GE profit up 9.6%, to exit sub-prime

July 15, 2007 - 0:0

BOSTON (Reuters) -- General Electric Co. posted a 9.6 percent rise in quarterly profit Friday on good results in its commercial finance business and strong demand for products ranging from jet engines to gas turbines.

The company also said it had decided to exit the sub-prime lending business, where it recorded a loss in the quarter. GE, whose operations also include NBC media, said second-quarter profit rose to $5.42 billion, or 53 cents per share, from $4.95 billion, or 48 cents per share, a year earlier. Operating profit came to 52 cents per share, matching the average forecast of analysts polled by Reuters Estimates. Revenue rose 12 percent to 42.32 billion dollars. Profit rose at five of GE's six segments, declining only in health care, where operating earnings slipped 8 percent. The company attributed that to regulatory changes. GE said it expects to report third-quarter earnings from continuing operations of 54 cents to 56 cents per share. Analysts expect 55 cents, according to Reuters Estimates. The company also said it would repurchase up to $14 billion of its shares this year. With the U.S. economy slowing, investors have focused on the Fairfield, Connecticut-based conglomerate's growth prospects overseas. GE expects to generate half its revenue outside the United States this year. In May, GE agreed to sell its GE Plastics unit to Saudi Basic Industries Corp. for $11.6 billion. The deal, expected to close in the third quarter, will remove from GE's portfolio a business that had been a drag on profits