GE Sees Sharp Profit falls in Q2

General Electric (IW 1000/11) reported Friday an 18% profit fall in the second quarter but kept its full-year outlook as a backlog of orders reached a record high. The company posted $3.1 billion net earnings.

Earnings per share of 38 cents were one cent higher than the average market estimate.

Revenues, up 2% at $36.5 billion, were hit by unfavorable foreign-exchange rates and further shrinkage of the company's GE Capital business, the unit that battered earnings during the 2008-2009 financial crisis, the company said.

Revenues slightly missed expectations of $36.8 billion.

The multinational, seen as a bellwether of the world economy with businesses including aircraft engines, wind turbines, energy, home appliances and finance, said its industrial segment revenues jumped 9% to $25 billion.

"Today's results demonstrate that we are executing on our growth strategy in the midst of a still volatile global economy," GE chairman and chief executive Jeff Immelt said in a statement.

"Our industrial segments delivered another quarter of double-digit organic revenue growth. 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%," he said.

In growth markets, revenues jumped 17%, driven by double-digit growth in Australia, Canada, China, Latin America, the Middle East/North Africa, Southeast Asia and Russia.

GE said it ended the quarter with a record backlog of $204 billion.

The Fairfield, Connecticut-based company's cash pile was $74 billion.

Copyright Agence France-Presse, 2012