GE Healthcare profits slide 21% in Q2

Although GE reported a 49 percent drop in net earnings for its fiscal 2009 second quarter, from $5.07 billion for the same period in 2008 to $2.87 billion this quarter, its healthcare unit's profits saw only a 21 percent decline

"In a global economic environment that continues to remain challenging, GE delivered solid second-quarter business results," said GE's Chairman and CEO Jeff Immelt.

GE Healthcare, which falls under the parent company's technology infrastructure, noted that its revenues dropped 12 percent, from $4.49 billion last year to $3.96 billion this year. Also, the segment's profits dropped to $590 million for the period, compared with $747 million in segment profits for the second quarter of 2008.

The company attributed its healthcare segment losses to a decline in U.S. hospital sales of diagnostic imaging equipment, such MRIs and CTs. The healthcare unit reported equipment orders of $2.5 billion, a 15 percent drop compared with the second quarter of 2008. Immelt said that equipment markets remain difficult, especially in the United States. In addition, GE Healthcare reported a 6 percent downturn in its service orders.

In order to generate more cash flow, Immelt said that the company is targeting 400 global stimulus projects in areas where there are appropriations for nearly $200 billion. For healthcare, the company is targeting $32 billion for its healthcare IT initiatives, with the specific intention to bid on health information exchange (HIE) contracts.