GE Capital sees double-digit 2012 earnings growth
(Reuters) - General Electric Co (GE.N) expects profit at its GE Capital finance arm to rise at a double-digit percentage rate next year, the unit's head said at an investor meeting on Tuesday.
The unit of the largest U.S. conglomerate said it was monitoring Europe's debt crisis and doing frequent reviews of the counterparties to which it is exposed, and reiterated its plan to resume paying a dividend back to the Fairfield, Connecticut-based parent company next year.
Having cut $4 billion in costs from its operations since 2007, GE Capital is prepared for any downturn in the world economy, said Michael Neal, a GE vice chairman who runs the division.
"Things could get worse. We don't predict the world," said Neal, who ran the unit through the global financial crisis. "If it does, we have levers in the business as well. We have great experience from the last couple of years."
The business is bracing for a tougher credit environment in Europe next year and would be open to buying assets there if the right opportunity arose, Neal said.
"We certainly expect there to be a recession in Europe," said GE Capital Chief Financial Officer Jeff Boorstein. "Things are going to be fairly tough in Europe."
GE shares closed up 2.4 percent at $16.72 on the New York Stock Exchange.
Earlier on Tuesday blue-chip manufacturer 3M Co (MMM.N) set a 2012 profit target that called for growth of about 8 percent, slightly above Wall Street's expectations.
GE CEO Jeff Immelt is scheduled to meet with investors next week to detail the company's overall expectations for 2012. The CEOs of peers including United Technologies Corp (UTX.N), Honeywell International Inc (HON.N) and Danaher Corp (DHR.N) are also due to brief investors next week.
(Reporting by Scott Malone in Boston; Editing by Tim Dobbyn, Dave Zimmerman)
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