GE Delivers $0.34 Operating Earnings Per Share (EPS) up 17%;

Industrial Segment Revenue Growth of 10%; Infrastructure Orders up 24%

2Q 2011 Highlights (Continuing Operations Attributable to GE)

  • Fifth consecutive quarter of double-digit earnings growth
    • Operating earnings of $3.7 billion, up 18%; operating EPS of $0.34, up 17%
    • GAAP earnings of $3.5 billion, up 10%; GAAP EPS of $0.33, up 14%
  • Leading indicators improving
    • Infrastructure orders up 24%, with equipment up 33%, services up 16%
    • Industrial segment revenue growth of 10% and organic growth of 3%
    • Total revenues of $35.6 billion for 2Q’11, down 4%; up 7% excluding impact of NBCU
  • GE Capital earned $1.7 billion, with pre-tax earnings of $2.1 billion
  • GECC/GECS Tier 1 Common ratios up to 10.4%/9.1%

FAIRFIELD, Conn.--()--GE [NYSE: GE] announced today strong second-quarter 2011 operating earnings from continuing operations of $3.7 billion, up 18%, or $0.34 per share, up 17%, from the second quarter of 2010. Revenues were $35.6 billion for the quarter, down 4% from a year ago, primarily driven by the absence of NBCU revenues after the sale of GE’s majority position to Comcast. Excluding this impact, revenues were up 7%.

“With our fifth-consecutive quarter of double-digit earnings growth, we continue to execute in a volatile environment,” GE Chairman and CEO Jeff Immelt said. “We posted solid overall operating earnings growth of 18%, with strong contributions from GE Capital, Healthcare, Transportation, Aviation, and Oil & Gas. GE’s backlog grew to a record high of $189 billion. Total infrastructure orders were up 24%, reflecting robust strength in equipment orders, up 33%, and service orders up 16%.”

International revenues from Industrial (ex NBCU) were $13.4 billion, up 23% representing 59% of total Industrial revenues. GE revenue for the Industrial segments accelerated in growth regions, including double-digit increases in India, China, Southeast Asia, Africa, Russia, Australia, Canada, and Latin America.

“GE Capital continued to deliver strong performance through the second quarter, earning $1.7 billion after tax,” Immelt said. “GE Capital’s portfolio transformation is ahead of schedule. Consumer and Commercial Lending and Leasing (CLL) led with earnings growth of 57% and more than 100%, respectively. We continue to see strong demand for credit with CLL new volume originations at $10.8 billion for the quarter, up 33% from prior year.

”As previously communicated, Energy earnings and margins were down primarily as a result of pressure in the renewable sector,” Immelt said. “In addition, margins were impacted by the integration of Energy acquisitions. Indicators are pointing to a stronger second half in 2011 for Energy when we expect approximately 17% unit volume growth versus 2010. Integration of strategic Energy acquisitions is ahead of plan, further positioning Energy Infrastructure for growth in the second half of this year. Overall, Industrial earnings should improve in the second half of 2011 and the cycle is expected to accelerate in 2012.”

In the second quarter, the Company increased R&D investment 40% above a year ago to ensure GE continues to lead in technology innovations, products and services that drive strong organic revenue growth and future margin expansion. The investment is showing results. For example, GE Aviation and its joint ventures announced record wins of $27 billion at the Paris Air Show in June. The LEAP-X engine (a CFM International engine) has taken the lead in narrow-body orders on the new Airbus A320neo and is positioned as the sole source for Boeing’s 737 re-engine program. In Energy, GE launched the FlexEfficiency 50 Combined Cycle Power Plant, which delivers an unprecedented combination of flexibility and fuel efficiency, announced the world’s most efficient wind turbine, and achieved the highest reported efficiency for thin-film solar panels.

Cash generated from Industrial operating activities totaled $4.4 billion in the first half of 2011, on track for full-year plan of $12-$13 billion. At quarter-end, GE had $91 billion of consolidated cash. Year-to-date, the Company has executed on $1 billion of stock buybacks and $2.7 billion of stock buybacks since restarting the program in the third quarter of 2010. The Company plans to retire the preferred stock issued to Berkshire Hathaway Inc. in October 2011.

“We are very encouraged by second-quarter orders and earnings momentum across the company,” Immelt said. “We are optimistic about our growth prospects in the second half and beyond.”

Second-quarter 2011 Financial Highlights:

Second-quarter operating earnings were $3.7 billion, up 18% from $3.2 billion in the second quarter of 2010 and operating EPS was $0.34, up 17% from $0.29 in the second quarter of last year. Segment profit increased 18% compared with the second quarter of 2010, as increases of more than 100% at GE Capital, more than 500% at Transportation, 9% at Aviation and 8% at Healthcare more than offset earnings decreases of 19% at Energy Infrastructure and 26% at Home & Business Solutions.

Including the effects of discontinued operations, second-quarter net earnings attributable to GE were $3.8 billion ($0.35 per share attributable to common shareowners) in 2011 compared with $3.1 billion ($0.28 per share attributable to common shareowners) in the second quarter of 2010.

Second-quarter revenues decreased 4% to $35.6 billion, up 7% excluding NBCU revenues. GE Capital Services’ (GECS) revenues decreased 1% from last year to $12.4 billion. Industrial sales of $23.0 billion decreased 6% versus 2010.

Cash generated from GE Industrial operating activities in the first six months of 2011 totaled $4.4 billion, down 31% from $6.3 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 second-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; 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; 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.

GENERAL ELECTRIC COMPANY
Condensed Statement of Earnings
                   
Consolidated GE (a) Financial Services (GECS)
Three months ended June 30 2011 2010 V% 2011 2010 V% 2011 2010 V%
Revenues
Sales of goods and services $ 22,908 $ 24,504 $ 22,961 $ 24,403 $ 42 $ 168
Other income 623 278 675 304 - -
GECS earnings from continuing operations - - 1,593 734 - -
GECS revenues from services   12,094     12,146     -     -     12,401     12,464  
Total revenues   35,625     36,928   (4 )%   25,229     25,441   (1 )%   12,443     12,632   (1 )%
 
Costs and expenses
Cost of sales, operating and administrative expenses 25,784 26,081 20,761 20,697 5,284 5,618
Interest and other financial charges 3,773 3,946 321 430 3,601 3,645
Investment contracts, insurance losses and insurance annuity benefits 746 722 - - 790 770
Provision for losses on financing receivables   811     2,007     -     -     811     2,007  
Total costs and expenses   31,114     32,756   (5 )%   21,082     21,127   - %   10,486     12,040   (13 )%
 
Earnings from continuing operations before income taxes 4,511 4,172 8 % 4,147 4,314 (4 )% 1,957 592 F
Benefit (provision) for income taxes   (890 )   (866 )   (546 )   (986 )   (344 )   120  
Earnings from continuing operations 3,621 3,306 10 % 3,601 3,328 8 % 1,613 712 F
 
Earnings (loss) from discontinued operations, net of taxes   217     (101 )   217     (101 )   217     (100 )
 
Net earnings 3,838 3,205 20 % 3,818 3,227 18 % 1,830 612 F
 
Less net earnings (loss) attributable to noncontrolling interests   74     96     54     118     20     (22 )
Net earnings attributable to the Company 3,764 3,109 21 % 3,764 3,109 21 % 1,810 634 F
 
Preferred stock dividends declared   (75 )   (75 )   (75 )   (75 )   -     -  
Net earnings attributable to GE common shareowners $ 3,689   $ 3,034   22 % $ 3,689   $ 3,034   22 % $ 1,810   $ 634   F
                                       
Amounts attributable to the Company:
Earnings from continuing operations $ 3,547 $ 3,210 10 % $ 3,547 $ 3,210 10 % $ 1,593 $ 734 F
Earnings (loss) from discontinued operations, net of taxes   217     (101 )   217     (101 )   217     (100 )
Net earnings attributable to the Company $ 3,764   $ 3,109   21 % $ 3,764   $ 3,109   21 % $ 1,810   $ 634   F
 
Per-share amounts - earnings from continuing operations
Diluted earnings per share $ 0.33 $ 0.29 14 %
Basic earnings per share $ 0.33 $ 0.29 14 %
 
Per-share amounts - net earnings
Diluted earnings per share $ 0.35 $ 0.28 25 %
Basic earnings per share $ 0.35 $ 0.28 25 %
 
Total average equivalent shares
Diluted shares 10,639 10,702 (1 )%
Basic shares 10,604 10,685 (1 )%
 
Dividends declared per common share   $ 0.15     $ 0.10     50 %                          
 
Amounts attributable to the Company:
Earnings from continuing operations $ 3,547 $ 3,210 10 %
Less: Non-operating pension costs/(income), net of taxes   181     (57 )
Operating earnings (non-GAAP measure) $ 3,728   $ 3,153   18 %
 
Operating earnings - diluted earnings per share $ 0.34 $ 0.29 17 %
                                                 
(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)
Six months ended June 30 2011 2010 V% 2011 2010 V% 2011 2010 V%
Revenues
Sales of goods and services $ 44,899 $ 48,177 $ 45,063 $ 47,912 $ 84 $ 449
Other income 4,249 628 4,341 680 - -
GECS earnings from continuing operations - - 3,361 1,236 - -
GECS revenues from services   24,812     24,190     -     -     25,400     24,816  
Total revenues   73,960     72,995   1 %   52,765     49,828   6 %   25,484     25,265   1 %
 
Costs and expenses
Cost of sales, operating and administrative expenses 51,013 52,510 40,989 41,597 10,583 11,438
Interest and other financial charges 7,574 7,867 676 773 7,190 7,343
Investment contracts, insurance losses and insurance annuity benefits 1,482 1,469 - - 1,559 1,557
Provision for losses on financing receivables   1,968     4,187     -     -     1,968     4,187  
Total costs and expenses   62,037     66,033   (6 )%   41,665     42,370   (2 )%   21,300     24,525   (13 )%
 
Earnings from continuing operations before income taxes 11,923 6,962 71 % 11,100 7,458 49 % 4,184 740 F
Benefit (provision) for income taxes   (4,831 )   (1,305 )   (4,059 )   (1,774 )   (772 )   469  
Earnings from continuing operations 7,092 5,657 25 % 7,041 5,684 24 % 3,412 1,209 F
 
Earnings (loss) from discontinued operations, net of taxes   273     (454 )   273     (454 )   274     (450 )
 
Net earnings 7,365 5,203 42 % 7,314 5,230 40 % 3,686 759 F
 
Less net earnings (loss) attributable to noncontrolling interests   168     149     117     176     51     (27 )
Net earnings attributable to the Company 7,197 5,054 42 % 7,197 5,054 42 % 3,635 786 F
 
Preferred stock dividends declared   (150 )   (150 )   (150 )   (150 )   -     -  
Net earnings attributable to GE common shareowners $ 7,047   $ 4,904   44 % $ 7,047   $ 4,904   44 % $ 3,635   $ 786   F
                                       
Amounts attributable to the Company:
Earnings from continuing operations $ 6,924 $ 5,508 26 % $ 6,924 $ 5,508 26 % $ 3,361 $ 1,236 F
Earnings (loss) from discontinued operations, net of taxes   273     (454 )   273     (454 )   274     (450 )
Net earnings attributable to the Company $ 7,197   $ 5,054   42 % $ 7,197   $ 5,054   42 % $ 3,635   $ 786   F
 
Per-share amounts - earnings from continuing operations
Diluted earnings per share $ 0.64 $ 0.50 28 %
Basic earnings per share $ 0.64 $ 0.50 28 %
 
Per-share amounts - net earnings
Diluted earnings per share $ 0.66 $ 0.45 47 %
Basic earnings per share $ 0.66 $ 0.46 43 %
 
Total average equivalent shares
Diluted shares 10,640 10,694 (1 )%
Basic shares 10,608 10,678 (1 )%
 
Dividends declared per common share   $ 0.29     $ 0.20     45 %                          
 
Amounts attributable to the Company:
Earnings from continuing operations $ 6,924 $ 5,508 26 %
Less: Non-operating pension costs/(income), net of taxes   344     (108 )
Operating earnings (non-GAAP measure) $ 7,268   $ 5,400   35 %
 
Operating earnings - diluted earnings per share $ 0.67 $ 0.49 37 %
                                                 
(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 Six Months
Ended June 30 Ended June 30
(Dollars in millions) 2011   2010   V% 2011   2010   V%
 
Revenues
Energy Infrastructure $ 10,402 $ 9,540 9 % $ 19,851 $ 18,195 9 %
Aviation(a) 4,732 4,259 11 % 9,100 8,424 8 %
Healthcare(a) 4,498 4,102 10 % 8,588 7,835 10 %
Transportation(a) 1,231 709 74 % 2,134 1,475 45 %
Home & Business Solutions 2,153 2,250 (4 )% 4,142 4,190 (1 )%
GE Capital   11,626       11,782   (1 )%   23,837       23,575   1 %
Total segment revenues 34,642 32,642 6 % 67,652 63,694 6 %
Corporate items and eliminations(a)   983       4,286   (77 )%   6,308       9,301   (32 )%
Consolidated revenues from continuing operations $ 35,625     $ 36,928   (4 )% $ 73,960     $ 72,995   1 %
 
Segment profit(a)
Energy Infrastructure $ 1,552 $ 1,910 (19 )% $ 2,933 $ 3,391 (14 )%
Aviation(a) 959 879 9 % 1,800 1,678 7 %
Healthcare(a) 711 661 8 % 1,242 1,158 7 %
Transportation(a) 178 26 F 335 141 F
Home & Business Solutions 106 143 (26 )% 180 214 (16 )%
GE Capital   1,655       743   F   3,460       1,313   F
Total segment profit 5,161 4,362 18 % 9,950 7,895 26 %
 
Corporate items and eliminations(a) (747 ) 264 U 1,709 160 F
GE interest and other financial charges (321 ) (430 ) 25 % (676 ) (773 ) 13 %
GE provision for income taxes   (546 )     (986 ) 45 %   (4,059 )     (1,774 ) U
 
Earnings from continuing operations attributable to the Company 3,547 3,210 10 % 6,924 5,508 26 %
 
Earnings (loss) from discontinued operations, net of taxes, attributable to the Company 217 (101 ) F 273 (454 ) F
           
Consolidated net earnings attributable to the Company $ 3,764     $ 3,109   21 % $ 7,197     $ 5,054   42 %
                                             

(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 Six Months
Ended June 30 Ended June 30
(Dollars in millions) 2011   2010   V% 2011   2010   V%
 
Energy Infrastructure
Revenues $ 10,402     $ 9,540   9 % $ 19,851     $ 18,195   9 %
 
Segment profit $ 1,552     $ 1,910   (19 )% $ 2,933     $ 3,391   (14 )%
 
Revenues
Energy $ 8,141 $ 8,027 1 % $ 15,986 $ 15,232 5 %
Oil & Gas 2,468 1,774 39 % 4,255 3,367 26 %
 
Segment profit
Energy $ 1,268 $ 1,661 (24 )% $ 2,489 $ 3,000 (17 )%
Oil & Gas 333 292 14 % 532 483 10 %
 
 
GE Capital
Revenues $ 11,626     $ 11,782   (1 )% $ 23,837     $ 23,575   1 %
 
Segment profit $ 1,655     $ 743   F $ 3,460     $ 1,313   F
 
Revenues
Commercial Lending and Leasing (CLL) $ 4,666 $ 4,506 4 % $ 9,274 $ 9,100 2 %
Consumer 4,176 4,317 (3 )% 9,003 8,743 3 %
Real Estate 992 991 - % 1,899 1,935 (2 )%
Energy Financial Services 365 595 (39 )% 710 1,386 (49 )%
GE Capital Aviation Services (GECAS) 1,327 1,259 5 % 2,652 2,498 6 %
 
Segment profit
CLL $ 701 $ 312 F $ 1,255 $ 544 F
Consumer 1,020 649 57 % 2,239 1,204 86 %
Real Estate (335 ) (524 ) 36 % (693 ) (927 ) 25 %
Energy Financial Services 139 126 10 % 251 279 (10 )%
GECAS 321 288 11 % 627 605 4 %
                                                   
 
GENERAL ELECTRIC COMPANY
Condensed Statement of Financial Position
                       
(Dollars in billions)
Consolidated GE (a) Financial Services (GECS)
Assets

  6/30/11  

 12/31/10 

  6/30/11  

 12/31/10 

  6/30/11  

 12/31/10 

Cash & marketable securities $ 136.4 $ 122.9 $ 13.6 $ 19.3 $ 123.3 $ 104.2
Receivables 18.6 18.6 11.9 10.4 - -
Inventories 14.6 11.5 14.6 11.5 0.1 0.1
Financing receivables - net 292.9 303.0 - - 300.7 312.2
Property, plant & equipment - net 68.8 66.2 13.5 12.4 55.3 53.8
Investment in GECS - - 75.1 69.0 - -
Goodwill & intangible assets 82.3 74.4 52.3 45.0 30.0 29.4
Other assets 118.1 105.3 35.9 17.3 88.9 93.5
Assets of businesses held for sale 0.9 36.9 - 33.8 0.9 3.1
Assets of discontinued operations   6.5   12.4   0.1   0.1   6.4   12.4
 
Total assets $ 739.1 $ 751.2 $ 217.0 $ 218.8 $ 605.6 $ 608.7
 
Liabilities and equity
Borrowings and bank deposits $ 472.0 $ 478.6 $ 10.9 $ 10.1 $ 463.2 $ 470.5

Investment contracts, insurance liabilities and insurance annuity benefits

29.3 29.6 - - 29.9 30.0
Other liabilities 104.8 100.2 76.7 70.0 33.7 35.0
Liabilities of businesses held for sale 0.5 16.0 - 15.5 0.5 0.6
Liabilities of discontinued operations 2.1 2.6 0.2 0.2 2.0 2.4
GE shareowners' equity 128.1 118.9 128.1 118.9 75.1 69.0
Noncontrolling interests   2.3   5.3   1.1   4.1   1.2   1.2
 
Total liabilities and equity $ 739.1 $ 751.2 $ 217.0 $ 218.8 $ 605.6 $ 608.7
                                               
(a) Refers to the Industrial businesses of the Company including GECS on an equity basis.
 

June 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, Industrial segment organic revenue growth, revenues 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 June 30
(Dollars in millions; except earnings per share) 2011 2010 V%
 
Earnings from continuing operations attributable to GE $ 3,547 $ 3,210 10 %
Less non-operating pension costs/(income), net of tax   181     (57 )
Operating earnings $ 3,728   $ 3,153   18 %
 

Earnings per share - diluted

Continuing earnings per share $ 0.33 $ 0.29 14 %
Less: non-operating pension costs/(income) after tax   0.01     -  
Operating earnings per share $ 0.34   $ 0.29   17 %
 
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.
 
 
Industrial Segment Organic Revenue Growth
Three months ended June 30
(Dollars in millions) 2011 2010 V%
 
Revenues as reported $ 35,625 $ 36,928 (4 )%
Less GE Capital revenues 11,626 11,782
Less Corporate items and eliminations   983     4,286  
Industrial segment revenues 23,016 20,860 10 %
Less the effects of:

Acquisitions, business dispositions (other than dispositions of businesses acquired for investment) and currency exchange rates

  1,714     179  

Industrial segment revenues excluding effects of acquisitions, business dispositions (other than dispositions of businesses acquired for investment) and currency exchange rates (Industrial segment organic revenues)

$ 21,302   $ 20,681   3 %
 
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 June 30
(Dollars in millions) 2011 2010 V%
 
Revenues as reported $ 35,625 $ 36,928 (4 )%
Less NBCU-related revenues   280     3,750  
Revenues excluding impact of NBCU $ 35,345   $ 33,178   7 %
 
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.
 
Industrial CFOA
Six months ended June 30
(Dollars in millions) 2011 2010 V%
 
Cash from GE's operating activities as reported $ 4,380 $ 6,314 (31 )%
Less dividends from GECS   -     -  

Cash from GE's operating activities excluding dividends from GECS (Industrial CFOA)

$ 4,380   $ 6,314   (31 )%
 
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.

Contacts

GE
Media Contact:
Andrew Williams, 203-373-3061 (office)
203-209-9694 (mobile)
andrew.williams2@ge.com
or
Investor Contact:
Trevor Schauenberg, 203-373-2424 (office)
trevor.a.schauenberg@ge.com

Sharing

Contacts

GE
Media Contact:
Andrew Williams, 203-373-3061 (office)
203-209-9694 (mobile)
andrew.williams2@ge.com
or
Investor Contact:
Trevor Schauenberg, 203-373-2424 (office)
trevor.a.schauenberg@ge.com