General Electric posts strong industrial profit, continues GE Capital sales
The company also expects to meet its goal of selling about $100 billion in GE Capital assets by the end of the year.
General Electric's industrial profit edged up 5% in the second quarter, a sign that the conglomerate's core business is getting stronger even as it sheds its financing assets.
GE posted a 5% increase in operating profit in its industrial division -- the core of the company that investors closely watch -- to $4.36 billion. Operating profit margin in the industrial segment also rose from 15.5% to 16.2%.
Executives also reiterated their plans to fight the U.S. Justice Department's lawsuit seeking to block GE's sale of its appliances division to Sweden-based Electrolux for $3.3 billion.
GE's total revenue increased 2% to $32.75 billion in the second quarter, compared to the same period a year earlier.
The company's power and water division fueled strong growth, posting an 8% increase in profit to $1.22 billion. That segment's performance accounted for about 46% of GE's industrial segment profit growth.
The earnings report comes as GE is actively selling most of the assets contained within its GE Capital unit. The company disposed of $68 billion in GE Capital assets during the second quarter and said it's on track to meet its goal of selling $100 billion by the end of the year.
Those efforts temporarily dented the bottom line. Because of charges associated with that process, the company swung from a $3.545 billion net profit a year ago to a $1.36 billion loss for the second quarter of 2015.
“Our operating execution remains excellent," GE CEO Jeff Immelt said on a conference call. "We’ve created a premier industrial company well positioned to win in this environment."
GE Chief Financial Officer Jeffrey Bornstein emphasized that the company plans to "vigorously defend" its decision to sell its appliances manufacturing business to Electrolux, which the Justice Department has challenged on antitrust grounds.
"Our goal remains to close this deal this year," Bornstein said on the call. "We are confident the transaction is good for customers and consumers."
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