General Electric Co GE - equity, debt and subsidiaries

Accuracy score :
97%

General Electric Co  GE

Summary (from the latest annual and quarterly report – 2018)

  • Total equity: 31.4 billion USD
  • Market Cap is 65.8 billion USD ( the last price of the stock is 7.57 USD)
  • General Electric Co is known for its digital industrial offerings and massive installed base spread across a variety of products and services, including aircraft engines, gas turbines, steam turbines, wind turbines, locomotives, and LED lighting
  • Total equity has decreased from 75 billion USD in 2016 to 31.4 billion in 2018
  • The company has 1 billion USD in cash on account
  • Total equity – cash on account = 31.4 billion USD - 1 billion USD = 30.4 billion USD
  • In 2018 the company has 99 billion USD long-term debt, short-term debt is 15.2 billion USD
  • In 2016 the company had 105 billion USD long-term debt, short-term debt was 31 billion USD
  • Company's revenue has increased in 2017 to 120 billion USD  from 119.6 billion in 2016
  • Net loss in 2017 was 5.7 billion USD, Net income in 2016 was 8.8 billion USD
  •  In 2017 company paid 8.6 billion USD dividend to its shareholders

 

Opinion about the company

Fundamentally it is a not good company (Total debt is very big (114.2 billion USD), the company has 1 billion USD in cash on account, ROE is negative:  around  - 58%).

With historical ties to inventor Thomas Edison, General Electric was formed through the combination of two companies in 1892. Today, GE is known for its digital industrial offerings and massive installed base spread across a variety of products and services, including aircraft engines, gas turbines, steam turbines, wind turbines, locomotives, and LED lighting, among others. In its current form, the company focuses on aviation, healthcare, and power, but management announced corporate actions in 2018 that will make aviation, power, and renewable energy the primary areas of focus going forward.

General Electric has been selling off a number of its subsidiaries, including the large financial division GE Capital. It is selling off these assets to scale back its business after issues with GE Capital threatened the parent company during the 2008 financial crisis. In April 2015, GE announced it planned to divest around $200 billion in assets from GE Capital. GE has sold off more than $200 billion of its assets from 2015 and on November 6, 2018, General Electric announced the latest of its subsidiary selloffs. According to the Wall Street Journal, General Electric has agreed to sell current, a GE subsidiary that produces energy management systems, to American Industrial Partners (AIP) for an undisclosed amount. Consolidated revenues for the third quarter 2018 were $29.6 billion, down $1.1 billion, or 4%, for the quarter. The decline in revenues was largely a result of the absence of Water following the sale in September 2017 and Industrial Solutions following the sale in June 2018. Industrial segment organic revenues have increased $0.3 billion driven principally by Aviation, Renewable Energy, Oil & Gas and Healthcare segments, partially offset by our Power, Lighting and Transportation segments. Consolidated continuing earnings decreased $ 24.3 billion due to increased goodwill impairment charges of $21.0 billion, decreased GE Industrial continuing earnings of $ 2.6 billion, increased provision for GE Industrial income taxes of $ 0.5 billion and increased non-operating benefit costs of $0.2 billion.

Here are the leading subsidiaries that GE continues to own:

  • GE Power is a wholly-owned subsidiary and remains the company's largest business division. GE Power produces systems that generate power using wind, oil, gas, and water, but the subsidiary has taken a sharp downturn in recent years, especially after the sale of GE Capital and the refocusing of General Electric's core business segments. General Electric reported third-quarter revenues of $29.6 billion on October 30, 2018. GE Power accounted for $5.74 billion of General Electric's revenues this quarter, down 33.8% from $8.67 billion over the same period last year (worth 15 billion USD)
  • GE Aviation - One of General Electric's few business segments with consistent growth, GE Aviation provides jets, turboprop engines, and designs software used by major aviation corporations. The segment has plans to have 60,000 jet engines connected to the internet by 2020, which they claim will save fuel and create fewer delays at airports. GE Aviation grew to $7.48 billion in revenues in Q3 2018, up from $6.82 billion over the same period last year (worth 15 billion USD)
  • GE Renewable Energy, also known as GE Energy Connections, is the company's energy management division focused on the distribution, conversion, automation, and optimization of energy sources. By focusing on an area that promotes sustainability and increased efficiency, there is plenty of room to grow. With $2.88 billion in revenues for Q3 2018, compared to $2.90 billion last year, GE Renewable Energy is one of the companies smallest, but more reliable, business segments (worth 7 billion USD)
  • GE Oil & Gas is the fourth-largest revenue generator for General Electric, producing smart and efficient solutions to the oil and gas industry. In Q3 2018, GE Oil & Gas accounted for $5.67 billion of General Electric's quarterly revenues, up from $5.37 billion the year before(worth 13 billion USD)
  • Transportation, healthcare and lighting accounted for $6 billion of General Electric's quarterly revenues (worth 15 billion USD)
  • On January 10, 2017, GE completed the acquisition of ServiceMax, a leader in cloud-based field service management (FSM) solutions, for 0.9 billion USD, net of cash acquired.
  • On April 20, 2017, GE completed the acquisition of LM Wind Power, one of the world’s largest wind turbine blade manufacturers for approximately 1.7 billion USD, net of cash acquired

 

Total = 67.6 billion USD