GE posted earnings for the first three months of the year of $3.2bn, or 32 cents a share, before required accounting changes, down from $3.5bn in the same period a year ago.

Net earnings - the earnings figure after required accounting changes - were 30 cents a share for the quarter, up from 25 cents in the same period last year.

GE said it expected profit during the April-to-June quarter to drop by up to 15%.

But it said it remained "comfortable" with its full-year target of earnings of $1.55-$1.70 a share.

'Tough environment'

GE had warned previously that sales at its power systems unit would fall as spending on power plants fell.

It shipped 33 heavy-duty gas turbines during the January to March quarter, down from 69 a year ago.

Profits at GE's plastics division tumbled by 56% following big increases in raw material costs such as oil.

Despite the dip, GE's chairman and chief executive Jeff Immelt remained upbeat.

"In this tough economic environment, eight of our 13 businesses delivered double-digit earnings growth," Mr Immelt said in a statement.

"We planned for a tough and uncertain environment in 2003, and we remain comfortable with our target range of $1.55-$1.70 per share for the year."