EX-99 2 exhibit99.htm EXHIBIT 99 PRESS RELEASE FINANCIALS exhibit99.htm
Exhibit 99
PRESS RELEASE

GE Reports 3Q’13 Operating EPS $0.36, Revenues $35.7B
Industrial segment margins +120 basis points
Orders +19%
Record backlog of $229B


3Q 2013 Highlights
·  
Operating EPS of $0.36; $0.40 excluding restructuring and other charges
·  
U.S. orders +18%, Europe orders +17%, growth market orders +22%
·  
Industrial segment profit +11% with strong growth in six of seven Industrial businesses
·  
Industrial segment margins +120 bps with strong value gap & cost productivity; no contributing Industrial gains
·  
GE Capital earnings +13% with ENI at $385 billion; Tier 1 common ratio under Basel 1 at 11.3%, +116 bps
·  
$13.9 billion returned to shareholders YTD
·  
Overall framework for 2013 remains unchanged


FAIRFIELD, Conn. – October 18, 2013 – GE [NYSE: GE] announced today third-quarter 2013 operating earnings of $3.7 billion, or $0.36 per share, down 3% and flat respectively from the third quarter of 2012.  Excluding restructuring and other charges, operating EPS was $0.40.  GAAP earnings from continuing operations were $3.3 billion, or $0.32 per share, down 5% and 3% respectively.  Net earnings of $3.2 billion, or $0.31 per share, fell 9% and 6% respectively from the year-ago period.  Revenues were $35.7 billion for the quarter, down 1% from the year-ago period, driven by lower revenues in GE Capital due to planned asset reductions, and a negative FX impact of $132 million.

“Our third-quarter results were very strong in an improving global business environment,” said GE Chairman and CEO Jeff Immelt.  “Orders grew 19% with orders growth around the world.  Total segment profit grew 12%, Industrial margins grew 120 basis points in the quarter, and we are on track for planned margin expansion of 70 basis points for the year.  GE Capital continues to perform well, and we finished the quarter with a Tier 1 common ratio of 11.3%, up 116 basis points.

“Our Industrial strength was broad based, with six of seven businesses growing earnings.  As expected, our Power & Water business is strengthening in the second half of the year.  Our strategic initiatives are working: growth markets orders expanded 22%; service revenues grew 7%; and margins grew significantly, driven by a positive value gap and company-wide simplification efforts.  We have reduced Industrial structural costs by approximately $1 billion year-to-date, and will exceed our plan for the year.”

Orders for the quarter rose 19% to $25.7 billion.  GE’s backlog of equipment and services at the end of the quarter was its highest ever at $229 billion, up $6 billion from the second quarter.  Infrastructure order pricing was flat for the quarter.  The ratio of equipment orders received to sales billed (book-to-bill) was 1.2.

During the quarter, GE announced one of the largest power agreements in company history to supply Algeria’s Sonelgaz with power generation equipment and services for six new combined-cycle power plants, valued at $1.9 billion.  Also during the quarter, GE received an order of approximately $600 million to provide turbomachinery equipment to Russia’s Yamal liquefied natural gas project, an order from Air Asia for 528 LEAP aircraft engines produced by CFM International (a 50/50 joint venture between GE and Snecma), and a commitment from Lufthansa for the new GE9X engine for 34 Boeing 777-9X aircraft, valued at more than $2.5 billion at list price.

GE Capital continues to decrease the size of its portfolio, while focusing on its core businesses.  GE Capital earnings rose 13% on positive results from its Real Estate and Consumer businesses.  ENI (excluding cash and equivalents) was $385 billion at quarter-end.  Volume was up 6% for the quarter, with good returns.  General Electric Capital Corporation’s (GECC) Tier 1 common ratio rose 116 basis points to 11.3%, and net interest margin was strong at 5%.  During the quarter, GECC paid $2 billion in dividends to the parent.

Industrial cash from operating activities (CFOA), excluding NBCUniversal deal-related taxes and pension contributions, was $5.9 billion, up 5% from the year-ago period.  Year-to-date total CFOA of $7.8 billion was 27% lower due to NBCU deal-related taxes and the timing of GE Capital dividends.  GE ended the quarter with $87 billion of consolidated cash and cash equivalents, and is on track to generate $14 billion to $17 billion of CFOA this year.

GE continues to execute on its balanced, disciplined capital allocation plan.  GE has returned $13.9 billion to investors year-to-date through dividends and share buybacks.  During the quarter, GE closed its acquisition of Avio Aero, an Italy-based manufacturer of aviation propulsion components and systems for civil and military aircraft.  Also during the quarter, GE closed its acquisition of Lufkin Industries, a leading provider of artificial lift technologies for the oil and gas industry and a manufacturer of industrial gears.  GE also officially formed a global partnership with XD Electric Group to offer high voltage transmission and distribution solutions and provide customers in China with localized grid automation equipment and services.

Immelt concluded, “This quarter we delivered on our major strategic goals for investors.  We grew Industrial segment profits 11% with good margin expansion.  GE Capital is smaller and stronger; it is returning cash to the parent, while maintaining its profitability.  And with a record backlog of $229 billion, we are winning in the market and are well positioned for 2014.  Our overall framework for the year is unchanged.”
 
(1)
 
 


Third-Quarter Highlights:

Third-quarter operating earnings were $3.7 billion, down 3% from third-quarter 2012 and operating EPS was $0.36, flat with the year-ago period.  GAAP earnings from continuing operations (attributable to GE) were $3.3 billion, or $0.32 per share, down 5% and 3% respectively from the third quarter of 2012.  Operating earnings include $0.02 per share of restructuring and other charges and $0.02 per share of Avio acquisition-related charges, with no offsetting industrial gains.

Including the effects of discontinued operations, third-quarter net earnings attributable to GE were $3.2 billion ($0.31 per share) in 2013 compared with $3.5 billion ($0.33 per share) in the third quarter of 2012.

Third-quarter revenues were down 1% at $35.7 billion.  Industrial sales of $25.3 billion rose 2% versus the third quarter of 2012.  GECC revenues of $10.7 billion fell 5% from last year.

Cash generated from GE operating activities year-to-date totaled $7.8 billion ($9.8 billion excluding NBCU deal-related taxes), compared to $10.7 billion last year.

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/investor.  Related charts are now posted on our website for your review prior to the call.

*   *   *
About GE
GE (NYSE: GE) works on things that matter.  The best people and the best technologies taking on the toughest challenges.  Finding solutions in energy, health and home, transportation and finance.  Building, powering, moving and curing the world.  Not just imagining.  Doing.  GE works.  For more information, visit the Company's website at www.ge.com.

GE’s Investor Relations website at www.ge.com/investor and our corporate blog at www.gereports.com, as well as GE’s Facebook page and Twitter accounts including @GE_Reports, contain a significant amount of information about GE, including financial and other information for investors.  GE encourages investors to visit these websites from time to time, as information is updated and new information is posted.


 
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 sovereign debt situations; 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 (GE Money Japan); pending and future mortgage securitization claims and litigation in connection with WMC, which may affect our estimates of liability, including possible loss estimates; 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 or to repurchase shares at the planned level; GECC’s ability to pay dividends to GE at the planned level; our ability to convert 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; our capital allocation plans, as such plans may change and affect planned share repurchases and strategic actions, including acquisitions, joint ventures and dispositions; our success in completing announced transactions and integrating acquired businesses; the impact of potential information technology or data security breaches; 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. This document may also contain non-GAAP financial information. Management uses this information in its internal analysis of results and believes that this information may be informative to investors in gauging the quality of our financial performance, identifying trends in our results and providing meaningful period-to-period comparisons. For a reconciliation of non-GAAP measures presented in this document, see the accompanying supplemental information posted to the investor relations section of our website at www.ge.com.

In this document, “GE” refers to the Industrial businesses of the Company including GECC on an equity basis.  “GE (ex. GECC)” and/or “Industrial” refer to GE excluding Financial Services.”


Investor Contact:
Trevor Schauenberg, 203.373.2424
trevor.a.schauenberg@ge.com

Media Contact:
Seth Martin, 203.572.3567
seth.martin@ge.com
 

 
(2)
 
 

GENERAL ELECTRIC COMPANY
Condensed Statement of Earnings
(unaudited)
                                         
Financial
   
Consolidated
    
GE(a)
  
Services (GECC)
Three Months Ended September 30
    
2013 
    
2012 
    
V%
      
2013 
    
2012 
    
V%
    
2013 
    
2012 
    
V%
Revenues and other income
                                                        
Sales of goods and services
  
$
25,152 
  
$
24,539 
    
2%
    
$
25,262 
  
$
24,749 
    
2%
  
$
33 
  
$
34 
    
(3)%
Other income
    
363 
    
787 
            
271 
    
818 
          
– 
    
– 
      
GECC earnings from continuing operations
    
– 
    
– 
            
1,895 
    
1,675 
          
– 
    
– 
      
GECC revenues from services
    
10,210 
    
10,928 
            
– 
    
– 
          
10,637 
    
11,240 
      
   Total revenues and other income
    
35,725 
    
36,254 
    
(1)%
      
27,428 
    
27,242 
    
1%
    
10,670 
    
11,274 
    
(5)%
                                                         
Costs and expenses
                                                        
Cost of sales, operating and administrative
                                                        
   expenses
    
28,162 
    
27,380 
            
23,493 
    
23,024 
          
4,988 
    
4,781 
      
Interest and other financial charges
    
2,462 
    
2,972 
            
338 
    
294 
          
2,241 
    
2,798 
      
Investment contracts, insurance losses and
                                                        
   insurance annuity benefits
    
672 
    
756 
            
– 
    
– 
          
714 
    
798 
      
Provision for losses on financing receivables
    
821 
    
1,122 
            
– 
    
– 
          
821 
    
1,122 
      
   Total costs and expenses
    
32,117 
    
32,230 
    
-%
      
23,831 
    
23,318 
    
2%
    
8,764 
    
9,499 
    
(8)%
                                                         
Earnings from continuing operations
                                                        
   before income taxes
    
3,608 
    
4,024 
    
(10)%
      
3,597 
    
3,924 
    
(8)%
    
1,906 
    
1,775 
    
7%
Benefit (provision) for income taxes
    
(345)
    
(557)
            
(344)
    
(477)
          
(1)
    
(80)
      
Earnings from continuing operations
    
3,263 
    
3,467 
    
(6)%
      
3,253 
    
3,447 
    
(6)%
    
1,905 
    
1,695 
    
12%
Earnings (loss) from discontinued
                                                        
   operations, net of taxes
    
(82)
    
41 
            
(82)
    
41 
          
(83)
    
(107)
      
Net earnings
    
3,181 
    
3,508 
    
(9)%
      
3,171 
    
3,488 
    
(9)%
    
1,822 
    
1,588 
    
15%
Less net earnings (loss) attributable to
                                                        
   noncontrolling interests
    
(10)
    
17 
            
(20)
    
(3)
          
10 
    
20 
      
Net earnings attributable
                                                        
    to the Company
    
3,191 
    
3,491 
    
(9)%
      
3,191 
    
3,491 
    
(9)%
    
1,812 
    
1,568 
    
16%
Preferred stock dividends declared
    
– 
    
– 
            
– 
    
– 
          
– 
    
– 
      
Net earnings attributable to
                                                        
   GE common shareowners
  
$
3,191 
  
$
3,491 
    
(9)%
    
$
3,191 
  
$
3,491 
    
(9)%
  
$
1,812 
  
$
1,568 
    
16%
                                                         
                                                         
Amounts attributable to the Company:
                                                        
Earnings from continuing operations
  
$
3,273 
  
$
3,450 
    
(5)%
    
$
3,273 
  
$
3,450 
    
(5)%
  
$
1,895 
  
$
1,675 
    
13%
Earnings (loss) from discontinued
                                                        
   operations, net of taxes
    
(82)
    
41 
            
(82)
    
41 
          
(83)
    
(107)
      
Net earnings attributable
                                                        
   to the Company
  
$
3,191 
  
$
3,491 
    
(9)%
    
$
3,191 
  
$
3,491 
    
(9)%
  
$
1,812 
  
$
1,568 
    
16%
                                                         
Per-share amounts - earnings from
                                                        
   continuing operations
                                                        
Diluted earnings per share
  
$
 0.32 
  
$
 0.33 
    
(3)%
                                      
Basic earnings per share
  
$
 0.32 
  
$
 0.33 
    
(3)%
                                      
                                                         
Per-share amounts - net earnings
                                                        
Diluted earnings per share
  
$
 0.31 
  
$
 0.33 
    
(6)%
                                      
Basic earnings per share
  
$
 0.31 
  
$
 0.33 
    
(6)%
                                      
                                                         
Total average equivalent shares
                                                        
Diluted shares
    
10,223 
    
10,568 
    
(3)%
                                      
Basic shares
    
10,151 
    
10,523 
    
(4)%
                                      
                                                         
Dividends declared per common share
  
$
 0.19 
  
$
 0.17 
    
12%
                                      
                                                         
                                                         
Amounts attributable to the Company:
                                                        
Earnings from continuing operations
  
$
3,273 
  
$
3,450 
    
(5)%
                                      
Adjustment (net of tax): Non-operating
                                                        
   pension costs/(income)
    
426 
    
348 
                                            
Operating earnings (non-GAAP measure)
  
$
3,699 
  
$
3,798 
    
(3)%
                                      
                                                         
Operating earnings – diluted earnings
                                                        
   per share
  
$
0.36 
  
$
0.36 
    
-%
                                      
                                                         
                                                         
(a)  
Refers to the Industrial businesses of the Company including GECC on an equity basis.

Dollar amounts and share amounts in millions; per-share amounts in dollars; unaudited. Supplemental data are shown for “GE” and “GECC.” Transactions between GE and GECC have been eliminated from the “Consolidated” columns. See Note 1 to the 2012 consolidated financial statements at www.ge.com/ar2012 for further information about consolidation matters.


 
(3)
 
 


GENERAL ELECTRIC COMPANY
Condensed Statement of Earnings
(unaudited)
                                         
Financial
   
Consolidated
    
GE(a)
  
Services (GECC)
Nine Months Ended September 30
    
2013 
    
2012 
    
V%
      
2013 
    
2012 
    
V%
    
2013 
    
2012 
    
V%
Revenues and other income
                                                        
Sales of goods and services
  
$
71,841 
  
$
73,069 
    
(2)%
    
$
72,188 
  
$
73,574 
    
(2)%
  
$
90 
  
$
90 
    
 -% 
Other income
    
2,082 
    
1,737 
            
1,893 
    
1,827 
          
– 
    
– 
      
GECC earnings from continuing operations
    
– 
    
– 
            
5,744 
    
5,569 
          
– 
    
– 
      
GECC revenues from services
    
31,935 
    
32,925 
            
– 
    
– 
          
33,095 
    
33,878 
      
   Total revenues and other income
    
105,858 
    
107,731 
    
(2)%
      
79,825 
    
80,970 
    
(1)%
    
33,185 
    
33,968 
    
(2)%
                                                         
Costs and expenses
                                                        
Cost of sales, operating and administrative
                                                        
   expenses
    
81,335 
    
81,182 
            
67,506 
    
68,310 
          
14,794 
    
13,993 
      
Interest and other financial charges
    
7,700 
    
9,521 
            
988 
    
960 
          
7,046 
    
8,962 
      
Investment contracts, insurance losses and
                                                        
   insurance annuity benefits
    
2,022 
    
2,155 
            
– 
    
– 
          
2,131 
    
2,271 
      
Provision for losses on financing receivables
    
3,338 
    
2,728 
            
– 
    
– 
          
3,338 
    
2,728 
      
   Total costs and expenses
    
94,395 
    
95,586 
    
(1)%
      
68,494 
    
69,270 
    
(1)%
    
27,309 
    
27,954 
    
(2)%
                                                         
Earnings from continuing operations
                                                        
   before income taxes
    
11,463 
    
12,145 
    
(6)%
      
11,331 
    
11,700 
    
(3)%
    
5,876 
    
6,014 
    
(2)%
Benefit (provision) for income taxes
    
(1,159)
    
(1,718)
            
(1,065)
    
(1,319)
          
(94)
    
(399)
      
Earnings from continuing operations
    
10,304 
    
10,427 
    
(1)%
      
10,266 
    
10,381 
    
(1)%
    
5,782 
    
5,615 
    
3%
Earnings (loss) from discontinued
                                                        
   operations, net of taxes
    
(313)
    
(709)
            
(313)
    
(709)
          
(313)
    
(857)
      
Net earnings
    
9,991 
    
9,718 
    
3%
      
9,953 
    
9,672 
    
3%
    
5,469 
    
4,758 
    
15%
Less net earnings (loss) attributable to
                                                        
   noncontrolling interests
    
140 
    
88 
            
102 
    
42 
          
38 
    
46 
      
Net earnings attributable
                                                        
    to the Company
    
9,851 
    
9,630 
    
2%
      
9,851 
    
9,630 
    
2%
    
5,431 
    
4,712 
    
15%
Preferred stock dividends declared
    
– 
    
– 
            
– 
    
– 
          
(135)
    
– 
      
Net earnings attributable to
                                                        
   GE common shareowners
  
$
9,851 
  
$
9,630 
    
2%
    
$
9,851 
  
$
9,630 
    
2%
  
$
5,296 
  
$
4,712 
    
12%
                                                         
                                                         
Amounts attributable to the Company:
                                                        
Earnings from continuing operations
  
$
10,164 
  
$
10,339 
    
(2)%
    
$
10,164 
  
$
10,339 
    
(2)%
  
$
5,744 
  
$
5,569 
    
3%
Earnings (loss) from discontinued
                                                        
   operations, net of taxes
    
(313)
    
(709)
            
(313)
    
(709)
          
(313)
    
(857)
      
Net earnings attributable
                                                        
   to the Company
  
$
9,851 
  
$
9,630 
    
2%
    
$
9,851 
  
$
9,630 
    
2%
  
$
5,431 
  
$
4,712 
    
15%
                                                         
Per-share amounts - earnings from
                                                        
   continuing operations
                                                        
Diluted earnings per share
  
$
 0.98 
  
$
 0.98 
    
-%
                                      
Basic earnings per share
  
$
 0.99 
  
$
 0.98 
    
1%
                                      
                                                         
Per-share amounts - net earnings
                                                        
Diluted earnings per share
  
$
 0.95 
  
$
 0.91 
    
4%
                                      
Basic earnings per share
  
$
 0.96 
  
$
 0.91 
    
5%
                                      
                                                         
Total average equivalent shares
                                                        
Diluted shares
    
10,328 
    
10,590 
    
(2)%
                                      
Basic shares
    
10,262 
    
10,552 
    
(3)%
                                      
                                                         
Dividends declared per common share
  
$
 0.57 
  
$
 0.51 
    
12%
                                      
                                                         
                                                         
Amounts attributable to the Company:
                                                        
Earnings from continuing operations
  
$
10,164 
  
$
10,339 
    
(2)%
                                      
Adjustment (net of tax): Non-operating
                                                        
   pension costs/(income)
    
1,279 
    
1,036 
                                            
Operating earnings (non-GAAP measure)
  
$
11,443 
  
$
11,375 
    
1%
                                      
                                                         
Operating earnings – diluted earnings
                                                        
   per share
  
$
1.11 
  
$
1.07 
    
4%
                                      
                                                         
                                                         
(a)  
Refers to the Industrial businesses of the Company including GECC on an equity basis.

Dollar amounts and share amounts in millions; per-share amounts in dollars; unaudited. Supplemental data are shown for “GE” and “GECC.” Transactions between GE and GECC have been eliminated from the “Consolidated” columns. See Note 1 to the 2012 consolidated financial statements at www.ge.com/ar2012 for further information about consolidation matters.
 

 
 
(4)
 
 

 
 
GENERAL ELECTRIC COMPANY
Summary of Operating Segments
(unaudited)
       
 
Three months ended September 30
  
Nine months ended September 30
(Dollars in millions)
  
2013 
    
2012 
    
V% 
    
2013 
    
2012 
    
V%
                                   
Revenues(a)
                                  
   Power & Water
$
6,498 
  
$
7,196 
    
(10)%
  
$
17,038 
  
$
20,647 
    
(17)%
   Oil & Gas
  
4,315 
    
3,645 
    
18%
    
11,669 
    
10,693 
    
9%
   Energy Management
  
1,828 
    
1,879 
    
(3)%
    
5,557 
    
5,478 
    
1%
   Aviation
  
5,364 
    
4,781 
    
12%
    
15,741 
    
14,527 
    
8%
   Healthcare
  
4,304 
    
4,307 
    
-%
    
13,083 
    
13,107 
    
-%
   Transportation
  
1,406 
    
1,409 
    
-%
    
4,425 
    
4,244 
    
4%
   Home & Business Solutions
  
2,098 
    
1,955 
    
7%
    
6,142 
    
5,899 
    
4%
      Total industrial segment revenues
  
25,813 
    
25,172 
    
3%
    
73,655 
    
74,595 
    
(1)%
   GE Capital
  
10,670 
    
11,274 
    
(5)%
    
33,185 
    
33,968 
    
(2)%
      Total segment revenues
  
36,483 
    
36,446 
    
-%
    
106,840 
    
108,563 
    
(2)%
   Corporate items and eliminations(a)
  
(758)
    
(192)
    
U
    
(982)
    
(832)
    
(18)%
Consolidated revenues and other income from
                                  
   continuing operations
$
35,725 
  
$
36,254 
    
(1)%
  
$
105,858 
  
$
107,731 
    
(2)%
                                   
Segment profit(a)
                                  
   Power & Water
$
1,289 
  
$
1,184 
    
9%
  
$
3,095 
  
$
3,675 
    
(16)%
   Oil & Gas
  
519 
    
469 
    
11%
    
1,376 
    
1,275 
    
8%
   Energy Management
  
18 
    
42 
    
(57)%
    
64 
    
67 
    
(4)%
   Aviation
  
1,091 
    
924 
    
18%
    
3,094 
    
2,708 
    
14%
   Healthcare
  
665 
    
620 
    
7%
    
1,986 
    
1,899 
    
5%
   Transportation
  
306 
    
265 
    
15%
    
886 
    
779 
    
14%
   Home & Business Solutions
  
77 
    
60 
    
28%
    
239 
    
196 
    
22%
      Total industrial segment profit
  
3,965 
    
3,564 
    
11%
    
10,740 
    
10,599 
    
1%
   GE Capital
  
1,895 
    
1,675 
    
13%
    
5,744 
    
5,569 
    
3%
      Total segment profit
  
5,860 
    
5,239 
    
12%
    
16,484 
    
16,168 
    
2%
                                   
Corporate items and eliminations(a)
  
(1,904)
    
(1,018)
    
(87)%
    
(4,266)
    
(3,550)
    
(20)%
GE interest and other financial charges
  
(338)
    
(294)
    
(15)%
    
(988)
    
(960)
    
(3)%
GE provision for income taxes
  
(345)
    
(477)
    
28%
    
(1,066)
    
(1,319)
    
19%
                                   
Earnings from continuing operations
                                  
   attributable to the Company
  
3,273 
    
3,450 
    
(5)%
    
10,164 
    
10,339 
    
(2)%
                                   
Earnings (loss) from discontinued operations,
                                  
   net of taxes, attributable to the Company
  
(82)
    
41 
    
U
    
(313)
    
(709)
    
56%
                                   
Consolidated net earnings attributable
                                  
    to the Company
$
3,191 
  
$
3,491 
    
(9)%
  
$
9,851 
  
$
9,630 
    
2%
                                   
                                   
(a)  
Segment revenues includes both revenues and other income related to the segment. Segment profit excludes results reported as discontinued operations, earnings attributable to noncontrolling interests of consolidated subsidiaries, GECC preferred stock dividends declared 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 Power & Water, Oil & Gas, Energy Management, Aviation, Healthcare, Transportation and Home & Business Solutions; included in determining segment profit, which we sometimes refer to as “net earnings,” for GE Capital. Certain corporate costs, such as shared services, employee benefits and information technology are allocated to our segments based on usage. A portion of the remaining corporate costs are allocated based on each segment’s relative net cost of operations.
 
 

 
 
(5)
 
 

 

 
GENERAL ELECTRIC COMPANY
Summary of Operating Segments (unaudited)
Additional Information
                                   
       
 
Three months ended September 30
  
Nine months ended September 30
(Dollars in millions)
  
2013 
    
2012 
    
V% 
    
2013 
    
2012 
    
V%
                                   
GE Capital
                                  
                                   
   Revenues
$
10,670 
  
$
11,274 
    
(5)%
  
$
33,185 
  
$
33,968 
    
(2)%
                                   
   Segment profit
$
1,895 
  
$
1,675 
    
13%
  
$
5,744 
  
$
5,569 
    
3%
                                   
   Revenues
                                  
      Commercial Lending and Leasing (CLL)
$
3,677 
  
$
4,028 
    
(9)%
  
$
11,091 
  
$
12,406 
    
(11)%
      Consumer
  
3,747 
    
3,911 
    
(4)%
    
11,353 
    
11,600 
    
(2)%
      Real Estate
  
689 
    
948 
    
(27)%
    
3,218 
    
2,660 
    
21%
      Energy Financial Services
  
438 
    
401 
    
9%
    
1,084 
    
1,086 
    
-%
      GE Capital Aviation Services (GECAS)
  
1,312 
    
1,249 
    
5%
    
3,973 
    
3,897 
    
2%
                                   
   Segment profit
                                  
      CLL
$
479 
  
$
563 
    
(15)%
  
$
1,702 
  
$
1,855 
    
(8)%
      Consumer
  
889 
    
749 
    
19%
    
2,240 
    
2,485 
    
(10)%
      Real Estate
  
464 
    
217 
    
F
    
1,589 
    
494 
    
F
      Energy Financial Services
  
150 
    
132 
    
14%
    
293 
    
325 
    
(10)%
      GECAS
  
173 
    
251 
    
(31)%
    
825 
    
877 
    
(6)%
 


 
(6)
 
 


GENERAL ELECTRIC COMPANY
Condensed Statement of Financial Position
(unaudited)
                             
Financial 
 
Consolidated 
    
GE(a) 
    
Services (GECC) 
(Dollars in billions)
  
9/30/13
    
12/31/12
      
9/30/13
    
12/31/12
      
9/30/13
    
12/31/12
                                       
Assets
                                      
   Cash & marketable securities
$
130.4 
  
$
125.9 
    
$
10.3 
  
$
15.6 
    
$
120.1 
  
$
110.4 
   Receivables
  
20.6 
    
19.9 
      
10.7 
    
9.3 
      
– 
    
– 
   Inventories
  
17.9 
    
15.4 
      
17.9 
    
15.3 
      
0.1 
    
0.1 
   Financing receivables - net
  
243.8 
    
258.0 
      
– 
    
– 
      
254.2 
    
269.0 
   Property, plant & equipment - net
  
68.7 
    
69.0 
      
17.0 
    
16.0 
      
51.7 
    
53.0 
   Investment in GECC
  
– 
    
– 
      
79.2 
    
77.9 
      
– 
    
– 
   Goodwill & intangible assets
  
92.3 
    
85.2 
      
64.4 
    
56.8 
      
27.9 
    
28.3 
   Other assets
  
85.8 
    
109.5 
      
32.7 
    
45.5 
      
59.2 
    
70.1 
   Assets of businesses held for sale
  
0.2 
    
0.2 
      
0.1 
    
– 
      
0.1 
    
0.2 
   Assets of discontinued operations
  
1.7 
    
2.3 
      
– 
    
– 
      
1.7 
    
2.3 
                                       
Total assets
$
661.4 
  
$
685.4 
    
$
232.3 
  
$
236.4 
    
$
515.0 
  
$
533.4 
                                       
Liabilities and equity
                                      
   Borrowings and bank deposits
$
388.1 
  
$
414.1 
    
$
12.6 
  
$
17.5 
    
$
376.1 
  
$
397.3 
   Investment contracts, insurance liabilities
                                      
      and insurance annuity benefits
  
26.7 
    
28.3 
      
– 
    
– 
      
27.2 
    
28.7 
   Other liabilities
  
115.1 
    
111.9 
      
96.0 
    
95.0 
      
24.8 
    
22.2 
   Liabilities of businesses held for sale
  
– 
    
0.2 
      
– 
    
– 
      
– 
    
0.2 
   Liabilities of discontinued operations
  
2.4 
    
2.5 
      
0.1 
    
0.1 
      
2.3 
    
2.4 
   GE shareowners' equity
  
122.7 
    
123.0 
      
122.7 
    
123.0 
      
84.1 
    
81.9 
   Noncontrolling interests
  
6.4 
    
5.4 
      
0.9 
    
0.8 
      
0.5 
    
0.7 
                                       
Total liabilities and equity
$
661.4 
  
$
685.4 
    
$
232.3 
  
$
236.4 
    
$
515.0 
  
$
533.4 
                                       
                                       
(a)  
Refers to the Industrial businesses of the Company including GECC on an equity basis.
 
Supplemental consolidating data are shown for "GE" and "GECC." Transactions between GE and GECC have been eliminated from the "Consolidated" columns. See Note 1 to the 2012 consolidated financial statements at www.ge.com/ar2012 for further information about consolidation matters.
 
 

 
 
(7)
 
 
 

 
Other 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 (EPS), operating EPS excluding restructuring and other charges, GE Capital ending net investment (ENI) excluding cash and equivalents, cash generated from GE Industrial operating activities (Industrial CFOA), Industrial CFOA excluding certain items, GE CFOA excluding NBCU deal-related taxes and Industrial CFOA excluding NBCU deal-related taxes. The reconciliations of these measures to the most comparable GAAP measures follow.

Operating Earnings and Operating Earnings Per Share
                 
(Dollars in millions; except earnings per share)
Three Months Ended September 30
   
2013 
    
2012 
    
V% 
                 
Earnings from continuing operations attributable to GE
$
 3,273 
  
$
 3,450 
    
(5)%
Adjustment (net of tax): non-operating pension costs/(income)
  
 426 
    
 348 
      
Operating earnings
$
 3,699 
  
$
 3,798 
    
(3)%
                 
Earnings per share – diluted(a)
                
Continuing earnings per share
$
 0.32 
  
$
 0.33 
    
(3)%
Adjustment (net of tax): non-operating pension costs/(income)
  
 0.04 
    
 0.03 
      
Operating earnings per share
$
 0.36 
  
$
 0.36 
    
-% 
                 
Adjustment (net of taxes): Avio acquisition-related charges
$
 0.02 
            
Adjustment (net of taxes): restructuring and other charges
  
 0.02 
            
Operating EPS excluding restructuring and other charges
$
 0.40 
            
                 
                 
 
Nine Months Ended September 30
(Dollars in millions; except earnings per share)
  
2013 
    
2012 
    
V% 
                 
Earnings from continuing operations attributable to GE
$
 10,164 
  
$
 10,339 
    
(2)%
Adjustment (net of tax): non-operating pension costs/(income)
  
 1,279 
    
 1,036 
      
Operating earnings
$
 11,443 
  
$
 11,375 
    
1%
                 
Earnings per share – diluted(a)
                
Continuing earnings per share
$
 0.98 
  
$
 0.98 
    
-%
Adjustment (net of tax): non-operating pension costs/(income)
  
 0.12 
    
 0.10 
      
Operating earnings per share
$
 1.11 
  
$
 1.07 
    
4%
                 
                 
(a)  
Earnings-per-share amounts are computed independently.  As a result, the sum of per-share amounts may not equal the total.



 
(8)
 
 


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 investors may find it useful to compare our operating earnings excluding the effects of restructuring and other charges and Avio acquisition-related charges. 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.

     
GE Capital Ending Net Investment (ENI), Excluding Cash and Equivalents
     
   
September 30,
(In billions)
  
2013 
     
Financial Services (GECC) total assets
$
515.0 
   Adjustment: deferred income taxes
  
5.7 
GECC total assets
  
520.7 
   Less assets of discontinued operations
  
(1.7)
   Less non-interest bearing liabilities
  
(58.1)
GE Capital ENI
  
460.9 
   Less cash and equivalents
  
(76.3)
GE Capital ENI, excluding cash and equivalents
$
384.6 


We use ENI to measure the size of our GE Capital segment. We believe that this measure is a useful indicator of the capital (debt or equity) required to fund a business as it adjusts for non-interest bearing current liabilities generated in the normal course of business that do not require a capital outlay. We also believe that by excluding cash and equivalents, we provide a meaningful measure of assets requiring capital to fund our GE Capital segment as a substantial amount of this cash resulted from debt issuances to pre-fund future debt maturities and will not be used to fund additional assets. Providing this measure will help investors measure how we are performing against our previously communicated goal to reduce the size of our financial services segment.


Industrial CFOA, GE and Industrial CFOA excluding NBCU Deal-Related Taxes and Pension Contributions
                 
 
Nine Months Ended September 30
(Dollars in millions)
  
2013 
    
2012 
    
V%
                 
Cash from GE's operating activities (continuing operations) as reported
$
7,828 
  
$
10,652 
    
(27)%
Less dividends from GECC
  
3,947 
    
5,446 
      
Cash from GE's operating activities (continuing operations) excluding
                
   dividends from GECC (Industrial CFOA)
  
3,881 
    
5,206 
    
(25)%
Adjustment: effects of NBCU deal-related taxes
  
2,016 
    
– 
      
Adjustment: effect of pension contributions
  
– 
    
433 
      
Industrial CFOA excluding NBCU deal-related taxes and pension contributions
$
5,897 
  
$
5,639 
    
5%
                 
Cash from GE's operating activities (continuing operations) as reported
$
7,828 
            
Adjustment: effect of NBCU deal-related taxes
  
2,016 
            
GE CFOA excluding the effect of NBCU deal-related taxes
$
9,844 
            
                 

 

 
(9)
 
 


We define “Industrial CFOA” as GE’s cash from operating activities (continuing operations) less the amount of dividends received by GE from GECC. This includes the effects of intercompany transactions, including GE customer receivables sold to GECC; GECC services for trade receivables management and material procurement; buildings and equipment (including automobiles) leased by GE from GECC; information technology (IT) and other services sold to GECC by GE; aircraft engines manufactured by GE that are installed on aircraft purchased by GECC 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 GECC 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. We also believe that investors may find it useful to compare Industrial CFOA excluding the effects of taxes paid related to the NBCU transaction and 2012 pension contributions. Management recognizes that these measures 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 GECC cash flows. We believe that our measures of Industrial CFOA and Industrial CFOA excluding certain items provides management and investors with useful measures 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 useful measures to supplement the reported GAAP CFOA measure.


 
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