GE, Biogen Give Wall Street Some Upbeat Earnings News

General Electric Co. and biotech firm Biogen Inc. on Wednesday provided some upbeat news on earnings, amid what has been a rash of profit warnings by many other companies in recent weeks.

GE Chief Financial Officer Keith Sherin said at a meeting of analysts in New York that the conglomerate will meet its targets for profit in the first quarter and for the year.

Biogen, meanwhile, raised its first-quarter and 2003 profit estimates as more doctors prescribe its drugs Avonex and Amevive.

The companies’ announcements were more optimistic than profit forecasts from hundreds of other firms recently. Earnings-tracker Thomson First Call in Boston said 2.8 companies have warned of disappointing first-quarter results for every firm that has expected to beat analysts’ estimates.

That ratio is up sharply from 1.6 to 1 at this time a year ago, Thomson said.

The onset of war has delayed some consumer and business spending, hurting many firms’ results, analysts say.

But Fairfield, Conn.-based GE, viewed as an economic barometer because its customers include consumers, manufacturers and companies that need financing, will meet its first-quarter earnings forecast of 32 cents a share, Sherin said. That would be down from operating earnings of 35 cents a year earlier.

GE said it would post strong results at its medical and finance units, while results weakened at its plastics and power-systems businesses. The plastics unit was hit by rising costs for raw materials, including oil, Sherin said.

The company’s NBC television unit has been hurt by the decision to preempt regular programming for war coverage in recent weeks, he said.

Still, for the year, “We’re well positioned for the target range to total $1.55 to $1.70” a share in profit, Sherin said. The company earned $1.51 last year, before accounting changes.

GE will report first-quarter results April 11.

Some GE investors may have been hoping the company would raise its estimates: The firm’s stock fell back after Sherin gave his forecast, but still closed up 92 cents, or 3.5%, to $27.05 on the New York Stock Exchange.

Biogen, the fourth-biggest U.S. biotechnology company, said operating income would be 47 cents to 51 cents a share in the first quarter. The Cambridge, Mass.-based firm had previously forecast profit of 31 cents to 38 cents.

Biogen also increased its 2003 operating profit forecast to $1.72 to $1.85 a share from $1.63 to $1.78.

The company’s shares rocketed $3.70, or 12.2%, to $33.99 on Nasdaq and helped boost the biotech sector in general.

First-quarter sales were about $320 million, Biogen said. That was up from $288 million a year earlier.

The sales figure suggests Biogen’s biggest drug, the multiple sclerosis treatment Avonex, has continued to win new prescriptions, even as it faces competition from Serono’s Rebif medicine, investors said.

“There’s still growth in Avonex,” said Paul Abel, who manages the Kinetics Medical Fund, which recently increased its stake in Biogen and now owns about 15,000 shares.

Meanwhile, Amevive -- which won Food and Drug Administration approval in January to be the first biotech drug to treat the skin disorder psoriasis -- is on track to produce sales of $85 million this year, Biogen said.