Little Chalfont, U.K.-based GE Healthcare posted profits of $735 million for the three months ended March 31, up 11.2% compared with Q1 2017, on sales growth of 9.2% to $4.70 billion.
The Boston-based industrial conglomerate said orders were up 4.3% to $4.73 billion for the healthcare business, with the profit growth driven by volume and productivity. Earlier this month the company said it agreed to sell its value-based healthcare division to Veritas Capital for $1.05 billion in cash; that deal is expected to close during the third quarter, GE said today.
And although its overall losses widened some 912% during the quarter, to -$1.18 billion, or -14¢ per share, GE said Q1 sales grew 9.2% to $26.87 billion. Adjusted to exclude one-time items, earnings per share were 16¢, 4¢ ahead of The Street, where analysts were looking for revenues of $27.52 billion.
“The first quarter is a step forward in executing on our 2018 plan and we are seeing signs of progress in our performance. Industrial earnings, free cash flow and margins all improved year over year. We reduced industrial structural costs by $805 million and are on track to exceed our cost reduction goal of $2 billion in 2018,” chairman & CEO John Flannery said in prepared remarks. “Aviation, healthcare, renewables, and transportation grew earnings, and BHGE continues to execute on its plan. Power is making progress on cost actions and operational and services execution, but the industry continues to be challenging and is trending softer than our forecast. We are working to resolve legacy matters in our discontinued operations, and we recorded a reserve of $1.5 billion related to the WMC FIRREA investigation. We are making significant progress on the $20 billion of dispositions planned for 2018 & 2019. There is no change to our framework for 2018.”
GE shares were trading at $14.56 today in early activity, up 4.0%.