$13.6b loss hits GE

$13.6b loss hits GE

New  York — The industrial heart of General Electric, the company’s new focus, posted lower revenue and earnings in the first quarter amid an enormous overall loss resulting from its recently-announced sale of most of the assets in its finance subsidiary.

Net income from the part of GE that the company will retain after the sale fell five per cent to $3.1 billion, the company said on Friday. Adjusted earnings per share fell six per cent to 31¢, a penny better than analysts polled by Zacks Investment Research expected, on average.

Revenue fell 12 per cent to $29.4 billion, below the $34.4 billion analysts expected.

GE chief executive officer Jeff Immelt said in a statement that the global economic environment remained “volatile” but that investments in large infrastructure projects being made around the world provided opportunities for growth.

GE announced last week it would sell most of the assets in its GE Capital subsidiary, the latest and most dramatic move by the company to transform itself into a more focused industrial conglomerate that makes large, complicated equipment for other businesses.

“This is the plan for the future of GE as a fast-growth, high-tech industrial company,” Immelt said in a statement on Friday.

Costs and charges associated with the sale totalling $14.1 billion pushed the company to an overall loss of $13.57 billion in the quarter, down from a profit of $3 billion during last year’s first quarter. On a per-share basis, the company lost $1.35.