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GE- 2009 Annual Meeting of Shareowners
1. Positioning GE for long-term
growth
Jeff Immelt, Chairman and CEO
Keith Sherin, Vice Chairman and CFO
GE Shareowners Meeting
April 22, 2009
2. Presentation
Keith Sherin (CFO): Operating GE in a
challenging environment
Jeff Immelt (CEO): Positioning GE for long-
term growth
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3. Operating in a challenging
environment
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4. Global economic recession
U.S. housing U.S. unemployment Global GDP
210
1st time since
~30% decline Great Depression
Average home prices ($)
200 in house 2%
8.5% global GDP
prices from negative
190 peak
180
5.1%
1Q’09E
160 1Q’08
150
March ’08 March ‘09
2007 2008 2009 (2)%
S&P/Case-Schiller Price Index
Recession now affecting all pockets of global economy
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5. Financial system in crisis
Peak
Cumulative bank losses to date Founded valuation
1850 $46B Bankruptcy
~$1.5T 1879 $130B Sold for $15B
1889 $40B Sold for $2B
1920 $262B $4B market cap
1923 $20B Sold for $2B
~$500B
1938 $86B $1B market cap
1969 $26B Sold for $4B
U.S. Global
1970 $51B $0.5B market cap
Fundamental reset of financial services landscape
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6. Capital markets not functioning
Gov. equity Bank holding co.
Avg. debt issuance per month–a)
$3B Converted
~$30B+
$10B Converted
$10B Converted
$25B Existing
~$2B $45B Existing
$25B Existing
Pre-crisis Today $45B Existing
(a- excludes government guaranteed debt issuance
GE is paying the government to participate in loan programs
GE has not had to convert to a bank holding company
GE has received NO government equity
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7. GE Capital impact What we don’t do
+ Originate risky debt (CLO, CDO, SIV)
Earnings
+ Sell credit default insurance
+ Trade securities
~$12B + Originate high-yield debt
~$8B
What we do
+ Senior and secured leader
+ Diversified portfolio
+ Operate assets
‘07 ‘08 + Work out problems
+ Underwrite to hold
+ Conservative funding
GE Capital earnings will be under pressure
Expect GE Capital to be profitable in 2009
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8. Dividend
GE had communicated flat dividend S&P 500 dividend reductions
in 2008 … what changed in 2009? significantly increased in 2008 -
Unemployment spiked to 7.6% in 50
January already
in ‘09
Capital markets deteriorated in
Feb. 2009 62
Loss expectations at GE Capital …
government stress tests for banks
Moody’s and S&P ratings review
11 9 12
2005 2006 2007 2008
Sustained $0.31/share through 2Q’09 …
$0.10 per share starting 3Q’09
Environment continued to deteriorate and
GE was not immune
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9. GE earnings performance
2008 actuals 2009
+10%
Industrial • 1Q ’09 … $0.26 EPS vs. $0.21 consensus
Infrastructure earnings +11%
Capital Finance earns $1.1B
(1)%
S&P GE–a) • Operating with intensity
Aggressive cost out
(193)% (29)%
Capital $171B infrastructure backlog
Solid cash performance
• Increase disclosure + transparency
S&P GE–b)
(a- GE Industrial excluding C&I (b- Capital Finance
Performance > peers in ’08 … but below expectations
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10. Global markets 43% over last year
World equity index April 2008 – April 2009 returns
1,800
(52)%
1,600
1,400
(38)% (36)%
1,200
(39)%
1,000 (51)%
800
(48)%
600
2004 2005 2007 2009
~$30 trillion in wealth destroyed
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11. GE stock
(50)% Ind. peers
(64)% GE
(71)% Fin. peers
April ’08 Aug ’08 Dec ’08 April ’09
Concerns on GE Capital weighing on stock … but significantly off March lows
– Stock +15% since March 19 meeting on financial services
– Continuing to proactively communicate 2009/2010 scenarios
Stock performance in 2008 and 2009 disappointing to all of us
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12. Safe and secure in summary
($ in billions)
GE cash GE borrowings
$45B less debt
including $30B
$31B more less commercial
cash since paper
September $549
$504
$47
$16
Commercial
paper $88 $58
September Today September Today
2008 2008
Equity issuance provided $15B additional cash in hand
Dividend cut will provide ~$9B in cash annually
Retained strong, stable debt rating
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13. Final thoughts
GE is a big company … impacted when the system
collapsed
GE Capital is a good business … must be smaller as the
financial markets reset
Made difficult decisions to protect the company over
the long term
Performance builds trust
Focused on keeping GE safe and secure
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15. A new era
Cycle Reset
Housing Financial services restructuring
Unemployment Role of government
Credit Wealth reduction/transfer
Capital investment Reputation + trust
Happens once Happens once
each decade each generation
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16. How we plan to win
1 Build strong businesses
2 Invest in innovation, services and globalization
3 Position in essential themes
4 Drive competitiveness through scale
5 Commit to people: strong leaders + loyal team
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17. 1 Strong businesses
GE has leadership franchises
Segment / 15-year growth
Strength (’93-’08)
Energy Infrastructure ~15%
(Power Gen, Wind, O&G)
Technology Infrastructure 10+
(Aviation, Trans., Healthcare)
NBCU 15+
(Cable, Film)
Capital Finance 10+
(Verticals, Mid-Market Finance)
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18. 1 Strong businesses
Must create a smaller + more focused GE Capital
Reduce assets ($B)
+ Connection with GE
Exit product lines
+ High margin
+ Competitive advantage
+ Reliable lender
Past Future
GE Capital investor value
2000 Today Future
$100B+ Low +
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19. 1 Strong businesses
Portfolio has been rebuilt for growth
Businesses we sold Businesses we acquired
– Reinsurance + Renewable energy
– Financial Assurance + Oil & Gas/Water
– Plastics/Silicones + Healthcare IT/Life sciences
– Industrial supply + Avionics
– TV stations + Cable media
Underperformed Made billions
post-GE for GE
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20. 2 Invest in growth
Lead in technology and content
+
2000-09 Leadership in sciences
$50B in technology Continuous innovation
20,000 patents
Positioned in important industries
$40B in content Energy/Water Media
Healthcare Oil & Gas
Global deployment Transportation Consumer
Investment
GE has scale advantage
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21. 2 Invest in growth: Smart grid
GE story
Marriage of IT with electrical
infrastructure to support 21st
century energy needs … drives
efficiency and renewables use
Only GE …
Technology to integrate systems
Domain knowledge from
generation through end use
Innovating for the future at our
Global Research Centers
Could be a $5B+
new business
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22. 2 Invest in growth: sodium battery
GE story
Increasing demand across GE
industries + new markets
Unique technology…patented
$150 million in investments
Novel chemistry + materials +
intelligent controls
Major investment planned
Could be $1B+ new
business
Energy storage
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23. 2 Invest in growth: hulu
GE story
#2 online video site in the U.S.
Nearly 200 advertisers
More than 140 content providers
“50 Most Innovative Companies of
2009,” Fast Company
“The Best New Way to Watch TV,”
BusinessWeek
$100M revenue within
first 24 months
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24. 2 Invest in growth: molecular imaging
GE story
Brain imaging
L R GE leading in neuro imaging
agents
Compounds being developed
for early diagnosis for
Alzheimer’s & Parkinson's
Therapy being developed with
pharma companies
Marker development Lowers cost + improves patient
+ outcomes
Imaging tools
Commercialized by 2015
Could be $500M+
new product
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25. 2 Invest in growth: cleaner coal
GE story
Coal with a cleaner footprint
Capable of carbon capture
GE + Duke Energy building the
largest commercial IGCC plant
Gives coal a future in a carbon
constrained world
GE a leader … expect more
business globally
Duke Energy Could be $5B+
Edwardsport site construction, January 2009
new business
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26. 2 Invest in growth: services
$120B
~$40B
28%
GE-Southwest story
Backlog ’09 revenue Margins Largest operator of our CFM56
engine…1,120 in Southwest fleet
Business growth even Big engine services customers …
in a recession ~ $5B+ under contract through 2018
GE services help Southwest to be
competitive
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27. 2 Invest in growth: global
($ in billions) Iraq turbine order
Industrial global revenues
~15%
$61 CAGR
$43
$26
2009 priorities
'03 '06 '09F Win major infrastructure orders
% int’l. 41% 48% 53% Establish strategic partnerships
Build capability in service, technology
and manufacturing
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28. 3 Position in essential themes
Stimulus GE impact
Target countries
Drive renewables
$2T U.S.
Accelerate green energy
Canada infrastructure
China Increase global infrastructure
projects
Japan
Accelerate targeted healthcare
Brazil spending
U.K.
Encourage innovation investment
France
Aggressive export finance support
Germany
Announced
Middle East
Governments targeting infrastructure, GE well-positioned
energy, healthcare, jobs
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29. 3 Position in essential themes
($ in billions)
ecomaginationsm
Revenues
72+ products $25
Big pipeline R&D leadership
$17
Reputation/brand
$6 Saved $500M by reducing
carbon footprint
Customer partnerships
'04 '08 '10F
GE the leader in clean energy
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30. 4 Drive competitiveness
2008 industrial organic
revenue growth 2008 margins
8 15.6
(in %) 2X (in %) 14.6 +100 bps.
4
GE GE
Peers Peers
2008 return 2008 revenue
on capital per employee
14.8 +270 bps. (in $K) 566 2X
(in %)
12.1
294
GE GE
Peers Peers
Peers include Whirlpool, Disney, News Corp., United Technologies,
Honeywell, Siemens, Philips, ABB, Rolls Royce, Alstom
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31. 4 Drive competitiveness
2009 actions
Cost out Cash
$5B+ $2B+
Working
capital
reduced,
freeing up
cash
Base cost Inventory
Indirect cost Receivables
Material cost Payables
Can weather the cycle
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32. 5 Commit to people
Employees Retirees
$1B training investment You are GE
Deep expertise Pension safe
Retention high Good healthcare
benefits
Fiercely loyal team
Market-tested leaders in challenging times
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33. Through cycles, GE performs
($ in billions)
1970-79 1980-89 1990-99 2000-09
~165
~90
65
29
12
8 10
4
Dividend Earnings Dividend Earnings Dividend Earnings Dividend Earnings
From 2000-09, GE generated more earnings and paid
more dividends than the past 30 years combined
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34. Winning in the reset world
1 Build financial services around GE core
2 Invest more in R&D … products at all price points
3 Lead in essential themes … ecomagination
Next target is healthcare
4 Excellence in manufacturing … for the U.S. and the
world
5 Retain a team that is competitive and loyal and has
a long term view
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35. There will be a future
+
GE will lead
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