Investor Presentaiton
Cash Flows
A summary of cash flows is as follows:
Change
Change
(In millions)
2022
from 2021
2021
from 2020
2020
Net cash provided by operating activities
$
2,533 $ 370 $
2,163 $
(781) $ 2,944
Net cash provided by (used in) investing activities
(1,200)
564
(1,764)
(2,161)
397
Net cash used in financing activities
(1,340)
(805)
(535)
2,723
(3,258)
Effect of currency on cash
4
9
(5)
10
(15)
Total increase (decrease) in cash
$
$
(141)
$
68
Operating Cash Flow
Net cash provided by operating activities increased by $370 million in 2022 compared to 2021. The increase in net cash
provided by operating activities in 2022 was primarily due to taxes paid on the sale of the Hydraulics business in 2021, cash
received from the termination of interest rate swaps in 2022, lower pension contributions in 2022 due to a $200 million
contribution to Eaton's U.S. qualified pension plan in 2021, and higher net income in 2022, partially offset by higher working
capital balances to support the Company's organic growth.
Net cash provided by operating activities decreased by $781 million in 2021 compared to 2020. The decrease in net cash
provided by operating activities in 2021 was primarily due to higher working capital balances to support the Company's organic
growth as our business segments had largely recovered from the negative impact of the COVID-19 pandemic, taxes paid on the
sale of the Hydraulics business, and a $200 million pension contribution to Eaton's U.S. qualified pension plan in 2021.
Investing Cash Flow
Net cash used in investing activities decreased by $564 million in 2022 compared to 2021. The decrease in the use of cash
was primarily driven by the decrease in cash paid in 2022 for business acquisitions to $610 million in 2022 compared to $4,500
million in 2021, proceeds from the sale of certain office and distribution facilities in 2022, and the decrease in cash paid for
investments in associate companies to $42 million in 2022 from $124 million in 2021, partially offset by proceeds received in
2021 from the sale of Hydraulics business of $3,129 million and net purchases of short-term investments of $19 million in 2022
compared to net sales of $379 million in 2021. Capital expenditures were $598 million in 2022 compared to $575 million in
2021.
Net cash used in investing activities increased by $2,161 million in 2021 compared to 2020. The increase in the use of cash
was primarily driven by cash paid in 2021 for business acquisitions of $4,500 million compared to cash paid in 2020 for
business acquisitions of $200 million, partially offset by proceeds received in 2021 from the sale of Hydraulics business of
$3,129 million compared to proceeds received in 2020 from the sale of the Lighting business of $1,408 million, and net sales of
short-term investments of $379 million in 2021 compared to net purchases of $441 million in 2020. Capital expenditures were
$575 million in 2021 compared to $389 million in 2020.
Financing Cash Flow
Net cash used in financing activities increased by $805 million in 2022 compared to 2021. The increase in the use of cash
was primarily due to higher payments on borrowings of $2,012 million in 2022 compared to $1,013 million in 2021, higher
share repurchases of $286 million in 2022 compared to $122 million in 2021, and higher dividends paid of $1,299 million in
2022 compared to $1,219 million in 2021, partially offset by an increase in net proceeds of short-term debt $317 million in
2022 from $20 million in 2021 and higher proceeds from borrowings of $1,995 million in 2022 compared to $1,798 million in
2021.
Net cash used in financing activities decreased by $2,723 million in 2021 compared to 2020. The decrease in the use of cash
was primarily due to higher proceeds from borrowings of $1,798 million in 2021 compared to no proceeds from borrowings in
2020, lower share repurchases of $122 million in 2021 compared to $1,608 million in 2020, and net proceeds of short-term debt
of $20 million in 2021 compared to net payments of $254 million in 2020, partially offset by higher payments on borrowings of
$1,013 million in 2021 compared to $249 million in 2020.
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