GE reports 22 percent drop in earnings

HARTFORD, Conn. (AP) — General Electric Co. spared investors any nasty surprises as it reported a 22 percent drop in third-quarter earnings Friday, meeting its own lowered forecast and blaming the decline on its struggling finance arm. The company’s loan and lease business has been hammered by the worst financial crisis since the 1929 stock market crash.

GE, which also makes everything from jet engines to water treatment systems and owns NBC Universal, reported net income of $4.3 billion, or 43 cents per share. Sales rose 11 percent to $47.23 billion.

A year earlier, the company earned $5.56 billion, or 54 cents.

The Fairfield, Conn.-based company has cited softening profits at GE Capital, which provides financing ranging from consumer car loans to energy project lending. Since the spring, troubled credit markets and waning confidence in global financial systems have cut into profits there. GE has lowered its 2008 earnings forecast twice since April, announced a reorganization and raised capital through the sale of $15 billion in stock, including $3 billion in preferred shares to Warren Buffett’s Berkshire Hathaway Inc.

Analyst Nicholas Heymann of Sterne Agee in New York said investors are nervous that GE may lower its full-year forecast again.

“Investors are saying. ‘We see two adjustments before we get into rough seas. How many are we going to see when we’re in rough seas?’”