GE posts higher profits as aviation sector recovers

GE posts higher profits as aviation sector recovers

General Electric Co surprised Wall Street on Tuesday with a higher quarterly profit and positive cash flow, as a recovery in the aviation sector boosted its jet engine business, sending its shares higher. rose in operations prior to the opening of the market.

The industrial conglomerate reiterated that its full-year results were on track to be at the lower end of its forecasts, as supply chain difficulties and inflationary pressures remain.

However, it cut the free cash flow forecast for the full year by about $1 billion.

“Working capital will come under pressure as GE shields customers from the impact of supply chain challenges as well as renewable-related orders,” the company said.

The pressure will cause about $1 billion of cash flow to shift “into the future,” GE added.

In January, the company projected adjusted profit in 2022 to be in the range of $2.80 to $3.50 per share and expected to generate $5.5 billion to $6.5 billion of free cash flow.

GE shares were up 4.8% at $71.63 in the hours before the market opened.

Adjusted profit for the quarter through June was 78 cents a share, significantly higher than analyst expectations of 38 cents a share, according to Refinitiv.

The company posted $162 million of free cash flow in the second quarter.

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