2016 1Q

GE 1Q’16
supplemental information
• Orders & backlog by segment
• Equipment orders
• Equipment/service revenue by segment – 1Q’16
• GE Industrial segment organic revenue growth*
• GE Industrial segment organic op profit growth*
• GE Industrial organic op profit growth*
• Power, Renewable Energy, & Energy Connections
organic op profit growth*
• Oil & Gas & Healthcare organic op profit growth*
• Organic revenue by segment*
• Power & Renewable Energy results ex. Alstom*
• Units summary – orders
• Units summary – sales
• Regional summary
• Alstom results & EPS impact
• Corporate operating profit (cost)*
• Industrial segment gross margins*
• Industrial segment operating profit margins*
• Industrial operating profit margins*
• Operating earnings & EPS*
• Industrial operating EPS*
Imagination at work.
• Industrial operating plus Verticals
earnings & EPS*
• Industrial operating plus Verticals
earnings & EPS excluding gains &
restructuring*
• GAAP & Industrial Operating plus
Verticals EPS*
• GE effective tax rate (ex-GE Capital)*
• Industrial CFOA from continuing operations*
• Free cash flow*
• GE Capital segment results
• GE Capital segment assets
• GE Capital funding
• GE Capital leverage ratio*
• GE Capital tier 1 common ratio estimate
• Capital ending net investment*
• GE Capital reserves
• GE Capital Aircraft and Helicopter asset details
• Non-GAAP supplemental information
* Non-GAAP financial measures. See the following pages for reconciliations
of these measures to the most directly comparable GAAP financial
measures. Also see the Non-GAAP supplemental materials section for
descriptions of non-GAAP financial measures and the reasons we believe
that they provide useful information to investors.
Orders & backlog by segment
($ in billions)
1Q'16
Orders
$5.6
4.2
1.5
V%
66%
23
-
1Q'16
Backlog
$77.8
62.6
15.2
V%
38%
11
-
Renewable Energy
- Core
- Alstom
2.0
1.7
0.2
F
86
-
12.4
7.4
5.0
F
43
-
Oil & Gas
- Core
- Alstom
2.4
2.4
0.0
(44)
(45)
-
22.6
22.4
0.1
(2)
(3)
-
Energy Connections
- Core
- Alstom
2.7
1.4
1.2
27
(32)
-
11.9
3.5
8.4
F
(30)
-
Aviation
6.6
(12)
153.4
9
Healthcare
4.2
1
17.3
9
Transportation
0.7
(56)
21.1
(2)
Infrastructure
- Core
- Alstom
$23.5
20.5
3.0
1%
(11)
-
$316.1
287.3
28.8
18%
7
-
Power
- Core
- Alstom
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
2
Equipment orders
($ in billions)
Power
- Core
- Alstom
Renewable Energy
- Core
- Alstom
Oil & Gas
- Core
- Alstom-a)
Energy Connections
- Core
- Alstom
Aviation
Healthcare
Transportation
Infrastructure
- Core
- Alstom
2Q'15
$1.8
V%
40%
3Q'15
$1.7
V%
13%
2.0
24
1.7
2
2.2
(14)
1.1
(61)
1.5
6
1.6
6
4.0
2.7
0.5
37
(3)
(19)
2.8
2.6
0.1
(58)
(5)
(95)
$14.5
11%
$11.2
(43)%
(36)
(5)
F
1Q'16
$1.8
1.4
0.4
1.8
1.6
0.2
0.7
0.6
0.0
2.0
1.0
1.0
2.6
2.4
0.1
V%
F
57%
F
94
(70)
(71)
37
(30)
(35)
3
(89)
Four qtr.
rolling
average
$2.6
2.4
0.2
2.0
1.8
0.1
1.3
1.3
0.0
1.8
1.3
0.5
3.1
2.7
0.8
2%
(7)%
-
$11.0
9.4
1.6
(8)%
(21)%
-
$13.9
13.1
0.8
4Q'15
$5.0
4.6
0.4
2.3
1.9
0.4
1.2
V%
58%
46%
(1)
(20)
2.0
1.1
0.9
2.8
3.2
2.6
20
(34)
$18.7
17.1
1.7
(52)
(a– Industrial Steam Turbines
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
V%
50%
39%
20
11
(49)
(49)
17
(14)
(32)
(3)
(41)
(12)%
(17)%
3
Equipment/service revenue by segment - 1Q’16
($ in billions)
1Q'16
Equipment
$1.5
1.0
0.5
V%
(24)%
(48)
-
1Q'16
Services
$3.7
2.8
0.9
V%
40%
5
-
1Q'16
Total
$5.2
3.8
1.4
V%
13%
(18)
-
Renewable Energy
- Core
- Alstom
1.5
1.3
0.3
63
36
-
0.1
0.1
0.0
53
8
-
1.7
1.4
0.3
62
34
-
Oil & Gas
- Core
- Alstom
1.6
1.6
0.0
(23)
(24)
-
1.7
1.7
0.0
(13)
(13)
-
3.3
3.3
0.0
(18)
(18)
-
Energy Connections
- Core
- Alstom
1.8
0.9
0.9
45
(29)
-
0.5
0.3
0.2
6
(34)
-
2.3
1.2
1.1
34
(31)
-
Aviation
2.7
2
3.5
17
6.3
10
Healthcare
2.3
4
1.9
1
4.2
3
Transportation
0.4
(41)
0.6
(5)
1.0
(25)
1.9
$13.7
12.1
1.7
3
1%
(11)%
-
0.1
$12.1
11.0
1.1
9
13%
2%
-
2.0
$25.9
23.1
2.8
3
6%
(5)%
-
Power
- Core
- Alstom
Appliances & Lighting
Industrial segments
- Core
- Alstom
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are calculated from
the underlying numbers in millions
4
Non-GAAP reconciliation
GE Industrial segment organic revenue growth
($ in millions)
1Q'16
Industrial segment revenue (GAAP)
Less the effects of:
Acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment) & translational
foreign exchange
Industrial segment revenues excluding the
effects of acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment), translational
foreign exchange (Non-GAAP)
1Q'15
$25,869
$24,362
2,287
542
$23,582
$23,821
V%
6%
-1%
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions
5
Non-GAAP reconciliation
GE Industrial segment organic op profit growth
($ in millions)
1Q'16
Industrial segment op profit (GAAP)
Less the effects of:
Acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment) & translational
foreign exchange
Industrial segment op profit excluding the
effects of acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment), translational
foreign exchange (Non-GAAP)
1Q'15
V%
$3,314
$3,560
(56)
41
$3,370
$3,518
(7)%
(4)%
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions
6
Non-GAAP reconciliation
GE Industrial organic op profit growth
($ in millions)
1Q'16
Industrial segment op profit (GAAP)
Plus: Adjusted Corporate costs (operating)-a)
Industrial op profit-a)
Less the effects of:
Acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment) & translational
foreign exchange
Industrial op profit excluding the
effects of acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment), translational
foreign exchange-a) (Non-GAAP)
1Q'15
V%
$3,314
(431)
$2,883
$3,560
(574)
$2,985
(51)
41
$2,935
$2,944
(7)%
(3)%
-%
(a- Excluding gains and restructuring & other items
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions
7
Non-GAAP reconciliation
Power, Renewable Energy, & Energy Connections
organic op profit growth
($ in millions)
Power
1Q'16 1Q'15
Segment op profit (GAAP)
$573
Less the effects of:
Acquisitions, business
dispositions (other than
dispositions of businesses
acquired for investment) &
translational foreign
exchange
33
Segment op profit excluding
the effects of acquisitions,
business dispositions
(other than dispositions of
businesses acquired for
investment), &
translational foreign
exchange (Non-GAAP)
$541
V%
$757 (24)%
-
$757 (29)%
Renewable Energy
1Q'16 1Q'15 V%
$83
(20)
$103
$57 46%
(2)
$59 75%
Energy Connections
1Q'16 1Q'15 V%
$(85)
$28
(34)
25
$(50)
$3
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions
U
U
8
Non-GAAP reconciliation
Oil & Gas and Healthcare organic op profit growth
($ in millions)
Oil & Gas
1Q'16
1Q'15
Industrial segment op profit (GAAP)
$308
Less the effects of:
Acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment) & translational
foreign exchange
(26)
Industrial segment op profit excluding the
effects of acquisitions, business dispositions
(other than dispositions of businesses
acquired for investment), translational
foreign exchange (Non-GAAP)
$334
V%
$489 (37)%
4
$485 (31)%
Healthcare
1Q'16
1Q'15
$631
$587
(13)
0
$644
$588
V%
7%
10%
.
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions
9
Non-GAAP reconciliation
Organic revenue by segment
($ in millions)
1Q'16
Power
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Renewable Energy
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Oil & Gas
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Energy Connections
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Aviation
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Healthcare
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Transportation
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
Appliances & Lighting
Reported Revenue-a)
Less Acq./Disp. & FX-b)
Organic Revenue-c)
1Q'15
V%
5,204
1,335
3,869
4,612
4,612
13%
1,669
202
1,467
1,028
15
1,012
62%
3,314
(146)
3,460
4,040
32
4,007
(18)%
2,260
1,031
1,229
1,685
375
1,310
34%
6,262
(7)
6,269
5,674
5,674
10%
4,183
(113)
4,295
4,075
31
4,044
3%
981
981
1,308
88
1,220
(25)%
1,996
(16)
2,012
1,940
1,940
3%
(16)%
45%
(14)%
(6)%
10%
6%
(20)%
4%
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages are calculated from the underlying numbers in millions
(a- GAAP
(b- Translational foreign exchange
(c- Non-GAAP
10
Non-GAAP reconciliation
Power & Renewable Energy results ex. Alstom
($ in millions)
Power
Renewable Energy
1Q’16
1Q’15
V%
$5,204
$4,612
13%
1,403
-
$3,801
$4,612
$573
$757
26
-
Segment profit ex. Alstom-b) $547
$757
16.4%
Revenues-a)
Alstom revenues
Revenues ex. Alstom-b)
Segment profit-a)
Alstom segment profit
Op profit % ex. Alstom-b)
14.4%
1Q’16
1Q’15
V%
$1,669
$1,028
62%
295
-
(18)%
$1,373
$1,028
34%
(24)%
$83
$57
46%
(8)
-
(28)%
$91
$57
(2.0)pts
6.6%
60%
5.5% 1.1pts
(a- GAAP
(b- Non-GAAP
Note: Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions
11
Units summary – orders
1Q'16
Power:
Gas Turbines-a)
1Q'15
V
25
21
4
711
376
335
Aviation:
CEO engines
GEnx engines-b)
Leap engines-b)
Military engines
Spares rate-c)
702
7
443
286
$39.6
1,219
47
415
135
$38.9
(517)
(40)
28
151
$0.7
Transportation:
Locomotives
-
191
(191)
Renewable Energy:
Wind Turbines-a)
(a- Gas Turbines & Wind Turbines are GE-only
(b- GEnx & Leap engines are a subset of CEO engines
(c- Commercial spares rate in millions of dollars per day
12
Units summary – sales
1Q'16
Power:
Gas Turbines-a)
1Q'15
V
13
39
(26)
616
472
144
Aviation:
CEO engines
GEnx engines-b)
Leap engines-b)
Military engines
Spares rate-c)
677
53
151
$38.6
649
51
169
$36.5
28
2
(18)
$2.1
Transportation:
Locomotives
156
215
(59)
Renewable Energy:
Wind Turbines-a)
(a- Gas Turbines & Wind Turbines are GE-only
(b- GEnx & Leap engines are a subset of CEO engines
(c- Commercial spares rate in millions of dollars per day
13
Regional summary
($ in billions)
Infrastructure Orders
1Q'16
Resource Rich-a)
Asia-b)
Growth Regions
Industrial Segment Revenues
V%
1Q'16
V%
$5.5
(20)%
$6.8
(6)%
3.3
16
3.1
29
$8.8
(9)%
$9.9
3%
Developed-c)
$14.7
9%
$16.0
8%
Total
$23.5
1%
$25.9
6%
(a- Resource Rich: Australia & New Zealand, Canada, Latin America, MENAT, Russia/CIS, & Sub-Saharan Africa
(b- Asia: ASEAN, China & India
(c- Developed: US, Europe, Japan, & Korea
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
14
Alstom results and EPS impact
Key metrics
($ in millions)
Financial impact
($ in billions, except EPS)
Orders
Power
Renewable Energy
Grid
Oil & Gas-a)
Segment orders
1Q'16
$1,454
225
1,249
26
$2,953
Revenue
Power
Renewable Energy
Grid
Oil & Gas
Segment revenue
1Q'16
$1,403
295
1,094
21
$2,813
Op profit
Power
Renewable Energy
Grid
Oil & Gas
Segment op profit
1Q'16
26
(8)
(38)
0
$(20)
Corporate charges
Corporate
Total op profit
FX impact
(183)
$(204)
$(68)
EPS
Operations
Cost synergy benefits
Synergy investment
1Q'16
0.1
-
Acquisition accounting
(0.1)
Deal/integration costs
-
JV minority interest
0.1
Segment op profit
0.0
− Deal costs/synergy inv.
(0.1)
− Acquisition accounting
(0.1)
Net tax benefits
$0.1
$(0.01)
15
(a – Industrial Steam Turbines
Non-GAAP reconciliation
Corporate operating profit (cost)
($ in millions)
1Q'16
1Q'15
V%
Gains (losses) on dispositions
$59
$-
Principal retirement plans-a)
(468)
(789)
Restructuring and other charges
(686)
(422)
Other Corporate costs & eliminations
(476)
(480)
Corporate costs (continuing) (GAAP)
(1,571)
(1,691)
(512)
(695)
(1,059)
(996)
(627)
(422)
($431)
($574)
Less: Non-operating pension cost
Corporate (operating) (Non-GAAP)
Less: restructuring & other, gains
Adjusted Corporate (operating) (Non-GAAP)
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
(a- Includes non-operating pension
25%
16
Non-GAAP reconciliation
Industrial segment gross margins
($ in millions)
1Q'16
Industrial sales
1Q'15
$25,407
$23,839
(456)
2,887
(439)
-
Industrial segment sales ex. Alstom (Non-GAAP)
22,976
24,278
Industrial cost of sales
Less: Corporate cost of sales and eliminations
Less: Alstom cost of sales
19,890
599
2,329
18,325
415
-
Industrial segment cost of sales ex. Alstom (Non-GAAP)
16,962
17,910
Industrial segment gross margin ex. Alstom (Non-GAAP)
Industrial segment gross profit margin ex. Alstom (Non-GAAP)
6,014
26.2%
6,368
26.2%
Less: Corporate sales and eliminations
Less: Alstom sales
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
17
Non-GAAP reconciliation
Industrial segment operating profit margins
($ in millions)
1Q'16
Industrial segment revenue-a) (GAAP)
Less: Alstom revenue
Industrial segment revenue ex. Alstom (Non-GAAP)
Industrial segment op profit-a) (GAAP)
Less: Alstom segment op profit
Industrial segment op profit ex. Alstom (Non-GAAP)
Industrial segment op profit margin ex. Alstom (Non-GAAP)
1Q'15
V%
$25,869
$24,362
2,813
-
23,056
24,362
3,314
3,560
(20)
-
3,335
3,560
(6)%
14.5%
14.6%
(0.1)pts
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total.
(a- Total Industrial segment revenue and op profit include the sum of our Industrial reporting segments without giving
effect to the elimination of transactions among such segments.
18
Non-GAAP reconciliation
Industrial operating profit margins
($ in millions)
1Q'16
Industrial segment revenue-a) (GAAP)
1Q'15
$25,869
$24,362
Plus: Corporate revenue ex. gains
(968)
(988)
Less: GE-Capital eliminations
(540)
(518)
25,440
23,892
2,813
-
22,627
23,892
3,314
3,560
(1,059)
(996)
(627)
(422)
2,883
2,985
(20)
-
2,904
2,985
12.8%
12.5%
Industrial revenue
Less: Alstom revenue
Industrial revenue ex. Alstom (Non-GAAP)
Industrial segment op profit-a) (GAAP)
Plus: Corporate operating earnings
Less: Gains and restructuring
Industrial OP profit (Non-GAAP)
Less: Alstom segment op profit
Industrial op profit ex. Alstom (Non-GAAP)
Industrial op profit margin ex. Alstom (Non-GAAP)
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total.
(a- Total Industrial segment revenue and op profit include the sum of our Industrial reporting segments without giving
effect to the elimination of transactions among such segments.
19
Non-GAAP reconciliation
Operating earnings & EPS
($ in millions except earnings per share)
1Q'16
Earnings from continuing operations
attributable to common shareholders (GAAP)
1Q'15
V%
$210
$(4,548)
333
452
$543
$(4,096)
F
Continuing earnings per share (GAAP)
$0.02
$(0.45)
F
Adjustment (net of tax): non-operating
pensions costs/(income)
0.04
0.04
$0.06
$(0.41)
Adjustment (net of tax): non-operating
pensions costs/(income)
Operating earnings (Non-GAAP)
F
Earnings per share - diluted-a)
Operating earnings per share (Non-GAAP)
(a - Earnings per share amounts are computed independently. As a result, the sum of per share amounts may not equal the total
F
20
Non-GAAP reconciliation
Industrial operating EPS
($ in millions except earnings per share)
1Q'16
1Q'15
V%
Operating earnings (Non-GAAP)
$543
$(4,096)
F
GE Capital operating earnings (Non-GAAP)
(893)
(5,721)
84%
Industrial operating earnings (Non-GAAP)
1,436
1,625
(12)%
Operating earnings per share (Non-GAAP)
$0.06
$(0.41)
F
GE Capital operating EPS (Non-GAAP)-a)
(0.10)
(0.57)
82%
Industrial operating EPS (Non-GAAP)-a)
0.15
0.16
(6)%
(a - Earnings per share amounts are computed independently. As a result, the sum of per share amounts may not equal the total
21
Non-GAAP reconciliation
Industrial operating plus Verticals earnings & EPS
($ in millions except earnings per share)
1Q'16
Operating earnings (Non-GAAP)
1Q'15
V%
$543
$(4,096)
(1,389)
(6,067)
Industrial operating plus Verticals earnings (Non-GAAP)
GE Capital Verticals earnings (Non-GAAP)
Industrial operating earnings (Non-GAAP)
1,932
496
1,436
1,971
346
1,625
(2)%
43%
(12)%
Earnings per share - diluted -a)
Operating earnings per share (Non-GAAP)
$0.06
$(0.41)
F
Less: Other GE Capital (Non-GAAP)
(0.15)
(0.60)
Industrial operating plus Verticals EPS
(Non-GAAP)
0.21
0.20
5%
GE Capital Verticals operating EPS (Non-GAAP)
Industrial operating EPS (Non-GAAP)
0.05
0.15
0.03
0.16
67%
(6)%
Less: Other GE Capital (Non-GAAP)
(a- Earnings per share amounts are computed independently. As a result, the sum of per share amounts may not equal the total.
F
22
Non-GAAP reconciliation
Industrial operating plus Verticals earnings & EPS
excluding gains & restructuring
($ in millions except earnings per share)
Earnings
1Q'16
Industrial operating earnings
GE Capital Verticals earnings
Industrial operating plus Verticals earnings
Industrial gains & restructuring (after-tax):
Gains (after-tax)
Restructuring (after-tax)
Gains & restructuring (after-tax)
Industrial operating earnings ex. gains &
restructuring)
GE Capital Verticals earnings
Industrial operating plus Verticals earnings
ex. gains & restructuring
$1,436
496
1,932
1Q'15
Earnings per share -a)
V%
$1,625 (12)%
346 43%
1,971 (2)%
38
(483)
(445)
(292)
(292)
1,881
496
2,377
1,917
346
2,263
U
(2)%
43%
5%
1Q'16
1Q'15
V%
$0.15
0.05
0.21
$0.16 (6)%
0.03 67%
0.20 5%
0.00
(0.05)
(0.05)
0.00
(0.03)
(0.03)
0.20
0.05
0.25
(a- Earnings per share amounts are computed independently. As a result, the sum of per share amounts may not equal the total.
0.19 5%
0.03 67%
0.22 14%
23
Non-GAAP reconciliation
GAAP & Industrial Operating plus Verticals EPS
1Q’16
1Q’15
Industrial
Capital
Industrial
.15
.05
.16
(.04)
(.15)
(.04)
Capital
Earnings/(loss) per share -a)
Industrial operating
$.15
$.16
.05
.03
Industrial Operating plus Verticals $.21
$.20
Non-operating & other GE Capital
(.18)
(.65)
GAAP continuing EPS
$.02 $(.45)
Verticals
.03
(.60)
1Q’16 1Q’15
Industrial Operating & Verticals
Non-operating pension & other GE Capital
(a- Earnings per share amounts are computed independently. As a result, the sum of per share amounts may not equal the total.
24
Non-GAAP reconciliation
GE effective tax rate (ex. GE Capital)
($ in millions)
1Q'16
$294
1Q'15
$(4,369)
Less GE Capital earnings from continuing ops.
attributable to the common shareowner
$(893)
$(5,721)
Adjusted earnings from continuing ops.
before income taxes (Non-GAAP)
$1,187
$1,352
GE (ex. GE Capital) provision for income taxes
- continuing ops.
$201
$306
Effective tax rate GE (ex. GE Capital) (Non-GAAP)
17%
23%
GE earnings from continuing operations
before income taxes (GAAP)
25
Non-GAAP reconciliation
Industrial CFOA from continuing operations
($ in millions)
1Q'16
1Q'15
$7,856
$1,340
Less GE Capital dividends
7,500
450
Cash from GE's operating activities excluding
dividends from GE Capital (Industrial CFOA) (Non-GAAP)
$356
$890
Cash from GE's operating activities as reported (GAAP)
V%
F
(60)%
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
26
Free cash flow
Non-GAAP reconciliation
($ in millions)
1Q'16
Cash from GE's operating activities as reported (GAAP)
1Q'15
$7,856
$1,340
1,041
257
1,013
155
$7,072
$483
7,500
450
Industrial free cash flow (Non-GAAP)
$(428)
$33
Industrial operating earnings (Non-GAAP)
1,436
1,625
Industrial FCF conversion (Non-GAAP)
(30)%
2%
Less: Additions to property, plant and equipment
Plus: Dispositions of property, plant and equipment
Free cash flow (Non-GAAP)
Less: GE Capital dividends
V%
F
F
U
Note: Individual amounts are rounded. As a result, the sum of the parts presented may not add to the total
27
GE Capital segment results
($ in millions – net earnings)
1Q’16
GECAS
1Q’15
V%
$332
$307
8%
137
35
F
83
79
5
(56)
(75)
26
$496
$346
43%
Other continuing operations–b)
(1,389)
(6,067)
77
Capital segment profit/(loss)
$(893)
$(5,721)
84%
(308)
(9,024)
97
$(1,201)
$(14,745)
92%
EFS
Industrial Finance
Other–a)
Verticals
Earnings/(loss) from discontinued ops.
GE Capital net earnings/(loss)
(a – Includes run-off insurance business and allocated corporate costs
(b – Includes impact of preferred stock dividends
28
GE Capital segment assets
($ in billions)
1Q’16
GECAS
1Q’15
V%
$46.2
$46.9
EFS
13.2
16.1
(18)
Industrial Finance
22.8
19.3
18
Other
37.5
38.8
(3)
$119.8
$121.2
84.0
62.2
$203.8
$183.3
81.6
294.8
$285.4
$478.1
Verticals
Other continuing operations
Capital segment assets
Assets of discontinued operations
GE Capital assets
(1)%
(1)%
35
11%
(72)
(40)%
29
GE Capital funding
($ in billions)
Debt composition –a)
Comments
$236
• Maintaining $5B CP outstanding
5
Non-recourse
Securitization
$180
3
$168 -c)
3
• No incremental LT debt issuance in line with
April 2015 announcement
192
LT debt -b)
Alternative
funding/other
Comm’l. paper
14
25
1Q’15
Bank lines -d)
Liquidity -e)
LT debt <1yr.
$45
$78
$36
168
157
4
5
3
5
4Q’15
1Q’16
$46
$91
$43
$42
$106
$49
• $16B of maturities due in April 2016 driven
by 2015 debt exchange
• Completed hybrid debt tender of ‘17
callables ($4B)
• Completed ILC deposit sale to Goldman
Sachs ($16B) on April 18th (deposits in
discontinued operations)
(a - Continuing operations (excludes obligations issued to third parties that we reported in Discontinued operations or Held-for-Sale)
(b - Includes $74B of GE Capital debt assumed by GE Company and maintained as intercompany debt as of 1Q’16
(c - Includes ~$(0.4)B YTD FX impact and ~$1.3B YTD FAS 133
(d - Bank lines maintained at GE Company since Dec ‘15 but can be drawn and lent to GE Capital upon request
(e - Liquidity includes cash & equivalents (including discontinued operations and held for sale balances); 1Q’16 includes $13.9B of high quality
interest bearing deposits
30
Non-GAAP reconciliation
GE Capital leverage ratio-a)
($ in billions)
As reported
Debt
Equity-b)
Leverage ratio (GAAP)
Debt
Less: Liquidity-c)
Adjusted debt
Equity-b)
Adjusted leverage ratio (Non-GAAP)
1Q’16
4Q’15
1Q’15
$195.0
38.2
$211.9
46.2
$338.9
70.7
5.1
4.6
4.8
195.0
(105.9)
$89.2
211.9
(90.9)
$121.0
338.9
(78.2)
$260.7
38.2
46.2
70.7
2.3
2.6
3.7
(a - Includes discontinued operations and balances recorded as held for sale for all periods
(b - Total equity ex-non-controlling interests
(c - Liquidity includes cash & equivalents (including discontinued operations and held for sale balances) and $13.9B of high quality interest bearing deposits
31
GE Capital tier 1 common ratio estimate-a)
($ in billions)
As reported
Shareowners' equity–b) (GAAP)
- Preferred equity
- G/W & Intangibles
- Other additions/(deductions)
Tier 1 common
Estimated risk weighted assets
1Q’16
4Q’15
1Q’15
$38.2
$46.2
$70.7
(5.2)
(3.2)
(0.8)
(5.0)
(5.2)
0.3
(4.9)
(22.0)
1.2
$29.0
$36.4
$45.0
$199.7
$251.1
$422.8
Tier 1 common ratio
14.5%
14.5%
10.6%
Tangible Common Equity/Tangible
Assets
10.6%
11.5%
9.4%
(a - Based on Basel 3 standardized approach on a transitional basis; includes discontinued operations for all periods
(b - Total equity ex-non-controlling interests
32
Non-GAAP reconciliation
Capital ending net investment
($ in billions)
1Q’16
4Q’15
3Q’15-a) 2Q’15-a) 1Q’15-a)
$285.4
$316.7
$433.8
$463.3
$476.5
Less: assets of discontinued operations-b)
(81.6)
(120.9)
(121.9)
(154.9)
(31.3)
Less: non-interest bearing
liabilities & others
(43.0)
(43.3)
(50.3)
(51.2)
(66.0)
Capital ENI (Continuing operations)
160.8
152.4
261.6
257.2
379.2
Less: Liquidity-c)
(79.7)
(70.5)
(85.5)
(77.9)
(76.4)
Capital ENI (ex-Liquidity) (Non-GAAP)
$81.1
$81.9
$ 176.1
$179.3
$302.8
Memo:
Total ENI (ex-Liquidity) incl. disc. ops. (Non-GAAP) $126.7
$166.9
$270.6
$309.0
$331.4
GE Capital total assets (GAAP)
(a - As originally reported
(b - Real Estate, majority of Commercial Lending & Leasing, and Consumer segments moved to discontinued operations during 1Q’15, 2Q’15, and 4Q’15 respectively
(c - Liquidity includes cash & equivalents from continuing operations (excluding held for sale balances) and $13.9B of high quality interest bearing deposits
33
GE Capital reserves
($ in millions)
Allowances for
losses
$94
$81
$79
1Q'15
4Q'15
1Q'16
Coverage:
Reserve (%)
0.41%
0.32%
0.33%
Nonaccrual:
Nonaccrual ($)
Nonaccrual (%)
$343
1.48%
$256
1.02%
$317
1.33%
34
GE Capital Aircraft and Helicopter asset details
($ in millions)
Collateral type
Loans and leases
4Q'15
1Q'16
1Q'15
Narrow-body aircraft
Wide-body aircraft
Cargo
Regional jets
Engines
Helicopters
$
21,706
7,927
1,550
3,745
2,838
3,688
$
21,747
8,002
1,621
3,861
2,654
3,663
$
22,854
7,340
1,808
3,993
2,519
3,428
Total (a)
$
41,454
$
41,548
$
41,942
Airline regions
Loans and leases
4Q'15
1Q'16
1Q'15
U.S.
Europe
Pacific Basin
Americas
Other
$
9,217
9,675
8,317
3,861
6,696
$
9,236
9,818
8,248
4,006
6,577
$
10,140
9,604
8,258
4,213
6,299
Total (b)
$
37,766
$
37,885
$
38,514
Aircraft vintage profile
1Q'16
4Q'15
1Q'15
0-5 years
6-10 years
11 - 15 years
15+ years
$
13,963
7,768
7,469
1,944
$
13,842
7,880
7,503
1,993
Total (c)
$
31,143
$
31,218
13,857
8,423
7,917
1,437
$
31,634
(a- Includes loans and financing leases of $7,127 million, $7,294 million and $7,817 million (less non-aircraft loans and financing leases of $76 million,
$62 million and $128 million) and ELTO of $34,404 million, $34,316 million and $34,253 at March 31, 2016, December 31, 2015 and March 31, 2015
respectively, related to commercial aircraft at GECAS.
(b - Excludes helicopters
(c - Includes aircraft owned by GECAS and leased to others; excludes helicopters, engines and loans
35
Non-GAAP supplemental information
In an effort to provide investors with additional information regarding the company’s results as determined by
generally accepted accounting principles (GAAP), the company also discusses, in its earnings press release and earnings
presentation materials, the following Non-GAAP information which management believes provides useful information to
investors.
Operating and non-operating pension costs
We have provided the operating and non-operating components of cost for our principal pension plans. Operating pension
costs comprise the service cost of benefits earned, prior service cost amortization and curtailment loss for our principal
pension plans. Non-operating pension costs comprise the expected return on plan assets, interest cost on benefit obligations
and net actuarial loss amortization for our principal pension plans. We believe that the operating components of pension
costs better reflects the ongoing service-related costs of providing pension benefits to our employees. We believe that the
operating and non-operating components of cost for our principal pension plans, considered along with the corresponding
GAAP measure, provide management and investors with additional information for comparison of our pension plan costs and
operating results with the pension plan costs and operating results of other companies.
Adjusted corporate costs (operating)
Operating corporate costs exclude non-service-related pension costs of our principal pension plans, which comprise interest
costs, expected return on plan assets and amortization of actuarial gains/losses. Service cost, prior service cost and
curtailment loss components of our principal pension plans are included in operating corporate costs. We believe that these
components of pension cost better reflect the ongoing service-related costs of providing pension benefits to our employees.
Accordingly, we believe that our measure of operating corporate costs provides management and investors with a useful
measure of the operational costs incurred outside of our businesses. We believe that this measure, considered along with the
corresponding GAAP measure, provides management and investors with additional information for comparison of our
operating corporate costs to the operating corporate costs of other companies.
We also believe that adjusting operating corporate costs to exclude the effects of items that are not closely associated with
ongoing corporate operations, such as earnings of previously divested businesses, gains and losses on disposed and held for
sale businesses, and restructuring and other charges, provides management and investors with a meaningful measure that
increases the period-to-period comparability of our ongoing corporate costs.
36
Non-GAAP supplemental information
Industrial Segment Organic Revenue Growth
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.
Industrial Segment Organic Operating Profit Growth
Operating profit growth measures profit 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. Management recognizes that
the term “organic operating profit 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.
37
Non-GAAP supplemental information
Industrial Cash Flows from Operating Activities (Industrial CFOA)
We define “Industrial CFOA” as GE’s cash from operating activities (continuing operations) less the amount of dividends
received by GE from GE Capital. This includes the effects of intercompany transactions, including GE customer receivables sold
to GE Capital; GE Capital services for trade receivables management and material procurement; buildings and equipment
leased by GE from GE Capital; information technology (IT) and other services sold to GE Capital by GE; aircraft engines
manufactured by GE that are installed on aircraft purchased by GE Capital 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 GE Capital 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 GE Capital 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.
Free cash flow
We define free cash flow as GE’s cash from operating activities (continuing operations) less GE net additions to property, plant
and equipment, which are included in cash flows from investing activities. We believe that free cash flow is a useful financial
metric to assess our ability to pursue opportunities to enhance our growth. We also believe that presenting free cash flow
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 free cash flow 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.
38
Non-GAAP supplemental information
Industrial operating earnings and EPS and GE Capital operating earnings (loss) and EPS
Operating earnings (loss) 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, prior service cost and curtailment
loss 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 (loss) 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 capital allocation decisions
and 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.
We believe that presenting operating earnings and operating EPS separately for our industrial and financial services
businesses also provides management and investors with useful information about the relative size of our industrial and
financial services businesses in relation to the total company.
GE Industrial Operating + Verticals EPS
As described above, Verticals represents the GE Capital businesses that we expect to retain. We believe that presenting
Industrial operating + Vertical earnings-per-share amounts provides management and investors with a useful measure to
evaluate the performance of the businesses we expect to retain after the disposition of most of our financial services business.
39
Non-GAAP supplemental information
GE Capital Ending Net Investment (ENI), excluding liquidity
We use ENI to measure the size of our Capital segment. We believe that this measure is a useful indicator of the capital (debt
or equity) required to fund a business as it adjusts for non-interest bearing current liabilities generated in the normal course of
business that do not require a capital outlay. We also believe that by excluding liquidity, we provide a meaningful measure of
assets requiring capital to fund our Capital segment as a substantial amount of liquidity resulted from debt issuances to prefund future debt maturities and will not be used to fund additional assets. Liquidity consists of cash and equivalents and
certain high quality interest bearing deposits of the U.S. Treasury. As a general matter, investments included in liquidity are
expected to be highly liquid, giving us the ability to readily convert them to cash. Providing this measure will help investors
measure how we are performing against our previously communicated goal to reduce the size of our financial services
segment.
40