GE Delivers $0.33 Operating EPS Representing 1Q ’11 Growth of 65%; Revenues Total $38.4B for 1Q ’11, up 6%; Quarterly Dividend Increased by $0.01 to $0.15
1Q 2011 Highlights (Continuing Operations Attributable to GE)

Fourth-consecutive quarter of double-digit earnings growth

· Operating earnings of $3.6 billion, up 58%; operating EPS of $0.33, up 65%
· GAAP earnings of $3.4 billion, up 48%; GAAP EPS of $0.31, up 48%

Strong top-line performance in an improving environment

· Industrial revenue growth of 8%; organic growth of 5%
· Industrial segment international growth of 12%
· Infrastructure orders of $19 billion, up 13%

Executing balanced capital allocation plan

· Raised dividend $0.01 to $0.15/quarter effective 3Q ’11; third increase in last 12 months

GE Capital earned $1.8 billion, with pre-tax earnings of $2.3 billion

GE consolidated tax rate of 53%, reflecting tax on NBCU transaction and improved GE Capital earnings

Confident in full-year 2011 operating framework

FAIRFIELD, Conn. – April 21, 2011 – GE [NYSE: GE] announced today strong first-quarter 2011 operating earnings of $3.6 billion, up 58%, or .33 per share, up 65%, from the first quarter of 2010. GAAP earnings from continuing operations (attributable to GE) were $3.4 billion, or .31 per share, both up 48% year-over-year. Revenues grew to $38.4 billion for the quarter, up 6% from a year ago. In addition, GE raised its quarterly dividend by .01 to .15 effective in the third quarter of 2011. This is the third dividend increase declared in the last 12 months and reflects GE leadership’s confidence in the company’s business performance.

“As today’s results show, GE has emerged from the recession a stronger, more competitive company,” GE Chairman and CEO Jeff Immelt said. “GE Healthcare, Transportation and Aviation delivered strong results. Strategic investments in high-growth segments have strengthened the company’s Energy portfolio and position that business to return to growth in the second half of this year. We ended the quarter with a record high backlog of $177 billion.

“GE Capital also had a strong first quarter, earning $1.8 billion after tax,” Immelt said. “With losses having peaked, we are originating new business at attractive margins and our funding costs continue to be favorable. Reserve coverage decreased slightly in the quarter, driven by improving portfolio quality. Since the first quarter of 2010, we’ve improved our GECC Tier 1 common ratio to 9.8% from 7.8% and reduced GECC leverage to 4.5:1 from 5.5:1. We have strengthened the GE Capital franchise and are on track for solid earnings growth.”

In the first quarter, the company grew R&D investment 12% and launched nearly 50 new Healthcare and Energy products. Industrial segment operating profit margin declined 1.1 points from a year ago to 14.3%. Deflation remained positive for the quarter. Margins were also impacted by lower Wind pricing, the non-repeat of a 2010 Aviation franchise fee and new acquisitions. Cash generated from Industrial operating activities totaled $1.7 billion in the quarter, on track for full-year plan of $12-$13 billion. At quarter-end, GE had $82 billion of consolidated cash.

Balanced capital allocation remains a positive for GE investors. Since the second quarter of 2010 the company has declared dividend increases totaling 50%, announced six acquisitions in Energy and Healthcare that will drive long-term growth, and bought back $2.3 billion of stock.

Positive items were mostly offset by charges in the quarter. GE completed the NBC Universal transaction, resulting in a .04 per-share after-tax gain and a 49% ownership in the new entity. This was partially offset by .02 per share in after-tax restructuring and other charges and .01 in acquisition and disposition-related costs.

“As we said in January on the year-end 2010 earnings call, we expected the NBCU sale to result in a high tax rate,” Immelt said. “Including the impact of that transaction, GE’s consolidated tax rate for the first quarter of 2011 was 53%, up 37 points from the same quarter last year.

“We remain confident in GE’s 2011 framework,” Immelt said. “We are executing our capital allocation plan. We will continue investing to drive future growth and competitive advantage. The GE business model will continue to deliver earnings growth for shareowners in 2011 and beyond.”

First-quarter 2011 Financial Highlights:

First-quarter operating earnings were $3.6 billion, up 58% from $2.3 billion in the first quarter of 2010 and operating EPS was .33, up 65% from .20 in the first quarter of last year. Segment profit increased 36% compared with the first quarter of 2010, as increases of more than 200% at GE Capital, 37% at Transportation, 7% at Healthcare and 5% at Aviation more than offset a 7% earnings decline at Energy Infrastructure.

Including the effects of discontinued operations, first-quarter net earnings attributable to GE were $3.4 billion (.31 per share attributable to common shareowners) in 2011 compared with $1.9 billion (.17 per share attributable to common shareowners) in the first quarter of 2010.

First-quarter revenues increased 6% to $38.4 billion. GE Capital Services’ (GECS) revenues increased 3% from last year to $13.2 billion. Industrial sales of $22.1 billion decreased 6% versus 2010.

Cash generated from GE Industrial operating activities in first quarter 2011 totaled $1.7 billion, down 34% from $2.6 billion in the first quarter of 2010.

The accompanying tables include information integral to assessing the company’s financial position, operating performance and cash flow.

GE will discuss preliminary first-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.
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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