10-QPeriod: Q1 FY2008

GENERAL ELECTRIC CO Quarterly Report for Q1 Ended Mar 31, 2008

Filed April 25, 2008For Securities:GE

Summary

General Electric (GE) reported its first-quarter 2008 results, showing a decrease in earnings from continuing operations, down 12% to $4.361 billion from $4.928 billion in the prior year. Diluted earnings per share (EPS) from continuing operations also declined to $0.44 from $0.48. Overall net earnings saw a 6% decrease to $4.304 billion, with EPS at $0.43. Consolidated revenues grew 8% to $42.3 billion, driven by acquisitions, dispositions, and a weaker U.S. dollar. The Infrastructure segment demonstrated strong revenue growth, up 23%, while Financial Services segments like Commercial Finance and GE Money experienced revenue increases but saw declines in segment profit. The company highlighted the impact of recent acquisitions and the ongoing integration process. GE also continued its share repurchase program, with approximately $13.8 billion remaining authorization.

Key Highlights

  • 1Consolidated revenues increased by 8% to $42.3 billion, driven by acquisitions, dispositions, and a weaker U.S. dollar.
  • 2Earnings from continuing operations decreased by 12% to $4.361 billion, with diluted EPS falling to $0.44.
  • 3The Infrastructure segment showed robust revenue growth of 23%, primarily due to volume increases from acquisitions and organic growth.
  • 4Financial services segments, including Commercial Finance and GE Money, experienced revenue growth but a decline in segment profit, with GE Money's profit down 19%.
  • 5Discontinued operations resulted in a loss of $57 million, a significant improvement from the $357 million loss in the prior year's quarter.
  • 6GE repurchased approximately 34.9 million shares for $1.23 billion during the quarter, with $13.8 billion remaining under its share repurchase program.

Frequently Asked Questions

The increase in consolidated revenues is primarily attributed to the impact of acquisitions and dispositions, as well as the weaker U.S. dollar. Industrial sales saw a significant increase, boosted by organic growth and acquisitions.

Earnings from continuing operations declined due to various factors, including higher material and other costs in some segments, lower investment income, and increased provisions for loan losses in GE Money. While some segments like Infrastructure saw profit growth, others like Commercial Finance and GE Money experienced profit declines that impacted the overall consolidated earnings.

GE's financial services segment, GECS, continues to be a significant part of its operations, contributing substantial revenue. However, the segment is experiencing mixed results, with revenue growth in some areas but declining profitability due to factors like lower securitization income and increased delinquencies in the U.S. portfolio. The company is actively managing its financing receivables and adjusting underwriting standards in response to market conditions.

The loss from discontinued operations has significantly decreased, with a loss of $57 million in Q1 2008 compared to $357 million in Q1 2007. This indicates progress in the company's strategy to divest non-core assets and improve overall profitability.