EX-99 2 exhibit99.htm EXHIBIT 99 exhibit99.htm
                                             
Exhibit 99
 
PRESS RELEASE
 
GE Delivers $0.31 Operating EPS Excluding Effects of Preferred Redemption, Up 11%;
GE Reports Net EPS of $0.22, Up 22%;
Industrial Segment Revenue Growth of $23.4 billion, Up 19%; Industrial Orders Up 16%;
GE Capital Earns $1.5 billion, Up 79%
 
 
 
3Q 2011 Highlights
 
·  
Operating earnings of $3.4 billion, up 11%
ü 
Operating EPS of $0.24; $0.31 excluding effects of preferred redemption
ü 
Continuing EPS of $0.22, down 21% (includes preferred redemption impact)
ü 
Net EPS of $0.22, up 22% (includes discontinued operations)
·  
Leading indicators remain encouraging
ü 
Total revenues of $35.4 billion
ü 
Industrial organic revenue growth of 8%
ü 
Industrial segment global revenue growth of 25%
ü
Industrial backlog of $191 billion, a record
·  
GE Capital earned $1.5 billion, with pre-tax earnings of $1.6 billion
ü
GECC/GECS Tier 1 Common Ratios of 11.0%/9.6%
·  
Confident in 2011 framework; projecting double-digit operating EPS growth in 2012
 
 
FAIRFIELD, Conn. – October 21, 2011 – GE [NYSE: GE] announced today third-quarter 2011 operating earnings of $3.4 billion, or $0.31 per share, up 11%, from the third quarter of 2010 (excluding effects of the preferred redemption).
 
During the quarter, GE gave notice of redemption for the preferred stock held by Berkshire Hathaway, and subsequently redeemed the shares on October 17, 2011 for $3.3 billion. As expected, the redemption resulted in a $0.08 per share one-time impact.  Including the impact of the preferred redemption, Continuing EPS was $0.22, down 21%.  Net EPS was $0.22, up 22%.  Going forward, retiring the Berkshire preferred stock will improve GE’s annualized earnings per share by $0.03.
 
“We are pleased to deliver our sixth consecutive quarter of double-digit operating earnings growth in a volatile macro environment,” GE Chairman and CEO Jeff Immelt said.  “We improved earnings, achieved solid double-digit infrastructure order growth, executed on our balanced capital allocation plan and maintained a strong balance sheet.  We ended the quarter with a record high order backlog of $191 billion and we remain confident in our full-year 2011 operating framework.”
 
GE is aggressively investing in its growth platforms. Highlights from the quarter include the closing of GE’s acquisition of Converteam, a leading provider of power conversion and automation systems and high-efficiency power electronics, motors and generators.  GE continued to build its global position, including announcing two Russian joint ventures that will help modernize the country’s healthcare and power generation sectors.
 
 
(1)
 
 
Industrial orders grew 16% as compared to the prior year quarter, which is the fourth straight quarter of double-digit growth.  GE also announced more than $3 billion in new customer wins across its Energy business during the quarter.  These included: $800 million of wins to supply gas and wind turbines for projects in Brazil that will produce 1.4 gigawatts of electricity – 40% of the total amount awarded in energy auctions conducted recently by Brazil’s National Electric Power Agency.  Other industrial wins included Delta Airlines announcing that it had ordered 100 Next-Generation 737-900ER aircraft powered by CFM56-7BE engines.
 
GE’s third quarter Industrial segment revenues were $23.4 billion, up 19%.  Revenues for the quarter were $35.4 billion, up 12% excluding the impact of NBCU.  GE’s Industrial segments experienced double-digit revenue growth both domestically and internationally with international revenues up 25% driven by strong double-digit growth in Brazil, Russia, China, India, Canada, Mexico and the Middle East.
 
“GE Capital executed across all of its businesses, earning $1.5 billion after tax, an increase of 79% from the third quarter of last year,” Immelt said.  “We grew GE Capital volume to $43 billion, up 15%.  GE Capital’s margins remained strong at 5.4% year-to-date and the business continues to benefit from the credit cycle recovery.  GE Capital continued to strengthen its capital ratios and liquidity during the quarter.  GECC and GECS Tier 1 common ratios were up to 11.0% and 9.6% and we have reduced leverage across the portfolio.”
 
Total segment profit was up 15% to $4.7 billion.  Margins declined from a year-ago primarily driven by Wind pricing in Energy.  GE expects Industrial margins to improve sequentially in the fourth quarter.  Cash generated from Industrial operating activities for the first nine months of 2011 totaled $6.5 billion.  At quarter-end GE had $91 billion of consolidated cash.  GE’s cash position enabled the Company to repurchase $1 billion of common stock during the third quarter and has enabled $3.7 billion in stock repurchases since the buyback program was restarted in the third quarter of 2010.
 
“We continue to successfully navigate a volatile global economy,” Immelt said.  “Our investment in research and development and global expansion is paying off with robust organic growth.  Our liquidity is strong.  GE Capital is safe and secure, with increasing competitive advantage.  Our balanced capital allocation plan is reducing share count, sustaining a strong dividend yield and funding growth.  We are well positioned to execute on our operating framework in 2011 and achieve double-digit operating EPS growth in 2012.”
 
Third-quarter 2011 Financial Highlights:
 
Third-quarter operating earnings were $3.4 billion, up 11% from $3.1 billion in the third quarter of 2010 and Operating EPS excluding the preferred redemption impact was $0.31, up 11% from $0.28 per share in the third quarter of last year.  GAAP earnings from continuing operations (attributable to GE) were $3.2 billion, up 4%, or $0.22 per share, down 21% from the prior year quarter.
 
 
 
(2)
 
 
Including the effects of discontinued operations, third-quarter net earnings attributable to GE were $3.2 billion in 2011 compared with $2.1 billion in the third quarter of 2010, up 57%.  Net EPS was up 22%.
 
Positive items in the quarter were offset by one-time charges.
 
Third-quarter revenues were $35.4 billion for the quarter, up 12% excluding the impact of NBCU, and were flat compared to revenues of $35.4 billion from the prior year’s quarter. Industrial sales of $23.2 billion decreased 2% compared to 2010 and increased 18% excluding NBCU. GE Capital Services (GECS) revenues of $12.0 billion were up 1% from the third quarter of 2010.
 
Cash generated from GE Industrial operating activities for the first nine months of 2011 totaled $6.5 billion, down 35% from $10.1 billion for the comparable period of 2010.
 
The accompanying tables include information integral to assessing the Company’s financial position, operating performance and cash flow.
 
GE will discuss preliminary third-quarter results on a webcast at 8:30 a.m. ET today, available at www.ge.com/investors.  Related charts will be posted there prior to the webcast.
 
*   *   *
 
 
GE (NYSE: GE) is a diversified infrastructure and finance company taking on the world’s toughest challenges. From aviation and power generation to financial services, healthcare solutions, oil and gas and rail, GE operates in more than 100 countries and employs about 300,000 people worldwide. For more information, visit the company's website at www.ge.com. 
 
 
Caution Concerning Forward-Looking Statements:
 
 
This document contains “forward-looking statements” – that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include: current economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices and the value of financial assets; potential market disruptions or other impacts arising in the United States or Europe from developments in the European sovereign debt situation; the impact of conditions in the financial and credit markets on the availability and cost of General Electric Capital Corporation’s (GECC) funding and on our ability to reduce GECC’s asset levels as planned; the impact of conditions in the housing market and unemployment rates on the level of commercial and consumer credit defaults; changes in Japanese consumer behavior that may affect our estimates of liability for excess interest refund claims (Grey Zone); potential financial implications from the Japanese natural disaster; our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so; the adequacy of our cash flow and earnings and other conditions which may affect our ability to pay our quarterly dividend at the planned level; our ability to
 
 
 
(3)
 
 
convert customer wins (which represent pre-order commitments) into orders; the level of demand and financial performance of the major industries we serve, including, without limitation, air and rail transportation, energy generation, real estate and healthcare; the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks, including the impact of financial services regulation; strategic actions, including acquisitions, joint ventures and dispositions and our success in completing announced transactions and integrating acquired businesses; and numerous other matters of national, regional and global scale, including those of a political, economic, business and competitive nature. These 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.
 
 
Investor Contact:
Trevor Schauenberg, 203.373.2424 (office)
trevor.a.schauenberg@ge.com
 
Media Contact:
Kenny Juarez, 203.373.3061 (office); 203.224.9854 (mobile)
kenneth.juarez@ge.com
 

 
(4)
 

GENERAL ELECTRIC COMPANY
Condensed Statement of Earnings
 
   
Consolidated
    
GE (a)
  
Financial Services (GECS)
Three months ended September 30
  
2011
  
2010
  
V%
    
2011
  
2010
  
V%
  
2011
  
2010
  
V%
Revenues
                                      
Sales of goods and services
  
$23,138
  
$23,601
        
$23,230
  
$23,593
      
$32
  
$40
    
Other income
  
556
  
187
        
621
  
223
      
 -
  
 -
    
GECS earnings from continuing operations
  
 -
  
 -
        
1,453
  
780
      
 -
  
 -
    
GECS revenues from services
  
11,673
  
11,585
        
 -
  
 -
      
11,986
  
11,914
    
Total revenues
  
          35,367
  
35,373
  
-%
    
25,304
  
24,596
  
3%
  
  12,018
  
  11,954
  
1%
                                       
Costs and expenses
                                      
Cost of sales, operating and administrative expenses
  
26,194
  
25,590
        
21,344
  
20,252
      
     5,135
  
5,536
    
Interest and other financial charges
  
3,735
  
3,822
        
356
  
393
      
     3,560
  
3,573
    
Investment contracts, insurance losses and insurance annuity benefits
  
719
  
741
        
 -
  
 -
      
        755
  
796
    
Provision for losses on financing receivables
  
1,020
  
1,637
        
 -
  
 -
      
     1,020
  
1,637
    
Total costs and expenses
  
31,668
  
31,790
  
-%
    
21,700
  
20,645
  
5%
  
10,470
  
11,542
  
 (9)%
                                       
Earnings from continuing operations before income taxes
  
3,699
  
3,583
  
3%
    
3,604
  
3,951
  
(9)%
  
1,548
  
412
  
F
Benefit (provision) for income taxes
  
 (435)
  
 (319)
        
 (378)
  
 (705)
      
 (57)
  
386
    
Earnings from continuing operations
  
3,264
  
3,264
  
-%
    
3,226
  
3,246
  
(1)%
  
1,491
  
798
  
87%
                                       
Earnings (loss) from discontinued operations, net of taxes
  
1
  
 (1,052)
        
1
  
 (1,052)
      
2
  
 (1,052)
    
                                       
Net earnings (loss)
  
3,265
  
2,212
  
48%
    
3,227
  
2,194
  
47%
  
1,493
  
 (254)
  
F
                                       
Less net earnings (loss) attributable to noncontrolling interests
  
41
  
157
        
3
  
139
      
38
  
18
    
Net earnings (loss) attributable to the Company
  
3,224
  
2,055
  
57%
    
3,224
  
2,055
  
57%
  
1,455
  
 (272)
  
F
                                       
Preferred stock dividends declared
  
 (881)
  
 (75)
        
 (881)
  
 (75)
      
 -
  
 -
    
Net earnings (loss) attributable to GE common shareowners
  
$2,343
  
$1,980
  
18%
    
$2,343
  
$1,980
  
18%
  
$1,455
  
$ (272)
  
F
                                       
Amounts attributable to the Company:
                                      
Earnings from continuing operations
  
$3,223
  
$3,107
  
4%
    
$3,223
  
$3,107
  
4%
  
$1,453
  
$780
  
86%
Earnings (loss) from discontinued operations, net of taxes
  
1
  
 (1,052)
        
1
  
 (1,052)
      
2
  
 (1,052)
    
Net earnings (loss) attributable to the Company
  
$3,224
  
$2,055
  
57%
    
$3,224
  
$2,055
  
57%
  
$1,455
  
$ (272)
  
F
                                       
Per-share amounts  -  earnings from continuing operations
                                      
Diluted earnings per share
  
$0.22
  
$0.28
  
 (21)%
                          
Basic earnings per share
  
$0.22
  
$0.28
  
 (21)%
                          
                                       
Per-share amounts - net earnings
                                      
Diluted earnings per share
  
$0.22
  
$0.18
  
22%
                          
Basic earnings per share
  
$0.22
  
$0.18
  
22%
                          
                                       
Total average equivalent shares
                                      
Diluted shares
  
10,607
  
10,691
  
 (1)%
                          
Basic shares
  
10,580
  
10,674
  
 (1)%
                          
                                       
Dividends declared per common share
  
$0.15
  
$0.12
  
25%
                          
                                       
Amounts attributable to the Company:
                                      
Earnings from continuing operations
  
$3,223
  
$3,107
  
4%
                          
Less: Non-operating pension costs/(income), net of taxes
  
172
  
 (50)
                              
Operating earnings (non-GAAP measure)
  
$3,395
  
$3,057
  
11%
                          
                                       
Operating earnings - diluted earnings per share
  
$0.24
  
$0.28
  
 (14)%
                          
Operating earnings excluding the effects of the preferred
                                      
   stock redemption - diluted earnings per share
  
$0.31
  
$0.28
  
11%
                          
                                       
 
(a)  
Refers to the Industrial businesses of the Company including GECS on an equity basis.

Dollar amounts and share amounts in millions; per-share amounts in dollars; unaudited. Supplemental consolidating data are shown for "GE" and "GECS." Transactions between GE and GECS have been eliminated from the "Consolidated" columns. See Note 1 to the 2010 consolidated financial statements at www.ge.com/ar2010 for further information about consolidation matters.


 
 
 
GENERAL ELECTRIC COMPANY
Condensed Statement of Earnings


   
Consolidated
    
GE (a)
  
Financial Services (GECS)
Nine months ended September 30
  
2011
  
2010
  
V%
    
2011
  
2010
  
V%
  
2011
  
2010
  
V%
Revenues
                                      
Sales of goods and services
  
$68,037
  
$71,778
        
$68,293
  
$71,505
      
$116
  
$489
    
Other income
  
4,805
  
815
        
4,962
  
903
      
 -
  
 -
    
GECS earnings from continuing operations
  
 -
  
 -
        
4,814
  
2,016
      
 -
  
 -
    
GECS revenues from services
  
36,485
  
35,775
        
 -
  
 -
      
  37,386
  
  36,730
    
Total revenues
  
109,327
  
108,368
  
1%
    
78,069
  
74,424
  
5%
  
  37,502
  
  37,219
  
1%
                                       
Costs and expenses
                                      
Cost of sales, operating and administrative expenses
  
77,207
  
78,100
        
62,333
  
61,849
      
15,718
  
16,974
    
Interest and other financial charges
  
11,309
  
11,689
        
1,032
  
1,166
      
10,750
  
10,916
    
Investment contracts, insurance losses and insurance annuity benefits
  
2,201
  
2,210
        
 -
  
 -
      
2,314
  
2,353
    
Provision for losses on financing receivables
  
2,988
  
5,824
        
 -
  
 -
      
2,988
  
5,824
    
Total costs and expenses
  
93,705
  
97,823
  
 (4)%
    
63,365
  
63,015
  
1%
  
31,770
  
36,067
  
 (12)%
                                       
Earnings from continuing operations before income taxes
  
15,622
  
10,545
  
48%
    
14,704
  
11,409
  
29%
  
5,732
  
1,152
  
F
Benefit (provision) for income taxes
  
 (5,266)
  
 (1,624)
        
 (4,437)
  
 (2,479)
      
 (829)
  
855
    
Earnings from continuing operations
  
10,356
  
8,921
  
16%
    
10,267
  
8,930
  
15%
  
4,903
  
2,007
  
F
                                       
Earnings (loss) from discontinued operations, net of taxes
  
274
  
 (1,506)
        
274
  
 (1,506)
      
276
  
 (1,502)
    
                                       
Net earnings
  
10,630
  
7,415
  
43%
    
10,541
  
7,424
  
42%
  
5,179
  
505
  
F
                                       
Less net earnings (loss) attributable to noncontrolling interests
  
209
  
306
        
120
  
315
      
89
  
 (9)
    
Net earnings attributable to the Company
  
10,421
  
7,109
  
47%
    
10,421
  
7,109
  
47%
  
5,090
  
514
  
F
                                       
Preferred stock dividends declared
  
 (1,031)
  
 (225)
        
 (1,031)
  
 (225)
      
 -
  
 -
    
Net earnings attributable to GE common shareowners
  
$9,390
  
$6,884
  
36%
    
$9,390
  
$6,884
  
36%
  
$5,090
  
$514
  
F
 
Amounts attributable to the Company:
                                      
Earnings from continuing operations
  
$10,147
  
$8,615
  
18%
    
$10,147
  
$8,615
  
18%
  
$4,814
  
$2,016
  
F
Earnings (loss) from discontinued operations, net of taxes
  
274
  
 (1,506)
        
274
  
 (1,506)
      
276
  
 (1,502)
    
Net earnings attributable to the Company
  
$10,421
  
$7,109
  
47%
    
$10,421
  
$7,109
  
47%
  
$5,090
  
$514
  
F
                                       
Per-share amounts  -  earnings from continuing operations
                                      
Diluted earnings per share
  
$0.86
  
$0.78
  
10%
                          
Basic earnings per share
  
$0.86
  
$0.78
  
10%
                          
                                       
Per-share amounts - net earnings
                                      
Diluted earnings per share
  
$0.88
  
$0.64
  
38%
                          
Basic earnings per share
  
$0.88
  
$0.64
  
38%
                          
                                       
Total average equivalent shares
                                      
Diluted shares
  
10,626
  
10,689
  
 (1)%
                          
Basic shares
  
10,595
  
10,672
  
 (1)%
                          
                                       
Dividends declared per common share
  
$0.44
  
$0.32
  
38%
                          
                                       
Amounts attributable to the Company:
                                      
Earnings from continuing operations
  
$10,147
  
$8,615
  
18%
                          
Less: Non-operating pension costs/(income), net of taxes
  
516
  
 (157)
                              
Operating earnings (non-GAAP measure)
  
$10,663
  
$8,458
  
26%
                          
                                       
Operating earnings - diluted earnings per share
  
$0.91
  
$0.77
  
18%
                          
Operating earnings excluding the effects of the preferred
                                     
   stock redemption - diluted earnings per share
  
$0.98
  
$0.77
  
27%
                          
                                       

(a)  
Refers to the Industrial businesses of the Company including GECS on an equity basis

Dollar amounts and share amounts in millions; per-share amounts in dollars; unaudited. Supplemental consolidating data are shown for "GE" and "GECS." Transactions between GE and GECS have been eliminated from the "Consolidated" columns. See Note 1 to the 2010 consolidated financial statements at www.ge.com/ar2010 for further information about consolidation matters.


 
 
 


GENERAL ELECTRIC COMPANY
Summary of Operating Segments (Unaudited)


 
 
Three Months
  
Nine Months
 
Ended September 30
  
Ended September 30
(Dollars in millions)
2011
  
2010
  
 V%
  
2011
  
2010
  
V%
                       
Revenues
                      
Energy Infrastructure
$10,855
  
$8,359
  
30%
  
$30,706
  
$26,554
  
16%
Aviation(a)
 4,835
  
4,391
  
10%
  
13,935
  
12,815
  
9%
Healthcare(a)
 4,332
  
3,958
  
9%
  
12,920
  
11,793
  
10%
Transportation(a)
1,287
  
869
  
48%
  
3,421
  
2,344
  
46%
Home & Business Solutions
2,094
  
2,125
  
(1)%
  
6,236
  
6,315
  
(1)%
GE Capital
11,148
  
11,101
  
-%
  
34,985
  
34,676
  
1%
Total segment revenues
34,551
  
30,803
  
12%
  
102,203
  
94,497
  
8%
Corporate items and eliminations(a)
 816
  
4,570
  
(82)%
  
7,124
  
13,871
  
(49)%
Consolidated revenues from continuing operations
$35,367
  
$35,373
  
-%
  
$109,327
  
$108,368
  
1%
         
 
          
 
Segment profit(a)
        
 
          
 
Energy Infrastructure
$1,503
  
$1,656
  
(9)%
  
$4,436
  
$5,047
  
(12)%
Aviation(a)
862
  
805
  
7%
  
2,662
  
2,483
  
7%
Healthcare(a)
608
  
581
  
5%
  
1,850
  
1,739
  
6%
Transportation(a)
196
  
101
  
94%
  
531
  
242
  
F
Home & Business Solutions
38
  
104
  
(63)%
  
218
  
318
  
(31)%
GE Capital
1,467
  
818
  
79%
  
4,927
  
2,131
  
F
Total segment profit
 4,674
  
4,065
  
15%
  
14,624
  
11,960
  
22%
                       
Corporate items and eliminations(a)
 (717)
  
140
  
U
  
992
  
300
  
F
GE interest and other financial charges
 (356)
  
(393)
  
9%
  
(1,032)
  
(1,166)
  
11%
GE provision for income taxes
 (378)
  
(705)
  
46%
  
(4,437)
  
(2,479)
  
(79)%
                       
Earnings from continuing operations attributable to the Company
3,223
  
3,107
  
4%
  
10,147
  
8,615
  
18%
                       
Earnings (loss) from discontinued operations, net of taxes,
1
  
(1,052)
  
F
  
274
  
(1,506)
  
F
       attributable to the Company                      
                       
Consolidated net earnings attributable to the Company
$3,224
  
$2,055
  
57%
  
$10,421
  
$7,109
  
47%
                       

(a)  
Effective January 1, 2011, we reorganized our segments. We have reclassified prior-period amounts to conform to the current-period presentation. Segment profit excludes results reported as discontinued operations, earnings attributable to noncontrolling interests of consolidated subsidiaries and accounting changes. Segment profit excludes or includes interest and other financial charges and income taxes according to how a particular segment’s management is measured – excluded in determining segment profit, which we sometimes refer to as “operating profit,” for Energy Infrastructure, Aviation, Healthcare, Transportation and Home & Business Solutions; included in determining segment profit, which we sometimes refer to as “net earnings,” for GE Capital. Results of our formerly consolidated subsidiary, NBC Universal, are reported in the Corporate items and eliminations line. Prior to January 1, 2011, segment profit excluded the effects of principal pension plans. Beginning January 1, 2011, we allocate service costs related to our principal pension plans and we no longer allocate the retiree costs of our postretirement healthcare benefits to our segments. This revised allocation methodology better aligns segment operating costs to the active employee costs, which are managed by the segments.
 
 
 
 
 

GENERAL ELECTRIC COMPANY
Summary of Operating Segments (unaudited)
Additional Information
 
 
 
Three Months
  
Nine Months
  
 
Ended September 30
  
Ended September 30
  
(Dollars in millions)
2011
  
2010
  
 V%
  
2011
  
2010
  
 V%
  
                         
Energy Infrastructure
                        
Revenues
$10,855
  
$8,359
  
30%
  
$30,706
  
$26,554
  
16%
  
         
 
          
 
  
Segment profit
$1,503
  
$1,656
  
(9)%
  
$4,436
  
$5,047
  
(12)%
  
         
 
          
 
  
    Revenues
        
 
          
 
  
    Energy
$ 8,522
  
$6,812
  
25%
  
$24,508
  
$22,044
  
11%
  
    Oil & Gas
2,526
  
1,778
  
42%
  
6,781
  
5,145
  
32%
  
         
 
          
 
  
    Segment profit
        
 
          
 
  
    Energy
$1,221
  
$1,393
  
(12)%
  
$3,710
  
$4,393
  
(16)%
  
    Oil & Gas
319
  
287
  
11%
  
851
  
770
  
11%
  
                         
                         
GE Capital
                        
Revenues
$11,148
  
$11,101
  
-%
  
$34,985
  
$34,676
  
1%
  
         
 
          
 
  
Segment profit
$1,467
  
$ 818
  
79%
  
$ 4,927
  
$2,131
  
F
  
                         
    Revenues
                        
    Commercial Lending and Leasing (CLL)
$4,512
  
$ 4,551
  
(1)%
  
$13,786
  
$13,651
  
1%
  
    Consumer
4,032
  
4,097
  
(2)%
  
13,035
  
12,840
  
2%
  
    Real Estate
935
  
953
  
(2)%
  
2,834
  
2,888
  
(2)%
  
    Energy Financial Services
221
  
291
  
(24)%
  
931
  
1,677
  
(44)%
  
    GE Capital Aviation Services (GECAS)
1,265
  
1,321
  
(4)%
  
3,917
  
3,819
  
3%
  
                         
    Segment profit
                        
    CLL
$688
  
$443
  
55%
  
$1,943
  
$987
  
97%
  
    Consumer
737
  
773
  
(5)%
  
2,976
  
1,977
  
51%
  
    Real Estate
(82)
  
(405)
  
80%
  
(775)
  
(1,332)
  
42%
  
    Energy Financial Services
79
  
55
  
44%
  
330
  
334
  
(1)%
  
    GECAS
208
  
158
  
32%
  
835
  
763
  
9%
  



 
 
 



GENERAL ELECTRIC COMPANY
Condensed Statement of Financial Position




 
             
 (Dollars in billions)            
 
Consolidated
    
GE (a)
  
Financial Services (GECS)
Assets
9/30/11
  
12/31/10
    
9/30/11
  
12/31/10
  
9/30/11
  
12/31/10
Cash & marketable securities
$137.8
  
$122.9
    
$8.7
  
$19.3
  
$129.7
  
$104.2
Receivables
18.7
  
18.6
    
11.9
  
10.4
  
-
  
-
Inventories
15.0
  
11.5
    
15.0
  
11.5
  
-
  
0.1
Financing receivables - net
285.8
  
303.0
    
-
  
-
  
293.7
  
312.2
Property, plant & equipment - net
66.1
  
66.2
    
13.7
  
12.4
  
52.3
  
53.8
Investment in GECS
-
  
-
    
76.0
  
69.0
  
-
  
-
Goodwill & intangible assets
85.7
  
74.4
    
56.3
  
45.0
  
29.4
  
29.4
Other assets
123.8
  
105.3
    
36.5
  
17.3
  
93.4
  
93.5
Assets of businesses held for sale
3.2
  
36.9
    
0.1
  
33.8
  
3.1
  
3.1
Assets of discontinued operations
1.6
  
12.4
    
0.1
  
0.1
  
1.5
  
12.4
                         
Total assets
$737.7
  
$751.2
    
$218.3
  
$218.8
  
$603.1
  
$608.7
                         
Liabilities and equity
                        
Borrowings and bank deposits
$466.1
  
$478.6
    
$10.7
  
$10.1
  
$456.8
  
$470.5
Investment contracts, insurance liabilities and
                        
insurance annuity benefits
29.9
  
29.6
    
-
  
-
  
30.4
  
30.0
Other liabilities
111.3
  
100.2
    
81.8
  
70.0
  
35.3
  
35.0
Liabilities of businesses held for sale
1.9
  
16.0
    
-
  
15.5
  
1.8
  
0.6
Liabilities of discontinued operations
1.7
  
2.6
    
0.2
  
0.2
  
1.6
  
2.4
GE shareowners' equity
124.5
  
118.9
    
124.5
  
118.9
  
76.0
  
69.0
Noncontrolling interests
2.3
  
5.3
    
1.1
  
4.1
  
1.2
  
1.2
                         
Total liabilities and equity
$737.7
  
$751.2
    
$218.3
  
$218.8
  
$603.1
  
$608.7
                         
                         

(a)  
Refers to the Industrial businesses of the Company including GECS on an equity basis

September 30, 2011, information is unaudited.  Supplemental consolidating data are shown for "GE" and "GECS." Transactions between GE and GECS have been eliminated from the "Consolidated" columns. See Note 1 to the 2010 consolidated financial statements at www.ge.com/ar2010 for further information about consolidation matters.


 
 
 




GENERAL ELECTRIC COMPANY
Financial Measures That Supplement GAAP

We sometimes use information derived from consolidated financial information but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP). Certain of these data are considered “non-GAAP financial measures” under the U.S. Securities and Exchange Commission rules. These non-GAAP financial measures supplement our GAAP disclosures and should not be considered an alternative to the GAAP measure. We have referred to operating earnings, operating earnings per share, operating earnings per share excluding the effects of the preferred stock redemption, Industrial organic revenue growth, revenues excluding the impact of NBCU, Industrial sales excluding the impact of NBCU and cash generated from Industrial operating activities (Industrial CFOA). The reconciliations of these measures to the most comparable GAAP measures follow.

Operating Earnings and Operating Earnings per Share
 
Three months ended September 30
    
(Dollars in millions; except earnings per share)
2011
  
2010
  
V%
           
Earnings from continuing operations attributable to GE
$3,223
  
$3,107
  
4%
Less non-operating pension costs/(income), net of tax
172
  
(50)
    
Operating earnings
$3,395
  
$3,057
  
11%
           
Earnings per share - diluted(a)
          
Continuing earnings per share
$ 0.22
  
$0.28
  
(21)%
Less: non-operating pension costs/(income) after tax
0.02
  
-
    
Operating earnings per share
0.24
  
0.28
  
(14)%
           
Less: Effects of the preferred stock redemption
0.08
  
-
    
Operating EPS excluding the effects of the preferred stock redemption
$ 0.31
  
$0.28
  
11%
           
 
 
Nine months ended September 30
    
(Dollars in millions; except earnings per share)
2011
  
2010
  
V%
           
Earnings from continuing operations attributable to GE
$10,147
  
$8,615
  
18%
Less non-operating pension costs/(income), net of tax
516
  
(157)
    
Operating earnings
$10,663
  
$8,458
  
26%
           
Earnings per share - diluted(a)
          
Continuing earnings per share
$0.86
  
$0.78
  
10%
Less: non-operating pension costs/(income) after tax
0.05
  
(0.01)
    
Operating earnings per share
0.91
  
0.77
  
18%
           
Less: Effects of the preferred stock redemption
0.08
  
-
    
Operating EPS excluding the effects of the preferred stock redemption
$0.98
  
$0.77
  
27%
           
           

(a)  
Earnings-per-share amounts are computed independently. As a result, the sum of per-share amounts may not equal the total. 
 
Operating earnings excludes non-service related pension costs of our principal pension plans comprising interest cost, expected return on plan assets and amortization of actuarial gains/losses. The service cost and prior service cost components of our principal pension plans are included in operating earnings. We believe that these components of pension cost better reflect the ongoing service-related costs of providing pension benefits to our employees. As such, we believe that our measure of operating earnings provides management and investors with a useful measure of the operational results of our business. Other components of GAAP pension cost are mainly driven by market performance, and we manage these separately from the operational performance of our businesses. Neither GAAP nor operating pension costs are necessarily indicative of the current or future cash flow requirements related to our pension plan. We also believe that this measure, considered along with the corresponding GAAP measure, provides management and investors with additional information for comparison of our operating results to the operating results of other companies. We also believe that operating EPS excluding the effects of the $806 million preferred dividend related to the redemption of our preferred stock (calculated as the difference between the carrying value and the redemption value of the preferred stock) is a meaningful measure because it increases the comparability of period-to-period results.
 
 
 
  Page 1 of 3
 
 
 
Industrial Organic Revenue Growth
          
 
 Three months ended September 30
    
(Dollars in millions)
2011
  
2010
  
V%
           
GE revenues as reported
$25,304
  
$24,596
  
3%
Less GECS earnings from continuing operations
1,453
  
780
    
Industrial revenues
23,851
  
23,816
  
-%
Less the effects of:
          
Acquisitions, business dispositions (other than dispositions of businesses
          
acquired for investment) and currency exchange rates
2,476
  
4,113
    
Industrial revenues excluding effects of acquisitions, business dispositions
          
 (other than dispositions of businesses acquired for investment)
          
  and currency exchange rates (Industrial organic revenues)
$21,375
  
$19,703
  
8%
           

Organic revenue growth measures revenue excluding the effects of acquisitions, business dispositions and currency exchange rates.  We believe that this measure provides management and investors with a more complete understanding of underlying operating results and trends of established, ongoing operations by excluding the effect of acquisitions, dispositions and currency exchange, which activities are subject to volatility and can obscure underlying trends.  We also believe that presenting organic revenue growth separately for our industrial businesses provides management and investors with useful information about the trends of our industrial businesses and enables a more direct comparison to other non-financial businesses and companies.  Management recognizes that the term "organic revenue growth" may be interpreted differently by other companies and under different circumstances. Although this may have an effect on comparability of absolute percentage growth from company to company, we believe that these measures are useful in assessing trends of the respective businesses or companies and may therefore be a useful tool in assessing period-to-period performance trends.
 
 
Revenues excluding impact of NBCU
 
Three months ended September 30
    
(Dollars in millions)
2011
  
2010
  
V%
           
Revenues as reported
$35,367
  
$35,373
  
-%
Less NBCU-related revenues
394
  
4,069
    
Revenues excluding impact of NBCU
$34,973
  
$31,304
  
12%
           

During the first quarter of 2011, we transferred the assets of the NBCU business and Comcast Corporation transferred certain of its assets to a newly formed entity, in which we now hold a 49% interest.  Consolidated revenues include revenues from NBCU operations prior to this transfer as well as the transaction related gain. We have provided the percentage of revenue growth excluding the impact of NBCU, as the volatility related to NBCU revenues can obscure underlying trends.  We believe that this measure, considered along with the corresponding GAAP measure of consolidated revenues, provides
management and investors with additional information that is useful in assessing period-to-period performance trends.
 

 
 
     Page 2 of 3
 
Industrial sales excluding impact of NBCU
 
Three months ended September 30
    
(Dollars in millions)
2011
  
2010
  
V%
           
GE sales as reported
$23,230
  
$23,593
  
(2)%
Less NBCU-related sales
–
  
3,957
    
Industrial sales excluding impact of NBCU
$23,230
  
$19,636
  
18%


During the first quarter of 2011, we transferred the assets of the NBCU business and Comcast Corporation transferred certain of its assets to a newly formed entity, in which we now hold a 49% interest. GE sales include sales from NBCU operations prior to this transfer. We have provided the percentage of Industrial sales growth excluding the impact of NBCU, as the volatility related to NBCU sales can obscure underlying trends.  We believe that this measure, considered along with the corresponding GAAP measure of GE sales, provides management and investors with additional information that is useful in assessing period-to-period performance trends.

Industrial CFOA
          
 
Nine months ended September 30
    
(Dollars in millions)
2011
  
2010
  
V%
           
Cash from GE's operating activities as reported
$6,544
  
$10,142
  
(35)%
Less dividends from GECS
–
   –     
Cash from GE's operating activities excluding dividends
          
from GECS (Industrial CFOA)
$6,544
  
$10,142
  
(35)%


We define “Industrial CFOA” as GE’s cash from operating activities less the amount of dividends received by GE from GECS. This includes the effects of intercompany transactions, including GE customer receivables sold to GECS; GECS services for trade receivables management and material procurement; buildings and equipment (including automobiles) leased by GE from GECS; information technology (IT) and other services sold to GECS by GE; aircraft engines manufactured by GE that are installed on aircraft purchased by GECS from third-party producers for lease to others; and various investments, loans and allocations of GE corporate overhead costs. We believe that investors may find it useful to compare GE’s operating cash flows without the effect of GECS dividends, since these dividends are not representative of the operating cash flows of our industrial businesses and can vary from period to period based upon the results of the financial services businesses. Management recognizes that this measure may not be comparable to cash flow results of companies which contain both industrial and financial services businesses, but believes that this comparison is aided by the provision of additional information about the amounts of dividends paid by our financial services business and the separate presentation in our financial statements of the Financial Services (GECS) cash flows. We believe that our measure of Industrial CFOA provides management and investors with a useful measure to compare the capacity of our industrial operations to generate operating cash flow with the operating cash flow of other non-financial businesses and companies and as such provides a useful measure to supplement the reported GAAP CFOA measure.



 
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