Investors were reminded Wednesday of the challenges which lay ahead for General Electric, as the company reported steep revenue declines in addition to also said the item was being investigated by the Securities in addition to also Exchange Commission over its accounting practices.
GE’s fourth quarter fell short of Wall Street’s expectations, however the item offered up a stronger-than-expected outlook for 2018. which news initially lifted GE shares in premarket trading, however during its investor call, the company revealed its recent review of its GE Capital insurance portfolio was under scrutiny in addition to also the item would likely be restating two years of financial results. The stock was down slightly early in Wednesday’s regular trading session.
within the latest period, the conglomerate swung to a loss by continuing operations of $10.01 billion, or $1.15 per share, by earnings of $3.48 billion, or 39 cents per share.
Stripping out charges, GE earned 27 cents a share, or about 2 cents per share less than what analysts surveyed by Thomson Reuters were expecting.
Revenue fell 5 percent to $31.40 billion by $33.09 billion a year ago. Revenue was far less than analysts expected, with Thomson Reuters reporting an average revenue estimate of $34.06 billion.
A portion of the charges taken within the fourth quarter are at the center of the SEC’s investigation. GE’s review led the item to take a $6.2 billion after-tax charge. The company also plans to contribute $15 billion to the unit over the next seven years to shore up its portfolio.
The SEC wants to know more about the process which lead to the insurance reserve increase in addition to also the change. the item also has questions about its revenue recognition in addition to also controls for its long-term service agreements, GE Chief Financial Officer Jamie Miller told investors.
The company said the item will be cooperating with the investigation.
The earnings were the second under CEO John Flannery, who has embarked on an extensive review of the company’s business.
Flannery cheered the improvements the company made within the latest period.
“Our results This kind of quarter demonstrate some of the early progress we are seeing by our key initiatives,” Flannery said within the company’s press Discharge. “The team will be focused
on operational execution, capital allocation in addition to also deep cost reduction to position us for continued improvement in 2018.”
The company says its cash performance within the latest period was better than expected.
GE said its industrial businesses generated adjusted cash flow of $7.76 billion. which figure excludes taxes on deals, the costs of GE’s pension plan in addition to also its oil in addition to also gas business. the item includes a dividend by its ownership of Baker Hughes.