According to Jan 23 Bloomberg report, General Electric Co. said improving economic conditions and reduced costs are giving it flexibility to consider using cash for acquisitions and eventually for stock buybacks and dividend increases.
“This is painting a picture of the future,” Chief Financial Officer Keith Sherin said in an interview. Given “dramatic changes we’ve made in the company in the past 18 months, the future outlook looks pretty good.”
GE yesterday reported fourth-quarter earnings and sales that beat analysts’ estimates, with all GE Capital units other than real estate reporting a profit. Options for cash use may open up as the industrial divisions benefit from expanding economies this year and from cost savings made over the past year, Sherin and Chief Executive Officer Jeffrey Immelt told investors.
The world’s biggest maker of jet engines, locomotives and medical-imaging machines said profit from continuing operations fell 22 percent to $3.03 billion, or 28 cents a share, from $3.87 billion, or 36 cents, a year earlier. The average estimate was 26 cents a share in a Bloomberg survey of 13 analysts. Sales fell 10 percent to $41.4 billion, GE said in a statement.
Fairfield, Connecticut-based GE rose 9 cents to $16.11 yesterday in New York Stock Exchange composite trading, while the Dow Jones Industrial Average dropped 2.1 percent. GE fell 6.6 percent in 2009.
GE’s industrial operations generated $16.6 billion in cash by the end of 2009 and this year expects about $10 billion from the sale of a majority stake in NBC Universal as well as a security unit.