April 13 (Bloomberg) -- General Electric Co. said first- quarter profit rose 8 percent, led by Chief Executive Officer Jeffrey Immelt's strategy of selling more power-plant and aviation equipment in the world's fastest-growing economies.

Profit from continuing operations climbed to $4.51 billion, or 44 cents a share, from $4.18 billion, or 40 cents, matching analysts' estimates. Revenue grew 5.7 percent to $40.2 billion, Fairfield, Connecticut-based GE said today in a statement.

Immelt pushed for sales of products to help drill for oil and gas and build power plants in faster-growing economies like China, India and the Middle East as the U.S. economy slowed. Revenue from developing markets rose 14 percent on increased demand from airlines and utilities.

``One of GE's strengths is it is a global enterprise,'' said Peter Sorrentino, portfolio manager at Cincinnati-based Huntington Asset Management, with 8.9 million GE shares among $6.5 billion in assets under management. ``We see strong growth in Europe and the Pacific Rim. That bodes well for GE.''

Shares of GE, the world's second-largest company by market value, rose 20 cents to $35.38 at 4 p.m. in New York Stock Exchange composite trading. The stock fell 5 percent in the first three months of the year as the Standard & Poor's 500 Index gained less than 1 percent. Exxon Mobil has the largest market value in the world.

Second-Quarter Forecast

The average of 14 analyst estimates compiled by Bloomberg was for profit of 44 cents a share in the quarter.

GE affirmed its full-year forecast for profit from continuing operations of $2.18 to $2.23 a share. The company said second-quarter profit will rise to $5.3 billion to $5.5 billion, or 52 cents to 54 cents, an increase of 8 percent to 13 percent. Sales will climb 7 percent to $43 billion. Analysts, on average, estimate $2.21 for the year and 53 cents for the quarter.

In the first quarter, a pretax gain from divesting a stake in Swiss Reinsurance Co. of $558 million helped pay for restructuring, including the elimination of 3,900 positions across the six main business segments. There were job cuts in the U.S. sub-prime mortgage lending, lighting and NBC Universal units. The gain also covered costs of $185 million for an asbestos litigation-related settlement.

GE sold last year its parts-distribution unit and advanced materials division. Including those results and profit from an operation discontinued last quarter, net income rose 1.5 percent to $4.51 billion, or 44 cents a share, from $4.44 billion, or 42 cents.

Infrastructure Profit

A higher-than-expected profit increase of 28 percent in the infrastructure segment, which includes the world's biggest maker of jet engines, locomotives and power-plant turbines, tempered lower-than-projected earnings at consumer finance, industrial and health care. The commercial finance unit's profit also came in above forecasts, driven by overseas investments in real estate.

``This is the highest-quality quarter GE has reported in a year, and it could have been a blow out if the company hadn't been hit by weakness in the U.S. sub-prime mortgage unit and a regulatory issue at its health-care segment,'' wrote Scott Davis, an analyst at New York-based Morgan Stanley, in a note to clients today. He has an ``overweight'' rating on the stock.

Profit at health care, the world's biggest maker of medical-imaging equipment, rose 5 percent, lower than forecast. Sales were little-changed because of a delay in x-ray systems while GE worked to comply with a U.S. Food and Drug Administration decree covering two plants and coped with lower Medicare reimbursements. The division should still have a profit increase of 15 percent this year, Immelt said.

Selling Plastics

Immelt, who put GE's plastics unit up for sale in January because it was hurting industrial profits, said he plans to make an announcement on the disposition in the second quarter and close the transaction in the third.

GE will sell divisions if other companies can run them better, he said on a conference call with analysts and investors. He rebuffed suggestions that GE may consider a large spinoff or breakup like multi-industry companies American Standard Cos. and Tyco International Ltd., citing GE's ability to sell a group of products in emerging economies.

``In Saudi Arabia, Abu Dabi and Dubai, $5 billion as a company,'' Immelt told investors. ``In Pakistan, $1 billion as a company. In Turkey, $1 billion as a company. That's the value we create. We're not like these other guys. We play the totality of the company as a great strength.''

Total Orders

Total orders rose 3 percent in the quarter, buoyed by a 32 percent increase to $37 billion in the backlog for major equipment including power-plant turbines, oil and gas exploration gear and jet engines. Service contracts, which secure a revenue stream over years and are more profitable than equipment sales alone, rose 11 percent.

The company today reported a consolidated tax rate of 17 percent. The tax rate at the industrial segments was 28 percent, and 10 percent at the finance units, the company said.

For 2007, the consolidated rate will be 16 percent to 17 percent, about the same as last year, Chief Financial Officer Keith Sherin said in an interview. The forecast includes all potential events the company knows about now, including the plastics disposal, he said.

Profit at GE Money, the consumer-finance division that includes the U.S. sub-prime mortgage unit, rose 2 percent as the company took $330 million in reserves because of the housing market downturn. The division is monitoring other areas of U.S. consumer credit and has hired 700 additional collectors to keep payments up to date.

Industrial group profit dropped 20 percent, dragged down by higher costs for raw material at the plastics unit. NBC Universal's profit gained 6 percent after a 22 percent sales decline because the year-earlier period included advertising sales from the Olympic games.

To contact the reporter on this story: Rachel Layne in Boston at rlayne@bloomberg.net

Last Updated: April 13, 2007 16:08 EDT