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GE reports 1Q ’09 EPS of $.26; Technology & Energy Infrastructure Earnings +11%; Capital Finance Earns $1.1B in 1Q ’09; Total Backlog Stable at $171B


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1Q ’09 Highlights (Continuing Operations attributable to GE)

· Earnings per share (EPS) of $.26, down 40%; earnings of $2.8 billion, down 35%
· Revenues of $38.4 billion, down 9%; Industrial sales down 1%; financial services revenues down 20%; Industrial organic revenue was flat year-over-year
· Energy Infrastructure earnings grew 19%; Technology Infrastructure earnings grew 6%
· Capital Finance earned $1.1 billion in 1Q and remains on track for profitable 2009
· Capital Finance extended $69 billion of new credit in 1Q
· Total equipment and services backlog steady at $171 billion; 1Q Infrastructure orders totaled $19 billion, down 10%
· Achieved ~93% of planned 2009 long-term debt funding; $47 billion cash and equivalents
· Results do not include any impact from newly issued mark-to-market rules; implementing in 2Q
· Cash generated from operating activities totaled $2.8 billion, on plan

FAIRFIELD, Conn. - GE announced today first-quarter 2009 earnings from continuing operations (attributable to GE) of $2.8 billion, or $.26 per share attributable to common shareowners, down 40% from first quarter 2008. First-quarter 2009 revenues from continuing operations were $38.4 billion, down 9% year-over-year.

“In a recessionary environment impacting every segment of the economy, we delivered first-quarter business results consistent with our GE Capital investor meeting on March 19th and the framework provided last December, which included a smaller but still-profitable GE Capital and 0-5% earnings growth in our Industrial segments,” GE Chairman and CEO Jeff Immelt said. “Amid a continued weak economy, we’re performing well and our backlog remains strong.

“Infrastructure and Media earnings together were flat versus last year. Energy Infrastructure grew earnings by 19% while Technology Infrastructure had earnings growth of 6%. While Cable continued to deliver double-digit growth, NBC Universal had a tougher performance overall due to a soft advertising market and fewer major DVD releases compared to a year ago.

“Despite the difficult economy, we generated $19 billion in Infrastructure orders, a decline of 10%. Importantly, high-margin service orders grew 7%. Major equipment and service backlog held approximately flat at $171 billion vs. year-end 2008 and was up 6% versus a year ago.

“Capital Finance earned $1.1 billion in the quarter and remains on track to be profitable for the full year,” Immelt said. “Revenues and profitability declined year-over-year in our financial services business and we continue to experience rising delinquencies. However, we have taken prudent actions to address these challenges, including tightening risk requirements, improving liquidity and reducing leverage. Also, questions about credit ratings have been resolved. We still have a strong rating and our outlook is stable.”

On balance, positive items were mostly offset by charges in the quarter. The Company realized a $0.3 billion after-tax net benefit from transaction gains, marks and impairments and an incremental $0.2 billion tax benefit, which were mostly offset by $0.4 billion in after-tax restructuring and other charges. First-quarter results do not include any impact from the newly issued mark-to-market accounting rules, which we will implement, as required, in the second quarter 2009.

“We are aggressively managing our cost structure to respond to challenging global economic conditions,” Immelt said. “For 2009, we will reduce our costs by more than $5 billion. We’ve reduced headcount and are managing company operations more efficiently, leading to improved operating leverage in our infrastructure businesses.”

First Quarter 2009 Financial Highlights:

Earnings from continuing operations attributable to GE were $2.8 billion, down 35% from $4.4 billion in the first quarter of 2008. EPS from continuing operations was $.26, down 40% from last year. Segment profit fell 27% in the quarter, as strong 19% growth at Energy Infrastructure was more than offset by a 58% decline at Capital Finance and a 45% decrease at NBC Universal.

Including the effects of discontinued operations, first quarter net earnings attributable to GE were $2.8 billion ($.26 per share) in 2009 and $4.3 billion ($.43 per share) in the first quarter of 2008.

Revenues fell 9% to $38.4 billion. GE Capital Services’ (GECS) revenues fell 20% over last year to $14.4 billion. Industrial sales were $24.0 billion, down 1% from the first quarter of 2008. Industrial organic revenue held steady year over year.

Cash generated from GE operating activities in the first quarter of 2009 totaled $2.8 billion, down 42% from last year, primarily reflecting the lack of a GECS dividend payment in 2009 and lower progress collections, which were offset by improvements in working capital. Historically, the Company has generated approximately 18% of its full-year cash flow in the first quarter. GE is on track to meet its full-year cash flow plan.

“We are running GE for the long term. Over the last six months, we have made the difficult decisions to raise equity and cut the dividend to keep GE safe and secure,” Immelt said. “On March 19, we conducted a ‘deep dive’ into GE Capital that demonstrated the strength of our team and our commitment to transparency. Estimated stress-test results showed that we do not need to raise additional capital even in the Fed’s adverse-case scenario.

“Meanwhile, we are investing in growth, while lowering cost and generating cash. We see great opportunity in a global economy that favors clean energy, affordable healthcare and services that drive customer productivity. GE is positioning itself to lead in this reset economy.”

GE will discuss preliminary first-quarter results on a conference call and Webcast at 8:30 a.m. ET today. Call information is available at http://www.ge.com/investor, and related charts will be posted there prior to the call.

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GE (NYSE: GE) is a diversified infrastructure, finance and media company taking on the world’s toughest challenges. From aircraft engines and power generation to financial services, medical imaging, and television programming, GE operates in more than 100 countries and employs about 300,000 people worldwide. For more information, visit the company’s Web site at www.ge.com.

Caution Concerning Forward-Looking Statements:

This document contains “forward-looking statements”- that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” believe,” “seek,” “see,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include: the severity and duration of current economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices and the value of financial assets; the impact of U.S. and foreign government programs to restore liquidity and stimulate national and global economies; the impact of conditions in the financial and credit markets on the availability and cost of GE Capital’s funding and on our ability to reduce GE Capital’s asset levels and commercial paper exposure as planned; the impact of conditions in the housing market and unemployment rates on the level of commercial and consumer credit defaults; our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so; the soundness of other financial institutions with which GE Capital does business; the adequacy of our cash flow and earnings and other conditions which may affect our ability to maintain our quarterly dividend at the current level; the level of demand and financial performance of the major industries we serve, including, without limitation, air and rail transportation, energy generation, network television, real estate and healthcare; the impact of regulation and regulatory, investigative and legal proceedings and legal compliance risks; strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses; and numerous other matters of national, regional and global scale, including those of a political, economic, business and competitive nature. These uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.



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