|
|
||
Weighted-average remaining lease term
|
|
||
Operating leases
|
5.1 years
|
|
|
Finance leases
|
6.8 years
|
|
|
|
|
||
Weighted-average discount rate
|
|
||
Operating leases
|
3.7
|
%
|
|
Finance leases
|
7.6
|
%
|
|
Operating Leases
|
|
Finance Leases
|
||||
2020
|
$
|
142
|
|
|
$
|
8
|
|
2021
|
113
|
|
|
8
|
|
||
2022
|
82
|
|
|
6
|
|
||
2023
|
56
|
|
|
4
|
|
||
2024
|
37
|
|
|
2
|
|
||
Thereafter
|
82
|
|
|
9
|
|
||
Total lease payments
|
512
|
|
|
37
|
|
||
Less imputed interest
|
60
|
|
|
10
|
|
||
Total present value of lease liabilities
|
$
|
452
|
|
|
$
|
27
|
|
|
Operating Leases
|
||
2019
|
$
|
165
|
|
2020
|
133
|
|
|
2021
|
106
|
|
|
2022
|
75
|
|
|
2023
|
53
|
|
|
Thereafter
|
110
|
|
|
Total lease commitments
|
$
|
642
|
|
2018
|
$
|
232
|
|
2017
|
222
|
|
Note 6.
|
DEBT
|
|
2019
|
|
2018
|
||||
6.95% notes due 2019 ($300 converted to floating rate by interest rate swap)
|
$
|
—
|
|
|
$
|
300
|
|
3.875% debentures due 2020 ($150 converted to floating rate by interest rate swap)
|
239
|
|
|
239
|
|
||
3.47% notes due 2021 ($275 converted to floating rate by interest rate swap)
|
300
|
|
|
300
|
|
||
0.02% Euro notes due 2021
|
674
|
|
|
—
|
|
||
8.10% debentures due 2022 ($100 converted to floating rate by interest rate swap)
|
100
|
|
|
100
|
|
||
2.75% senior notes due 2022 ($1,400 converted to floating rate by interest rate swap)
|
1,600
|
|
|
1,600
|
|
||
3.68% notes due 2023 ($200 converted to floating rate by interest rate swap)
|
300
|
|
|
300
|
|
||
0.75% Euro notes due 2024
|
617
|
|
|
629
|
|
||
6.50% debentures due 2025
|
145
|
|
|
145
|
|
||
0.70% Euro notes due 2025
|
562
|
|
|
—
|
|
||
3.10% senior notes due 2027
|
700
|
|
|
700
|
|
||
7.65% debentures due 2029 ($50 converted to floating rate by interest rate swap)
|
200
|
|
|
200
|
|
||
4.00% senior notes due 2032
|
700
|
|
|
700
|
|
||
5.45% debentures due 2034 ($25 converted to floating rate by interest rate swap)
|
137
|
|
|
136
|
|
||
5.80% notes due 2037
|
240
|
|
|
240
|
|
||
4.15% senior notes due 2042
|
1,000
|
|
|
1,000
|
|
||
3.92% senior notes due 2047
|
300
|
|
|
300
|
|
||
5.25% to 7.875% notes (maturities ranging from 2024 to 2035, including $25 converted to floating rate by interest rate swap)
|
165
|
|
|
203
|
|
||
Other
|
88
|
|
|
15
|
|
||
Total long-term debt
|
8,067
|
|
|
7,107
|
|
||
Less current portion of long-term debt
|
(248
|
)
|
|
(339
|
)
|
||
Long-term debt less current portion
|
$
|
7,819
|
|
|
$
|
6,768
|
|
2020
|
$
|
248
|
|
2021
|
981
|
|
|
2022
|
1,704
|
|
|
2023
|
303
|
|
|
2024
|
685
|
|
2019
|
$
|
279
|
|
2018
|
313
|
|
|
2017
|
293
|
|
Note 7.
|
RETIREMENT BENEFITS PLANS
|
|
United States
pension liabilities
|
|
Non-United States
pension liabilities
|
|
Other postretirement
liabilities
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
Funded status
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fair value of plan assets
|
$
|
3,433
|
|
|
$
|
3,068
|
|
|
$
|
1,903
|
|
|
$
|
1,560
|
|
|
$
|
23
|
|
|
$
|
37
|
|
Benefit obligations
|
(4,028
|
)
|
|
(3,633
|
)
|
|
(2,747
|
)
|
|
(2,285
|
)
|
|
(378
|
)
|
|
(378
|
)
|
||||||
Funded status
|
$
|
(595
|
)
|
|
$
|
(565
|
)
|
|
$
|
(844
|
)
|
|
$
|
(725
|
)
|
|
$
|
(355
|
)
|
|
$
|
(341
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Amounts recognized in the Consolidated
Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-current assets
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
73
|
|
|
$
|
58
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current liabilities
|
(23
|
)
|
|
(20
|
)
|
|
(27
|
)
|
|
(24
|
)
|
|
(27
|
)
|
|
(20
|
)
|
||||||
Non-current liabilities
|
(572
|
)
|
|
(545
|
)
|
|
(890
|
)
|
|
(759
|
)
|
|
(328
|
)
|
|
(321
|
)
|
||||||
Total
|
$
|
(595
|
)
|
|
$
|
(565
|
)
|
|
$
|
(844
|
)
|
|
$
|
(725
|
)
|
|
$
|
(355
|
)
|
|
$
|
(341
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Amounts recognized in Accumulated other
comprehensive loss (pre-tax)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net actuarial (gain) loss
|
$
|
1,096
|
|
|
$
|
1,153
|
|
|
$
|
879
|
|
|
$
|
683
|
|
|
$
|
(8
|
)
|
|
$
|
(20
|
)
|
Prior service cost (credit)
|
7
|
|
|
7
|
|
|
25
|
|
|
27
|
|
|
(17
|
)
|
|
(32
|
)
|
||||||
Total
|
$
|
1,103
|
|
|
$
|
1,160
|
|
|
$
|
904
|
|
|
$
|
710
|
|
|
$
|
(25
|
)
|
|
$
|
(52
|
)
|
|
United States
pension liabilities
|
|
Non-United States
pension liabilities
|
|
Other postretirement
liabilities
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
Balance at January 1
|
$
|
3,633
|
|
|
$
|
3,961
|
|
|
$
|
2,285
|
|
|
$
|
2,399
|
|
|
$
|
378
|
|
|
$
|
448
|
|
Service cost
|
91
|
|
|
100
|
|
|
58
|
|
|
63
|
|
|
2
|
|
|
2
|
|
||||||
Interest cost
|
138
|
|
|
122
|
|
|
57
|
|
|
52
|
|
|
14
|
|
|
13
|
|
||||||
Actuarial (gain) loss
|
435
|
|
|
(272
|
)
|
|
315
|
|
|
(16
|
)
|
|
14
|
|
|
(39
|
)
|
||||||
Gross benefits paid
|
(270
|
)
|
|
(282
|
)
|
|
(102
|
)
|
|
(112
|
)
|
|
(60
|
)
|
|
(67
|
)
|
||||||
Currency translation
|
—
|
|
|
—
|
|
|
47
|
|
|
(124
|
)
|
|
2
|
|
|
(4
|
)
|
||||||
Plan amendments
|
1
|
|
|
4
|
|
|
—
|
|
|
21
|
|
|
1
|
|
|
—
|
|
||||||
Acquisitions and divestitures
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Benefit obligation reclassified to held for sale
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
95
|
|
|
2
|
|
|
27
|
|
|
25
|
|
||||||
Balance at December 31
|
$
|
4,028
|
|
|
$
|
3,633
|
|
|
$
|
2,747
|
|
|
$
|
2,285
|
|
|
$
|
378
|
|
|
$
|
378
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accumulated benefit obligation
|
$
|
3,883
|
|
|
$
|
3,506
|
|
|
$
|
2,592
|
|
|
$
|
2,175
|
|
|
|
|
|
|
United States
pension liabilities
|
|
Non-United States
pension liabilities
|
|
Other postretirement
liabilities
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
Balance at January 1
|
$
|
3,068
|
|
|
$
|
3,585
|
|
|
$
|
1,560
|
|
|
$
|
1,727
|
|
|
$
|
37
|
|
|
$
|
55
|
|
Actual return on plan assets
|
618
|
|
|
(252
|
)
|
|
230
|
|
|
(72
|
)
|
|
5
|
|
|
—
|
|
||||||
Employer contributions
|
17
|
|
|
17
|
|
|
102
|
|
|
109
|
|
|
15
|
|
|
25
|
|
||||||
Gross benefits paid
|
(270
|
)
|
|
(282
|
)
|
|
(102
|
)
|
|
(112
|
)
|
|
(60
|
)
|
|
(67
|
)
|
||||||
Currency translation
|
—
|
|
|
—
|
|
|
58
|
|
|
(93
|
)
|
|
—
|
|
|
—
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
55
|
|
|
1
|
|
|
26
|
|
|
24
|
|
||||||
Balance at December 31
|
$
|
3,433
|
|
|
$
|
3,068
|
|
|
$
|
1,903
|
|
|
$
|
1,560
|
|
|
$
|
23
|
|
|
$
|
37
|
|
|
United States
pension liabilities
|
|
Non-United States
pension liabilities
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Projected benefit obligation
|
$
|
4,028
|
|
|
$
|
3,633
|
|
|
$
|
1,107
|
|
|
$
|
905
|
|
Accumulated benefit obligation
|
3,883
|
|
|
3,506
|
|
|
1,028
|
|
|
853
|
|
||||
Fair value of plan assets
|
3,433
|
|
|
3,068
|
|
|
242
|
|
|
158
|
|
|
United States
pension liabilities
|
|
Non-United States
pension liabilities
|
|
Other postretirement
liabilities
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
Balance at January 1
|
$
|
1,160
|
|
|
$
|
1,063
|
|
|
$
|
710
|
|
|
$
|
604
|
|
|
$
|
(52
|
)
|
|
$
|
(27
|
)
|
Prior service cost arising during the year
|
1
|
|
|
4
|
|
|
—
|
|
|
21
|
|
|
1
|
|
|
—
|
|
||||||
Net loss (gain) arising during the year
|
52
|
|
|
233
|
|
|
231
|
|
|
161
|
|
|
11
|
|
|
(36
|
)
|
||||||
Currency translation
|
—
|
|
|
—
|
|
|
15
|
|
|
(35
|
)
|
|
1
|
|
|
(2
|
)
|
||||||
Less amounts included in expense during the year
|
(110
|
)
|
|
(140
|
)
|
|
(52
|
)
|
|
(41
|
)
|
|
14
|
|
|
13
|
|
||||||
Net change for the year
|
(57
|
)
|
|
97
|
|
|
194
|
|
|
106
|
|
|
27
|
|
|
(25
|
)
|
||||||
Balance at December 31
|
$
|
1,103
|
|
|
$
|
1,160
|
|
|
$
|
904
|
|
|
$
|
710
|
|
|
$
|
(25
|
)
|
|
$
|
(52
|
)
|
|
United States
pension benefit expense
|
|
Non-United States
pension benefit expense
|
|
Other postretirement
benefits expense
|
||||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
Service cost
|
$
|
91
|
|
|
$
|
100
|
|
|
$
|
96
|
|
|
$
|
58
|
|
|
$
|
63
|
|
|
$
|
71
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
3
|
|
Interest cost
|
138
|
|
|
122
|
|
|
123
|
|
|
57
|
|
|
52
|
|
|
55
|
|
|
14
|
|
|
13
|
|
|
14
|
|
|||||||||
Expected return on plan assets
|
(235
|
)
|
|
(253
|
)
|
|
(244
|
)
|
|
(106
|
)
|
|
(105
|
)
|
|
(94
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|
(4
|
)
|
|||||||||
Amortization
|
62
|
|
|
94
|
|
|
83
|
|
|
38
|
|
|
39
|
|
|
51
|
|
|
(14
|
)
|
|
(13
|
)
|
|
(13
|
)
|
|||||||||
|
56
|
|
|
63
|
|
|
58
|
|
|
47
|
|
|
49
|
|
|
83
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|||||||||
Settlements, curtailments and special termination benefits
|
48
|
|
|
46
|
|
|
62
|
|
|
14
|
|
|
2
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Total expense
|
$
|
104
|
|
|
$
|
109
|
|
|
$
|
120
|
|
|
$
|
61
|
|
|
$
|
51
|
|
|
$
|
88
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
United States
pension liabilities
|
|
Non-United States
pension liabilities
|
|
Other postretirement
liabilities
|
||||||
Actuarial loss
|
$
|
144
|
|
|
$
|
59
|
|
|
$
|
1
|
|
Prior service cost (credit)
|
1
|
|
|
3
|
|
|
(14
|
)
|
|||
Total
|
$
|
145
|
|
|
$
|
62
|
|
|
$
|
(13
|
)
|
|
United States
pension plans
|
|
Non-United States
pension plans
|
||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
||||||
Assumptions used to determine benefit obligation at year-end
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
3.22
|
%
|
|
4.28
|
%
|
|
3.64
|
%
|
|
2.02
|
%
|
|
2.83
|
%
|
|
2.62
|
%
|
Rate of compensation increase
|
3.14
|
%
|
|
3.14
|
%
|
|
3.15
|
%
|
|
3.05
|
%
|
|
3.10
|
%
|
|
3.11
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Assumptions used to determine expense
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate used to determine benefit obligation
|
4.28
|
%
|
|
3.64
|
%
|
|
4.12
|
%
|
|
2.83
|
%
|
|
2.62
|
%
|
|
2.63
|
%
|
Discount rate used to determine service cost
|
4.39
|
%
|
|
3.78
|
%
|
|
4.31
|
%
|
|
4.02
|
%
|
|
3.54
|
%
|
|
3.38
|
%
|
Discount rate used to determine interest cost
|
3.94
|
%
|
|
3.19
|
%
|
|
3.40
|
%
|
|
2.56
|
%
|
|
2.31
|
%
|
|
2.34
|
%
|
Expected long-term return on plan assets
|
7.25
|
%
|
|
7.52
|
%
|
|
7.90
|
%
|
|
6.42
|
%
|
|
6.40
|
%
|
|
6.30
|
%
|
Rate of compensation increase
|
3.14
|
%
|
|
3.15
|
%
|
|
3.15
|
%
|
|
3.10
|
%
|
|
3.11
|
%
|
|
3.13
|
%
|
|
Other postretirement
benefits plans
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Assumptions used to determine benefit obligation at year-end
|
|
|
|
|
|
|||
Discount rate
|
3.13
|
%
|
|
4.23
|
%
|
|
3.55
|
%
|
Health care cost trend rate assumed for next year
|
6.95
|
%
|
|
7.10
|
%
|
|
8.25
|
%
|
Ultimate health care cost trend rate
|
4.75
|
%
|
|
4.75
|
%
|
|
4.75
|
%
|
Year ultimate health care cost trend rate is achieved
|
2029
|
|
|
2028
|
|
|
2027
|
|
|
|
|
|
|
|
|||
Assumptions used to determine expense
|
|
|
|
|
|
|||
Discount rate used to determine benefit obligation
|
4.23
|
%
|
|
3.55
|
%
|
|
3.96
|
%
|
Discount rate used to determine service cost
|
4.29
|
%
|
|
3.62
|
%
|
|
4.11
|
%
|
Discount rate used to determine interest cost
|
3.85
|
%
|
|
3.04
|
%
|
|
3.18
|
%
|
Initial health care cost trend rate
|
7.10
|
%
|
|
8.25
|
%
|
|
7.35
|
%
|
Ultimate health care cost trend rate
|
4.75
|
%
|
|
4.75
|
%
|
|
4.75
|
%
|
Year ultimate health care cost trend rate is achieved
|
2028
|
|
|
2027
|
|
|
2026
|
|
|
1% increase
|
|
1% decrease
|
||||
Effect on total service and interest cost
|
$
|
1
|
|
|
$
|
—
|
|
Effect on other postretirement liabilities
|
10
|
|
|
(8
|
)
|
|
2020
|
|
2019
|
|
2018
|
|
2017
|
||||||||
United States plans
|
$
|
24
|
|
|
$
|
17
|
|
|
$
|
17
|
|
|
$
|
374
|
|
Non-United States plans
|
104
|
|
|
102
|
|
|
109
|
|
|
99
|
|
||||
Total contributions
|
$
|
128
|
|
|
$
|
119
|
|
|
$
|
126
|
|
|
$
|
473
|
|
|
Estimated
United States
pension payments
|
|
Estimated
non-United States
pension payments
|
|
Estimated other postretirement
benefit payments
|
||||||||||
|
|
|
Gross
|
|
Medicare prescription
drug subsidy
|
||||||||||
2020
|
$
|
316
|
|
|
$
|
96
|
|
|
$
|
36
|
|
|
$
|
(1
|
)
|
2021
|
313
|
|
|
96
|
|
|
31
|
|
|
(1
|
)
|
||||
2022
|
307
|
|
|
100
|
|
|
31
|
|
|
—
|
|
||||
2023
|
306
|
|
|
103
|
|
|
28
|
|
|
—
|
|
||||
2024
|
299
|
|
|
106
|
|
|
26
|
|
|
—
|
|
||||
2025 - 2029
|
1,436
|
|
|
594
|
|
|
112
|
|
|
(1
|
)
|
Level 1 -
|
Quoted prices (unadjusted) for identical assets in active markets.
|
Level 2 -
|
Quoted prices for similar assets in active markets, and inputs that are observable for the asset, either directly or indirectly, for substantially the full term of the financial instrument.
|
Level 3 -
|
Unobservable prices or inputs.
|
|
Total
|
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Other
observable
inputs
(Level 2)
|
|
Unobservable
inputs
(Level 3)1
|
||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Common collective trusts
|
|
|
|
|
|
|
|
||||||||
Non-United States equity and global equities
|
$
|
606
|
|
|
$
|
—
|
|
|
$
|
606
|
|
|
$
|
—
|
|
United States equity
|
74
|
|
|
—
|
|
|
74
|
|
|
—
|
|
||||
Fixed income
|
571
|
|
|
—
|
|
|
571
|
|
|
—
|
|
||||
Fixed income securities
|
885
|
|
|
—
|
|
|
885
|
|
|
—
|
|
||||
United States treasuries
|
330
|
|
|
330
|
|
|
—
|
|
|
—
|
|
||||
Bank loans
|
104
|
|
|
—
|
|
|
104
|
|
|
—
|
|
||||
Real estate
|
299
|
|
|
225
|
|
|
13
|
|
|
61
|
|
||||
Cash equivalents
|
196
|
|
|
67
|
|
|
129
|
|
|
—
|
|
||||
Exchange traded funds
|
79
|
|
|
79
|
|
|
—
|
|
|
—
|
|
||||
Other
|
167
|
|
|
—
|
|
|
38
|
|
|
129
|
|
||||
Common collective and other trusts measured at net asset value
|
2,108
|
|
|
|
|
|
|
|
|||||||
Money market funds measured at net asset value
|
6
|
|
|
|
|
|
|
|
|||||||
Pending purchases and sales of plan assets, and interest
receivable
|
(89
|
)
|
|
|
|
|
|
|
|||||||
Total pension plan assets
|
$
|
5,336
|
|
|
$
|
701
|
|
|
$
|
2,420
|
|
|
$
|
190
|
|
|
Total
|
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Other
observable
inputs
(Level 2)
|
|
Unobservable
inputs
(Level 3)1
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Common collective trusts
|
|
|
|
|
|
|
|
||||||||
Non-United States equity and global equities
|
$
|
612
|
|
|
$
|
—
|
|
|
$
|
612
|
|
|
$
|
—
|
|
United States equity
|
50
|
|
|
—
|
|
|
50
|
|
|
—
|
|
||||
Fixed income
|
483
|
|
|
—
|
|
|
483
|
|
|
—
|
|
||||
Fixed income securities
|
721
|
|
|
—
|
|
|
721
|
|
|
—
|
|
||||
United States treasuries
|
262
|
|
|
262
|
|
|
—
|
|
|
—
|
|
||||
Bank loans
|
107
|
|
|
—
|
|
|
107
|
|
|
—
|
|
||||
Real estate
|
202
|
|
|
181
|
|
|
—
|
|
|
21
|
|
||||
Equity securities
|
51
|
|
|
51
|
|
|
—
|
|
|
—
|
|
||||
Cash equivalents
|
176
|
|
|
130
|
|
|
46
|
|
|
—
|
|
||||
Exchange traded funds
|
60
|
|
|
60
|
|
|
—
|
|
|
—
|
|
||||
Other
|
90
|
|
|
—
|
|
|
15
|
|
|
75
|
|
||||
Common collective and other trusts measured at net asset value
|
1,833
|
|
|
|
|
|
|
|
|||||||
Money market funds measured at net asset value
|
5
|
|
|
|
|
|
|
|
|||||||
Pending purchases and sales of plan assets, and interest
receivable
|
(24
|
)
|
|
|
|
|
|
|
|||||||
Total pension plan assets
|
$
|
4,628
|
|
|
$
|
684
|
|
|
$
|
2,034
|
|
|
$
|
96
|
|
|
Real estate
|
|
Other
|
|
Total
|
||||||
Balance at January 1, 2018
|
$
|
19
|
|
|
$
|
73
|
|
|
$
|
92
|
|
Actual return on plan assets:
|
|
|
|
|
|
||||||
Gains (losses) relating to assets still held at year-end
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Purchases, sales, settlements - net
|
3
|
|
|
2
|
|
|
5
|
|
|||
Transfers into or out of Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance at December 31, 2018
|
21
|
|
|
75
|
|
|
96
|
|
|||
Actual return on plan assets:
|
|
|
|
|
|
||||||
Gains (losses) relating to assets still held at year-end
|
4
|
|
|
12
|
|
|
16
|
|
|||
Purchases, sales, settlements - net
|
36
|
|
|
42
|
|
|
78
|
|
|||
Transfers into or out of Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance at December 31, 2019
|
$
|
61
|
|
|
$
|
129
|
|
|
$
|
190
|
|
|
Total
|
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Other
observable
inputs
(Level 2)
|
|
Unobservable
inputs
(Level 3)
|
||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Common collective and other trusts measured at net asset value
|
18
|
|
|
|
|
|
|
|
|||||||
Total other postretirement benefits plan assets
|
$
|
23
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Total
|
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Other
observable
inputs
(Level 2)
|
|
Unobservable
inputs
(Level 3)
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Common collective and other trusts measured at net asset value
|
31
|
|
|
|
|
|
|
|
|||||||
Total other postretirement benefits plan assets
|
$
|
37
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2019
|
$
|
130
|
|
2018
|
124
|
|
|
2017
|
114
|
|
Note 8.
|
COMMITMENTS AND CONTINGENCIES
|
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at January 1
|
$
|
176
|
|
|
$
|
188
|
|
|
$
|
180
|
|
Provision
|
204
|
|
|
139
|
|
|
163
|
|
|||
Settled
|
(175
|
)
|
|
(145
|
)
|
|
(156
|
)
|
|||
Other
|
(2
|
)
|
|
(6
|
)
|
|
1
|
|
|||
Warranty accruals reclassified to held for sale
|
(16
|
)
|
|
—
|
|
|
—
|
|
|||
Balance at December 31
|
$
|
187
|
|
|
$
|
176
|
|
|
$
|
188
|
|
Note 9.
|
INCOME TAXES
|
|
Income (loss) before income taxes
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Ireland
|
$
|
(201
|
)
|
|
$
|
(365
|
)
|
|
$
|
(1,090
|
)
|
Foreign
|
2,792
|
|
|
2,789
|
|
|
4,458
|
|
|||
Total income before income taxes
|
$
|
2,591
|
|
|
$
|
2,424
|
|
|
$
|
3,368
|
|
|
Income tax expense (benefit)
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Current
|
|
|
|
|
|
||||||
Ireland
|
$
|
26
|
|
|
$
|
47
|
|
|
$
|
1
|
|
Foreign
|
410
|
|
|
370
|
|
|
357
|
|
|||
Total current income tax expense
|
436
|
|
|
417
|
|
|
358
|
|
|||
|
|
|
|
|
|
||||||
Deferred
|
|
|
|
|
|
||||||
Ireland
|
3
|
|
|
6
|
|
|
—
|
|
|||
Foreign
|
(61
|
)
|
|
(145
|
)
|
|
24
|
|
|||
Total deferred income tax expense (benefit)
|
(58
|
)
|
|
(139
|
)
|
|
24
|
|
|||
Total income tax expense
|
$
|
378
|
|
|
$
|
278
|
|
|
$
|
382
|
|
2019
|
$
|
425
|
|
2018
|
379
|
|
|
2017
|
288
|
|
|
2019
|
|
2018
|
||||
|
Noncurrent assets and liabilities
|
|
Noncurrent assets and liabilities
|
||||
Accruals and other adjustments
|
|
|
|
||||
Employee benefits
|
$
|
514
|
|
|
$
|
481
|
|
Depreciation and amortization
|
(1,245
|
)
|
|
(1,198
|
)
|
||
Other accruals and adjustments
|
498
|
|
|
434
|
|
||
Ireland income tax loss carryforwards
|
1
|
|
|
1
|
|
||
Foreign income tax loss carryforwards
|
1,826
|
|
|
1,915
|
|
||
Foreign income tax credit carryforwards
|
349
|
|
|
396
|
|
||
Valuation allowance for income tax loss and income tax
credit carryforwards
|
(1,914
|
)
|
|
(2,032
|
)
|
||
Other valuation allowances
|
(52
|
)
|
|
(53
|
)
|
||
Total deferred income taxes
|
(23
|
)
|
|
(56
|
)
|
||
Deferred income taxes reported as assets held for sale
|
1
|
|
|
—
|
|
||
Deferred income taxes
|
$
|
(24
|
)
|
|
$
|
(56
|
)
|
|
2020
through
2024
|
|
2025
through
2029
|
|
2030
through
2034
|
|
2035
through
2044
|
|
Not
subject to
expiration
|
|
Valuation
allowance
|
||||||||||||
Ireland income tax loss carryforwards
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
—
|
|
Ireland deferred income tax assets for income tax loss carryforwards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
2020
through 2024 |
|
2025
through 2029 |
|
2030
through 2034 |
|
2035
through 2044 |
|
Not
subject to
expiration
|
|
Valuation
allowance
|
||||||||||||
Foreign income tax loss carryforwards
|
$
|
874
|
|
|
$
|
52
|
|
|
$
|
7,931
|
|
|
$
|
367
|
|
|
$
|
3,233
|
|
|
$
|
—
|
|
Foreign deferred income tax assets for income tax loss carryforwards
|
108
|
|
|
23
|
|
|
819
|
|
|
108
|
|
|
797
|
|
|
(1,690
|
)
|
||||||
Foreign deferred income tax assets for income tax loss carryforwards after ASU 2013-11
|
90
|
|
|
22
|
|
|
810
|
|
|
108
|
|
|
796
|
|
|
(1,690
|
)
|
||||||
Foreign income tax credit carryforwards
|
115
|
|
|
189
|
|
|
40
|
|
|
90
|
|
|
30
|
|
|
(223
|
)
|
||||||
Foreign income tax credit carryforwards after ASU 2013-11
|
111
|
|
|
165
|
|
|
24
|
|
|
19
|
|
|
30
|
|
|
(223
|
)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at January 1
|
$
|
913
|
|
|
$
|
735
|
|
|
$
|
629
|
|
Increases and decreases as a result of positions taken during prior years
|
|
|
|
|
|
||||||
Transfers from valuation allowances
|
15
|
|
|
2
|
|
|
—
|
|
|||
Other increases, including currency translation
|
22
|
|
|
164
|
|
|
10
|
|
|||
Other decreases, including currency translation
|
(10
|
)
|
|
(35
|
)
|
|
(30
|
)
|
|||
Increases as a result of positions taken during the current year
|
80
|
|
|
69
|
|
|
162
|
|
|||
Decreases relating to settlements with tax authorities
|
(16
|
)
|
|
(3
|
)
|
|
(10
|
)
|
|||
Decreases as a result of a lapse of the applicable statute of limitations
|
(3
|
)
|
|
(19
|
)
|
|
(26
|
)
|
|||
Balance at December 31
|
$
|
1,001
|
|
|
$
|
913
|
|
|
$
|
735
|
|
Note 10.
|
EATON SHAREHOLDERS' EQUITY
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
|
Pre-tax
|
|
After-tax
|
|
Pre-tax
|
|
After-tax
|
|
Pre-tax
|
|
After-tax
|
||||||||||||
Currency translation and related hedging instruments
|
$
|
15
|
|
|
$
|
16
|
|
|
$
|
(613
|
)
|
|
$
|
(609
|
)
|
|
$
|
800
|
|
|
$
|
807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pensions and other postretirement benefits
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Prior service credit (cost) arising during the year
|
(2
|
)
|
|
(2
|
)
|
|
(25
|
)
|
|
(20
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Net gain (loss) arising during the year
|
(294
|
)
|
|
(232
|
)
|
|
(358
|
)
|
|
(274
|
)
|
|
215
|
|
|
169
|
|
||||||
Currency translation
|
(16
|
)
|
|
(13
|
)
|
|
37
|
|
|
29
|
|
|
(67
|
)
|
|
(53
|
)
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
(5
|
)
|
||||||
Amortization of actuarial loss and prior service cost
reclassified to earnings
|
148
|
|
|
117
|
|
|
168
|
|
|
121
|
|
|
188
|
|
|
130
|
|
||||||
|
(164
|
)
|
|
(130
|
)
|
|
(178
|
)
|
|
(139
|
)
|
|
335
|
|
|
241
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flow hedges
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain (loss) on derivatives designated as cash flow hedges
|
(33
|
)
|
|
(27
|
)
|
|
(8
|
)
|
|
(6
|
)
|
|
(24
|
)
|
|
(15
|
)
|
||||||
Changes in cash flow hedges reclassified to earnings
|
(5
|
)
|
|
(4
|
)
|
|
16
|
|
|
13
|
|
|
17
|
|
|
11
|
|
||||||
Cash flow hedges, net of reclassification adjustments
|
(38
|
)
|
|
(31
|
)
|
|
8
|
|
|
7
|
|
|
(7
|
)
|
|
(4
|
)
|
||||||
Other comprehensive income (loss) attributable to Eaton ordinary shareholders
|
$
|
(187
|
)
|
|
$
|
(145
|
)
|
|
$
|
(783
|
)
|
|
$
|
(741
|
)
|
|
$
|
1,128
|
|
|
$
|
1,044
|
|
|
Currency translation and related hedging instruments
|
|
Pensions and other postretirement benefits
|
|
Cash flow
hedges
|
|
Total
|
||||||||
Balance at January 1, 2019
|
$
|
(2,864
|
)
|
|
$
|
(1,278
|
)
|
|
$
|
(3
|
)
|
|
$
|
(4,145
|
)
|
Other comprehensive income (loss) before
reclassifications
|
16
|
|
|
(247
|
)
|
|
(27
|
)
|
|
(258
|
)
|
||||
Amounts reclassified from Accumulated other
comprehensive loss (income)
|
—
|
|
|
117
|
|
|
(4
|
)
|
|
113
|
|
||||
Net current-period Other comprehensive
income (loss)
|
16
|
|
|
(130
|
)
|
|
(31
|
)
|
|
(145
|
)
|
||||
Balance at December 31, 2019
|
$
|
(2,848
|
)
|
|
$
|
(1,408
|
)
|
|
$
|
(34
|
)
|
|
$
|
(4,290
|
)
|
|
|
December 31, 2019
|
|
Consolidated Statements of
Income classification
|
||
Amortization of defined benefits pension and other
postretirement benefits items
|
|
|
|
|
||
Actuarial loss and prior service cost
|
|
$
|
(148
|
)
|
|
1
|
Tax benefit
|
|
31
|
|
|
|
|
Total, net of tax
|
|
(117
|
)
|
|
|
|
|
|
|
|
|
||
Gains and (losses) on cash flow hedges
|
|
|
|
|
||
Currency exchange contracts
|
|
5
|
|
|
Net sales and Cost of products sold
|
|
Tax expense
|
|
(1
|
)
|
|
|
|
Total, net of tax
|
|
4
|
|
|
|
|
|
|
|
|
|
||
Total reclassifications for the period
|
|
$
|
(113
|
)
|
|
|
(Shares in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Net income attributable to Eaton ordinary shareholders
|
$
|
2,211
|
|
|
$
|
2,145
|
|
|
$
|
2,985
|
|
|
|
|
|
|
|
||||||
Weighted-average number of ordinary shares outstanding - diluted
|
420.8
|
|
|
436.9
|
|
|
447
|
|
|||
Less dilutive effect of equity-based compensation
|
1.8
|
|
|
2.6
|
|
|
2.5
|
|
|||
Weighted-average number of ordinary shares outstanding - basic
|
419.0
|
|
|
434.3
|
|
|
444.5
|
|
|||
|
|
|
|
|
|
||||||
Net income per share attributable to Eaton ordinary shareholders
|
|
|
|
|
|
||||||
Diluted
|
$
|
5.25
|
|
|
$
|
4.91
|
|
|
$
|
6.68
|
|
Basic
|
5.28
|
|
|
4.93
|
|
|
6.71
|
|
Note 11.
|
EQUITY-BASED COMPENSATION
|
(Restricted stock units and awards in millions)
|
Number of restricted
stock units and awards
|
|
Weighted-average fair
value per unit and award
|
|||
Non-vested at January 1
|
2.1
|
|
|
$
|
68.56
|
|
Granted
|
0.9
|
|
|
80.59
|
|
|
Vested
|
(1.2
|
)
|
|
65.45
|
|
|
Forfeited
|
(0.1
|
)
|
|
76.24
|
|
|
Non-vested at December 31
|
1.7
|
|
|
$
|
76.79
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Pre-tax expense for RSUs and RSAs
|
$
|
57
|
|
|
$
|
59
|
|
|
$
|
66
|
|
After-tax expense for RSUs and RSAs
|
45
|
|
|
46
|
|
|
43
|
|
|||
Fair value of vested RSUs and RSAs
|
103
|
|
|
71
|
|
|
73
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Expected volatility
|
|
21
|
%
|
|
22
|
%
|
|
24
|
%
|
|||
Risk-free interest rate
|
|
2.42
|
%
|
|
2.38
|
%
|
|
1.46
|
%
|
|||
Weighted-average fair value of PSUs granted
|
|
$
|
92.50
|
|
|
$
|
100.86
|
|
|
$
|
80.07
|
|
(Performance share units in millions)
|
|
2019
|
|
2018
|
||
Percent payout
|
|
130
|
%
|
|
116
|
%
|
Shares vested
|
|
0.3
|
|
|
0.5
|
|
(Performance share units in millions)
|
|
Number of performance
share units |
|
Weighted-average fair
value per unit |
|||
Non-vested at January 1
|
|
0.6
|
|
|
$
|
89.95
|
|
Granted1
|
|
0.3
|
|
|
92.50
|
|
|
Adjusted for performance results achieved2
|
|
0.1
|
|
|
80.07
|
|
|
Vested
|
|
(0.3
|
)
|
|
80.07
|
|
|
Forfeited
|
|
(0.1
|
)
|
|
90.91
|
|
|
Non-vested at December 31
|
|
0.6
|
|
|
$
|
96.14
|
|
(Performance share units in millions)
|
|
Number of performance
share units |
|
Weighted-average fair
value per unit |
|||
Non-vested at January 1
|
|
0.1
|
|
|
$
|
56.55
|
|
Granted
|
|
—
|
|
|
—
|
|
|
Vested
|
|
(0.1
|
)
|
|
56.55
|
|
|
Forfeited
|
|
—
|
|
|
—
|
|
|
Non-vested at December 31
|
|
—
|
|
|
$
|
—
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Pre-tax expense for PSUs
|
|
$
|
21
|
|
|
$
|
28
|
|
|
$
|
22
|
|
After-tax expense for PSUs
|
|
17
|
|
|
22
|
|
|
13
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Expected volatility
|
23
|
%
|
|
26
|
%
|
|
27
|
%
|
|||
Expected option life in years
|
6.6
|
|
|
6.7
|
|
|
6.6
|
|
|||
Expected dividend yield
|
3.2
|
%
|
|
3.0
|
%
|
|
2.8
|
%
|
|||
Risk-free interest rate
|
1.9 to 2.6%
|
|
|
2.6 to 2.9%
|
|
|
1.8 to 2.1%
|
|
|||
Weighted-average fair value of stock options granted
|
$
|
14.08
|
|
|
$
|
16.93
|
|
|
$
|
15.11
|
|
(Options in millions)
|
Weighted-average
exercise price per option
|
|
Options
|
|
Weighted-average
remaining
contractual life
in years
|
|
Aggregate
intrinsic
value
|
|||||
Outstanding at January 1, 2019
|
$
|
65.96
|
|
|
4.6
|
|
|
|
|
|
||
Granted
|
80.47
|
|
|
0.8
|
|
|
|
|
|
|||
Exercised
|
60.47
|
|
|
(1.2
|
)
|
|
|
|
|
|||
Forfeited and canceled
|
74.08
|
|
|
(0.1
|
)
|
|
|
|
|
|||
Outstanding at December 31, 2019
|
$
|
69.95
|
|
|
4.1
|
|
|
6.2
|
|
$
|
102.5
|
|
|
|
|
|
|
|
|
|
|||||
Exercisable at December 31, 2019
|
$
|
65.59
|
|
|
2.8
|
|
|
5.2
|
|
$
|
82.6
|
|
Reserved for future grants at December 31, 2019
|
|
|
9.3
|
|
|
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Pre-tax expense for stock options
|
$
|
9
|
|
|
$
|
11
|
|
|
$
|
11
|
|
After-tax expense for stock options
|
7
|
|
|
9
|
|
|
8
|
|
|||
Proceeds from stock options exercised
|
67
|
|
|
29
|
|
|
66
|
|
|||
Income tax benefit related to stock options exercised
|
|
|
|
|
|
||||||
Tax benefit classified in operating activities in the Consolidated
Statements of Cash Flows
|
4
|
|
|
3
|
|
|
13
|
|
|||
Intrinsic value of stock options exercised
|
29
|
|
|
17
|
|
|
41
|
|
|||
Total fair value of stock options vested
|
$
|
9
|
|
|
$
|
11
|
|
|
$
|
11
|
|
|
|
|
|
|
|
||||||
Stock options exercised, in millions of options
|
1.2
|
|
|
0.6
|
|
|
1.5
|
|
Note 12.
|
FAIR VALUE MEASUREMENTS
|
|
Total
|
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Other
observable
inputs
(Level 2)
|
|
Unobservable
inputs
(Level 3)
|
||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Cash
|
$
|
370
|
|
|
$
|
370
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term investments
|
221
|
|
|
221
|
|
|
—
|
|
|
—
|
|
||||
Net derivative contracts
|
53
|
|
|
—
|
|
|
53
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Cash
|
$
|
283
|
|
|
$
|
283
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term investments
|
157
|
|
|
157
|
|
|
—
|
|
|
—
|
|
||||
Net derivative contracts
|
14
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
2019
|
|
2018
|
||||
Time deposits and certificates of deposit with banks
|
$
|
150
|
|
|
$
|
111
|
|
Money market investments
|
71
|
|
|
46
|
|
||
Total short-term investments
|
$
|
221
|
|
|
$
|
157
|
|
Note 13.
|
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
|
•
|
Hedges of the change in the fair value of a recognized fixed-rate asset or liability, or the firm commitment to acquire such an asset or liability (a fair value hedge); for these hedges, the gain or loss from the derivative financial instrument, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized in income during the period of change in fair value.
|
•
|
Hedges of the variable cash flows of a recognized variable-rate asset or liability, or the forecasted acquisition of such an asset or liability (a cash flow hedge); for these hedges, the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive income and reclassified to income in the same period when the gain or loss on the hedged item is included in income.
|
•
|
Hedges of the currency exposure related to a net investment in a foreign operation (a net investment hedge); for these hedges, the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive income and reclassified to income in the same period when the gain or loss related to the net investment in the foreign operation is included in income.
|
Notional amount
|
|
Fixed interest
rate received
|
|
Floating interest
rate paid
|
|
Basis for contracted floating interest rate paid
|
|
150
|
|
|
3.88%
|
|
4.35%
|
|
1 month LIBOR + 2.12%
|
275
|
|
|
3.47%
|
|
3.97%
|
|
1 month LIBOR + 1.74%
|
100
|
|
|
8.10%
|
|
8.13%
|
|
1 month LIBOR + 5.90%
|
1,400
|
|
|
2.75%
|
|
2.85%
|
|
1 month LIBOR + 0.58%
|
200
|
|
|
3.68%
|
|
3.30%
|
|
1 month LIBOR + 1.07%
|
25
|
|
|
7.63%
|
|
4.87%
|
|
6 month LIBOR + 2.48%
|
50
|
|
|
7.65%
|
|
5.21%
|
|
6 month LIBOR + 2.57%
|
25
|
|
|
5.45%
|
|
2.79%
|
|
6 month LIBOR + 0.28%
|
Notional amount
|
|
Floating interest
rate to be received |
|
Fixed interest
rate to be paid |
|
Basis for contracted floating interest rate received
|
||
$
|
50
|
|
|
—%
|
|
3.10%
|
|
3 month LIBOR + 0.00%
|
50
|
|
|
—%
|
|
3.06%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
2.80%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
2.81%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
2.64%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
2.64%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
2.30%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
2.08%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
1.77%
|
|
3 month LIBOR + 0.00%
|
|
50
|
|
|
—%
|
|
1.51%
|
|
3 month LIBOR + 0.00%
|
|
Notional
amount
|
|
Other
current
assets
|
|
Other
noncurrent
assets
|
|
Other
current
liabilities
|
|
Other
noncurrent
liabilities
|
|
Type of
hedge
|
|
Term
|
||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives designated as hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-to-floating interest rate swaps
|
$
|
2,225
|
|
|
$
|
—
|
|
|
$
|
57
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Fair value
|
|
12 months to
15 years |
Forward starting floating-to-fixed interest rate swaps
|
500
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
42
|
|
|
Cash flow
|
|
13 to 33 years
|
|||||
Currency exchange contracts
|
1,146
|
|
|
14
|
|
|
3
|
|
|
11
|
|
|
6
|
|
|
Cash flow
|
|
1 to 36 months
|
|||||
Commodity contracts
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Cash flow
|
|
1 to 9 months
|
|||||
Total
|
|
|
$
|
14
|
|
|
$
|
63
|
|
|
$
|
11
|
|
|
$
|
48
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives not designated as hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Currency exchange contracts
|
$
|
4,975
|
|
|
$
|
48
|
|
|
|
|
$
|
13
|
|
|
|
|
|
|
1 to 12 months
|
||||
Commodity contracts
|
3
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
|
|
1 month
|
|||||||
Total
|
|
|
$
|
48
|
|
|
|
|
$
|
13
|
|
|
|
|
|
|
|
December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives designated as hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-to-floating interest rate swaps
|
$
|
2,550
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
$
|
1
|
|
|
$
|
26
|
|
|
Fair value
|
|
3 months to
16 years |
Forward starting floating-to-fixed interest rate swaps
|
100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
Cash flow
|
|
34 years
|
|||||
Currency exchange contracts
|
951
|
|
|
19
|
|
|
2
|
|
|
11
|
|
|
8
|
|
|
Cash flow
|
|
1 to 36 months
|
|||||
Total
|
|
|
$
|
19
|
|
|
$
|
24
|
|
|
$
|
12
|
|
|
$
|
37
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives not designated as hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Currency exchange contracts
|
$
|
3,886
|
|
|
$
|
40
|
|
|
|
|
$
|
20
|
|
|
|
|
|
|
1 to 12 months
|
||||
Total
|
|
|
$
|
40
|
|
|
|
|
|
$
|
20
|
|
|
|
|
|
|
|
Commodity
|
|
December 31, 2019
|
|
|
|
Term
|
|
Copper
|
|
2
|
|
|
millions of pounds
|
|
1 to 4 months
|
Gold
|
|
2,158
|
|
|
Troy ounces
|
|
1 to 9 months
|
|
Carrying amount of the hedged assets (liabilities)
|
|
Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged asset (liabilities) (a)
|
||||
Location on Consolidated Balance Sheets
|
December 31, 2019
|
|
December 31, 2019
|
||||
Long-term debt
|
$
|
(2,838
|
)
|
|
$
|
(97
|
)
|
|
2019
|
||||||||||
|
Net Sales
|
|
Cost of products sold
|
|
Interest expense - net
|
||||||
Amounts from Consolidated Statements of Income
|
$
|
21,390
|
|
|
$
|
14,338
|
|
|
$
|
236
|
|
|
|
|
|
|
|
||||||
Gain (loss) on derivatives designated as cash flow hedges
|
|
|
|
|
|
||||||
Currency exchange contracts
|
|
|
|
|
|
||||||
Hedged item
|
$
|
7
|
|
|
$
|
(12
|
)
|
|
$
|
—
|
|
Derivative designated as hedging instrument
|
(7
|
)
|
|
12
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Commodity contracts
|
|
|
|
|
|
||||||
Hedged item
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivative designated as hedging instrument
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Gain (loss) on derivatives designated as fair value hedges
|
|
|
|
|
|
||||||
Fixed-to-floating interest rate swaps
|
|
|
|
|
|
||||||
Hedged item
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(62
|
)
|
Derivative designated as hedging instrument
|
—
|
|
|
—
|
|
|
62
|
|
|
Gain (loss) recognized in Consolidated Statements of Income
|
|
Consolidated Statements of Income classification
|
||
|
2019
|
|
|
||
Gain (loss) on derivatives not designated as hedges
|
|
|
|
||
Currency exchange contracts
|
$
|
73
|
|
|
Other income - net
|
Commodity Contracts
|
—
|
|
|
Cost of products sold
|
|
Total
|
$
|
73
|
|
|
|
|
Gain (loss) recognized in
other comprehensive
(loss) income
|
|
Location of gain (loss)
reclassified from
Accumulated other
comprehensive loss
|
|
Gain (loss) reclassified
from Accumulated other
comprehensive loss
|
||||||||||||
|
2019
|
|
2018
|
|
|
|
2019
|
|
2018
|
||||||||
Derivatives designated as cash flow hedges
|
|
|
|
|
|
|
|
|
|
||||||||
Forward starting floating-to-fixed interest rate swaps
|
$
|
(36
|
)
|
|
$
|
(4
|
)
|
|
Interest expense - net
|
|
$
|
—
|
|
|
$
|
—
|
|
Currency exchange contracts
|
3
|
|
|
(4
|
)
|
|
Net sales and Cost of products sold
|
|
5
|
|
|
(16
|
)
|
||||
Commodity contracts
|
—
|
|
|
—
|
|
|
Cost of products sold
|
|
—
|
|
|
—
|
|
||||
Non-derivative designated as net
investment hedges |
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency denominated debt
|
15
|
|
|
47
|
|
|
Other income - net
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
(18
|
)
|
|
$
|
39
|
|
|
|
|
$
|
5
|
|
|
$
|
(16
|
)
|
Note 14.
|
ACCOUNTS RECEIVABLE AND INVENTORY
|
|
2019
|
|
2018
|
||||
Raw materials
|
$
|
986
|
|
|
$
|
1,077
|
|
Work-in-process
|
640
|
|
|
500
|
|
||
Finished goods
|
1,179
|
|
|
1,208
|
|
||
Total inventory
|
$
|
2,805
|
|
|
$
|
2,785
|
|
Note 15.
|
BUSINESS SEGMENT AND GEOGRAPHIC REGION INFORMATION
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net sales
|
|
|
|
|
|
||||||
Electrical Products
|
$
|
7,148
|
|
|
$
|
7,124
|
|
|
$
|
6,917
|
|
Electrical Systems and Services
|
6,287
|
|
|
6,024
|
|
|
5,666
|
|
|||
Hydraulics
|
2,552
|
|
|
2,756
|
|
|
2,468
|
|
|||
Aerospace
|
2,044
|
|
|
1,896
|
|
|
1,744
|
|
|||
Vehicle
|
3,038
|
|
|
3,489
|
|
|
3,326
|
|
|||
eMobility
|
321
|
|
|
320
|
|
|
283
|
|
|||
Total net sales
|
$
|
21,390
|
|
|
$
|
21,609
|
|
|
$
|
20,404
|
|
|
|
|
|
|
|
||||||
Segment operating profit
|
|
|
|
|
|
||||||
Electrical Products
|
$
|
1,390
|
|
|
$
|
1,311
|
|
|
$
|
1,233
|
|
Electrical Systems and Services
|
1,027
|
|
|
896
|
|
|
770
|
|
|||
Hydraulics
|
286
|
|
|
370
|
|
|
288
|
|
|||
Aerospace
|
495
|
|
|
398
|
|
|
332
|
|
|||
Vehicle
|
460
|
|
|
611
|
|
|
541
|
|
|||
eMobility
|
17
|
|
|
44
|
|
|
50
|
|
|||
Total segment operating profit
|
3,675
|
|
|
3,630
|
|
|
3,214
|
|
|||
|
|
|
|
|
|
||||||
Corporate
|
|
|
|
|
|
||||||
Amortization of intangible assets
|
(367
|
)
|
|
(382
|
)
|
|
(388
|
)
|
|||
Interest expense - net
|
(236
|
)
|
|
(271
|
)
|
|
(246
|
)
|
|||
Pension and other postretirement benefits expense
|
(12
|
)
|
|
(1
|
)
|
|
(45
|
)
|
|||
Gain on sale of business
|
—
|
|
|
—
|
|
|
1,077
|
|
|||
Arbitration decision expense
|
—
|
|
|
(275
|
)
|
|
—
|
|
|||
Other corporate expense - net
|
(469
|
)
|
|
(277
|
)
|
|
(244
|
)
|
|||
Income before income taxes
|
2,591
|
|
|
2,424
|
|
|
3,368
|
|
|||
Income tax expense
|
378
|
|
|
278
|
|
|
382
|
|
|||
Net income
|
2,213
|
|
|
2,146
|
|
|
2,986
|
|
|||
Less net income for noncontrolling interests
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||
Net income attributable to Eaton ordinary shareholders
|
$
|
2,211
|
|
|
$
|
2,145
|
|
|
$
|
2,985
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Identifiable assets
|
|
|
|
|
|
||||||
Electrical Products
|
$
|
2,201
|
|
|
$
|
2,451
|
|
|
$
|
2,446
|
|
Electrical Systems and Services
|
2,532
|
|
|
2,243
|
|
|
2,141
|
|
|||
Hydraulics
|
1,439
|
|
|
1,473
|
|
|
1,345
|
|
|||
Aerospace
|
1,362
|
|
|
935
|
|
|
938
|
|
|||
Vehicle
|
2,145
|
|
|
2,289
|
|
|
2,367
|
|
|||
eMobility
|
141
|
|
|
139
|
|
|
136
|
|
|||
Total identifiable assets
|
9,820
|
|
|
9,530
|
|
|
9,373
|
|
|||
Goodwill
|
13,456
|
|
|
13,328
|
|
|
13,568
|
|
|||
Other intangible assets
|
4,638
|
|
|
4,846
|
|
|
5,265
|
|
|||
Corporate
|
3,514
|
|
|
3,388
|
|
|
4,417
|
|
|||
Assets held for sale
|
1,377
|
|
|
—
|
|
|
—
|
|
|||
Total assets
|
$
|
32,805
|
|
|
$
|
31,092
|
|
|
$
|
32,623
|
|
|
|||||||||||
|
|
|
|
|
|
||||||
Capital expenditures for property, plant and equipment
|
|
|
|
|
|
||||||
Electrical Products
|
$
|
162
|
|
|
$
|
135
|
|
|
$
|
130
|
|
Electrical Systems and Services
|
108
|
|
|
101
|
|
|
83
|
|
|||
Hydraulics
|
90
|
|
|
106
|
|
|
96
|
|
|||
Aerospace
|
47
|
|
|
38
|
|
|
37
|
|
|||
Vehicle
|
127
|
|
|
143
|
|
|
141
|
|
|||
eMobility
|
8
|
|
|
4
|
|
|
4
|
|
|||
Total
|
542
|
|
|
527
|
|
|
491
|
|
|||
Corporate
|
45
|
|
|
38
|
|
|
29
|
|
|||
Total expenditures for property, plant and equipment
|
$
|
587
|
|
|
$
|
565
|
|
|
$
|
520
|
|
|
|
|
|
|
|
||||||
Depreciation of property, plant and equipment
|
|
|
|
|
|
||||||
Electrical Products
|
$
|
126
|
|
|
$
|
136
|
|
|
$
|
138
|
|
Electrical Systems and Services
|
87
|
|
|
85
|
|
|
83
|
|
|||
Hydraulics
|
66
|
|
|
64
|
|
|
61
|
|
|||
Aerospace
|
27
|
|
|
26
|
|
|
26
|
|
|||
Vehicle
|
102
|
|
|
104
|
|
|
109
|
|
|||
eMobility
|
5
|
|
|
5
|
|
|
5
|
|
|||
Total
|
413
|
|
|
420
|
|
|
422
|
|
|||
Corporate
|
52
|
|
|
53
|
|
|
54
|
|
|||
Total depreciation of property, plant and equipment
|
$
|
465
|
|
|
$
|
473
|
|
|
$
|
476
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net sales
|
|
|
|
|
|
||||||
United States
|
$
|
12,336
|
|
|
$
|
12,034
|
|
|
$
|
11,222
|
|
Canada
|
941
|
|
|
931
|
|
|
942
|
|
|||
Latin America
|
1,312
|
|
|
1,442
|
|
|
1,485
|
|
|||
Europe
|
4,311
|
|
|
4,553
|
|
|
4,394
|
|
|||
Asia Pacific
|
2,490
|
|
|
2,649
|
|
|
2,361
|
|
|||
Total
|
$
|
21,390
|
|
|
$
|
21,609
|
|
|
$
|
20,404
|
|
|
|
|
|
|
|
||||||
Long-lived assets
|
|
|
|
|
|
||||||
United States
|
$
|
1,821
|
|
|
$
|
1,898
|
|
|
$
|
1,872
|
|
Canada
|
24
|
|
|
20
|
|
|
20
|
|
|||
Latin America
|
316
|
|
|
286
|
|
|
290
|
|
|||
Europe
|
797
|
|
|
723
|
|
|
769
|
|
|||
Asia Pacific
|
538
|
|
|
540
|
|
|
551
|
|
|||
Total
|
$
|
3,496
|
|
|
$
|
3,467
|
|
|
$
|
3,502
|
|
Note 16.
|
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS
|
CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
YEAR ENDED DECEMBER 31, 2019
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Net sales
|
$
|
—
|
|
|
$
|
7,322
|
|
|
$
|
6,995
|
|
|
$
|
12,101
|
|
|
$
|
(5,028
|
)
|
|
$
|
21,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of products sold
|
—
|
|
|
5,646
|
|
|
5,073
|
|
|
8,651
|
|
|
(5,032
|
)
|
|
14,338
|
|
||||||
Selling and administrative expense
|
11
|
|
|
1,480
|
|
|
780
|
|
|
1,312
|
|
|
—
|
|
|
3,583
|
|
||||||
Research and development expense
|
—
|
|
|
141
|
|
|
140
|
|
|
325
|
|
|
—
|
|
|
606
|
|
||||||
Interest expense (income) - net
|
—
|
|
|
248
|
|
|
19
|
|
|
(29
|
)
|
|
(2
|
)
|
|
236
|
|
||||||
Other expense (income) - net
|
(12
|
)
|
|
16
|
|
|
(8
|
)
|
|
40
|
|
|
—
|
|
|
36
|
|
||||||
Equity in loss (earnings) of
subsidiaries, net of tax
|
(2,423
|
)
|
|
(593
|
)
|
|
(2,492
|
)
|
|
(2,563
|
)
|
|
8,071
|
|
|
—
|
|
||||||
Intercompany expense (income) - net
|
213
|
|
|
1
|
|
|
520
|
|
|
(734
|
)
|
|
—
|
|
|
—
|
|
||||||
Income (loss) before income taxes
|
2,211
|
|
|
383
|
|
|
2,963
|
|
|
5,099
|
|
|
(8,065
|
)
|
|
2,591
|
|
||||||
Income tax expense (benefit)
|
—
|
|
|
3
|
|
|
135
|
|
|
239
|
|
|
1
|
|
|
378
|
|
||||||
Net income (loss)
|
2,211
|
|
|
380
|
|
|
2,828
|
|
|
4,860
|
|
|
(8,066
|
)
|
|
2,213
|
|
||||||
Less net loss (income) for
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||
Net income (loss) attributable to
Eaton ordinary shareholders
|
$
|
2,211
|
|
|
$
|
380
|
|
|
$
|
2,828
|
|
|
$
|
4,858
|
|
|
$
|
(8,066
|
)
|
|
$
|
2,211
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss)
|
(145
|
)
|
|
(6
|
)
|
|
(109
|
)
|
|
(312
|
)
|
|
427
|
|
|
(145
|
)
|
||||||
Total comprehensive income (loss) attributable to Eaton
ordinary shareholders
|
$
|
2,066
|
|
|
$
|
374
|
|
|
$
|
2,719
|
|
|
$
|
4,546
|
|
|
$
|
(7,639
|
)
|
|
$
|
2,066
|
|
CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
YEAR ENDED DECEMBER 31, 2018
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Net sales
|
$
|
—
|
|
|
$
|
7,395
|
|
|
$
|
6,875
|
|
|
$
|
12,649
|
|
|
$
|
(5,310
|
)
|
|
$
|
21,609
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of products sold
|
—
|
|
|
5,805
|
|
|
5,012
|
|
|
9,011
|
|
|
(5,317
|
)
|
|
14,511
|
|
||||||
Selling and administrative expense
|
10
|
|
|
1,451
|
|
|
756
|
|
|
1,331
|
|
|
—
|
|
|
3,548
|
|
||||||
Research and development expense
|
—
|
|
|
151
|
|
|
146
|
|
|
287
|
|
|
—
|
|
|
584
|
|
||||||
Interest expense (income) - net
|
—
|
|
|
273
|
|
|
15
|
|
|
(18
|
)
|
|
1
|
|
|
271
|
|
||||||
Arbitration decision expense
|
—
|
|
|
—
|
|
|
275
|
|
|
—
|
|
|
—
|
|
|
275
|
|
||||||
Other expense (income) - net
|
(29
|
)
|
|
55
|
|
|
22
|
|
|
(52
|
)
|
|
—
|
|
|
(4
|
)
|
||||||
Equity in loss (earnings) of
subsidiaries, net of tax
|
(2,302
|
)
|
|
(716
|
)
|
|
(2,867
|
)
|
|
(2,338
|
)
|
|
8,223
|
|
|
—
|
|
||||||
Intercompany expense (income) - net
|
176
|
|
|
133
|
|
|
1,022
|
|
|
(1,331
|
)
|
|
—
|
|
|
—
|
|
||||||
Income (loss) before income taxes
|
2,145
|
|
|
243
|
|
|
2,494
|
|
|
5,759
|
|
|
(8,217
|
)
|
|
2,424
|
|
||||||
Income tax expense (benefit)
|
—
|
|
|
1
|
|
|
28
|
|
|
248
|
|
|
1
|
|
|
278
|
|
||||||
Net income (loss)
|
2,145
|
|
|
242
|
|
|
2,466
|
|
|
5,511
|
|
|
(8,218
|
)
|
|
2,146
|
|
||||||
Less net loss (income) for
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||||
Net income (loss) attributable to
Eaton ordinary shareholders
|
$
|
2,145
|
|
|
$
|
242
|
|
|
$
|
2,466
|
|
|
$
|
5,510
|
|
|
$
|
(8,218
|
)
|
|
$
|
2,145
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss)
|
(741
|
)
|
|
(162
|
)
|
|
(765
|
)
|
|
(1,565
|
)
|
|
2,492
|
|
|
(741
|
)
|
||||||
Total comprehensive income (loss) attributable to Eaton
ordinary shareholders
|
$
|
1,404
|
|
|
$
|
80
|
|
|
$
|
1,701
|
|
|
$
|
3,945
|
|
|
$
|
(5,726
|
)
|
|
$
|
1,404
|
|
CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
YEAR ENDED DECEMBER 31, 2017
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Net sales
|
$
|
—
|
|
|
$
|
6,900
|
|
|
$
|
6,563
|
|
|
$
|
12,358
|
|
|
$
|
(5,417
|
)
|
|
$
|
20,404
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of products sold
|
—
|
|
|
5,434
|
|
|
4,840
|
|
|
8,895
|
|
|
(5,413
|
)
|
|
13,756
|
|
||||||
Selling and administrative expense
|
11
|
|
|
1,387
|
|
|
768
|
|
|
1,360
|
|
|
—
|
|
|
3,526
|
|
||||||
Research and development expense
|
—
|
|
|
183
|
|
|
176
|
|
|
225
|
|
|
—
|
|
|
584
|
|
||||||
Interest expense (income) - net
|
—
|
|
|
244
|
|
|
20
|
|
|
(20
|
)
|
|
2
|
|
|
246
|
|
||||||
Gain on sale of business
|
—
|
|
|
561
|
|
|
—
|
|
|
516
|
|
|
—
|
|
|
1,077
|
|
||||||
Other expense (income) - net
|
79
|
|
|
48
|
|
|
(76
|
)
|
|
(50
|
)
|
|
—
|
|
|
1
|
|
||||||
Equity in loss (earnings) of
subsidiaries, net of tax
|
(3,644
|
)
|
|
(1,644
|
)
|
|
(5,063
|
)
|
|
(3,832
|
)
|
|
14,183
|
|
|
—
|
|
||||||
Intercompany expense (income) - net
|
569
|
|
|
(309
|
)
|
|
794
|
|
|
(1,054
|
)
|
|
—
|
|
|
—
|
|
||||||
Income (loss) before income taxes
|
2,985
|
|
|
2,118
|
|
|
5,104
|
|
|
7,350
|
|
|
(14,189
|
)
|
|
3,368
|
|
||||||
Income tax expense (benefit)
|
—
|
|
|
337
|
|
|
(52
|
)
|
|
99
|
|
|
(2
|
)
|
|
382
|
|
||||||
Net income (loss)
|
2,985
|
|
|
1,781
|
|
|
5,156
|
|
|
7,251
|
|
|
(14,187
|
)
|
|
2,986
|
|
||||||
Less net loss (income) for
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
2
|
|
|
(1
|
)
|
||||||
Net income (loss) attributable to
Eaton ordinary shareholders
|
$
|
2,985
|
|
|
$
|
1,781
|
|
|
$
|
5,156
|
|
|
$
|
7,248
|
|
|
$
|
(14,185
|
)
|
|
$
|
2,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss)
|
1,044
|
|
|
104
|
|
|
1,021
|
|
|
2,252
|
|
|
(3,377
|
)
|
|
1,044
|
|
||||||
Total comprehensive income (loss) attributable to Eaton
ordinary shareholders
|
$
|
4,029
|
|
|
$
|
1,885
|
|
|
$
|
6,177
|
|
|
$
|
9,500
|
|
|
$
|
(17,562
|
)
|
|
$
|
4,029
|
|
CONDENSED CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 2019
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
—
|
|
|
$
|
343
|
|
|
$
|
—
|
|
|
$
|
370
|
|
Short-term investments
|
—
|
|
|
—
|
|
|
—
|
|
|
221
|
|
|
—
|
|
|
221
|
|
||||||
Accounts receivable - net
|
—
|
|
|
460
|
|
|
982
|
|
|
1,995
|
|
|
—
|
|
|
3,437
|
|
||||||
Intercompany accounts receivable
|
9
|
|
|
937
|
|
|
1,848
|
|
|
1,683
|
|
|
(4,477
|
)
|
|
—
|
|
||||||
Inventory
|
—
|
|
|
596
|
|
|
672
|
|
|
1,609
|
|
|
(72
|
)
|
|
2,805
|
|
||||||
Assets held for sale
|
—
|
|
|
—
|
|
|
1,211
|
|
|
166
|
|
|
—
|
|
|
1,377
|
|
||||||
Prepaid expenses and other
current assets
|
—
|
|
|
106
|
|
|
28
|
|
|
371
|
|
|
13
|
|
|
518
|
|
||||||
Total current assets
|
9
|
|
|
2,126
|
|
|
4,741
|
|
|
6,388
|
|
|
(4,536
|
)
|
|
8,728
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property, plant and equipment - net
|
—
|
|
|
854
|
|
|
563
|
|
|
2,079
|
|
|
—
|
|
|
3,496
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other noncurrent assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
—
|
|
|
1,742
|
|
|
5,839
|
|
|
5,875
|
|
|
—
|
|
|
13,456
|
|
||||||
Other intangible assets
|
—
|
|
|
302
|
|
|
2,406
|
|
|
1,930
|
|
|
—
|
|
|
4,638
|
|
||||||
Operating lease assets
|
—
|
|
|
173
|
|
|
31
|
|
|
232
|
|
|
—
|
|
|
436
|
|
||||||
Deferred income taxes
|
—
|
|
|
250
|
|
|
74
|
|
|
279
|
|
|
(231
|
)
|
|
372
|
|
||||||
Investment in subsidiaries
|
17,195
|
|
|
10,610
|
|
|
58,610
|
|
|
23,019
|
|
|
(109,434
|
)
|
|
—
|
|
||||||
Intercompany loans receivable
|
—
|
|
|
2,643
|
|
|
2,983
|
|
|
38,671
|
|
|
(44,297
|
)
|
|
—
|
|
||||||
Other assets
|
—
|
|
|
817
|
|
|
129
|
|
|
733
|
|
|
—
|
|
|
1,679
|
|
||||||
Total assets
|
$
|
17,204
|
|
|
$
|
19,517
|
|
|
$
|
75,376
|
|
|
$
|
79,206
|
|
|
$
|
(158,498
|
)
|
|
$
|
32,805
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and shareholders’
equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-term debt
|
$
|
—
|
|
|
$
|
255
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
255
|
|
Current portion of long-term debt
|
—
|
|
|
4
|
|
|
242
|
|
|
2
|
|
|
—
|
|
|
248
|
|
||||||
Accounts payable
|
—
|
|
|
529
|
|
|
340
|
|
|
1,245
|
|
|
—
|
|
|
2,114
|
|
||||||
Intercompany accounts payable
|
25
|
|
|
953
|
|
|
2,275
|
|
|
1,224
|
|
|
(4,477
|
)
|
|
—
|
|
||||||
Accrued compensation
|
—
|
|
|
113
|
|
|
58
|
|
|
278
|
|
|
—
|
|
|
449
|
|
||||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
232
|
|
|
93
|
|
|
—
|
|
|
325
|
|
||||||
Other current liabilities
|
1
|
|
|
531
|
|
|
400
|
|
|
809
|
|
|
—
|
|
|
1,741
|
|
||||||
Total current liabilities
|
26
|
|
|
2,385
|
|
|
3,547
|
|
|
3,651
|
|
|
(4,477
|
)
|
|
5,132
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Noncurrent liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term debt
|
—
|
|
|
5,886
|
|
|
1,921
|
|
|
12
|
|
|
—
|
|
|
7,819
|
|
||||||
Pension liabilities
|
—
|
|
|
420
|
|
|
122
|
|
|
920
|
|
|
—
|
|
|
1,462
|
|
||||||
Other postretirement benefits
liabilities
|
—
|
|
|
172
|
|
|
80
|
|
|
76
|
|
|
—
|
|
|
328
|
|
||||||
Operating lease liabilities
|
—
|
|
|
128
|
|
|
21
|
|
|
182
|
|
|
—
|
|
|
331
|
|
||||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
432
|
|
|
195
|
|
|
(231
|
)
|
|
396
|
|
||||||
Intercompany loans payable
|
1,096
|
|
|
5,120
|
|
|
36,000
|
|
|
2,081
|
|
|
(44,297
|
)
|
|
—
|
|
||||||
Other noncurrent liabilities
|
—
|
|
|
570
|
|
|
272
|
|
|
362
|
|
|
—
|
|
|
1,204
|
|
||||||
Total noncurrent liabilities
|
1,096
|
|
|
12,296
|
|
|
38,848
|
|
|
3,828
|
|
|
(44,528
|
)
|
|
11,540
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Eaton shareholders’ equity
|
16,082
|
|
|
4,836
|
|
|
32,981
|
|
|
71,676
|
|
|
(109,493
|
)
|
|
16,082
|
|
||||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|
—
|
|
|
51
|
|
||||||
Total equity
|
16,082
|
|
|
4,836
|
|
|
32,981
|
|
|
71,727
|
|
|
(109,493
|
)
|
|
16,133
|
|
||||||
Total liabilities and equity
|
$
|
17,204
|
|
|
$
|
19,517
|
|
|
$
|
75,376
|
|
|
$
|
79,206
|
|
|
$
|
(158,498
|
)
|
|
$
|
32,805
|
|
CONDENSED CONSOLIDATING BALANCE SHEETS
DECEMBER 31, 2018
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash
|
$
|
1
|
|
|
$
|
21
|
|
|
$
|
1
|
|
|
$
|
260
|
|
|
$
|
—
|
|
|
$
|
283
|
|
Short-term investments
|
—
|
|
|
—
|
|
|
—
|
|
|
157
|
|
|
—
|
|
|
157
|
|
||||||
Accounts receivable - net
|
—
|
|
|
501
|
|
|
1,381
|
|
|
1,976
|
|
|
—
|
|
|
3,858
|
|
||||||
Intercompany accounts receivable
|
—
|
|
|
2,457
|
|
|
1,877
|
|
|
2,159
|
|
|
(6,493
|
)
|
|
—
|
|
||||||
Inventory
|
—
|
|
|
592
|
|
|
714
|
|
|
1,555
|
|
|
(76
|
)
|
|
2,785
|
|
||||||
Prepaid expenses and other
current assets
|
—
|
|
|
109
|
|
|
29
|
|
|
355
|
|
|
14
|
|
|
507
|
|
||||||
Total current assets
|
1
|
|
|
3,680
|
|
|
4,002
|
|
|
6,462
|
|
|
(6,555
|
)
|
|
7,590
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property, plant and equipment - net
|
—
|
|
|
858
|
|
|
663
|
|
|
1,946
|
|
|
—
|
|
|
3,467
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other noncurrent assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
—
|
|
|
1,742
|
|
|
6,293
|
|
|
5,293
|
|
|
—
|
|
|
13,328
|
|
||||||
Other intangible assets
|
—
|
|
|
322
|
|
|
2,860
|
|
|
1,664
|
|
|
—
|
|
|
4,846
|
|
||||||
Deferred income taxes
|
—
|
|
|
252
|
|
|
134
|
|
|
287
|
|
|
(380
|
)
|
|
293
|
|
||||||
Investment in subsidiaries
|
16,476
|
|
|
13,101
|
|
|
68,196
|
|
|
32,625
|
|
|
(130,398
|
)
|
|
—
|
|
||||||
Intercompany loans receivable
|
1,508
|
|
|
2,208
|
|
|
8,406
|
|
|
39,757
|
|
|
(51,879
|
)
|
|
—
|
|
||||||
Other assets
|
—
|
|
|
758
|
|
|
115
|
|
|
695
|
|
|
—
|
|
|
1,568
|
|
||||||
Total assets
|
$
|
17,985
|
|
|
$
|
22,921
|
|
|
$
|
90,669
|
|
|
$
|
88,729
|
|
|
$
|
(189,212
|
)
|
|
$
|
31,092
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and shareholders’
equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-term debt
|
$
|
—
|
|
|
$
|
388
|
|
|
$
|
—
|
|
|
$
|
26
|
|
|
$
|
—
|
|
|
$
|
414
|
|
Current portion of long-term debt
|
—
|
|
|
338
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
339
|
|
||||||
Accounts payable
|
—
|
|
|
515
|
|
|
397
|
|
|
1,218
|
|
|
—
|
|
|
2,130
|
|
||||||
Intercompany accounts payable
|
32
|
|
|
1,718
|
|
|
2,864
|
|
|
1,879
|
|
|
(6,493
|
)
|
|
—
|
|
||||||
Accrued compensation
|
—
|
|
|
139
|
|
|
67
|
|
|
251
|
|
|
—
|
|
|
457
|
|
||||||
Other current liabilities
|
30
|
|
|
536
|
|
|
386
|
|
|
864
|
|
|
(2
|
)
|
|
1,814
|
|
||||||
Total current liabilities
|
62
|
|
|
3,634
|
|
|
3,714
|
|
|
4,239
|
|
|
(6,495
|
)
|
|
5,154
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Noncurrent liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term debt
|
—
|
|
|
5,814
|
|
|
945
|
|
|
7
|
|
|
2
|
|
|
6,768
|
|
||||||
Pension liabilities
|
—
|
|
|
391
|
|
|
122
|
|
|
791
|
|
|
—
|
|
|
1,304
|
|
||||||
Other postretirement benefits
liabilities
|
—
|
|
|
168
|
|
|
81
|
|
|
72
|
|
|
—
|
|
|
321
|
|
||||||
Deferred income taxes
|
—
|
|
|
1
|
|
|
553
|
|
|
175
|
|
|
(380
|
)
|
|
349
|
|
||||||
Intercompany loans payable
|
1,816
|
|
|
7,681
|
|
|
39,552
|
|
|
2,830
|
|
|
(51,879
|
)
|
|
—
|
|
||||||
Other noncurrent liabilities
|
—
|
|
|
391
|
|
|
290
|
|
|
373
|
|
|
—
|
|
|
1,054
|
|
||||||
Total noncurrent liabilities
|
1,816
|
|
|
14,446
|
|
|
41,543
|
|
|
4,248
|
|
|
(52,257
|
)
|
|
9,796
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Eaton shareholders’ equity
|
16,107
|
|
|
4,841
|
|
|
45,412
|
|
|
80,207
|
|
|
(130,460
|
)
|
|
16,107
|
|
||||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
||||||
Total equity
|
16,107
|
|
|
4,841
|
|
|
45,412
|
|
|
80,242
|
|
|
(130,460
|
)
|
|
16,142
|
|
||||||
Total liabilities and equity
|
$
|
17,985
|
|
|
$
|
22,921
|
|
|
$
|
90,669
|
|
|
$
|
88,729
|
|
|
$
|
(189,212
|
)
|
|
$
|
31,092
|
|
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
DECEMBER 31, 2019
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Net cash provided by (used in)
operating activities
|
$
|
(78
|
)
|
|
$
|
1,316
|
|
|
$
|
652
|
|
|
$
|
1,561
|
|
|
$
|
—
|
|
|
$
|
3,451
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures for property,
plant and equipment
|
—
|
|
|
(101
|
)
|
|
(114
|
)
|
|
(372
|
)
|
|
—
|
|
|
(587
|
)
|
||||||
Cash paid for acquisitions of
businesses, net of cash acquired
|
—
|
|
|
(152
|
)
|
|
(30
|
)
|
|
(998
|
)
|
|
—
|
|
|
(1,180
|
)
|
||||||
Payments for sale of a business
|
—
|
|
|
—
|
|
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
(36
|
)
|
||||||
Sales (purchases) of short-term investments - net
|
—
|
|
|
—
|
|
|
—
|
|
|
(70
|
)
|
|
—
|
|
|
(70
|
)
|
||||||
Loans to affiliates
|
—
|
|
|
(470
|
)
|
|
(811
|
)
|
|
(8,440
|
)
|
|
9,721
|
|
|
—
|
|
||||||
Repayments of loans from affiliates
|
—
|
|
|
841
|
|
|
—
|
|
|
6,830
|
|
|
(7,671
|
)
|
|
—
|
|
||||||
Proceeds from (payments for) settlement of currency exchange contracts not designated as hedges - net
|
—
|
|
|
3
|
|
|
—
|
|
|
51
|
|
|
—
|
|
|
54
|
|
||||||
Other - net
|
—
|
|
|
(32
|
)
|
|
29
|
|
|
(44
|
)
|
|
—
|
|
|
(47
|
)
|
||||||
Net cash provided by (used in)
investing activities
|
—
|
|
|
89
|
|
|
(926
|
)
|
|
(3,079
|
)
|
|
2,050
|
|
|
(1,866
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from borrowings
|
—
|
|
|
—
|
|
|
1,232
|
|
|
—
|
|
|
—
|
|
|
1,232
|
|
||||||
Payments on borrowings
|
—
|
|
|
(474
|
)
|
|
—
|
|
|
(33
|
)
|
|
—
|
|
|
(507
|
)
|
||||||
Proceeds from borrowings from
affiliates
|
2,426
|
|
|
5,341
|
|
|
673
|
|
|
1,281
|
|
|
(9,721
|
)
|
|
—
|
|
||||||
Payments on borrowings from
affiliates
|
(185
|
)
|
|
(6,286
|
)
|
|
(459
|
)
|
|
(741
|
)
|
|
7,671
|
|
|
—
|
|
||||||
Other intercompany financing
activities
|
—
|
|
|
51
|
|
|
(1,162
|
)
|
|
1,111
|
|
|
—
|
|
|
—
|
|
||||||
Cash dividends paid
|
(1,201
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,201
|
)
|
||||||
Exercise of employee stock options
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
||||||
Repurchase of shares
|
(1,029
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,029
|
)
|
||||||
Employee taxes paid from shares
withheld
|
—
|
|
|
(31
|
)
|
|
(5
|
)
|
|
(10
|
)
|
|
—
|
|
|
(46
|
)
|
||||||
Other - net
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(3
|
)
|
|
—
|
|
|
(9
|
)
|
||||||
Net cash provided by (used in)
financing activities
|
77
|
|
|
(1,399
|
)
|
|
273
|
|
|
1,605
|
|
|
(2,050
|
)
|
|
(1,494
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Effect of currency on cash
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
||||||
Total increase (decrease) in cash
|
(1
|
)
|
|
6
|
|
|
(1
|
)
|
|
83
|
|
|
—
|
|
|
87
|
|
||||||
Cash at the beginning of the period
|
1
|
|
|
21
|
|
|
1
|
|
|
260
|
|
|
—
|
|
|
283
|
|
||||||
Cash at the end of the period
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
—
|
|
|
$
|
343
|
|
|
$
|
—
|
|
|
$
|
370
|
|
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
DECEMBER 31, 2018
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Net cash provided by (used in)
operating activities
|
$
|
(26
|
)
|
|
$
|
(84
|
)
|
|
$
|
220
|
|
|
$
|
2,643
|
|
|
$
|
(95
|
)
|
|
$
|
2,658
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures for property,
plant and equipment
|
—
|
|
|
(98
|
)
|
|
(91
|
)
|
|
(376
|
)
|
|
—
|
|
|
(565
|
)
|
||||||
Sales (purchases) of short-term investments - net
|
—
|
|
|
—
|
|
|
—
|
|
|
355
|
|
|
—
|
|
|
355
|
|
||||||
Investments in affiliates
|
(4
|
)
|
|
(36
|
)
|
|
—
|
|
|
—
|
|
|
40
|
|
|
—
|
|
||||||
Loans to affiliates
|
—
|
|
|
(100
|
)
|
|
(84
|
)
|
|
(6,442
|
)
|
|
6,626
|
|
|
—
|
|
||||||
Repayments of loans from affiliates
|
—
|
|
|
647
|
|
|
1,044
|
|
|
4,455
|
|
|
(6,146
|
)
|
|
—
|
|
||||||
Proceeds from (payments for) settlement of currency exchange contracts not designated as hedges - net
|
—
|
|
|
11
|
|
|
—
|
|
|
(121
|
)
|
|
—
|
|
|
(110
|
)
|
||||||
Other - net
|
—
|
|
|
(78
|
)
|
|
23
|
|
|
(23
|
)
|
|
—
|
|
|
(78
|
)
|
||||||
Net cash provided by (used in)
investing activities
|
(4
|
)
|
|
346
|
|
|
892
|
|
|
(2,152
|
)
|
|
520
|
|
|
(398
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from borrowings
|
—
|
|
|
388
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
410
|
|
||||||
Payments on borrowings
|
—
|
|
|
(538
|
)
|
|
(35
|
)
|
|
(1
|
)
|
|
—
|
|
|
(574
|
)
|
||||||
Proceeds from borrowings from
affiliates
|
3,756
|
|
|
2,452
|
|
|
318
|
|
|
100
|
|
|
(6,626
|
)
|
|
—
|
|
||||||
Payments on borrowings from
affiliates
|
(1,334
|
)
|
|
(3,178
|
)
|
|
(710
|
)
|
|
(924
|
)
|
|
6,146
|
|
|
—
|
|
||||||
Capital contributions from affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
(40
|
)
|
|
—
|
|
||||||
Other intercompany financing
activities
|
—
|
|
|
463
|
|
|
(692
|
)
|
|
229
|
|
|
—
|
|
|
—
|
|
||||||
Cash dividends paid
|
(1,149
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,149
|
)
|
||||||
Cash dividends paid to affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|
95
|
|
|
—
|
|
||||||
Exercise of employee stock options
|
29
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
||||||
Repurchase of shares
|
(1,271
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,271
|
)
|
||||||
Employee taxes paid from shares
withheld
|
—
|
|
|
(16
|
)
|
|
(5
|
)
|
|
(3
|
)
|
|
—
|
|
|
(24
|
)
|
||||||
Other - net
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
||||||
Net cash provided by (used in)
financing activities
|
31
|
|
|
(430
|
)
|
|
(1,124
|
)
|
|
(633
|
)
|
|
(425
|
)
|
|
(2,581
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Effect of currency on cash
|
—
|
|
|
—
|
|
|
—
|
|
|
43
|
|
|
—
|
|
|
43
|
|
||||||
Total increase (decrease) in cash
|
1
|
|
|
(168
|
)
|
|
(12
|
)
|
|
(99
|
)
|
|
—
|
|
|
(278
|
)
|
||||||
Cash at the beginning of the period
|
—
|
|
|
189
|
|
|
13
|
|
|
359
|
|
|
—
|
|
|
561
|
|
||||||
Cash at the end of the period
|
$
|
1
|
|
|
$
|
21
|
|
|
$
|
1
|
|
|
$
|
260
|
|
|
$
|
—
|
|
|
$
|
283
|
|
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
DECEMBER 31, 2017
|
|||||||||||||||||||||||
|
Eaton
Corporation
plc
|
|
Eaton
Corporation
|
|
Guarantors
|
|
Other
subsidiaries
|
|
Consolidating
adjustments
|
|
Total
|
||||||||||||
Net cash provided by (used in)
operating activities
|
$
|
258
|
|
|
$
|
(470
|
)
|
|
$
|
15
|
|
|
$
|
4,472
|
|
|
$
|
(1,609
|
)
|
|
$
|
2,666
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures for property,
plant and equipment
|
—
|
|
|
(92
|
)
|
|
(110
|
)
|
|
(318
|
)
|
|
—
|
|
|
(520
|
)
|
||||||
Proceeds from the sales
of businesses
|
—
|
|
|
338
|
|
|
—
|
|
|
269
|
|
|
—
|
|
|
607
|
|
||||||
Cash received from sales (paid for
acquisitions) of affiliates
|
—
|
|
|
—
|
|
|
(92
|
)
|
|
92
|
|
|
—
|
|
|
—
|
|
||||||
Sales (purchases) of short-term
investments - net
|
—
|
|
|
—
|
|
|
—
|
|
|
(298
|
)
|
|
—
|
|
|
(298
|
)
|
||||||
Investments in affiliates
|
(190
|
)
|
|
(108
|
)
|
|
—
|
|
|
(90
|
)
|
|
388
|
|
|
—
|
|
||||||
Return of investments in affiliates
|
—
|
|
|
—
|
|
|
90
|
|
|
—
|
|
|
(90
|
)
|
|
—
|
|
||||||
Loans to affiliates
|
—
|
|
|
(443
|
)
|
|
(415
|
)
|
|
(6,309
|
)
|
|
7,167
|
|
|
—
|
|
||||||
Repayments of loans from affiliates
|
—
|
|
|
303
|
|
|
385
|
|
|
3,478
|
|
|
(4,166
|
)
|
|
—
|
|
||||||
Other - net
|
—
|
|
|
(45
|
)
|
|
10
|
|
|
29
|
|
|
—
|
|
|
(6
|
)
|
||||||
Net cash provided by (used in)
investing activities
|
(190
|
)
|
|
(47
|
)
|
|
(132
|
)
|
|
(3,147
|
)
|
|
3,299
|
|
|
(217
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from borrowings
|
—
|
|
|
1,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000
|
|
||||||
Payments on borrowings
|
—
|
|
|
(1,250
|
)
|
|
(297
|
)
|
|
(7
|
)
|
|
—
|
|
|
(1,554
|
)
|
||||||
Proceeds from borrowings from
affiliates
|
2,605
|
|
|
3,129
|
|
|
991
|
|
|
442
|
|
|
(7,167
|
)
|
|
—
|
|
||||||
Payments on borrowings from
affiliates
|
(822
|
)
|
|
(2,904
|
)
|
|
(353
|
)
|
|
(87
|
)
|
|
4,166
|
|
|
—
|
|
||||||
Capital contribution from affiliates
|
—
|
|
|
—
|
|
|
90
|
|
|
298
|
|
|
(388
|
)
|
|
—
|
|
||||||
Return of capital to affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
(90
|
)
|
|
90
|
|
|
—
|
|
||||||
Other intercompany financing
activities
|
—
|
|
|
652
|
|
|
500
|
|
|
(1,152
|
)
|
|
—
|
|
|
—
|
|
||||||
Cash dividends paid
|
(1,068
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,068
|
)
|
||||||
Cash dividends paid to affiliates
|
—
|
|
|
—
|
|
|
(800
|
)
|
|
(809
|
)
|
|
1,609
|
|
|
—
|
|
||||||
Exercise of employee stock options
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
||||||
Repurchase of shares
|
(850
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(850
|
)
|
||||||
Employee taxes paid from shares
withheld
|
—
|
|
|
(15
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|
—
|
|
|
(22
|
)
|
||||||
Other - net
|
—
|
|
|
(8
|
)
|
|
(1
|
)
|
|
(5
|
)
|
|
—
|
|
|
(14
|
)
|
||||||
Net cash provided by (used in)
financing activities
|
(69
|
)
|
|
604
|
|
|
126
|
|
|
(1,413
|
)
|
|
(1,690
|
)
|
|
(2,442
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Effect of currency on cash
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
11
|
|
||||||
Total increase (decrease) in cash
|
(1
|
)
|
|
87
|
|
|
9
|
|
|
(77
|
)
|
|
—
|
|
|
18
|
|
||||||
Cash at the beginning of the period
|
1
|
|
|
102
|
|
|
4
|
|
|
436
|
|
|
—
|
|
|
543
|
|
||||||
Cash at the end of the period
|
$
|
—
|
|
|
$
|
189
|
|
|
$
|
13
|
|
|
$
|
359
|
|
|
$
|
—
|
|
|
$
|
561
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net sales
|
$
|
21,390
|
|
|
$
|
21,609
|
|
|
$
|
20,404
|
|
Net income attributable to Eaton ordinary shareholders
|
2,211
|
|
|
2,145
|
|
|
2,985
|
|
|||
Net income per share attributable to Eaton ordinary shareholders - diluted
|
$
|
5.25
|
|
|
$
|
4.91
|
|
|
$
|
6.68
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Electrical Products
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Electrical Systems and Services
|
14
|
|
|
—
|
|
|
—
|
|
|||
Aerospace
|
1
|
|
|
—
|
|
|
—
|
|
|||
Total business segments
|
36
|
|
|
—
|
|
|
4
|
|
|||
Corporate
|
162
|
|
|
—
|
|
|
—
|
|
|||
Total acquisition integration, divestiture charges and transaction costs
before income taxes |
198
|
|
|
—
|
|
|
4
|
|
|||
Income taxes
|
24
|
|
|
—
|
|
|
2
|
|
|||
Total after income taxes
|
$
|
174
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Per ordinary share - diluted
|
$
|
0.42
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2019
|
|
Change
from 2018
|
|
2018
|
|
Change
from 2017
|
|
2017
|
||||||||
Net sales
|
$
|
21,390
|
|
|
(1
|
)%
|
|
$
|
21,609
|
|
|
6
|
%
|
|
$
|
20,404
|
|
Gross profit
|
7,052
|
|
|
(1
|
)%
|
|
7,098
|
|
|
7
|
%
|
|
6,648
|
|
|||
Percent of net sales
|
33.0
|
%
|
|
|
|
32.8
|
%
|
|
|
|
32.6
|
%
|
|||||
Income before income taxes
|
2,591
|
|
|
7
|
%
|
|
2,424
|
|
|
(28
|
)%
|
|
3,368
|
|
|||
Net income
|
2,213
|
|
|
3
|
%
|
|
2,146
|
|
|
(28
|
)%
|
|
2,986
|
|
|||
Less net income for noncontrolling interests
|
(2
|
)
|
|
|
|
(1
|
)
|
|
|
|
(1
|
)
|
|||||
Net income attributable to Eaton ordinary shareholders
|
2,211
|
|
|
3
|
%
|
|
2,145
|
|
|
(28
|
)%
|
|
2,985
|
|
|||
Excluding acquisition integration and divestiture charges,
after-tax
|
174
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|||||
Adjusted earnings
|
$
|
2,385
|
|
|
11
|
%
|
|
$
|
2,145
|
|
|
(28
|
)%
|
|
$
|
2,987
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per share attributable to Eaton ordinary shareholders - diluted
|
$
|
5.25
|
|
|
7
|
%
|
|
$
|
4.91
|
|
|
(26
|
)%
|
|
$
|
6.68
|
|
Excluding per share impact of acquisition integration and divestiture charges, after-tax
|
0.42
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|||||
Adjusted earnings per ordinary share
|
$
|
5.67
|
|
|
15
|
%
|
|
$
|
4.91
|
|
|
(26
|
)%
|
|
$
|
6.68
|
|
|
2019
|
|
Change
from 2018 |
|
2018
|
|
Change
from 2017 |
|
2017
|
||||||||
Net sales
|
$
|
7,148
|
|
|
—
|
%
|
|
$
|
7,124
|
|
|
3
|
%
|
|
$
|
6,917
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
1,390
|
|
|
6
|
%
|
|
$
|
1,311
|
|
|
6
|
%
|
|
$
|
1,233
|
|
Operating margin
|
19.4
|
%
|
|
|
|
18.4
|
%
|
|
|
|
17.8
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||
Acquisition integration and divestiture charges
|
$
|
21
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
4
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Before acquisition integration and divestiture charges
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
1,411
|
|
|
8
|
%
|
|
$
|
1,311
|
|
|
6
|
%
|
|
$
|
1,237
|
|
Operating margin
|
19.7
|
%
|
|
|
|
18.4
|
%
|
|
|
|
17.9
|
%
|
|
2019
|
|
Change
from 2018 |
|
2018
|
|
Change
from 2017 |
|
2017
|
||||||||
Net sales
|
$
|
6,287
|
|
|
4
|
%
|
|
$
|
6,024
|
|
|
6
|
%
|
|
$
|
5,666
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
1,027
|
|
|
15
|
%
|
|
$
|
896
|
|
|
16
|
%
|
|
$
|
770
|
|
Operating margin
|
16.3
|
%
|
|
|
|
14.9
|
%
|
|
|
|
13.6
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||
Acquisition integration and divestiture charges
|
$
|
14
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Before acquisition integration and divestiture charges
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
1,041
|
|
|
16
|
%
|
|
$
|
896
|
|
|
16
|
%
|
|
$
|
770
|
|
Operating margin
|
16.6
|
%
|
|
|
|
14.9
|
%
|
|
|
|
13.6
|
%
|
|
2019
|
|
Change
from 2018 |
|
2018
|
|
Change
from 2017 |
|
2017
|
||||||||
Net sales
|
$
|
2,552
|
|
|
(7
|
)%
|
|
$
|
2,756
|
|
|
12
|
%
|
|
$
|
2,468
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
286
|
|
|
(23
|
)%
|
|
$
|
370
|
|
|
28
|
%
|
|
$
|
288
|
|
Operating margin
|
11.2
|
%
|
|
|
|
13.4
|
%
|
|
|
|
11.7
|
%
|
|
2019
|
|
Change
from 2018 |
|
2018
|
|
Change
from 2017 |
|
2017
|
||||||||
Net sales
|
$
|
2,044
|
|
|
8
|
%
|
|
$
|
1,896
|
|
|
9
|
%
|
|
$
|
1,744
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
495
|
|
|
24
|
%
|
|
$
|
398
|
|
|
20
|
%
|
|
$
|
332
|
|
Operating margin
|
24.2
|
%
|
|
|
|
21.0
|
%
|
|
|
|
19.0
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||
Acquisition integration and divestiture charges
|
$
|
1
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Before acquisition integration and divestiture charges
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
496
|
|
|
25
|
%
|
|
$
|
398
|
|
|
20
|
%
|
|
$
|
332
|
|
Operating margin
|
24.3
|
%
|
|
|
|
21.0
|
%
|
|
|
|
19.0
|
%
|
|
2019
|
|
Change
from 2018 |
|
2018
|
|
Change
from 2017 |
|
2017
|
||||||||
Net sales
|
$
|
3,038
|
|
|
(13
|
)%
|
|
$
|
3,489
|
|
|
5
|
%
|
|
$
|
3,326
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
460
|
|
|
(25
|
)%
|
|
$
|
611
|
|
|
13
|
%
|
|
$
|
541
|
|
Operating margin
|
15.1
|
%
|
|
|
|
17.5
|
%
|
|
|
|
16.3
|
%
|
|
2019
|
|
Change
from 2018 |
|
2018
|
|
Change
from 2017 |
|
2017
|
||||||||
Net sales
|
$
|
321
|
|
|
—
|
%
|
|
$
|
320
|
|
|
13
|
%
|
|
$
|
283
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating profit
|
$
|
17
|
|
|
(61
|
)%
|
|
$
|
44
|
|
|
(12
|
)%
|
|
$
|
50
|
|
Operating margin
|
5.3
|
%
|
|
|
|
13.8
|
%
|
|
|
|
17.7
|
%
|
|
2019
|
|
Change
from 2018
|
|
2018
|
|
Change
from 2017
|
|
2017
|
||||||||
Amortization of intangible assets
|
$
|
367
|
|
|
(4
|
)%
|
|
$
|
382
|
|
|
(2
|
)%
|
|
$
|
388
|
|
Interest expense - net
|
236
|
|
|
(13
|
)%
|
|
271
|
|
|
10
|
%
|
|
246
|
|
|||
Pension and other postretirement benefits expense
|
12
|
|
|
1,100
|
%
|
|
1
|
|
|
(98
|
)%
|
|
45
|
|
|||
Gain on sale of a business
|
—
|
|
|
NM
|
|
|
—
|
|
|
NM
|
|
|
(1,077
|
)
|
|||
Arbitration decision expense
|
—
|
|
|
NM
|
|
|
275
|
|
|
NM
|
|
|
—
|
|
|||
Other corporate expense - net
|
469
|
|
|
69
|
%
|
|
277
|
|
|
14
|
%
|
|
244
|
|
|||
Total corporate expense (income)
|
$
|
1,084
|
|
|
(10
|
)%
|
|
$
|
1,206
|
|
|
(883
|
)%
|
|
$
|
(154
|
)
|
Credit Rating Agency (long- /short-term rating)
|
|
Rating
|
|
Outlook
|
Standard & Poor's
|
|
A-/A-2
|
|
Stable outlook
|
Moody's
|
|
Baa1/P-2
|
|
Positive outlook
|
Fitch
|
|
BBB+/F1
|
|
Stable outlook
|
|
2020
|
|
2021
to
2022
|
|
2023
to
2024
|
|
Thereafter
|
|
Total
|
||||||||||
Long-term debt, including current portion(1)
|
$
|
242
|
|
|
$
|
2,674
|
|
|
$
|
984
|
|
|
$
|
4,082
|
|
|
$
|
7,982
|
|
Interest expense related to long-term debt
|
252
|
|
|
460
|
|
|
339
|
|
|
1,634
|
|
|
2,685
|
|
|||||
Reduction of interest expense from interest rate swap agreements related to long-term debt
|
(18
|
)
|
|
(39
|
)
|
|
(14
|
)
|
|
(37
|
)
|
|
(108
|
)
|
|||||
Operating leases
|
142
|
|
|
195
|
|
|
93
|
|
|
82
|
|
|
512
|
|
|||||
Finance leases
|
8
|
|
|
14
|
|
|
6
|
|
|
9
|
|
|
37
|
|
|||||
Purchase obligations
|
1,091
|
|
|
183
|
|
|
83
|
|
|
91
|
|
|
1,448
|
|
|||||
Other obligations
|
169
|
|
|
10
|
|
|
12
|
|
|
23
|
|
|
214
|
|
|||||
Held for sale obligations
|
65
|
|
|
9
|
|
|
4
|
|
|
6
|
|
|
84
|
|
|||||
Total
|
$
|
1,951
|
|
|
$
|
3,506
|
|
|
$
|
1,507
|
|
|
$
|
5,890
|
|
|
$
|
12,854
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(1) Long-term debt excludes deferred gains and losses on derivatives related to debt, adjustments to fair market value, premiums and discounts on long-term debentures, debt issuance costs, and finance leases.
|
(In millions except for per share data)
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Net sales
|
$
|
21,390
|
|
|
$
|
21,609
|
|
|
$
|
20,404
|
|
|
$
|
19,747
|
|
|
$
|
20,855
|
|
Income before income taxes
|
2,591
|
|
|
2,424
|
|
|
3,368
|
|
|
2,118
|
|
|
2,133
|
|
|||||
Net income
|
2,213
|
|
|
2,146
|
|
|
2,986
|
|
|
1,919
|
|
|
1,974
|
|
|||||
Less net income for noncontrolling interests
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(2
|
)
|
|||||
Net income attributable to Eaton ordinary shareholders
|
$
|
2,211
|
|
|
$
|
2,145
|
|
|
$
|
2,985
|
|
|
$
|
1,916
|
|
|
$
|
1,972
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income per share attributable to Eaton ordinary shareholders
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted
|
$
|
5.25
|
|
|
$
|
4.91
|
|
|
$
|
6.68
|
|
|
$
|
4.20
|
|
|
$
|
4.22
|
|
Basic
|
5.28
|
|
|
4.93
|
|
|
6.71
|
|
|
4.21
|
|
|
4.23
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted-average number of ordinary shares outstanding
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted
|
420.8
|
|
|
436.9
|
|
|
447.0
|
|
|
456.5
|
|
|
467.1
|
|
|||||
Basic
|
419.0
|
|
|
434.3
|
|
|
444.5
|
|
|
455.0
|
|
|
465.5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash dividends declared
per ordinary share
|
$
|
2.84
|
|
|
$
|
2.64
|
|
|
$
|
2.40
|
|
|
$
|
2.28
|
|
|
$
|
2.20
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets (1)
|
$
|
32,805
|
|
|
$
|
31,092
|
|
|
$
|
32,623
|
|
|
$
|
30,476
|
|
|
$
|
31,059
|
|
Long-term debt
|
7,819
|
|
|
6,768
|
|
|
7,167
|
|
|
6,711
|
|
|
7,746
|
|
|||||
Total debt
|
8,322
|
|
|
7,521
|
|
|
7,751
|
|
|
8,277
|
|
|
8,414
|
|
|||||
Eaton shareholders' equity
|
16,082
|
|
|
16,107
|
|
|
17,253
|
|
|
14,954
|
|
|
15,249
|
|
|||||
Eaton shareholders' equity
per ordinary share
|
$
|
38.91
|
|
|
$
|
38.02
|
|
|
$
|
39.22
|
|
|
$
|
33.28
|
|
|
$
|
33.24
|
|
Ordinary shares outstanding
|
413.3
|
|
|
423.6
|
|
|
439.9
|
|
|
449.4
|
|
|
458.8
|
|
•
|
amending the objects or memorandum of association of the Company;
|
•
|
amending the articles of association of the Company;
|
•
|
approving a change of name of the Company;
|
•
|
authorizing the entering into of a guarantee or provision of security in connection with a loan, quasi-loan, or credit transaction to a director or connected person;
|
•
|
opting out of preemption rights on the issuance of new shares;
|
•
|
re-registration of the Company from a public limited company to a private company;
|
•
|
variation of class rights attaching to classes of shares (where the articles of association do not provide otherwise);
|
•
|
purchase of own shares off-market;
|
•
|
reduction of issued share capital;
|
•
|
sanctioning a compromise/scheme of arrangement;
|
•
|
resolving that the Company be wound up by the Irish courts;
|
•
|
resolving in favor of a shareholder’s voluntary winding-up;
|
•
|
re-designation of shares into different share classes; and
|
•
|
setting the re-issue price of treasury shares.
|
•
|
a court-approved scheme of arrangement under the Companies Acts. A scheme of arrangement with shareholders requires a court order from the Irish High Court and the approval of a majority in number representing 75% in value of the shareholders present and voting in person or by proxy at a meeting called to approve the scheme;
|
•
|
through a tender or takeover offer by a third party for all of the shares of the Company. Where the holders of 80% or more of the Company’s shares have accepted an offer for their shares in the Company, the remaining shareholders may also be statutorily required to transfer their shares. If the bidder does not exercise its “squeeze out” right, then the non-accepting shareholders also have a statutory right to require the bidder to acquire their shares on the same terms. If shares of the Company were to be listed on the main market of Euronext Dublin or another regulated stock exchange in the European Union, this threshold would be increased to 90%; and
|
•
|
it is also possible for the Company to be acquired by way of a transaction with an EU-incorporated company under the EU Cross-Border Mergers Directive 2005/56/EC. Such a transaction must be approved by a special resolution. If the Company is being merged with another EU company under the EU Cross-Border Mergers Directive 2005/56/EC and the consideration payable to the Company’s shareholders is not all in the form of cash, the Company’s shareholders may be entitled to require their shares to be acquired at fair value.
|
(a)
|
the sale, exchange, lease, transfer, or other disposition by the Company of all, or substantially all, of its assets or business;
|
(b)
|
the consolidation of the Company, or its merger, into another company;
|
(c)
|
the merger into the Company of another company or companies if the merger involves the issuance or transfer by the Company to the shareholders of the other constituent company or companies of such number of shares of the Company as entitle the holders thereof to exercise at least one-sixth of the voting power of the Company in the election of directors immediately after the consummation of the merger;
|
(d)
|
a combination or majority share acquisition in which the Company is the acquiring company and its voting shares are issued or transferred to another company if the combination or majority share acquisition involves the issuance or transfer by the Company to the shareholders of the other company or companies of such number of shares of the Company as entitle the holders thereof to exercise at least one-sixth of the voting power of the Company in the election of directors immediately after the consummation of the combination or majority share acquisition; or
|
(e)
|
to approve any agreement, contract, or other arrangement providing for any of the transactions described in subparagraph (a) above.
|
•
|
any transfer of those shares, or in the case of unissued shares any transfer of the right to be issued with shares and any issue of shares, shall be void;
|
•
|
no voting rights shall be exercisable in respect of those shares;
|
•
|
no further shares shall be issued in right of those shares or in pursuance of any offer made to the holder of those shares; and
|
•
|
no payment shall be made of any sums due from the Company on those shares, whether in respect of capital or otherwise.
|
•
|
in the event of an offer, all holders of security of the target company should be afforded equivalent treatment and, if a person acquires control of a company, the other holders of securities must be protected;
|
•
|
the holders of the securities in the target company must have sufficient time and information to enable them to reach a properly informed decision on the offer; where it advises the holders of securities, the board of the target company must give its views on the effects of implementation of the offer on employment, conditions of employment and the locations of the target company's places of business;
|
•
|
the board of the target company must act in the interests of the company as a whole and must not deny the holders of securities the opportunity to decide on the merits of the offer;
|
•
|
false markets must not be created in the securities of the target company, the bidder or of any other company concerned by the offer in such a way that the rise or fall of the prices of the securities becomes artificial and the normal functioning of the markets is distorted;
|
•
|
a bidder must announce an offer only after ensuring that he or she can fulfill in full, any cash consideration, if such is offered, and after taking all reasonable measures to secure the implementation of any other type of consideration;
|
•
|
a target company must not be hindered in the conduct of its affairs for longer than is reasonable by an offer for its securities; and
|
•
|
a substantial acquisition of securities (whether such acquisition is to be effected by one transaction or a series of transactions) shall take place only at an acceptable speed and shall be subject to adequate and timely disclosure.
|
•
|
the action is approved by the Company’s shareholders at a general meeting; or
|
•
|
the Irish Takeover Panel has given its consent, where:
|
•
|
it is satisfied the action would not constitute frustrating action;
|
•
|
the Company’s shareholders that hold 50% of the voting rights state in writing that they approve the proposed action and would vote in favor of it at a general meeting;
|
•
|
the action is taken in accordance with a contract entered into prior to the announcement of the offer; or
|
•
|
the decision to take such action was made before the announcement of the offer and either has been at least partially implemented or is in the ordinary course of business.
|
•
|
Allow the Company’s board of directors to issue preference shares without shareholder approval, with such rights, preferences and privileges as the board of directors may designate (see “Preference Shares”);
|
•
|
Permit holders of not less than 10% of the total voting rights of the Company to requisition an extraordinary meeting for various purposes, including considering director nominations (see “Description of Ordinary Shares-Extraordinary General Meetings of Shareholders”);
|
•
|
Establish advance notice procedures for shareholders to submit shareholder proposals or to submit nominations of candidates for election to the Company’s board of directors;
|
•
|
Permit the board of directors to fill any vacancy occurring on the board of directors (see “Description of Ordinary Shares-Removal of Directors”);
|
•
|
Authorize the board of directors to adopt a shareholder rights plan upon such terms and conditions as the board deems expedient and in the best interests of the Company;
|
•
|
Impose particular approval and other requirements in relation to certain business combinations (see “Description of Ordinary Shares-Acquisitions”);
|
•
|
Grant statutory preemption rights to shareholders when shares are being issued for cash consideration unless the Company “opts out” of these rights in its articles of association (see “Description of Ordinary Shares-Preemption Rights, Share Warrants and Share Options”);
|
•
|
Impose notification requirements on shareholders who acquire or cease to be interested in a specified percentage of the Company’s shares (see “Description of Ordinary Shares-Disclosure of Interests in Shares”); and
|
•
|
Provide that the Company may only alter its memorandum and articles of association by the passing of a special resolution of shareholders.
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Illumination Management Solutions, Inc.
|
|
California
|
Joslyn Sunbank Company, LLC
|
|
California
|
Souriau USA Inc
|
|
California
|
Sunbank Family of Companies LLC
|
|
California
|
Innovative Switchgear IP LLC
|
|
Colorado
|
Innovative Switchgear Solutions, Inc
|
|
Colorado
|
Bussmann International Holdings, LLC
|
|
Delaware
|
Bussmann International, Inc.
|
|
Delaware
|
CBE Services, Inc.
|
|
Delaware
|
Cooper B-Line, Inc.
|
|
Delaware
|
Cooper Bussmann, LLC
|
|
Delaware
|
Cooper Crouse-Hinds MTL, Inc.
|
|
Delaware
|
Cooper Crouse-Hinds, LLC
|
|
Delaware
|
Cooper Electrical International, LLC
|
|
Delaware
|
Cooper Enterprises LLC
|
|
Delaware
|
Cooper Finance USA, Inc.
|
|
Delaware
|
Cooper Industries International, LLC
|
|
Delaware
|
Cooper Industries Poland, LLC
|
|
Delaware
|
Cooper Industries Vietnam, LLC
|
|
Delaware
|
Cooper Industries, LLC
|
|
Delaware
|
Cooper Interconnect, Inc.
|
|
Delaware
|
Cooper Lighting, LLC
|
|
Delaware
|
Cooper Notification, Inc.
|
|
Delaware
|
Cooper Power Systems, LLC
|
|
Delaware
|
Cooper Technologies Company
|
|
Delaware
|
Eaton Aerospace LLC
|
|
Delaware
|
Eaton Automated Transmission Technologies Corporation
|
|
Delaware
|
Eaton Electric Holdings LLC
|
|
Delaware
|
Eaton Hydraulics LLC
|
|
Delaware
|
Eaton Industries Middle East, LLC
|
|
Delaware
|
Eaton Industries (Philippines), LLC
|
|
Delaware
|
Eaton Industries XVI LLC
|
|
Delaware
|
McGraw-Edison Development Corporation
|
|
Delaware
|
MTL Instruments LLC
|
|
Delaware
|
MTL Partners II, Inc.
|
|
Delaware
|
MTL Partners, Inc.
|
|
Delaware
|
Standard Automation & Control LP
|
|
Delaware
|
Wright Line Holding, Inc.
|
|
Delaware
|
Wright Line LLC
|
|
Delaware
|
Azonix Corporation
|
|
Massachusetts
|
Eaton Ann Arbor LLC
|
|
Michigan
|
Cannon Technologies, Inc.
|
|
Minnesota
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Cooper Wheelock, Inc.
|
|
New Jersey
|
Cooper Wiring Devices, Inc.
|
|
New York
|
Chagrin Highlands III Limited
|
|
Ohio
|
CLS Holdings LLC
|
|
Ohio
|
Eaton Aeroquip LLC
|
|
Ohio
|
Eaton Corporation
|
|
Ohio
|
Eaton Holding LLC
|
|
Ohio
|
Eaton Leasing Corporation
|
|
Ohio
|
Sure Power, Inc.
|
|
Oregon
|
Eaton Industries IX LLC
|
|
Texas
|
Eaton Industries VIII LLC
|
|
Texas
|
Eaton Industries (Argentina) S.A.
|
|
Argentina
|
Eaton Industries Pty. Ltd.
|
|
Australia
|
CTI-VIENNA Gesellschaft zur Prüfung elektrotechnischer Industrieprodukte GmbH
|
|
Austria
|
Eaton Holding (Austria) G.m.b.H.
|
|
Austria
|
Eaton Holding G.m.b.H.
|
|
Austria
|
Eaton Industries (Austria) G.m.b.H.
|
|
Austria
|
Eaton Holding SRL
|
|
Barbados
|
Eaton Electric SPRL
|
|
Belgium
|
Eaton Filtration BVBA
|
|
Belgium
|
Eaton Industries (Belgium) BVBA
|
|
Belgium
|
Cooper Bermuda Investments Ltd.
|
|
Bermuda Islands
|
Cooper Finance Group Ltd.
|
|
Bermuda Islands
|
Cooper Investment Group Ltd.
|
|
Bermuda Islands
|
Eaton Industries Holdings Ltd.
|
|
Bermuda Islands
|
Saturn Insurance Company Ltd.
|
|
Bermuda Islands
|
Aeroquip do Brasil Ltda.
|
|
Brazil
|
Blinda Industria e Comercio Ltda.
|
|
Brazil
|
Bussmann do Brasil Ltda.
|
|
Brazil
|
Cooper Power Systems do Brasil Ltda.
|
|
Brazil
|
Eaton Ltda.
|
|
Brazil
|
Eaton Power Solution Ltda.
|
|
Brazil
|
Moeller Electric Ltda.
|
|
Brazil
|
Moeller Industria de electro-electronicos do Amazonas Ltda.
|
|
Brazil
|
Digital Lighting Holdings Limited
|
|
British Virgin Islands
|
Nittan BVI Co. Ltd.
|
|
British Virgin Islands
|
Phoenixtec International Corp.
|
|
British Virgin Islands
|
Senyuan International Investments Limited
|
|
British Virgin Islands
|
Silver Light International Limited
|
|
British Virgin Islands
|
Winner Hydraulics Ltd.
|
|
British Virgin Islands
|
Eaton Industries EOOD
|
|
Bulgaria
|
Aeroquip-Vickers Canada Company
|
|
Canada
|
CLS (Canada) Company
|
|
Canada
|
Cooper Industries (Canada) Company
|
|
Canada
|
Cooper Industries (Electrical) Inc.
|
|
Canada
|
Cyme International T & D Inc.
|
|
Canada
|
Eaton Industries (Canada) Company
|
|
Canada
|
Cutler-Hammer Electrical Company
|
|
Cayman Islands
|
Cutler-Hammer Industries Ltd.
|
|
Cayman Islands
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Georgetown Financial Services Ltd.
|
|
Cayman Islands
|
Senyuan International Holdings Limited
|
|
Cayman Islands
|
Eaton Industries (Chile) S.p.A.
|
|
Chile
|
Beijing Yoosung Shinhwa Automobile Parts Co., Ltd.
|
|
China
|
Cooper (China) Co., Ltd.
|
|
China
|
Cooper (Ningbo) Electric Co., Ltd.
|
|
China
|
Cooper Edison (Pingdingshan) Electronic Technologies Co., Ltd.
|
|
China
|
Cooper Electric (Changzhou) Co., Ltd.
|
|
China
|
Cooper Electric (Shanghai) Co., Ltd.
|
|
China
|
Cooper Electronic Technologies (Shanghai) Co., Ltd.
|
|
China
|
Cooper Shanghai Power Capacitor Co., Ltd.
|
|
China
|
Cooper Xi'an Fusegear Co., Ltd.
|
|
China
|
Cooper Yuhua (Changzhou) Electric Equipment Manufacturing Co., Ltd.
|
|
China
|
Digital Lighting (Dong Guan) Co., Ltd.
|
|
China
|
Dongguan Cooper Electronics Co. Ltd.
|
|
China
|
Dongguan Wiring Devices Electronics Co., Ltd.
|
|
China
|
Eaton (China) Investments Co., Ltd.
|
|
China
|
Eaton Electrical Equipment Co Ltd
|
|
China
|
Eaton Electrical Ltd.
|
|
China
|
Eaton Filtration (Shanghai) Co. Ltd.
|
|
China
|
Eaton Fluid Power (Shanghai) Co., Ltd.
|
|
China
|
Eaton Fu Li An (Changzhou) Electronics Co., Ltd.
|
|
China
|
Eaton Hydraulics (Luzhou) Co., Ltd.
|
|
China
|
Eaton Hydraulics (Ningbo) Co., Ltd.
|
|
China
|
Eaton Hydraulics Systems (Jining) Co., Ltd.
|
|
China
|
Eaton Industrial Clutches and Brakes (Shanghai) Co., Ltd.
|
|
China
|
Eaton Industries (Jining) Co., Ltd
|
|
China
|
Eaton Industries (Shanghai) Co., Ltd
|
|
China
|
Eaton Industries (Wuxi) Co., Ltd.
|
|
China
|
Eaton Power (Shanghai) Trading Limited Partnership
|
|
China
|
Eaton Power Quality (Shanghai) Co., Ltd.
|
|
China
|
Guangzhou Nittan Valve Co. Ltd.
|
|
China
|
Kaicheng Funke+Huster (Tangshan) Mining Electrical Co. Ltd.
|
|
China
|
Lian Zheng Electronics (Shenzhen) Co., Ltd.
|
|
China
|
Moeller Electric (Shanghai) Co., Ltd.
|
|
China
|
Phoenixtec Electronics (Shenzhen) Co., Ltd.
|
|
China
|
Rizhao Yoosung Shinhwa Automobile Parts Co., Ltd.
|
|
China
|
Santak Electronic (Shenzhen) Co., Ltd.
|
|
China
|
Cooper Industries Colombia S.A.S.
|
|
Colombia
|
Eaton Industries (Colombia) S.A.S.
|
|
Colombia
|
Eaton Electrical Srl
|
|
Costa Rica
|
Eaton Electric s.r.o.
|
|
Czech Republic
|
Eaton Elektrotechnika s.r.o.
|
|
Czech Republic
|
Eaton Electric ApS
|
|
Denmark
|
Eaton Filtration (Denmark) ApS
|
|
Denmark
|
Cutler-Hammer, SRL
|
|
Dominican Republic
|
Souriau Dominican Republic Ltd
|
|
Dominican Republic
|
Eaton Industries (Egypt) LLC
|
|
Egypt
|
Eaton Power Quality OY (Finland)
|
|
Finland
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
CLS (France) SAS
|
|
France
|
Cooper Capri S.A.S.
|
|
France
|
Cooper Menvier France SARL
|
|
France
|
Cooper Securite S.A.S.
|
|
France
|
Eaton France Holding SAS
|
|
France
|
Eaton Industries (France) S.A.S.
|
|
France
|
Eaton S.A.S.
|
|
France
|
Martek Power F SAS
|
|
France
|
MP Group SAS
|
|
France
|
MTL Instruments SARL
|
|
France
|
Sefelec SAS
|
|
France
|
Souriau S.A.S.
|
|
France
|
Technocontact
|
|
France
|
CEAG Notlichtsysteme GmbH
|
|
Germany
|
Cooper Crouse-Hinds GmbH
|
|
Germany
|
Cooper Germany Holdings GmbH
|
|
Germany
|
Cooper Industries Finanzierungs-GbR
|
|
Germany
|
Eaton Electric G.m.b.H.
|
|
Germany
|
Eaton Electrical IP G.m.b.H. & Co. KG
|
|
Germany
|
Eaton Germany G.m.b.H.
|
|
Germany
|
Eaton Germany Holdings GmbH
|
|
Germany
|
Eaton GmbH & Co. KG
|
|
Germany
|
Eaton Holding SE & Co. KG
|
|
Germany
|
Eaton Industries G.m.b.H.
|
|
Germany
|
Eaton Industries Holding G.m.b.H.
|
|
Germany
|
Eaton Production International G.m.b.H.
|
|
Germany
|
Eaton Protection Systems IP G.m.b.H. & Co. KG
|
|
Germany
|
Eaton SE
|
|
Germany
|
Eaton Technologies G.m.b.H.
|
|
Germany
|
FHF Bergbautechnik GmbH & Co. KG
|
|
Germany
|
FHF Funke+Huster Fernsig GmbH
|
|
Germany
|
FHF New World GmbH
|
|
Germany
|
Funke+Huster GmbH
|
|
Germany
|
GeCma Components electronic GmbH
|
|
Germany
|
Hein Moeller Stiftung G.m.b.H.
|
|
Germany
|
Institute for International Product Safety G.m.b.H.
|
|
Germany
|
Martek Power GmbH
|
|
Germany
|
MTL Instruments GmbH
|
|
Germany
|
Sefelec GmbH
|
|
Germany
|
Souriau Germany GmbH
|
|
Germany
|
Cooper Univel S.A.
|
|
Greece
|
Digital Lighting Co., Limited
|
|
Hong Kong
|
Eaton Electric & Engineering Services Limited
|
|
Hong Kong
|
Eaton Enterprises Limited
|
|
Hong Kong
|
Eaton Power Quality Limited
|
|
Hong Kong
|
Riseson International Limited
|
|
Hong Kong
|
Santak Electronics Company Limited
|
|
Hong Kong
|
Scoremax Limited
|
|
Hong Kong
|
Silver Victory Hong Kong Limited
|
|
Hong Kong
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Vickers Systems Limited
|
|
Hong Kong
|
Eaton Enterprises (Hungary) Kft.
|
|
Hungary
|
Eaton Industries KFT
|
|
Hungary
|
Eaton Manufacturing Hungary Kft.
|
|
Hungary
|
Eaton Fluid Power Limited
|
|
India
|
Eaton India Innovation Center LLP
|
|
India
|
Eaton Industrial Products Pvt. Ltd.
|
|
India
|
Eaton Industrial Systems Private Limited
|
|
India
|
Eaton Management Services LLP
|
|
India
|
Eaton Power Quality Private Limited
|
|
India
|
Eaton Technologies Private Limited
|
|
India
|
MTL Instruments Private Limited
|
|
India
|
Souriau India Pvt Ltd
|
|
India
|
PT Eaton Industries
|
|
Indonesia
|
PT Eaton Industries
|
|
Indonesia
|
PT Ulusoy Electric Indonesia
|
|
Indonesia
|
PT Ulusoy Electric Industry
|
|
Indonesia
|
PT. Fluid Sciences Batam
|
|
Indonesia
|
Abeiron III Unlimited Company
|
|
Ireland
|
Cooper Industries Trading Unlimited Company
|
|
Ireland
|
Cooper Industries Unlimited Company
|
|
Ireland
|
Eaton Capital Global Holdings Unlimited Company
|
|
Ireland
|
Eaton Capital Unlimited Co
|
|
Ireland
|
Eaton Domhanda I Unlimited Company
|
|
Ireland
|
Eaton Domhanda Unlimited Company
|
|
Ireland
|
Eaton Industries (Ireland) II Limited
|
|
Ireland
|
Eaton Industries (Ireland) Limited
|
|
Ireland
|
Eaton Industries I Unlimited Company
|
|
Ireland
|
Eaton Industries II Unlimited Company
|
|
Ireland
|
Eaton Industries III Unlimited Company
|
|
Ireland
|
Eaton Industries IV Unlimited Company
|
|
Ireland
|
Eaton Industries V Unlimited Company
|
|
Ireland
|
Eaton Industries VI Unlimited Company
|
|
Ireland
|
Eaton Industries VII Unlimited Company
|
|
Ireland
|
Eaton Industries X Unlimited Company
|
|
Ireland
|
Eaton Industries XI Unlimited Company
|
|
Ireland
|
Eaton Industries XII Unlimited Company
|
|
Ireland
|
Eaton Industries XIII Unlimited Company
|
|
Ireland
|
Eaton Industries XIV Unlimited Company
|
|
Ireland
|
Eaton Industries XIX Unlimited Company
|
|
Ireland
|
Eaton Industries XV Unlimited Company
|
|
Ireland
|
Eaton Industries XVIII Unlimited Company
|
|
Ireland
|
Eaton Industries XX Unlimited Company
|
|
Ireland
|
Eaton Intelligent Power Limited
|
|
Ireland
|
Eaton Manufacturing Limited
|
|
Ireland
|
Eaton Teorainn Unlimited Company
|
|
Ireland
|
Plumtree I Limited
|
|
Ireland
|
TT (Ireland) Acquisition Limited
|
|
Ireland
|
Eaton Global Holdings II Limited
|
|
Isle of Man
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Eaton Global Holdings Limited
|
|
Isle of Man
|
Eaton Global Limited
|
|
Isle of Man
|
Eaton Industries (Israel) Ltd.
|
|
Israel
|
Cooper Csa Srl
|
|
Italy
|
Eaton Filtration (Italy) S.r.l.
|
|
Italy
|
Eaton Fluid Power S.r.l.
|
|
Italy
|
Eaton Industries (Italy) S.r.l.
|
|
Italy
|
Eaton S.r.l.
|
|
Italy
|
Gitiesse S.r.l.
|
|
Italy
|
MTL Italia Srl
|
|
Italy
|
Souriau Italy Srl
|
|
Italy
|
Cooper Industries Japan K.K.
|
|
Japan
|
Eaton Electric (Japan) Ltd.
|
|
Japan
|
Eaton Filtration Ltd.
|
|
Japan
|
Eaton Industries (Japan) Ltd.
|
|
Japan
|
Eaton Japan G.K.
|
|
Japan
|
Souriau Japan KK
|
|
Japan
|
Cooper Korea Ltd.
|
|
Korea
|
Eaton Industries (Korea) Limited
|
|
Korea
|
Eaton Electric S.I.A.
|
|
Latvia
|
Aeroquip-Vickers International S.a.r.L.
|
|
Luxembourg
|
Cambridge International Sarl
|
|
Luxembourg
|
Cooper International Holdings S.a.r.l
|
|
Luxembourg
|
Cooper Investment Group S a.r.l.
|
|
Luxembourg
|
Cooper Offshore Holdings S.a.r.l. (Luxembourg)
|
|
Luxembourg
|
Eaton Controls (Luxembourg) S.a.r.l.
|
|
Luxembourg
|
Eaton Holding II S.a.r.l.
|
|
Luxembourg
|
Eaton Holding IV S.a.r.l.
|
|
Luxembourg
|
Eaton Holding IX S.a.r.l.
|
|
Luxembourg
|
Eaton Holding S.a.r.l.
|
|
Luxembourg
|
Eaton Holding V S.a.r.l.
|
|
Luxembourg
|
Eaton Holding VIII S.a.r.l.
|
|
Luxembourg
|
Eaton Holding XIII S.a.r.l.
|
|
Luxembourg
|
Eaton Moeller S.a.r.l.
|
|
Luxembourg
|
Eaton Services S.a.r.L.
|
|
Luxembourg
|
Eaton Technologies (Luxembourg) S.a.r.l.
|
|
Luxembourg
|
Green Holding S.a.r.l.
|
|
Luxembourg
|
Martek Power SA
|
|
Luxembourg
|
Cooper Industries Malaysia SDN BHD
|
|
Malaysia
|
Eaton Industries Sdn. Bhd.
|
|
Malaysia
|
ETN Asia International Limited
|
|
Mauritius
|
ETN Holding 1 Limited
|
|
Mauritius
|
ETN Holding 2 Limited
|
|
Mauritius
|
ETN Holding 3 Limited
|
|
Mauritius
|
Plumtree Mauritius Limited
|
|
Mauritius
|
Arrow-Hart, S. de R.L. de C.V.
|
|
Mexico
|
Bussmann, S. de R.L. de C.V.
|
|
Mexico
|
CL Solutions mexico, S. de R.L. de C.V.
|
|
Mexico
|
Componentes de Iluminacion, S. de R.L. de C.V.
|
|
Mexico
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Cooper Crouse-Hinds, S. de R.L. de C.V.
|
|
Mexico
|
Cooper Lighting de Mexico, S. de R.L. de C.V.
|
|
Mexico
|
Cooper Mexico Distribucion, S. de R.L. de C.V.
|
|
Mexico
|
Cooper Wiring Devices de Mexico, S.A. de C.V.
|
|
Mexico
|
Cooper Wiring Devices Manufacturing, S. de R.L. de C.V.
|
|
Mexico
|
Eaton Controls, S. de R.L. de C.V.
|
|
Mexico
|
Eaton Enterprises, S. de R.L. de C.V.
|
|
Mexico
|
Eaton Industries, S. de R.L. de C.V.
|
|
Mexico
|
Eaton Solutions, S. de R.L. de C.V.
|
|
Mexico
|
Eaton Technologies, S. de R.L. de C.V.
|
|
Mexico
|
Eaton Truck Components, S. de R.L. de C.V.
|
|
Mexico
|
Electromanufacturas, S. de R.L. de C.V.
|
|
Mexico
|
Iluminacion Cooper de las Californias, S. de R.L. de C.V.
|
|
Mexico
|
Martek Power S.A. de C.V.
|
|
Mexico
|
Sunbank De Mexico S de R.L. de C.V Mexico
|
|
Mexico
|
Eaton Electric S.a.r.l.
|
|
Morocco
|
Eaton Industries (Morocco) LLC
|
|
Morocco
|
Souriau MAROC Sarl
|
|
Morocco
|
Cooper Crouse-Hinds B.V.
|
|
Netherlands
|
Cooper Industries Finance B.V.
|
|
Netherlands
|
Cooper Industries Global B.V.
|
|
Netherlands
|
Cooper Safety B.V.
|
|
Netherlands
|
Eaton B.V.
|
|
Netherlands
|
Eaton Holding (Netherlands) B.V.
|
|
Netherlands
|
Eaton Holding I B.V.
|
|
Netherlands
|
Eaton Holding III B.V.
|
|
Netherlands
|
Eaton Holding Turlock B.V.
|
|
Netherlands
|
Eaton Holding V B.V.
|
|
Netherlands
|
Eaton Holding VI B.V.
|
|
Netherlands
|
Eaton Holding VII B.V.
|
|
Netherlands
|
Eaton Holding VIII B.V.
|
|
Netherlands
|
Eaton Industries (Netherlands) B.V.
|
|
Netherlands
|
Eaton International B.V.
|
|
Netherlands
|
Eaton Moeller B.V.
|
|
Netherlands
|
MTL Instruments B.V.
|
|
Netherlands
|
Scantronic Benelux BV
|
|
Netherlands
|
Turlock B.V.
|
|
Netherlands
|
Eaton Industries Company
|
|
New Zealand
|
Eaton International Industries Nigeria Limited
|
|
Nigeria
|
Cooper Crouse-Hinds AS
|
|
Norway
|
Eaton Electric AS
|
|
Norway
|
Hernis Scan Systems A/S
|
|
Norway
|
Norex AS
|
|
Norway
|
Eaton Trading (FZC) LLC
|
|
Oman
|
Eaton Industries Panama S.A.
|
|
Panama
|
Eaton Industries SAC
|
|
Peru
|
Eaton Automotive Components Spolka z o.o.
|
|
Poland
|
Eaton Automotive Spolka z o.o.
|
|
Poland
|
Eaton Automotive Systems Spolka z o.o.
|
|
Poland
|
Consolidated Subsidiaries (A)
|
|
Where Organized
|
Eaton Electric Spolka z.o.o.
|
|
Poland
|
Eaton Filtration (Poland) Sp. z o.o.
|
|
Poland
|
Eaton I Spolka z.o.o.
|
|
Poland
|
Eaton Truck Components Spolka z o.o.
|
|
Poland
|
Cooper Pretronica Unipessoal Lda.
|
|
Portugal
|
Eaton Madeira SGPS Lda.
|
|
Portugal
|
Cooper Industries Romania SRL
|
|
Romania
|
Eaton Electric S.r.l.
|
|
Romania
|
Eaton Electro Productie S.r.l.
|
|
Romania
|
Cooper Industries Russia LLC
|
|
Russia
|
Eaton LLC
|
|
Russia
|
Eaton II LP
|
|
Scotland
|
Eaton III LP
|
|
Scotland
|
Eaton Industries LP
|
|
Scotland
|
Eaton IV LP
|
|
Scotland
|
Eaton LP
|
|
Scotland
|
Eaton Manufacturing LP
|
|
Scotland
|
Eaton Electric d.o.o.
|
|
Serbia
|
Eaton Electric (Singapore) Pte. Ltd.
|
|
Singapore
|
Eaton Industries Pte. Ltd.
|
|
Singapore
|
Eaton Electric s.r.o.
|
|
Slovak Republic
|
Eaton Electric (South Africa) Pty Ltd.
|
|
South Africa
|
Eaton Hydraulics (Proprietary) Limited
|
|
South Africa
|
Eaton Truck Components (Proprietary) Ltd.
|
|
South Africa
|
Aeroquip Iberica S.L.
|
|
Spain
|
Cooper Crouse-Hinds, S.A.
|
|
Spain
|
Eaton Industries (Spain) S.L.
|
|
Spain
|
Productos Eaton Livia S.L.
|
|
Spain
|
Eaton Electric AB
|
|
Sweden
|
Ultronics Nordic Sales AB
|
|
Sweden
|
Eaton Automation G.m.b.H
|
|
Switzerland
|
Eaton Automation Holding G.m.b.H.
|
|
Switzerland
|
Eaton Industries II G.m.b.H.
|
|
Switzerland
|
Eaton Industries Manufacturing G.m.b.H.
|
|
Switzerland
|
Eaton Manufacturing G.m.b.H.
|
|
Switzerland
|
Eaton Manufacturing II G.m.b.H.
|
|
Switzerland
|
Eaton Manufacturing III G.m.b.H.
|
|
Switzerland
|
Eaton Switzerland Holding I GmbH
|
|
Switzerland
|
Eaton Switzerland Holding II GmbH
|
|
Switzerland
|
Eaton Phoenixtec MMPL Co. Ltd.
|
|
Taiwan
|
RTE Far East Corporation
|
|
Taiwan
|
Eaton Electric (Thailand) Ltd
|
|
Thailand
|
Eaton Industries (Thailand) Ltd.
|
|
Thailand
|
Eaton Electric Company Ltd.
|
|
Thailand
|
Eaton Elektrik Ticaret Limited Sirketi
|
|
Turkey
|
Polimer Kaucuk Sanayi ve Pazarlama A.S.
|
|
Turkey
|
Ulusoy Elektrik Imalat Taahhut ve Ticaret AS
|
|
Turkey
|
D.P. Eaton Electric
|
|
Ukraine
|
Cooper Crouse-Hinds (LLC)
|
|
United Arab Emirates
|
Registration
number
|
|
Description
|
|
Filing
date
|
333-223296
|
|
Form S-3 Registration Statement
|
|
February 28, 2018
|
|
|
|
|
|
333-207689
|
|
Form S-8 Registration Statement-2015 Stock Plan
|
|
October 30, 2015
|
|
|
|
|
|
333-202308
|
|
Form S-3 Registration Statement
|
|
February 26, 2015
|
|
|
|
|
|
333-185206
|
|
Multiple plans - Form S-8 Registration Statement
|
|
November 30, 2012
|
|
|
|
|
|
|
|
Amended and Restated 2012 Stock Plan
|
|
|
|
|
|
|
|
|
|
Second Amended and Restated 2009 Stock Plan
|
|
|
|
|
|
|
|
|
|
Amended and Restated 2008 Stock Plan
|
|
|
|
|
|
|
|
|
|
Amended and Restated 2004 Stock Plan
|
|
|
|
|
|
|
|
|
|
Amended and Restated 2002 Stock Plan
|
|
|
|
|
|
|
|
|
|
Amended and Restated 1998 Stock Plan
|
|
|
|
|
|
|
|
|
|
Amended and Restated 1995 Stock Plan
|
|
|
|
|
|
|
|
|
|
Eaton Incentive Compensation Deferral Plan II
|
|
|
|
|
|
|
|
|
|
Eaton Corporation Deferred Incentive Compensation Plan II
|
|
|
|
|
|
|
|
|
|
2005 Non-Employee Director Fee Deferral Plan
|
|
|
|
|
|
|
|
|
|
Eaton Savings Plan
|
|
|
|
|
|
|
|
|
|
Eaton Personal Investment Plan
|
|
|
|
|
|
|
|
|
|
Eaton Puerto Rico Retirement Savings Plan
|
|
|
|
|
|
|
|
|
|
Cooper Retirement Savings and Stock Ownership Plan
|
|
|
|
|
|
|
|
/s/ Ernst & Young LLP
|
|
|
|
|
|
|
|
Cleveland, Ohio
|
|
|
|
February 26, 2020
|
|
|
|
/s/ Craig Arnold
|
|
/s/ Richard H. Fearon
|
|
Craig Arnold, Chairman; Principal Executive Officer; Director
|
|
Richard H. Fearon, Principal Financial Officer; Director
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Todd M. Bluedorn
|
|
Ken D. Semelsberger, Principal Accounting Officer
|
|
Todd M. Bluedorn, Director
|
|
|
|
|
|
|
|
|
|
/s/ Christopher M. Connor
|
|
/s/ Michael J. Critelli
|
|
Christopher M. Connor, Director
|
|
Michael J. Critelli, Director
|
|
|
|
|
|
|
|
|
|
/s/ Olivier Leonetti
|
|
/s/ Deborah L. McCoy
|
|
Olivier Leonetti, Director
|
|
Deborah L. McCoy, Director
|
|
|
|
|
|
|
|
|
|
/s/ Silvio Napoli
|
|
|
|
Silvio Napoli, Director
|
|
Gregory R. Page, Director
|
|
|
|
|
|
|
|
|
|
/s/ Sandra Pianalto
|
|
/s/ Gerald B. Smith
|
|
Sandra Pianalto, Director
|
|
Gerald B. Smith, Director
|
|
|
|
|
|
|
|
|
|
/s/ Dorothy C. Thompson
|
|
|
|
Dorothy C. Thompson, Director
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.
|
I have reviewed this annual report on Form 10-K of Eaton Corporation plc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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February 26, 2020
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/s/ Craig Arnold
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Craig Arnold
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Principal Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Eaton Corporation plc;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
February 26, 2020
|
|
/s/ Richard H. Fearon
|
|
||
|
|
|
Richard H. Fearon
|
|
||
|
|
|
Principal Financial Officer
|
|
Date:
|
February 26, 2020
|
|
/s/ Craig Arnold
|
|
||
|
|
|
Craig Arnold
|
|
||
|
|
|
Principal Executive Officer
|
|
Date:
|
February 26, 2020
|
|
/s/ Richard H. Fearon
|
|
||
|
|
|
Richard H. Fearon
|
|
||
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|
|
Principal Financial Officer
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|