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GE's Majap Unit Notches Profit Increase

7/11/2003 07:54:00 AM Eastern

Fairfield, Conn. — Sparked by the introduction of such new products as an intelligent clothes-care system, the consumer products segment at General Electric — which includes major appliances and lighting goods — achieved double-digit earnings growth of 11 percent in the second quarter.

Consumer products operating profit hit $164 million in the second three months, up from $148 million in the year-ago period. Segment operating profit excludes certain charges, retiree benefits, interest and income taxes.

However, sales in GE's consumer products segment during the second quarter were relatively flat. The business registered a 1 percent decline in revenue during the period, down to $2.14 billion, from $2.15 billion in the same quarter in 2002.

For the six months GE's consumer products segment posted a 7 percent increase in operating profit, to $277 million, compared with $259 million in the same six months a year earlier.

Segment revenue, as in the second quarter, continued to trail earnings results, with six-month sales dropping 3 percent, to $4 billion, down from $4.1 billion in the same six months a year ago.

GE pointed to certain segment highlights that carried the majap business in the second quarter, namely the launching of 18 new products, including the GE Profile Harmony Clothes Care System and GE Profile Stainless Steel cooking, dishwasher and refrigeration products.

It also said sales of Monogram high-end products increased more than 15 percent in the second three months, while the high-end Profile line registered continued strength.

With eight of GE's businesses delivering double-digit earnings growth in the second quarter — 'three months of broad-based performance in a tough economy,' said the company — the manufacturing giant expects to also achieve significant growth in the second half, when nine of 13 business segments should notch double-digit earnings gains.

Consolidated second quarter sales were about the same quarter over quarter, hitting $33.37 billion, compared with $33.33 billion.

Overall second quarter earnings reached $3.8 billion, down 14 percent from the $4.4 billion reported a year earlier.