GE ANNOUNCES THIRD QUARTER 2019 RESULTS
Company delivers strong organic growth and margin expansion;
Raises Industrial free cash flow* outlook for 2019
- Total orders $22.5B, (5)%; organic orders (1)%; backlog $386B, +14%
- Total revenues (GAAP) $23.4B, flat; Industrial segment organic revenues* $21.5B, +7%
- Industrial profit margin (GAAP) of (2.1)%; adjusted Industrial profit margin* 10.0%, +150 bps, +130 bps organically
- Continuing EPS (GAAP) $(0.15), including non-cash Insurance & goodwill charges; adjusted EPS* $0.15
- GE CFOA (GAAP) $1.1B; Industrial free cash flow* $650M, increasing 2019 outlook to $0 - $2B
BOSTON - October 30, 2019 - GE (NYSE:GE) announced results today for the third quarter ending September 30, 2019.
GE Chairman and CEO H. Lawrence Culp, Jr. said, “Our results reflect another quarter of progress in the transformation of GE. We are encouraged by our strong backlog, organic growth, margin expansion, and positive cash trajectory amidst global macro uncertainty. We are raising our Industrial free cash flow outlook again even with external headwinds from the 737 MAX and tariffs, and we are holding our adjusted EPS outlook despite reduced income from moving Baker Hughes to discontinued operations.”
Culp continued, “This quarter, during strategy reviews with each of our businesses, we identified and prioritized operating improvements and growth investments that will drive sustainable results. We have more work to do, and we will continue to take actions to improve our financial position and strengthen our businesses as we prepare for 2020 and beyond. I remain confident that we will unlock value for GE's stakeholders as our transformation accelerates.”
Read the full results on GE's Investor Relations website.
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(for communications dated on or after October 30, 2019)
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For us, particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include:
- our success in executing and completing, including obtaining regulatory approvals and satisfying other closing conditions for, announced GE Industrial and GE Capital business or asset dispositions or other transactions, including the planned sale of our BioPharma business within our Healthcare segment and plan to exit our equity ownership position in Baker Hughes, the timing of closing for those transactions and the expected proceeds and benefits to GE;
- our de-leveraging and capital allocation plans, including with respect to actions to reduce our indebtedness, the timing and amount of GE dividends, organic investments, and other priorities;
- further downgrades of our current short- and long-term credit ratings or ratings outlooks, or changes in rating application or methodology, and the related impact on our liquidity, funding profile, costs and competitive position;
- GE’s liquidity and the amount and timing of our GE Industrial cash flows and earnings, which may be impacted by customer, competitive, contractual and other dynamics and conditions;
- GE Capital's capital and liquidity needs, including in connection with GE Capital’s run-off insurance operations, the amount and timing of required capital contributions to those insurance operations and related strategic actions that we may pursue; the impact of conditions in the financial and credit markets on GE Capital's ability to sell financial assets; the availability and cost of funding; and GE Capital's exposure to particular counterparties and markets;
- changes in macroeconomic conditions, particularly interest rates, as well as the value of stocks and other financial assets (including our equity ownership position in Baker Hughes and Wabtec), oil and other commodity prices and exchange rates;
- market developments or customer actions that may affect levels of demand and the financial performance of the major industries and customers we serve, such as secular and cyclical pressures in our Power business, pricing and other pressures in the renewable energy market, conditions in China and other key markets, early aircraft retirements, and other shifts in the competitive landscape for our products and services;
- operational execution by our businesses, including our ability to improve the operations and execution of our Power business, execution by our Renewable Energy business, and the continued strength of our Aviation business;
- changes in law, regulation or policy that may affect our businesses, such as trade policy and tariffs, regulation related to climate change, and the effects of U.S. tax reform and other tax law changes;
- our decisions about investments in new products, services and platforms, and our ability to launch new products in a cost-effective manner;
- our ability to increase margins through implementation of operational changes, restructuring and other cost reduction measures;
- the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks, including the impact of Alstom, SEC and other investigative and legal proceedings;
- the impact of actual or potential failures of our products or our customers’ products, such as the fleet grounding of the Boeing 737 MAX, and related reputational effects;
- the impact of potential information technology, cybersecurity or data security breaches; and
- the other factors that are described in "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2018, as updated in our Quarterly Reports on Form 10-Q.
These or other uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.
Our public communications and SEC filings may include certain forward-looking projected financial information that is based on current estimates and forecasts. Actual results could differ materially.
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Conference Call and Webcast
GE will discuss its results during its investor conference call today starting at 8:00 a.m. ET. The conference call will be broadcast live via webcast, and the webcast and accompanying slide presentation containing financial information can be accessed by visiting the Events and Reports page on GE’s website at: www.ge.com/investor. An archived version of the webcast will be available on the website after the call.
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