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WASHINGTON: US conglomerate General Electric Co. said on Tuesday that its fourth quarter profit would be at the lower end of its forecast as it embarks on restructuring and other actions to cope with financial turmoil.
The lowered outlook, in which earnings are forecast to hit 50-52 cents per share, remains in line with expectations as analysts predict a profit of 51 cents per share.
The multinational US manufacturing and services giant also said in a statement that restructuring and other charges could be as high as 1.4 billion dollars after taxes.
But despite the difficult economic environment, the company expects to earn more than 18 billion dollars in 2008, including potential restructuring and other charges, GE vice chairman Keith Sherin said.
The restructuring and other actions would strengthen the company to better perform in the current economic environment and position it for profitable long-term growth, the GE statement said.
"Concerns continue to stem from financial headwinds, given the company's exposure to lending and capital markets," said Briefing.com, an Internet market analysis firm, pointing to turmoil driving heavy write-downs in the company's key capital unit.
In reassuring the market, GE said that a number of "tough but prudent actions" would be taken to make GE Capital unit "safer, stronger and more secure during this financial crisis."
"GE Capital is an invaluable part of GE's portfolio, and we are fully committed to financial services," Sherin said. "We are committed to being a Triple-A company."
GE serves customers in more than 100 countries and employs more than 300,000 people worldwide.
In July, GE announced a new "simplified" organisational structure around four core segments as it set the stage for a spin-off of its consumer and appliance businesses.
GE's divisions include Technology Infrastructure, which includes health care, aviation and transportation; and GE Energy Infrastructure, making generators, wind turbines and other equipment for the energy sector.
GE Capital, another of the new segments, includes financial services including commercial finance and GE Money consumer finance.
GE also controls NBC Universal, the media-entertainment powerhouse that includes NBC television and Universal Pictures. - AFP/de
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