The story appears on

Page A12

January 25, 2018

GET this page in PDF

Free for subscribers

View shopping cart

Related News

Home » Business » Manufacturing

GE posts US$10b loss, income fall in Q4

GENERAL Electric Co forecast further weakening of its troubled power business yesterday as it reported a US$10 billion loss and a 5-percent fall in revenue in the fourth quarter, driven by previously-announced charges for insurance losses and taxes.

While the results contained no new sizeable charges, they threw into stark relief how far the US industrial conglomerate had veered from its outlook less than a year ago, when former Chief Executive Jeff Immelt predicted that sales would rise as much as 5 percent in 2017 and margins would expand by a full percentage point.

In fact, GE said, sales fell 1 percent to US$122.1 billion in 2017 and operating profit margins contracted by 5.7 percentage points to 5.7 percent.

The results also indicated that GE’s painful turnaround, which has sent its stock down 43 percent over the last year as investors fled, likely has more months to run.

The stock was higher in part on investor relief that the company reaffirmed its 2018 profit forecast, RBC Capital Markets analyst Deane Dray said in a note to clients.

“Some short-covering could be triggered just on the news that GE reaffirmed 2018, but the gravity of its operating challenges — especially at Power — are likely to continue to pressure the stock over the near-term,” he wrote.

GE kept unchanged its recent forecast for 2018 earnings of between US$1.00 and US$1.07 a share, which contrasts markedly with US$2 a share that Immelt had promised before being replaced as CEO in August.

GE’s weakening performance largely reflected deterioration in GE’s power business, where profit plunged 88 percent in the quarter. The division, which makes and services electricity generating equipment, attributed the drop to unspecified charges and other factors. Revenue and orders also fell sharply at the power business.




 

Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend