Industrial conglomerate General Electric Co. (GE) said Wednesday that it does not expect its industrial profit margin to grow as much as anticipated in 2012, but will make up the difference in 2013. The company's Chief Executive Officer Jeff Immelt revealed this while speaking during a presentation at the 2012 Electrical Products Group conference in Florida earlier in the day.
The company had earlier forecast a 2012 operating margin improvement of 50 basis points to 15.4 percent from last year. However, Immlet cast the improvement figure at 30 basis points only during his presentation.
Immlet primarily attributed the anticipated higher shipments of low-margin wind turbines in 2012 than in 2013.
However, Immlet noted that the forecast for 2013 margin improvement is between 50 and 70 basis points, and is expected to see a two-year margin improvement of up to 100 basis points to 15.9 percent.
The company also said its industrial organic growth is now seen in a range of 5 to 10 percent.
Further, the company noted that it in the process of shrinking GE Capital and that is expected to continue. Immlet is looking to pull out of consumer finance and cutting its real estate holdings.
Meanwhile, GE also cut the financial arms profit growth outlook to now be in single-digit percentage in 2013, down from the previous forecast for double-digit growth, citing the anticipated drop in investments outside GE's core industrial operations.
The company added it is taking a special dividend of $4.5 billion from its financial arm, and putting it through a share buyback, and will continue to grow dividends in line with its earnings. Last week, the Federal Reserve gave GE Capital approval to resume returning a share of its profit to the parent company.
GE closed Wednesday's regular trading session at $19.18, unchanged on a volume of 63.50 million shares.
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