General Electric (GE) posted second quarter earnings gains in-line with analysts’ expectations Friday, as industrial margins improved and the company said it is readying an initial public offering for its Synchrony Financial segment later this month.
The IPO for Synchrony Financial, GE’s North American retail finance business, is planned for the end of July, the company announced. It’s the first step in GE’s planned exit from its consumer finance unit.
GE saw an adjusted profit increase of $3.9 billion, up 8% year-over-year with earnings per share of 39 cents, the company said. Earnings-per-share results matched the average analyst estimate, according to data compiled by Bloomberg.
“GE had a good performance in the quarter and in the first half of 2014, with double-digit industrial segment profit growth,” Jeff Immelt, GE chairman and CEO, said in a statement. “The environment continues to be generally positive.”
The on-target second quarter earnings come on the back of GE’s largest-ever acquisition, the $17 billion purchase of Alstom’s (ALO) energy assets. The purchase advances Immelt’s plan to boost GE’s industrial business.
Industrial units are expected to account for 75% of earnings by 2016, up from 53% last year. Alstom’s gas and turbine business will help meet that goal as it is expected to add 6-9 cents per share to earnings in 2016.
GE is on track to cut $1 billion or more in structure costs for the year. About $382 million has been cut in the first half of 2014. The company may also be considering a sale of its appliances business after a similar effort in 2008.