GE 2015 Annual Report Download - page 4

GE Capital Historic Timeline
1930s 1940s–50s 1960s 1980s 1990s 2000s 2008–15 TODAY1970s
GE Credit
formed in 1932
to provide in-
stallment loans
to purchase
GE appliances
GE Credit
signs
8 millionth
contract
Entered Aviation
financing
Commercial
Lending
and Leasing
launches
Energy Financial
Services
launches
GE Capital Retail
Card Finance
launches
E-business
launches
GE Capital
splits into 27
businesses
GE Capital
revenues
reach ~50%
International;
~70% by 2006
Genworth IPO
(largest IPO of
2004)
Financial crisis &
new regulatory
bodies
GE Capital
Retail Finance
IPOs as
Synchrony
Financial (2014)
Milestone
Aviation
acquired; first
acquisition since
financial crisis
(2014)
Real Estate
launches
It is easy to be uncertain as an investor to-
day. The global economy is long on volatility
and short on economic leadership. But GE
remains a good investment. In a complicated
world, we are simpler and more competitive.
In an uncertain world, we are skilled in man-
aging through tough cycles. In a risky world,
we have cultural strength and a lot of cash.
We are tested. Companies that think they
are perfect can get you in trouble in this
environment. GE is not perfect, but we make
progress every day. In 2015, we continued to
take strong actions that make GE better.
We transformed our portfolio by exiting most
of financial services while completing the
purchase of Alstom, our largest industrial
deal. This ends a period in which we refo-
cused GE as a high-tech leader. To do so, we
sold more than half the Company where
we lacked competitive advantage and re-
built our core franchises. Every GE business
today rests solidly on a bedrock of deep do-
main competency.
The bold strategy to exit GE Capital came
from Keith Sherin and his team. The plan was
complicated, challenging and risky. It involved
one of the largest corporate restructurings in
history. Their execution has been flawless.
The move says a lot about the GE culture: We
are willing to take bold actions in the face of
uncertainty; and our team puts the Company
ahead of their own interests.
At the same time, we accelerated our
transformation as a leader in the Industrial
Internet, becoming a “Digital Industrial” com-
pany. In the Industrial Internet we see the
next great wave of productivity both for our
company and for the customers we serve.
We are a company that invests in broad
industrial transitions, and they don’t come
much bigger than the full application of data
and analytics to machines and systems.
Act
Letter to Shareowners
GE Capital % of GE’s earnings
GE CAPITAL PORTFOLIO
REPOSITIONING IN 2015
Based on strong buyer interest and an
accelerated timeline, the portfolio transition
will be largely executed by the end of 2016.
GE CAPITAL
PROFIT CONTRIBUTION
GE Capital drove significant earnings
growth and helped fuel GE’s investment
in its industrial portfolio.
~60%
% Earnings Growth
1990–2005
37%
41%
<10%*
% Earnings: 1990–99
% Earnings: 2000–15
% Earnings: Future
GE Capital Transition
Established GE Capital Verticals
to better align with GE’s industrial
businesses
Successful split-off of Synchrony
Financial through largest-ever
share exchange with 671MM GE
shares retired
*Industrial operating + Verticals basis
$107B
Earnings
since 1980
$200B
GOAL FOR
ASSET
DISPOSITIONS
$157B
SIGNED
$104B
CLOSED
~$50B
TO GO
2 GE 2015 ANNUAL REPORT