Insurance losses mar GE results

GE's boss says the firm had an excellent year

Huge losses at General Electric's former insurance business have hurt profits at the US industrial giant.

The firm saw its earnings fall 3% to $16.3bn (£9.2bn) in 2005, due mainly to losses at its insurance businesses, most of which have since been sold.

In the final quarter, GE incurred $2.7bn of losses from its insurance arm, dragging total profits down 46%.

But GE said the fundamentals of its business remained strong and that the outlook for 2006 remained positive.

Excluding the losses and measuring only its continuing businesses, the company's profits rose slightly to $5.77bn.

Sales in the quarter, however, fell slightly short of expectations at $40.7bn.

Momentum

GE is best known for manufacturing jet engines but owns a diverse range of businesses including the NBC Universal film studio.

The current economic environment remains positive Jeff Immelt, GE chief executive

Excluding losses from discontinued operations, GE generated record profits of $18.3bn in 2005, up 12% on the previous year.

Sales from retained business rose 11% to $149.7bn.

GE said 2005 had been an "excellent year" for its business, with total orders up 10%.

"Looking into 2006, the current economic environment remains positive and is in line with our expectations," said chief executive Jeff Immelt.

"We enter 2006 with solid momentum and a strong outlook."