October 30 (Renewables Now) - The renewable energy arm of US conglomerate General Electric Co (NYSE:GE) saw its third-quarter profit shrink by 72% year-on-year to USD 60 million (EUR 52.8m), even though revenues improved.
The company blamed the decrease on “continued pricing challenges” in the market and lower repowering volumes, according to a press release from Tuesday. The profit margin of the segment fell to 2.1% from 8.7% a year back.
GE Renewable Energy posted a 15% increase in third-quarter revenues to USD 2.87 billion, with sales of onshore wind equipment rising 37%. Orders in the three months shrank by 3% on the year and amounted to USD 2.88 billion.
For the first nine months of 2018, GE Renewable Energy recorded a 51% year-on-year drop in net profit to USD 220 million, with a profit margin of 3.6%, down from 6.8%. Revenues were 6% lower, coming at USD 6.17 billion, while orders slipped by 1% to USD 7.04 billion.
Overall, GE reported negative net earnings per share (EPS) of USD 2.69 for January-September, compared to a positive result of USD 0.24 per share in the same period of 2017. Adjusted EPS declined to USD 0.49 from USD 0.56. The company intends to cut its quarterly dividend from USD 0.12 to USD 0.01 per share with the doard's next dividend declaration, expected in December. This will allow GE to retain about USD 3.9 billion of cash per year compared to the prior payout level. It will also reorganise its traditional power business.
The company’s new chairman and CEO H Lawrence Culp commented: “We are on the right path to create a more focused portfolio and strengthen our balance sheet. My priorities in my first 100 days are positioning our businesses to win, starting with Power, and accelerating deleveraging.”
(USD 1.0 = EUR 0.879)