10-QPeriod: Q3 FY2014

GENERAL ELECTRIC CO Quarterly Report for Q3 Ended Nov 3, 2014

Filed November 4, 2014For Securities:GE

Summary

General Electric (GE) reported solid performance for the third quarter of 2014, with a notable increase in net earnings attributable to the Company, up 11% year-over-year to $3.54 billion. Diluted EPS also saw a healthy increase, reaching $0.35, up from $0.31 in the prior year's quarter. The industrial segments collectively demonstrated strength, with revenues up 3% and segment profit increasing by 9%, driven by robust performance in Aviation, Oil & Gas, and Healthcare. GE Capital's performance showed a decline in segment profit, down 22%, reflecting ongoing efforts to reduce its balance sheet size and focus on core businesses. Key strategic developments during the quarter included progress on the planned exit of the Appliances business and continued efforts to divest non-core assets within GE Capital, demonstrating a commitment to portfolio optimization.

Key Highlights

  • 1Consolidated net earnings attributable to the Company increased by 11% to $3.54 billion.
  • 2Diluted EPS increased to $0.35 from $0.31 year-over-year.
  • 3Industrial segment revenues grew 3%, with segment profit up 9%, driven by strong performance in Aviation, Oil & Gas, and Healthcare.
  • 4GE Capital segment profit decreased by 22%, reflecting strategic initiatives to reduce its balance sheet.
  • 5The company announced the agreement to sell its Appliances business to Electrolux for $3.3 billion.
  • 6Progress was made on the initial public offering (IPO) of Synchrony Financial, a step in a planned staged exit.
  • 7Orders increased by 22% year-over-year, and backlog grew to $250.4 billion.

Frequently Asked Questions

GE reported an 11% increase in consolidated net earnings attributable to the Company, reaching $3.54 billion, with diluted EPS rising to $0.35 from $0.31 in the prior year's quarter. This growth was driven by the industrial segments, while GE Capital experienced a decline in profit due to strategic repositioning.

The industrial segments showed strong growth, with revenues up 3% and segment profit increasing by 9%. Key drivers of this growth included the Aviation, Oil & Gas, and Healthcare businesses, indicating healthy operational performance across these core industrial areas.

GE Capital's profit declined by 22% in the quarter, reflecting GE's ongoing strategy to reduce its balance sheet size and focus on more strategic, core financial services businesses. The company is actively pursuing dispositions of non-core assets, which is impacting current earnings but is aimed at improving long-term returns and capital efficiency.

GE made significant strategic moves including announcing the agreement to sell its Appliances business for $3.3 billion and progressing with the IPO of Synchrony Financial. These actions underscore GE's commitment to portfolio optimization and focusing on its core industrial and more strategic financial services businesses.