21 July, 2017
General Electric Co's incoming chief executive said on Friday he will update the company's 2018 earnings forecast in November, after a comprehensive review of the industrial company's businesses. He didn't get it - at least not yet.
The oil and gas division of the company, however, posted revenue of $3.1 billion, a 3 percent decline from the same time previous year.
GE's results translated into 28c per share, 3c above analyst expectations. The company reported a profit of $1.19 billion, or 15 cents per share, down from $2.76 billion, or 36 cents per share, a year earlier.
His successor, 55-year-old John Flannery, will officially take the role of CEO on August 1 while Immelt remains chairman through December.
Revenue fell 12 percent to $29.56 billion as weakness in its energy connections business offset strength in renewables and power units.
Adjusted earnings fell 45 percent to 28 cents a share, compared with estimates for 25 cents.
GE has cut $670 million in industrial overhead costs so far this year, Immelt said, and will "meet or exceed" its $1 billion target for 2017 - a goal set after discussion with activist investor Trian Fund Management. The healthcare segment saw revenues rise 4% to $4.7 billion and transportation segment revenues fell 14% to $1.07 billion. GE under the agreement divested from its water and process technology unit, part of a remedy for the merger announced a year ago. Since the outcome of the Board's succession planning process was announced in June, John and I have been spending a lot of time together discussing this unique role and what he can expect in the months and years ahead. Revenue has been dwindling since 2009, partially by design, and partially not. General Electric shares even made some bullish progress in anticipation of a turnaround, but it never happened.
Today's action from the stock doesn't say the market has definitively changed its mind, but the numbers do offer a glimmer of hope.
