Today GE released its 2019 Annual Report, which includes our Chairman and CEO Larry Culp’s second Annual Letter to Shareholders and our 2019 10-K.
In his letter, Larry reflects on our team’s progress against our 2019 priorities — improving our financial position and strengthening our businesses — and our trajectory into 2020. As Larry states, “Looking back at 2019, I hope you see a GE that diligently addressed its most pressing issues with grit and reset its foundation to drive long-term profitable growth. I am proud of the progress our team made together, especially in how we operate.”
Larry also highlights some of GE’s commercial wins, technology milestones, and proof points that our lean transformation is gaining traction across GE, all while facing directly into the areas where we know that we still have work to do. Looking forward, Larry shared, “Our leading technology, global network, and exceptional team, anchored in the service of others, are the same strengths I shared with you in this letter last year. I’m confident in our future, even more now than a year ago, because of them.”
As we execute on our strategy, we continue to evaluate the most effective and efficient ways to communicate our results. In that spirit, this year’s 10-K includes enhanced disclosures in response to feedback from our investors, GE portfolio changes, and other key business developments. This approach, coupled with other disclosure simplification initiatives, led to a significant reduction in the length of the 10-K as compared to 2018. Some of the more notable improvements and additional disclosures are:
- Updates on our Aviation / GECAS exposure to the Boeing 737 MAX grounding and the impact to Aviation operating cash flows in 2019 (p. 8)
- Information related to our recent pension actions, discount rate, asset returns, and pre-funding (pp. 22, 89-93)
- Commentary on our agreement to sell BioPharma (pp. 16, 26, 28) and the deconsolidation of Baker Hughes (pp. 75, 77)
- Introduced free cash flow reconciliation by segment (pp. 30-31); provided update on MUFG transition; increased transparency to internal & external factoring programs (pp. 33-34, 78-80)
- Additional disclosures related to contract assets (p. 84), other assets (p. 85), and other liabilities (p. 94)
I hope you find the report simpler and easier to understand. We strive for continuous improvement every day and welcome your comments or suggestions to help us drive increased transparency and simplification in the future.
As a reminder, GE will hold an Investor Call to provide more detail on our 2020 company outlook on March 4, 2020 at 8 a.m. ET. GE will also host the 2020 Annual Meeting of Shareholders on May 5, 2020 at 10 a.m. ET at the Westin Boston Waterfront Hotel in Boston, Massachusetts.
Steve Winoker is the vice president for investor communications at GE.