GE earnings surge

 
City A.M. Reporter
General Electric posted an 80 per cent surge in first-quarter profit, blowing past Wall Street forecasts and joining a wave of better-than-expected earnings from US manufacturers.

The largest U.S. conglomerate was helped by a pickup in demand for railroad locomotives - a weak spot over the past year - as well as higher revenues at its healthcare and energy business. Profit at GE Capital, which was the company's Achilles heel during the financial crisis, more than tripled.

GE also raised its dividend for the third time since July and Its shares rose nearly four per cent to $21.20 in premarket trading, within sight of their 52-week high of $21.65.

"You have got growth coming out of every segment of GE, which is quite encouraging. Infrastructure orders are up 13 per cent," said Daniel Holland, equity analyst at Morningstar in Chicago.

The world's biggest maker of jet engines and electric turbines said earnings attributable to common shareholders came to $3.36bn (£2.02bn), or 31 cents per share, up from $1.87 billion, or 17 cents per share, a year earlier.

Revenue rose six per cent to $38.45bn.

"This is a superb turnaround," said Howard Wheeldon, senior strategist at BGC Partners in London. "GE is reflecting an improvement in the U.S. economy and indeed more importantly it reflects the improvement of the global economy."