GE industrial profit rises despite flagging oil unit sales

(Reuters) - General Electric Co reported a 9 percent rise in quarterly industrial profit on Friday as its businesses that sell power-generating turbines and jet engines helped offset weak sales in its oil and gas unit.

Investors have been concerned that plunging oil prices will hurt GE's sales of oil equipment if customers slash spending. Orders in the unit also fell.

"It?s going to be an albatross...on GE as long as energy prices stay low," said Tim Ghriskey, chief investment officer at Solaris Asset Management. ?The sentiment on GE is very negative here, and I don?t see anything in the quarter that is going to change that."

GE Chief Executive Officer Jeff Immelt said the company expected to keep moving on his plan to tilt itself more toward industrial earnings and away from finance.

"The environment remains volatile, but we continue to see infrastructure growth opportunities," Immelt said in a statement.

The U.S. conglomerate said its fourth-quarter net income rose 61 percent to $5.15 billion, or 51 cents per share, from a year earlier, when results suffered from GE's move to resolve financial obligations to Japan's Shinsei Bank.

Excluding pension-related costs, earnings of 56 cents per share were 1 cent ahead of the analysts' average estimate, according to Thomson Reuters I/B/E/S.

Revenue rose 4 percent to $42 billion. GE's organic industrial revenue, which excludes the impact of foreign exchange fluctuations and deals, increased 9 percent.

Sales in the power and water unit, which sells a variety of turbines and is GE's biggest industrial segment, rose 22 percent, while the aviation division's sales increased 4 percent.

Revenue at the oil and gas division slumped 6 percent, although it was flat on an organic basis. Orders at the unit, which sells oil and gas equipment and services, fell 4 percent on an organic basis, but its quarterly profit edged up 1 percent.

GE's profit margin for the industrial businesses, which Wall Street watches closely, rose by 0.5 percentage points to 18.8 percent. The company is cutting costs and simplifying operations to lift margins.

GE backed its expectation for organic industrial revenue growth of 2 percent to 5 percent this year.

GE shares were down 1 cent at $24.27 in premarket trading. Through Thursday, the stock was off 4 percent so far in 2015, against a slight increase for the Standard & Poor's 500 index.

(Reporting by Lewis Krauskopf; Editing by Lisa Von Ahn)