GE second-quarter revenues decrease 4% to $37.4 billion

GE announced today second-quarter 2010 earnings from continuing operations (attributable to GE) of $3.3 billion, with EPS of $0.30 per share up 15% from the second quarter of 2009. Revenues were $37.4 billion for the quarter, down 4% from a year ago, impacted by lower GE Capital assets, industrial dispositions and lower equipment sales as expected.

“GE is well positioned across the portfolio, both financially and competitively”

"GE's economic environment continues to improve," GE Chairman and CEO Jeff Immelt said, citing growth in orders, margins and earnings amid other encouraging signs in the quarter. "Equipment orders increased 17%, including 20% growth in the Energy Infrastructure segment and 14% at Technology Infrastructure. Oil & Gas and Healthcare orders were particular bright spots and helped hold total company orders backlog roughly flat, excluding the impact of foreign exchange.

"GE's portfolio generated solid results across the board," Immelt said. "Our Energy and Technology Infrastructure businesses performed as expected, Home & Business Solutions and NBCU turned in good revenue and earnings growth, and GE Capital delivered 93% net income growth as losses have peaked and earnings are rebounding.

"Higher income and lower losses at GE Capital were particularly encouraging, with pre-tax earnings of $0.7 billion," Immelt said. "We continue to see improvement in key performance measurements. Losses and impairments declined $0.5 billion from the prior quarter, with consumer losses down $0.4 billion and real estate losses in line with our expectations. We have strengthened the franchise over the past year and GE Capital's earnings recovery should continue.

"The company advanced strategically in the quarter. We announced that our joint venture with China Aviation Industry Corporation (AVIC) has been selected to provide the avionics systems package for the newly launched C919 single-aisle aircraft. The C919 is now positioned to have the most GE content of any plane in history. We announced the launch of our global GE Healthcare Performance Solutions business to expand consulting capabilities that help customers reduce waste and improve efficiency. And GE Capital recently announced the disposition of BAC Credomatic, consistent with our overall strategy to bring ending net investment to targeted levels.

"Company execution was strong in the quarter," Immelt said. "Industrial margins improved to 17.1%, up 70 bps from a year ago. We continued to invest for future growth and increased our first-half R&D investment by 14%. Cash generated from Industrial operating activities totaled $3.8 billion in the quarter and we are on track for $13-$15 billion this year. At quarter-end, GE had $74 billion of consolidated cash and equivalents."

Positive items were offset by charges in the quarter. After-tax gains of $0.01 per share were offset by $0.01 per share in after-tax restructuring and other charges.

"GE is well positioned across the portfolio, both financially and competitively," Immelt said. "The company continues to generate strong cash flow, which we will invest strategically to create shareholder value, while keeping the company safe. We expect to grow earnings and dividends in 2011 and beyond."

Second-Quarter 2010 Financial Highlights:

Earnings from continuing operations attributable to GE were $3.3 billion, up 14% from $2.9 billion in the second quarter of 2009. EPS from continuing operations was $0.30, up 15% from last year. Segment profit increased 8% compared with the second quarter of 2009, as 93% growth at GE Capital, 13% growth at NBC Universal and 59% growth at Home & Business Solutions, more than offset an 11% earnings decline at Technology Infrastructure.

Including the effects of discontinued operations, second quarter net earnings attributable to GE were $3.1 billion ($0.28 per share attributable to common shareowners) in 2010 compared with $2.7 billion ($0.25 per share attributable to common shareowners) in the second quarter of 2009.

Revenues decreased 4% to $37.4 billion. GE Capital Services' (GECS) revenues fell 2% versus last year to $13.1 billion. Industrial sales were $24.4 billion, down 6% from the second quarter of 2009.

Cash generated from GE Industrial operating activities in the first six months of 2010 totaled $6.3 billion, down 10% from $7.0 billion last year.

Source GE