General Electric to Push Industrials as Finance Unit Soars
Though General Electric (NYSE:GE) has one of the most diversified businesses of all U.S. corporations, the company is trying to focus on industrial operations as its risky yet profitable finance unit continues to show strength. The GE earnings report of January 17 showed strong overall growth, with a 20 percent increase in earnings-per-share over the fourth quarter of 2012, meeting expectations.
Chief executive Jeffrey Immelt said in the earnings release that the strength in GE’s U.S. business was tempered by the “mixed” environment the company faces in Europe. Immelt also noted how the company was continuing with its plan of “reducing the size of GE Capital” while the division yielded exceptional profits. On the strength of an IPO of Swiss assets, the finance unit saw 38 percent gains in earnings. Furthermore, GE Capital’s volume was up 5 percent in the fourth quarter of 2013 compared to the prior year’s figures.
On the industrial side, GE hopes to grow — segment profits jumped 12 percent on the quarter. That included a $244 billion backlog that the company said was unprecedented. Six of seven segments in the industrial sector showed growth. Other divisions helped buoy the conglomerate at the end of 2013.