© Reuters. General Electric (GE.US) Q4 earnings of $1.24 per share beat expectations on strong free cash flow
Zhitong Finance APP learned that General Electric (GE.US) released the fourth quarter and annual performance report for 2022, showing that as of December 31, 2022, the adjusted total revenue in the fourth quarter was 21 billion U.S. dollars, an increase of 11%. Earnings per share were $1.24, beating consensus estimates of $1.16. This performance includes the operations of GE HealthCare Technologies, which was spun off on January 3, 2023. Its CEO expects high-single-digit revenue growth in 2023 and strong free cash flow. After the announcement of the results, General Electric’s stock price turned from a decline to an increase in the pre-market trading session. As of press time, it rose slightly by US$0.21 or 0.26%.
Specifically, total orders in the fourth quarter were US$25.4 billion, an increase of 15% year-on-year; organic orders increased by 18% year-on-year. Q4 total revenue was US$21.8 billion (GAAP), an increase of 7%; adjusted total revenue was US$21 billion, an organic growth of 11%. Q4 operating margin was 10.3% (GAAP), an increase of 2,740 basis points year-over-year; adjusted operating margin was 10.3%, an organic growth of 290 basis points. Earnings per share (GAAP) from continuing operations in Q4 was $1.99, an increase of $5.23 year-on-year; adjusted earnings per share were $1.24, an increase of $0.42 year-on-year. Cash from operating activities (GAAP) was US$4.6 billion, an increase of US$220 million year-on-year; free cash flow was US$430 million, an increase of US$600 million year-on-year.
For the full year, total orders were US$83 billion, up 4% year-on-year, and organic orders increased 7% year-on-year; total revenue (GAAP) was US$76.6 billion, up 3%; adjusted total revenue was US$73.6 billion, an organic increase of 6%; Operating margin was 1.8% (GAAP), up 680 basis points year-over-year; adjusted operating margin was 7.9%, up 160 basis points organically; EPS from continuing operations was $0.53 (GAAP), up $3.78 year-over-year; Earnings per share were US$2.62, an increase of US$0.91 year-on-year; cash from operating activities (GAAP) was US$5.9 billion, an increase of US$5 billion; free cash flow reached US$4.8 billion, an increase of US$2.1 billion.
General Electric Chairman and Chief Executive Officer H. Lawrence Culp, Jr. said: “2022 marks the beginning of a new era for GE. GE ends 2022 with solid revenue growth and profit Margins improved and free cash flow reached $4.8 billion. In the fourth quarter, GE Aerospace’s orders and revenue increased by more than 20%; Power achieved double-digit growth rates, both strong results.”
Looking ahead, Culp said GE will continue to focus on driving growth and improving profits and cash flow. High single-digit revenue growth is expected in 2023 with strong free cash flow.
UBS analyst Chris Snyder recently said that after General Electric (General Electric) divested its health care business, it lowered its target price on the company’s stock from $98 to $87 and maintained a “buy” rating on the stock. Analysts see positive change in all of GE’s business lines by 2023, and the company’s momentum will also be better in 2024.
