Summary
General Electric (GE) filed its 2021 10-K on February 10, 2022, detailing a significant strategic transformation. The company announced plans to split into three distinct, publicly traded companies focused on Aviation, Healthcare, and a combined Renewable Energy, Power, and Digital business. This separation is intended to allow each entity greater focus, tailored capital allocation, and strategic flexibility. For the year ended December 31, 2021, GE reported total revenues of $74.2 billion, a decrease from the prior year, primarily driven by declines in its Aviation, Power, and Healthcare segments. The company also reported a net loss attributable to common shareholders of $(6.7) billion, impacted by significant debt extinguishment costs of $6.5 billion, offset by a gain on equity securities and higher segment profit. Despite revenue and net loss pressures, the company highlighted improvements in segment profit across Aviation, Power, and Healthcare, and a substantial increase in Free Cash Flow (FCF) to $1.9 billion from $0.6 billion in the prior year. The Aviation segment, while impacted by the pandemic, showed signs of recovery in market fundamentals, with global departures improving from 2020. The company also completed the significant GECAS business combination with AerCap, receiving substantial cash proceeds, and continued its debt reduction efforts, significantly lowering its total borrowings.
Financial Highlights
47 data points| Revenue | $56.47B |
| R&D Expenses | $1.68B |
| SG&A Expenses | $8.18B |
| Operating Expenses | $64.86B |
| Operating Income | -$4.82B |
| Net Income | -$6.34B |
| EPS (Basic) | $-6.00 |
| EPS (Diluted) | $-6.00 |
| Shares Outstanding (Basic) | 1.10B |
| Shares Outstanding (Diluted) | 1.10B |
Key Highlights
- 1GE announced a strategic plan to separate into three independent public companies: Aviation, Healthcare, and a combined Renewable Energy, Power, and Digital business.
- 2Total revenues for 2021 were $74.2 billion, a decrease of $1.6 billion (2%) from 2020, primarily due to lower revenues in Aviation, Power, and Healthcare.
- 3Net loss attributable to GE common shareholders was $(6.7) billion, compared to a net earnings of $5.2 billion in 2020. This was significantly impacted by $6.5 billion in debt extinguishment costs.
- 4Free Cash Flow (FCF) improved to $1.9 billion in 2021, up from $0.6 billion in 2020, driven by improved net income and working capital management, partially offset by discontinued factoring programs.
- 5The Aviation segment saw a revenue decrease of 3% but a significant segment profit increase of $1.7 billion, driven by increased shop visit volume and operational cost reductions.
- 6The company completed the GECAS business combination with AerCap on November 1, 2021, receiving $22.6 billion in cash and shares.
- 7Consolidated total borrowings were reduced by $39.7 billion to $35.2 billion in 2021, primarily due to debt repurchases totaling $32.6 billion.