FAIRFIELD (dpa-AFX) - Diversified conglomerate General Electric Co. (GE) said Friday its first-quarter profit declined from a year ago, as it did not repeat last year's NBC Universal and Garanti sales. Lower results from GE Capital also impacted the bottom line. Excluding one-time items, earnings beat analysts' estimates driven mainly by higher industrial sales.
Looking ahead, GE said it is on track to deliver double-digit earnings growth in 2012 in both its Industrial businesses and GE Capital.
First-quarter net earnings attributable to GE's share owners fell 10 percent to $3.03 billion and earnings per share declined 6 percent to $0.29. The decline reflected charges of $0.2 billion from discontinued operations primarily related to GE'S intent to exit Irish mortgage platform in GE Capital.
Operating earnings, which excluded non-operating pension costs, edged up 1 percent to $3.59 billion and operating earnings per share grew 3 percent to $0.34, beating the consensus estimate of 13 analysts polled by Thomson Reuters by a penny. Analysts' estimates typically exclude one-time items.
The company said growth in operating earnings would have been 17 percent, excluding prior year's one-time gains from the sale of its stake in NBC Universal and Garanti.
Segment-wise, GE Capital Corp.'s earnings remained flat, but rose 27 percent excluding the Garanti sale impact last year. Energy infrastructure posted a 10 percent growth, while real estate segment returned to profitability - the first profit since the third quarter of 2008.
GE Chairman and CEO Jeff Immelt said, 'Today's results demonstrate that we are achieving Industrial growth and GE Capital continues to grow stronger. This quarter we witnessed broad-based strength in orders across all our Infrastructure businesses and in both equipment and services.'
Consolidated revenues fell 8 percent to $35.18 billion reflecting the non-repeat of last year's NBCU and Garanti sales and lower ending net investment at GE Capital.
Revenues, excluding NBC Universal sales, were up 4 percent to $35 billion. Analysts estimated revenues of $34.70 billion for the quarter.
Industrial sales grew 7 percent driven by improved performance in energy infrastructure, aviation, healthcare, transportation and home & business solutions. Industrial growth market revenues were up 14 percent, and revenues in the U.S grew 17 percent.
GE said its infrastructure orders were a record high for the first quarter at $23.1 billion, up 20 percent from the prior year. The company said pricing on new orders was up 50 basis points in total with higher prices in 4 out of 5 businesses.
For fiscal 2012, the company expects margins to increase 50 basis points as businesses continue to implement productivity projects and recognize value gap improvements. Margins on new business continue to be attractive, with overall portfolio margins increasing, GE noted.
The company also said it plans to return excess cash from GE Capital over the course of 2012, subject to review by the Federal Reserve.
In pre-market activity, GE shares are currently trading at $19.39, up $0.25 or 1.31 percent.
Copyright RTT News/dpa-AFX