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By Mike Caggeso
For the first time, overseas growth and revenue compromised more than half of General Electric Co. (GE) fourth-quarter earnings.
The company reported earnings of $6.8 billion, up 15% from earnings the previous year, and earnings per share (EPS) growth of 68 cents, up 17%. For fiscal 2007, earnings were $22.5 billion, up 16%, and EPS was $2.20, up 18%.
The surge of international growth was fueled by infrastructure growth, which accounted for 26% of profit growth. Total orders were up 18% to $27 billion.
The company forecasts full-year 2008 continuing EPS of at least $2.42.
GE Chairman and Chief Jeff Immelt said in a statement that the company is built to outperform in an otherwise stagnate U.S. market.
"Our record performance in such a tough environment validates the strength of our strategy and the talent of our team," Immelt said.
While many companies [and their investors] flocked to China and India to tap their growing middle classes, GE was in other countries… creating them.
In the former – a normally very politically and socially isolated country – GE inked a deal to build two power plants and help the desert nation [and Central Asia's leading source of natural gas] develop solar-energy production. Financial terms weren't disclosed.
In Algeria, GE won a $2.15 billion contract to build a 1,200-megawatt combined-cycle plant with Spanish power company Iberdrola S.A. over the next 46 months. In June, Alstom and GE signed deals totaling $767 million to build power plants in Algeria.
"Every place we went there's a need for power, there's a need for planes, there's lots of capital being invested, and there's just no signs this global infrastructure boom is slowing at all," Immelt told investors on a conference call.
News and Related Story Links:
- General Electric:
GE Reports Record Fourth-Quarter and Full-Year Results for 2007; 4Q EPS up 17%; 18% for the Year
- Money Morning:
Algeria Awards $4.1 Billion Worth of Power Plant Contracts; General Electric Part of $2.15 Billion Deal
- Money Morning:
GE to Build Two Power Plants in Turkmenistan