Qioptiq logo Raytheon Global MilSatCom

BUSINESS NEWS

15 Apr 14. GKN warns of modest growth after earnings jump. Shares in GKN rose after the FTSE 100 British engineer posted a 22 per cent rise in quarterly profit, boosted by growth in the car and commercial aerospace markets as it cautioned growth would be more modest later this year.
The Redditch-based company, which makes car and plane components, said pre-tax profits had risen to £145m in the first quarter on the back of higher global car production, compared with £119m it made in the same period last year. GKN, which is one of the world’s biggest makers of car steering systems, reported a 5 per cent rise in sales to £885m at its GKN Driveline division, which accounts for almost half of the group’s overall revenues. The unit benefited from a strong performance in China, where light vehicle production rose 10 per cent in the first quarter, and a one-off benefit of an increase in car sales in Japan because of short-term government incentives. However, the company warned that growth would be more modest for the remainder of 2014. “Looking forward to the rest of the year, tougher prior year comparators mean that organic growth is likely to be more modest,” said Nigel Stein, chief executive. The FTSE 100 group has focused on expanding its commercial aerospace presence in recent years to counteract a weakening military aircraft market and volatile sales from the car industry. In February, Mr Stein said it was eyeing acquisitions in the civil aviation sector as it seeks to further boost its commercial aerospace revenues. GKN also reiterated its warning from its full-year results in February that currency movements would limit its 2014 performance. Group sales rose 7 per cent on an organic basis but were offset by a 6 per cent adverse currency translation because of sterling’s strength against most major currencies. Sales ended the quarter up 1 per cent at £1.9bn. Revenues at its aerospace division were flat at £546m, after organic growth of 5 per cent was offset by foreign exchange fluctuations. (Source: FT.com)

16 Apr 14. GE has been under pressure to reduce its dependence on earnings from its finance arm and improve the performance of its industrial businesses. General Electric Co. GE IN Your Value Your Change Short position (GE) said its first-quarter income declined 15% as the conglomerate’s revenue slipped. Chief Executive Jeff Immelt said the company saw strength in most markets, including power and water, aviation and oil and gas. At a time of weak revenue growth, GE and its competitors have been able to eke out more profit by making cuts and improving productivity. GE also has sought to shrink the size of its financing arm and has been under pressure to improve the performance of its industrial businesses. The company has invested in developing new industrial operations such as oil and gas, while shedding financial assets such as real estate and stakes in international banks. Last year, the company outlined plans to exit the retail lending business, and in March, GE filed for an initial public offering of its North American retail finance business, which will operate under the name Synchrony Financial.
“The environment is consistent with our expectations, with a positive bias,” Mr. Immelt said in a statement. “GE is in good shape.” Overall, GE reported a profit of $3bn, or 30 cents a share, down from $3.53bn, or 34 cents a share, year earlier. Operating earnings were 33 cents a share, down from 39 cents a share. Revenue declined 2.2% to $34.18bn. (Source: Reuters)

16 Apr 14. IBM’s quarterly revenue sinks to 5-year low as hardware sales fall. IBM Corp reported its lowest quarterly revenue in five years on Wednesday as the company struggles with falling demand for its storage and server products. Shares of Big Blue fell about 4 percent to $188.20 in after-hours trade. Total revenue fell 4 percent to $22.5bn in the first quarter, below analysts’ average estimate of $22.91bn. “They have had eight revenue declines in a ro

Back to article list