General Electric is returning to “good, solid” earnings growth and plans to raise its dividend “at least” by 2011, chief executive Jeffrey Immelt told investors yesterday.
“The clouds are breaking and the forecast ahead of us is promising,” Immelt told the annual meeting of the largest US conglomerate in Houston.
The world’s largest maker of jet engines and electric turbines sees demand starting to rebound in its key markets, and expects to resume adding jobs in the US in the coming months, Immelt said. But it will take renewed investment by businesses, more than just consumer spending, to drive the US economy out of its worst downturn since the Great Depression.
“Typically, in a recovery, the consumer might be 70 per cent of the tail wind, if you will; and I just don’t think the consumer is going to be as much,” Immelt said.
Immelt expects profit growth to resume next year. General Electric cut its dividend 68 per cent during the credit crunch and conducted company-wide cost-cutting that reduced its headcount by about 26,000 to about 304,000 people worldwide.
The financial crisis and recession took a heavy toll on GE, bringing nine straight quarters of profit declines and briefly pounding its shares to two-decade lows.
City A.M. Reporter