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GE Provides Updated Strategic Framework for GE Capital and Total Company 4Q ’08 Outlook

December 2, 2008

Categories:
GE Capital
GE Corporate

Highlights and Outlook (Continuing Operations)

Fairfield, Conn., Dec. 2, 2008 – GE is today providing investors with a detailed update on GE Capital’s strategic framework and outlook in a webcast starting at 8:30 am EST. The Company will share plans on how it will continue to diversify funding, re-mix its financial services businesses, and position its portfolio for future growth. GE will also update that its fourth quarter earnings per share are trending toward $.50-.52, the low end of its previously guided range of $.50-.65. In addition, GE is evaluating restructuring and other charges to accelerate cost out and reviewing losses in current credit environment, expecting a $1.0-1.4 billion after tax charge. These restructuring and other actions would strengthen the Company to better perform in the current economic environment and position it for profitable long-term growth.

“GE Capital is an invaluable part of GE’s portfolio, and we are fully committed to financial services,” GE Vice Chairman and Chief Financial Officer Keith Sherin said. “We have averaged 15% earnings growth over the last 20 years in these businesses. We are operating in an extremely difficult environment, but we are outperforming our peers and we have strong franchises to build upon for long-term growth. We are a mid-market finance company differentiated by an originate-to-hold approach, product and geographic diversification, deep experience in risk assessment and collateral management, and senior secured positions for many of our receivables.

“We are taking a number of tough, but prudent actions to make GE Capital safer, stronger and more secure during this financial crisis. We are committed to being a Triple-A company,” Sherin said. “These actions include a funding plan that reflects the current market, and we are lowering our leverage ratio and commercial paper balance. Our forecast anticipates a challenging loss environment. We are also reorganizing the business to reduce costs and allocate capital more efficiently.

“Today, we are providing investors with a detailed review of GE Capital’s businesses and addressing questions about our funding plan, credit quality, product portfolio, leverage, and recently announced reorganization,” Sherin said. “Our plans reflect a very difficult environment. However, GE Capital expects to deliver exceptional relative performance in 2008. For 2009, we are targeting to reduce leverage to 6:1, lower outstanding commercial paper balance to $50 billion and reduce our overall funding needs.”

GE Vice Chairman and GE Capital CEO and President Michael Neal said, “We have established a framework for GE Capital to earn approximately $5 billion in 2009. From there, we believe the business is positioned to sustain solid, 10% earnings growth in the future.

“GE Capital is a focused, profitable mid-market finance company with leading market franchises and an increasingly more diversified funding model,” Neal said. “We will continue to support our customers and originate profitable new business. With the strategic adjustments we have made, we will reinforce our strong competitive position, enhance our funding model and create greater flexibility.”

Sherin said, “Even in a difficult economic environment, we expect the Company to earn more than $18 billion in 2008, including potential restructuring and other charges. We are reaffirming our plan to maintain a $1.24 per share dividend in 2009. We have leadership businesses that continue to generate strong margins and cash flow, supporting the dividend.”

GE will present the GE Capital update in a conference call/Webcast at 8:30 a.m. ET today. Call information is available at www.ge.com/investor, and related charts will be posted there prior to the call.

All earnings and EPS information in this release are on a continuing operations basis.
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GE (NYSE: GE) is Imagination at Work -- a diversified technology, media and financial services company focused on solving some of the world’s toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, and media content, GE serves customers in more than 100 countries and employs more than 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 often contain words such as “expect,” “anticipate,” “intend,” “plan,” believe,” “seek,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties that could adversely or positively affect our future results include: the behavior of financial markets, including fluctuations in interest and exchange rates, commodity and equity prices and the value of financial assets: continued volatility and further deterioration of the capital markets; the commercial and consumer credit environment; the impact of regulation and regulatory, investigative and legal actions; strategic actions, including acquisitions and dispositions; future integration of acquired businesses; future financial performance of major industries which we serve, including, without limitation, the air and rail transportation, energy generation, media, real estate and healthcare industries; 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.



Contact Information

Corporate Communications
Name
Corporate Communications
Job Title
Division
Phone
Fax
Mobile
Email
corp.communications@ge.com
Russell Wilkerson
Name
Russell Wilkerson
Job Title
Division
GE Capital, Managing Director of Communications and Public Affairs
Phone
+1 203 840 6420
Fax
Mobile
+1 203 581 2114
Email
russell.wilkerson@ge.com
Trevor Schauenberg
Name
Trevor Schauenberg
Job Title
Division
GE Corporate, VP Investor Communications
Phone
+1 203 373 2424
Fax
Mobile
Email
trevor.a.schauenberg@ge.com