NEW YORK: General Electric Co earnings topped analysts’ second-quarter estimates, as profit growth at the finance and energy units overcame a drop in wind-turbine orders.
Earnings from continuing operations rose 7% to US$4.01 billion, or 38 cents a share, excluding some costs, from US$3.75 billion, or 34 cents, a year earlier, Fairfield, Connecticut- based GE said today in a statement. That topped the 37-cent average of 12 analysts’ estimates compiled by Bloomberg.
GE is benefiting from Chief Executive Officer Jeffrey Immelt’s efforts to boost industrial earnings while shrinking the finance arm after about $32 billion of credit losses in the financial crisis. GE Capital profit rose to US$2.12 billion, a 31% gain, as energy earnings climbed 13%.
“Between finance and energy, those two provide such a big proportion of the earnings power of the company and they’re the ones that matter, with everything else mostly just details,” Brian Langenberg, principal and director of research at Langenberg & Co., said in a telephone interview.
GE Capital paid a $3 billion dividend to its parent company. It resumed the payouts in May after the Federal Resereve concluded its assessment of the business.
The industrial division’s order backlog climbed to a record $204 billion from $201 billion in the three months through March, GE said.
“We are executing on our growth strategy in the midst of a still volatile global economy,” Immelt said in the statement. “We achieved orders expansion in growth markets of 14 percent.” (Bloomberg/tw)