Finance unit drags GE's profit down 35% to $2.8 billion

BOSTON: General Electric Co���s first-quarter profit fell less than analysts estimated as demand for energy equipment and jet engines tempered the effects of real-estate losses and rising consumer-credit defaults at GE Capital.

Profit from continuing operations declined 35% to $2.83 billion, or 26 cents a share, from $4.35 billion, or 43 cents, a year earlier, the Fairfield, Connecticut-based company said in a statement. GE rose in early trading after the results beat the average estimate of 21 cents a share in a Bloomberg survey of 11 analysts.

GE Capital posted lower earnings, and demand declined for medical equipment and NBC Universal advertising in the US recession. Investors had pushed GE stock to the lowest since 1991 during the quarter on concern the finance arm would undercut profit at the industrial units, including the largest makers of power-generation equipment and jet engines.

���Amid a continued weak economy, we���re performing well and our backlog remains strong,��� Chief Executive Officer Jeffrey Immelt said in the statement.

The company has lost about 67% of its market value in the year since Immelt surprised investors with a first- quarter 2008 profit decline and lowered annual forecast.

Revenue fell 9% to $38.4 billion. The equipment and service contract backlog was $171 billion, just $1 billion less than at Dec. 31, GE said.

���The backlog was flat for the quarter but actually up year over year,��� Peter Sorrentino, who helps manage about $13.3
billion at Huntington Asset Management in Cincinnati, said in an interview with Bloomberg Television.