NEW YORK – General Electric Co. (GE) on Thursday said it is streamlining its businesses to six operating units from 11 in a move to cut costs, and it affirmed its second-quarter and full-year profit forecast.
The conglomerate, whose businesses range from health care to aerospace and television, also named three vice chairman in the realignment.
"These changes will accelerate GE's growth in key industries," Chief Executive Jeff Immelt (search) said. "We have been moving toward a more customer-focused organization for several years. In addition, we believe we can reduce $200-300 million of cost in savings and structural redundancies."
Immelt said the company is on track to hit its earnings targets of 43 cents to 45 cents per share for the second quarter and $1.78 to $1.83 for 2005.
Analysts, on average, expect the company to earn 44 cents per share for the quarter and $1.81 per share for the year, according to Reuters Estimates.
"We see continued double-digit growth into 2006 and beyond," Immelt said.
The company's units will be aligned into GE Infrastructure, GE Industrial, GE Commercial Financial Services, NBC Universal, GE Healthcare and GE Consumer Finance.
Dave Calhoun will lead its infrastructure business, Michael Neal will head commercial financial services, and John Rice will lead its industrial unit, GE said.
In its health care unit, GE named Joe Hogan as president and CEO. Hogan will succeed Bill Castell when he retires from the unit in 2006.
Shares of GE closed at $35.72 on the New York Stock Exchange Wednesday. The stock is down more than 2 percent year-to-date, underperforming the 1 percent rise among its peers on the Dow Jones industrial average.