GENERAL ELECTRIC CO Quarterly Report for Q1 Ended Mar 31, 2016

Summary

General Electric Company (GE) reported its first quarter 2016 results, highlighting significant progress on its GE Capital Exit Plan. The company substantially reduced the size of its financial services business, with assets decreasing from $501 billion at the end of 2014 to $281 billion by March 31, 2016. This strategic shift is aimed at transforming GE into a simpler, more valuable industrial-focused company. The industrial segments showed mixed performance, with revenue growth driven by acquisitions like Alstom, but also impacted by foreign currency headwinds. The company also returned substantial capital to shareholders through dividends and share repurchases.

Key Highlights

• 1GE is significantly advancing its GE Capital Exit Plan, having signed agreements for $166 billion in Ending Net Investment (ENI) and closing $146 billion by March 31, 2016.
• 2Consolidated revenues increased by 6% to $27.8 billion, driven by a 7% rise in industrial revenues, largely due to acquisitions like Alstom ($2.8 billion impact).
• 3GE Capital's losses decreased by 84% primarily due to the absence of significant exit plan charges incurred in the prior year's quarter.
• 4The company returned $8.3 billion to shareholders in Q1 2016, including $6.1 billion in stock buybacks and $2.2 billion in dividends.
• 5Industrial segment revenues grew 6% to $25.9 billion, but segment profit declined 7% to $3.3 billion, impacted by lower earnings in Power, Oil & Gas, and Energy Connections, partially offset by Aviation.
• 6Foreign exchange had a significant adverse impact, particularly on industrial operating profit, which was affected by $0.3 billion due to transactional impacts related to hedging.
• 7GE filed a request with the Financial Stability Oversight Council (FSOC) to rescind GE Capital's designation as a nonbank Systemically Important Financial Institution (SIFI).

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