Diversified conglomerate General Electric Co. (GE: Quote) reported Friday a profit for the second quarter that declined 18 percent from last year, hurt by losses from discontinued operations.
Stripping out special items, operating earnings grew 7 percent on revenue growth at industrial segment. Meanwhile, GE Capital revenues declined 8 percent.
Operating earnings per share topped analysts' expectations by a penny, while quarterly revenues missed their estimates. The also company added that it remains on track to deliver on double-digit earnings growth in 2012 for both Industrial and GE Capital segments.
"Today's results demonstrate that we are executing on our growth strategy in the midst of a still volatile global economy. CEO Jeffrey Immelt said.
The Fairfield, Connecticut-based company reported net earnings of $3.11 billion or $0.29 per share for the second quarter, lower than $3.76 billion or $0.35 per share in the prior-year quarter.
Earnings from continuing operations for the quarter grew to $3.66 billion or $0.34 per share from $3.57 billion or $0.33 per share in the year-ago quarter.
Excluding items, operating earnings increased to $4.01 billion or $0.38 per share from $3.75 billion or $0.34 per share in the year ago.
On average, 12 analysts polled by Thomson Reuters expected the company to report earnings of $0.37 per share for the second quarter. Analysts' estimates typically exclude special items.
Total revenues for the quarter grew 2 percent to $36.50 billion from $35.62 billion in the same quarter last year, but narrowly missed nine Wall Street analysts' consensus estimate of $36.80 billion.
However, infrastructure orders were down slightly amid a 37% decrease in orders for wind turbines.
Revenues were negatively impacted by $0.9 billion due to foreign exchange translation and further shrinkage of GE Capital business.
The company noted, "Our strategy to invest in growth markets is paying off, as we achieved orders expansion in growth markets of 14% and revenue growth of 17%." The company also ended the quarter with a record backlog of $204 billion.
Revenues from GE's industrial segment improved 9 percent to $25.04 billion from a year ago, with organic growth of 10 percent, while GE Capital revenues decreased 8 percent to $11.46 billion from the prior-year quarter.
The strength of GE's Industrial portfolio was underscored by strong segment profit increases in Energy, Oil & Gas and Transportation, the company said.
Separately, GE said it will simplify its energy business, reorganize it into three standalone businesses by the end of the fiscal year.
GE closed Thursday's regular trading session at $19.80, down $0.11 on a volume of 37.32 million shares, lower than the three-month average volume of 49.16 million shares. In the past 52-week period, the stock has been trading in a broad range of $14.02 to $21.00.
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by RTT Staff Writer
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