Tomahawk, WI 10/21/2011 (PennyPayDay) – General Electric Co. (NYSE:GE) reported an 18 percent profit rise that met Wall Street's expectations, helped by strong revenue growth in key foreign markets including Brazil, Russia and China.The largest U.S. conglomerate said on Friday it expects earnings to rise at a double-digit percentage rate next year, following peer United Technologies Corp in trying to assuage investors' fears about Europe's brewing debt crisis.
"We continue to successfully navigate a volatile global economy," Chief Executive Jeff Immelt said in a statement.
Investors took heart in the company's 16 percent growth in industrial equipment orders -- an important indicator of future revenue, and in the 25 percent rise in international sales. GE has been counting on strong demand in rapidly developing economies to offset weak U.S. and European demand.
"The revenue number was strong and the organic growth rate in industrial was strong," said Jack De Gan, chief investment officer at Harbor Advisory Corp in Portsmouth, New Hampshire. "Those are telling and they give us a little bit of a look into next quarter and beyond."
But GE shares declined 1.4 percent to $16.40 in premarket trading as some raised concerns that its profit margins were weaker than expected in the quarter, with a low tax rate helping the company to meet expectations.
"Margins missed our forecast and were down year on year in the four big industrial businesses," said Jeffrey Sprague, managing partner at Vertical Research Partners. "There is little or no operating leverage in GE's portfolio due to low priced equipment in backlog and R&D headwinds."
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