FAIRFIELD, Conn.--(BUSINESS WIRE)--Jan. 21, 2005--GE achieved record fourth-quarter revenues of $43.7 billion, up 18% from fourth quarter 2003, and record fourth-quarter earnings of $5.4 billion, also up 18%, the company announced today. Full-year 2004 earnings were $16.6 billion, up 6% from 2003 earnings before required accounting changes. Cash flow from GE's operating activities (CFOA) in 2004 increased 18% to $15.2 billion.
"GE had a tremendous fourth quarter and an excellent 2004, as we completed our strategic repositioning and returned to double-digit earnings growth in the quarter," said GE Chairman and CEO Jeff Immelt.
"In the fourth quarter, nine of our 11 businesses delivered double-digit earnings growth. Industrial sales grew 19%, and our key financial services businesses ended the year with assets up 20% and improved overall portfolio quality. Total orders for the quarter increased 15% over last year, with growth across the board. We are benefiting from strong execution of our growth initiatives and an excellent global economy.
"For the year, nine of our 11 businesses delivered at least double-digit earnings growth and we increased CFOA to $15.2 billion. We made major progress on our portfolio, exceeding our synergy goals for the Amersham and Universal acquisitions, adding capabilities to our water, security and key financial services units, and executing several dispositions, including the initial public offering of Genworth and the sale of 60% of Gecis, our global business processing operation. Revenues from our growth initiatives -- in services and our new platforms, such as security and water -- grew 12% and 17% respectively, and global revenues increased 16%.
"As a result, we're going into 2005 with excellent momentum," Immelt said. "We are very confident about achieving 10-15% earnings growth with strong cash flow growth and sustaining this growth into 2006 as well."
GE will discuss preliminary fourth-quarter and full-year results on a conference call and Webcast to be held at 8:30 a.m. ET today. Call information is available at www.ge.com/investor, and related charts will be posted there prior to the call.
Highlights of preliminary fourth-quarter and full-year 2004 results:
-- Fourth-quarter earnings were a record $5.378 billion, up 18% from $4.560 billion in fourth quarter 2003. Earnings per share (EPS) were $.51, up 13% from last year's $.45. Nine of GE's 11 businesses - Advanced Materials, Commercial Finance, Consumer Finance, Consumer & Industrial, Equipment & Other Services, Healthcare, Infrastructure, NBC Universal and Transportation - contributed double-digit earnings growth. Earnings of the Insurance segment declined as a result of increases in loss reserves for policies written in prior years and the disposition of several businesses.
-- Fourth-quarter revenues were a record $43.7 billion, up 18% over $37.0 billion in fourth quarter 2003. Industrial sales increased 19% to $24.6 billion, reflecting the impact of acquisitions, solid core growth and lower sales at GE Energy. Financial services revenues rose 16% over last year to $19.2 billion.
-- Full-year 2004 earnings were a record $16.6 billion, up 6% from $15.6 billion before required accounting changes in 2003, with EPS of $1.59 up 3% from last year's comparable $1.55. Nine of GE's 11 businesses contributed at least double-digit earnings growth for the year. Net earnings for 2004 of $16.6 billion were 11% higher than $15.0 billion in 2003, which reflected charges of $587 million ($.06 per share) for the cumulative effects of required accounting changes to consolidate special purpose entities and to record asset retirement obligations. Net 2004 EPS of $1.59 were up 7% from $1.49 last year.
-- Full-year revenues grew 14% to $152.4 billion. Industrial sales rose 17% to $82.2 billion, reflecting the impact of acquisitions, solid core growth and lower sales at GE Energy. Financial services revenues increased 10% to $70.8 billion, including the effects of exiting certain Insurance businesses.
-- Cash generated from GE's operating activities in 2004 totaled $15.2 billion, up 18% from $12.9 billion last year, reflecting a 27% increase in CFOA from industrial businesses and lower GE Capital Services dividends, due principally to lower proceeds from business dispositions.
"GE is in great shape," Immelt said. "We've got great businesses positioned in the right markets with very strong teams driving powerful initiatives. With a great pipeline of technology, billions in contractual services agreements, a rigorous focus on customers and the ability to deliver all of this globally, we are now focused on driving strong organic growth and delivering consistent double-digit growth in earnings and cash flow, with expanding returns on capital.
"This is a great time for GE."
Fourth Quarter 2004 Business Highlights
Transportation
-- Received $3.6 billion of new aircraft engine services
contracts from customers including Ryanair, Emirates and
Alaska Airlines, and locomotive services agreements worth more
than $0.4 billion, including the first GE Evolution Series(TM)
services contracts.
-- Received commercial aircraft engine orders totaling $0.6
billion from customers including Embraer, Bombardier and
Lufthansa.
-- Received $1.1 billion in Rail orders, including orders for 231
locomotives, of which 140 are GE Evolution Series locomotives,
and the first order from the China Ministry of Rail in more
than 19 years, for locomotives, parts, signaling and train
control systems.
-- Completed more than 4.5 million miles of cumulative active
field service for Evolution Series pre-production units, with
availability at 97%; completed preparations and commenced full
commercial production in January 2005, with a backlog of more
than 1,200 units for multi-year delivery.
-- Launched the Engine Exchange program for the CFM56-3 aircraft
engine under which Transportation provides "loaner" engines to
customers while servicing their own.
-- Completed the first site implementation, at Norfolk Southern
Railroad, of Rail's Precision Dispatch System, which improves
on-time performance and enables more efficient use of a
railroad's assets.
Healthcare
-- Increased total orders 25% over fourth quarter 2003 to $4.4
billion, driven by 9% growth in services, 15% growth in
ultrasound and $0.8 billion in Biosciences.
-- Received strong orders for new products, including the Volume
CT (computed tomography) scanner, the 3T MR (magnetic
resonance) scanner, and the Vivid I(TM) portable ultrasound.
-- Signed a $200 million-plus agreement in the U.K. with Fujitsu
Services Ltd., to provide Picture Archiving and Communication
System (PACS) technology that will enable the conversion of
hospitals and clinics to a new digital system for storing,
retrieving and displaying patients' medical images.
-- Launched HDMR, the world's first high-definition magnetic
resonance (MR) system, which provides unprecedented image
clarity for patients such as Parkinson's sufferers.
-- Received FDA approval for InSightec's ExAblate 2000, which
combines GE's MR imaging with focused ultrasound to provide
non-invasive treatment of uterine fibroids (GE is an equity
shareholder in InSightec).
-- Launched LOGIQBook XP, a 10-lb., full-featured, easy-to-use
ultrasound system with advanced connectivity that enables
clinicians to scan patients virtually anywhere -- even in
trauma and surgical settings.
Energy
-- Signed new contractual service agreements totaling $1.1
billion, increasing the number of gas turbines covered by 8%
and the number of sites by 4% since the end of 2003.
-- Increased orders for oil and gas equipment 34% to $1.5
billion, including a $95 million contract for turbines,
generator and compressor equipment for the latest expansion of
the RasGas (II) facility owned by Ras Laffan Liquefied Natural
Gas Company Ltd. in the State of Qatar.
-- Shipped 316 wind turbines in the quarter and received orders
for 1,243 1.5-megawatt wind turbines, including the final 100
of a 207-turbine order from MidAmerican Energy Company for its
310.5-megawatt project in Iowa that, when completed this year,
will be among the world's largest wind generation facilities.
-- Signed a letter of intent with Calpine Corporation for the
joint construction of a power plant based on the 60-Hz H
System(TM), GE's most advanced gas turbine technology.
-- Signed a letter of intent with Cinergy/PSI and Bechtel
Corporation to study the feasibility of constructing a
commercial Cleaner Coal(TM) generating station.
-- Received global equipment orders to supply a 1,135-megawatt
combined-cycle power plant in Mexico, the first installation
of GE's advanced gas turbine technology in Egypt, and
hydroelectric equipment for three facilities in China.
-- Shipped 28 heavy-duty gas turbines from Greenville, S.C., and
Belfort, France in the quarter compared with 35 in fourth quarter 2003.
Commercial Finance
-- Expanded its transportation finance capabilities with an
agreement to acquire $4.2 billion in assets from CitiCapital's
Transportation Financial Services Group, serving about 49,000
customers across the U.S. and Canada and financing
approximately 196,000 heavy- and medium-duty commercial trucks
and trailers.
-- Through CCE Holdings, a joint venture with Southern Union,
completed the $2.4 billion acquisition of CrossCountry Energy,
the holding company formed from Enron's remaining U.S. gas
pipelines.
-- Completed a global vendor financing agreement with Eastman
Kodak Company's Health Imaging Group, through which the
manufacturer will offer its customers a full range of GE
equipment financing options, including operating and capital
leases, loans and customized financing programs.
-- Signed an agreement for the restructuring of NMB-Heller, its
working-capital finance joint venture with ING, under which
Commercial Finance will buy ING's 50% stake in Heller GmbH,
NMB-Heller's German unit, broadening its range of financing
solutions for German customers and increasing its presence in
that country.
Consumer Finance
-- Completed the acquisition of Australian Financial Investments
Group (including the Wizard Home Loans brand and distribution
network), strengthening GE's presence in the Australian
mortgage industry.
-- Completed the purchase of substantially all the assets of
Dillard's National Bank, including its private label credit
card business, comprising the sixth-largest in-house private
label credit card program in the United States and adding 5.5
million active card members to Consumer Finance's customer
base.
-- Teamed with SAM'S CLUB to launch the new Business All-In-One
Card for SAM'S CLUB Business Members and Business Plus Members
throughout the United States.
-- Launched Kawasaki Motors Retail Finance with Canadian Kawasaki
Motors, which will allow Kawasaki dealers in Canada to offer
consumers special credit promotions and long-term financing
for motorcycles, ATVs, utility vehicles and personal
watercraft.
-- Signed a multi-year agreement to extend its retail credit card
program with The Men's Wearhouse, representing nearly 700,000
cardholders.
NBC Universal
-- Garnered a domestic box office total of $225 million in the
first four weeks of theatrical release with Universal
Pictures' Meet the Fockers, surpassing the entire box office
gross of its predecessor, Meet the Parents, by 40%.
-- Generated $72 million at the domestic box office for Ray,
which received a Golden Globe nomination for Best Picture and
the Golden Globe award for Best Actor.
-- Launched Joey, the quarter's top-ranking new comedy in the key
demographic of adults 18-49; continued NBC's late-night
leadership, with Jay Leno and Conan O'Brien leading their
respective competitors among adults 18-49 by 25% and 57%
respectively.
-- Completed the year with Bravo ranking as the basic cable
entertainment network with the highest concentration of
affluent viewers, and with Telemundo ranking as the
fastest-growing network for U.S. Hispanics in primetime among
adults 18-49.
-- Shipped 70 million DVDs and VHS units in the quarter, led by
the strength of Van Helsing, The Chronicles of Riddick and The
Bourne Supremacy.
-- Launched NBC Weather Plus, the nation's first all-digital
broadcast network, which provides local weather, news and
information around the clock.
Infrastructure
-- Announced two strategic acquisitions -- Ionics, a global
leader in desalination, and Edwards Systems Technology's fire
detection systems business -- and completed a third, InVision
Technologies, positioning Infrastructure for growth in the
water and security industries.
-- Received certification from the U.S. Transportation Security
Administration of its X-ray diffraction (XRD) system for
identifying the chemical signatures of explosives on
passenger-checked baggage, the first new technology certified
by the TSA since 1994.
-- Successfully completed commercial testing for its
tamper-evident sea container cargo-security system, which uses
RFID (radio frequency identification) wireless technology
embedded in a container's walls to determine if it has been
breached during transport.
-- Announced a strategic partnership with China Telecom, the
leading company in the world's largest telecommunications
market, to create a new generation of advanced home security
technology that will allow residents of China to communicate
with their homes through the Internet and cellular phones.
Advanced Materials
-- Announced with Goodyear the new Assurance(R) tire, with
all-weather performance characteristics based on GE's NXT(TM)
silane, a liquid coupling agent developed by GE scientists.
-- Introduced AZDEL(TM) Rail-Lite(TM), a breakthrough
flame-retardant, high-strength composite material using GE's
advanced Ultem(TM) resin, and announced a joint development
agreement with China Railway Long Dragon New Composite
Materials Co., Ltd. to co-develop AZDEL-based components for
passenger train interiors as part of China's refurbishing of
its national railway system for the 2008 Olympics.
Consumer & Industrial
-- Drove higher sales in the quarter with leadership from new
Profile(R) appliance launches, energy-saving Ultra(TM)
fluorescent lamps, new Ultramax(TM) and ProLine(TM) electronic
ballast products, improved market penetration by Reveal(R)
light bulbs and the global strength of industrial product
sales.
-- Completed the disposition of its Heating, Ventilation and Air
Conditioning/Refrigeration Motor and Capacitor operations to
Regal-Beloit Corporation for $380 million.
GE (NYSE: GE) is a diversified technology, media and financial services company dedicated to creating products that make life better. From aircraft engines and power generation to financial services, medical imaging, television programming, and plastics, GE operates in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit the company's Web site 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 often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties arise from the behavior of financial markets, including fluctuations in interest rates and commodity prices, from future integration of acquired businesses, from future financial performance of major industries which we serve, including, without limitation, the air and rail transportation, energy generation and healthcare industries, from unanticipated loss development in our insurance businesses, and from numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive or regulatory 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.
[See attachment for detailed financial numbers.]
CONTACT:
General Electric, Fairfield
David Frail, 203-373-3387
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