United States

United States

GE Renewable Energy profits fall 72%

UNITED STATES: Continued price pressure has led to a 72% fall in profit for GE Renewable Energy, its parent conglomerate said in its Q3 report.

GE orders were down 3% year-on-year in Q3 2018
GE orders were down 3% year-on-year in Q3 2018

Segment profit of the division fell from $217 million in Q3 2017, to just $60 million in 2018.

Across the first nine months of 2018, GE Renewable Energy’s segment profits also fell 51% year-on-year to $220 million.

The fall in profit comes despite a 15% increase in Q3 revenues, to $2.87 billion – up from $2.5 billion in Q3 2017.

Orders fell 3% year-on-year in the July-September quarter. 

GE Renewable Energy key figures Jan-Sep 17 Jan-Sep 18 Jul-Sep 17 Jul-Sep 18
Revenue ($ million) 6,587 7,172 2,507 2,873
Orders ($ million) 7,116 7,040 2,961 2,879
Segment Profit
($ million)
445 220 217 60

GE said the fall in profit was "mainly driven by pricing challenges in the market and lower repower volume".

GE group witnessed a 4% year-on-year fall in revenues in Q3, with adjusted earnings per share slipping 33% to $0.14/share.

As a result of the change, the group’s new CEO H. Lawrence Culp, reduced its quarterly dividend to shareholders from $0.12/share to $0.01/share.

The firm also proposed a reorganisation of its power division. It plans to split the division in to two units: one for its gas business and a second with the other assets including steam, grid, nuclear and power conversion, the US firm said.

"We are on the right path to create a more focused portfolio and strengthen our balance sheet. My priorities in my first 100 days are positioning our businesses to win, starting with Power, and accelerating deleveraging.

"We are moving with speed to improve our financial position, starting with the actions announced today," said Culp.

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