General Electric Posts 9% Profit Drop but Beats Forecasts
NEW YORK - General Electric (IW 500/6) on Friday reported a 9% drop in third-quarter earnings as revenues slipped, driven by a downsizing of its financing arm, GE Capital, and a negative currency impact.
Net earnings at the U.S. industrial giant totaled $3.2 billion for the July-September period, compared to the year-ago figure of $3.5 billion.
Net earnings per share fell by two cents to 31 cents.
Operating earnings came in at 36 cents per share, beating analyst expectations of 35 cents.
Revenue fell 1.5% from a year ago, to $35.7 billion, below Wall Street estimates.
It was the third consecutive quarter of lower revenue for the Fairfield, Conn., conglomerate, which provides financing and builds an array of products, from power systems and aircraft engines to appliances such as microwaves and refrigerators.
Revenues were hit as the company continued to pare GE Capital's assets portfolio to focus on its core businesses. The finance arm's profit was up 13% quarter-over-quarter.
A negative impact from foreign exchange rates of $132 million also weighed on revenues.
"Our third-quarter results were very strong in an improving global business environment," GE Chairman and CEO Jeff Immelt said in a statement.
Immelt noted 19% growth in orders around the world. The orders backlog hit $229 billion, a record for the company.
"Industrial margins grew 120 basis points in the quarter, and we are on track for planned margin expansion of 70 basis points for the year," he said.
Copyright Agence France-Presse, 2013
