GE Reports 49% Slump in Quarterly Profit

However all business segments remain profitable

General Electric said on July 17 that profits in the past quarter fell 49% from a year ago to $2.68. However the company, which makes aircraft engines, energy equipment and owns the NBC Universal media entertainment group, remained profitable in all its segments, including its struggling finance unit.

"In a global economic environment that continues to remain challenging, GE delivered solid second-quarter business results," CEO Jeff Immelt said. "We are executing through the recession by aggressively controlling costs and driving working capital improvements while continuing to invest for future growth," he added.

"At the same time, we are actively maintaining our backlog, focusing on higher-margin services and continuing to run our financial services business for safety and soundness. We continue to position GE to win in a reset economy."

The profit amounted to 26 cents per share, three cents better than expected by Wall Street, on revenues of $26 billion, a 17% drop from a year ago.

GE Capital Finance saw its profit fall 80% from a year ago to $590 million and Immelt said it "remains on track to be profitable for the full year."

GE, sometimes seen as a microcosm of the economy, said its results were driven by orders for "high margin services" for industry: industrial revenues grew 31% in China; 46% in India; and 10% in the Middle East.

It also cited a record $8 billion in order by GE and its two aircraft engine joint ventures at the Paris Air Show, and said it was seeking to play a role in 400 global stimulus projects.

GE's Energy Infrastructure unit reported profits up 13% at $1.79 billion on revenues unchanged from a year ago at $9.6 billion.

Its Technology Infrastructure earnings declined 11% to $1.8 billion, reflecting "softened demand and pricing pressure in healthcare and transportation."

NBC Universal said profits down 41% at $539 million, with revenue off 8% at $3.6 billion.

Copyright Agence France-Presse, 2009

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