Financial Mines

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Archive for the ‘GE’ Category

Ruger shares rise and GE stays even as guns stay in the news

Thursday, April 25, 2013 by:Rob Varnon
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Sturm Ruger & Co. was joined under the gun control microscope Fairfieldby neighbor General Electric.

Ruger, a gun maker headquartered in Connecticut, which just passed one of the nation’s most strict gun laws, has been receiving threats of boycotts by gun owners unless it moves out of the state where Ruger was founded. General Electric’s plan to stop providing consumer lending services at gun shops, was revealed by solid reporting from the Wall Street Journal this week, leading to promises of toaster, washers and dryer boycotts by similar factions.

Guns remain a topic as various states continue to weigh changes to their laws. Some are looking to restrict sales while others are debating legislation that would restrict the first amendment to protect gun owner privacy and strengthen the right to carry concealed weapons. And recent shootings in the country, both in the Boston Marathon bombing case and in Illinois recently continue to keep concerns about gun violence alive.

The attention has not hurt either company so far. Ruger’s shares were up 3.41 percent Thursday, gaining $1.62 to close at $49.17. The gun maker is to report earnings on Monday and then holds its annual meeting on Tuesday. Forbes and other financial press reported the increase was mostly likely due to expectations of solid earnings.

GE didn’t fare as well as Ruger. It’s shares finished even for the day at $21`.96

Some GE customers love their guns more

Wednesday, April 24, 2013 by:Rob Varnon
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Less than an hour after The Wall Street Journal reported GE Capital was going to stop providing retail lending services to gun shops, a few people decided to threaten GE with boycotts.

The Journal quoted gun store owners in other states who received letters from GE stating the company would no longer provide lending services for gun purchases. People could, at some stores, take out a small loan issued through GE Capital to buy guns or ammunition. The article confirmed the move with a GE spokesman who said it was a tiny part of the business, also said the decision was made due to changes in the law and tragic events.

The company intends to continue to provide retail lending services to major sporting goods stores that sell guns, including Dick’s.

Peter Lanza, the father of the Sandy Hook Elementary School shooter who killed 20 children and six adult in December, is a GE Capital executive.

GE also held its annual meeting Wednesday and the company’s shares gained 2.14 percent, or 46 cents, to close at $21.96 Wednesday.

Just moments after the article popped up on the WSJ website, GE’s corporate Facebook page attracted several comments.

 

While the number of people who found GE’s stance objectionable piled up on its Facebook page, there appeared a smattering of others who supported the move.

GE reports first quarter results Friday

Thursday, April 18, 2013 by:Rob Varnon
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General Electric will report its first quarter results Friday morning before the opening of the market.
The Fairfield-based multi-nationa saw its shares rise steadily last year and into this one, going from a low of less than $19 to more than $22.
The presentation will be webcast on GE’s site, www.ge.com.

Some local CEOs get 30 percent raises

Friday, March 15, 2013 by:Rob Varnon
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While pay increases have been creeping back into some industries, most Americans were still tightening their belts coming out of 2012. Not so for some of our area’s CEOs.

Six of the region’s top CEOs saw their pay packages jump more than 30 percent, with two of those gaining more than 100 percent for the year’s they turned in 2012. Many CEOs saw declines in pay in 2011, but boards of directors at some companies seemed willing to make it up to the bosses. There were also a few CEOs who saw declines in pay or slight increases.

GE’s Jeff Immelt, saw a bump of 80 percent from a year ago. The CEO of GE was rewarded after years of work that has moved the company away from its dependence on finance, though not too far away, and created an industrial technology company positioned in key transportation and infrastructure areas.

But Immelt, whose compensation package rose 80 percent from a year ago, didn’t see the largest jump in pay. That distinction in 2012 goes to Ethan Allen’s M. Farooq Kathwari.

Meanwhile, Louis Chenevert, UTC’s CEO, saw his salary remain virtually flat after orchestrating the massive merger with Goodrich. Still, Chenevert, whose company is the parent to Sikorsky and Pratt & Whitney, makes more than Immelt.

Check out how the state’s CEOs are doing so far as their companies report their compensation packages for their 2012 performance. The total value, as reported here, includes salary, bonus, options and other perks, which are disclosed in the annual proxy filings by the companies. Some companies have not yet reported, but we’ve included them with their 2011 pay.

GE delcares 19 cent dividend

Friday, February 15, 2013 by:Rob Varnon
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The Board of Directors of General Electric declared a 19 cent per share dividend on the outstanding common stock of the Company payable on April 25, 2013, with a record date of February 25, 2013, and ex-dividend date of February 21, 2013.

Cut and print! GE sells remaining NBC stake for $18.1 Billion

Tuesday, February 12, 2013 by:Rob Varnon
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Fairfield-based GE said Tuesday it agreed to sell its remaining 49 percent common equity interest in its joint venture with Comcast, which includes NBCUniversal and the NBCU floors in 30 Rockefeller Center, for $18.1 billion.

Here’s the official release from GE on the terms and what it did.

Under the terms of the transaction, GE will sell its remaining 49% common equity stake in the NBCU joint venture to Comcast for $16.7 billion. GE will receive $12.0 billion in cash, $4.0 billion in Comcast guaranteed debt, and $0.7 billion of preferred stock. Additionally, GE Capital (GECC) will sell the NBCU occupied floors in 30 Rockefeller Center, and property in Englewood Cliffs, New Jersey, to NBCU affiliates for $1.4 billion in cash. The transaction has been approved by the boards of directors of GE and Comcast and remains subject to customary closing conditions, which are expected to be satisfied before the end of the first quarter of 2013.

The joint venture includes NBCU’s cable networks, filmed entertainment, televised entertainment, theme parks, and unconsolidated investments, and Comcast’s cable networks, including E!, Versus and the Golf Channel, its ten regional sports networks, and certain digital media properties. An agreement announced by the two companies in December 2009 reduced GE’s holding in NBCU from 80% to 49% and made Comcast the majority partner. GE used proceeds from that transaction to make strategic acquisitions in its Energy and Oil & Gas businesses, which have performed well.

“This transaction allows us to significantly increase the cash we plan to return to shareholders in 2013, to approximately $18 billion, and to continue to invest in our industrial business,” said GE Chairman and CEO Jeff Immelt. “By adding significant new capital to our balanced capital allocation plan, we can accelerate our share buyback plans while investing in growth in our core businesses.”

The GE Board of Directors increased GE’s share repurchase authority to $35 billion, with approximately $23 billion of authorization remaining as of today. With this authorization, GE plans to accelerate its share repurchase program to approximately $10 billion in 2013.

GE does not expect this transaction to materially impact the overall earnings framework for 2013. GE expects the pre-tax gain from the sale of its remaining NBCU interest of approximately $1 billion to be offset by restructuring in 2013. Due to the accelerated restructuring plan, cost savings should exceed the previous target of $2 billion through 2014. GE expects earnings previously forecast from the NBCU joint venture to be replaced by the effects of share repurchases, cost reductions, and earnings growth in its industrial business, for both 2013 and 2014. In addition, GECC expects the $0.5 billion after-tax gain from the sale of property to be allocated to accelerating non-core asset reductions.

Immelt said, “We are very pleased with the investment we have made in NBCUniversal, which generated a return of 14 percent over more than two decades, and Comcast has been a great partner with GE in this joint venture. The gains we will realize from this sale will accelerate our restructuring plans and provide more momentum to our margin expansion goals. This transaction represents another strong step forward in our industrial transformation, with no change to our 2013 earnings outlook, substantially increased buyback, and continued investment in growth. Going forward, we expect to continue our balanced capital allocation approach, investing organically in our industrial businesses, growing dividends in line with earnings, buying back stock, and focusing our industrial M&A on bolt-on acquisitions.

“For nearly 30 years, NBC – and later NBCUniversal – has been a great business for GE and our investors. We are proud of our stewardship of the business and our association with the NBCU brand. Most of all, we enjoyed working with the great people of NBCUniversal. We wish them and Comcast well in the future.”

J.P. Morgan provided financial advice to GE, and Weil, Gotshal & Manges was the Company’s legal advisor. In addition, Goldman Sachs, Centerview Partners, and CBRE provided strategic advice related to the transaction.

Teleconference and Webcast

GE will host a webcast at 9:30am ET on Wednesday, February 13, 2013, to discuss this announcement with GE Chairman and CEO Jeff Immelt, and GE Chief Financial Officer Keith Sherin. The webcast will be available at www.ge.com/investors. A replay will be available later in the day on the site.

Joint Chiefs call on Congress to call off sequestration

Wednesday, January 16, 2013 by:Rob Varnon
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The Joint Chiefs for Staff for the U.S. Military have sent a letter to Congress warning that if they do not stop sequestration, the United States will be left with a hollow force.

The letter, reported on by Politico.com’s Morning Defense blog highlights the concerns of the nation’s top military brass.

Defense contractors are bracing for about $50 billion in more defense spending cuts if Congress does not address sequestration by March. Washington elected to create a budget control measure that automatically culls $1 trillion in federal spending over the course of a decade if lawmakers cannot find a way to cut spending through a budget agreement. The cuts were to begin this year, but Congress voted to delay implementation until March, presumably to give them more time to work out an agreement.

The JCS letter was praised, (this is sort of a ‘no duh’ sentence) by the Aerospace Industries Association, which agrees with the assessment.

“The Defense Department will be forced to cut training, furlough civilian personnel and raid investment accounts,” the AIA said in a release Wednesday. “Sequestration will render our defense strategy unexecutable and leave us with a hollow force incapable of resetting capabilities or responding to emerging national security dangers.  It will also cause massive disruption in the business world as program contracts are renegotiated, triggering layoffs and sending unit costs through the roof.

“Worst of all, it endangers the ability of future generations to address the security issues of the future.  We join the Chiefs in urging Congress to take immediate action on a legislative solution that President Obama can sign which preserves a military force that is second to none.”

The AIA’s membership includes UTC’s Sikorsky, Pratt & Whitney and Hamilton Sundstrand, GE Aviation and Kaman Aerospace, among a host of other important Connecticut companies that employ tens of thousands.

GE joins consortium to buy Iberdrola’s wind biz

Wednesday, January 2, 2013 by:Rob Varnon
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European wind power. AP photo

General Electric said Wednesday it is part of the consortium that is buying 32 operating wind farms in France from the Spanish company Iberdrola.

MEAG — the asset management arm of Munich Re and ERGO — and EDF Energies Nouvelles joined GE Energy Financial Services in the 350 million euro, or about $463 million, deal.

This is not the first time a Connecticut-based company has bought something from Iberdrola. The Spanish company sold Southern Connecticut Gas and Connecticut Natural Gas companies to New Haven-based United Illuminating several years ago.

The portfolio of onshore wind farms, which are spread throughout France and were commissioned in 2006-2012, have a combined capacity of 321.4 megawatts using turbines from a variety of manufacturers. Electricity generated is sold according to long-term contracts under France’s feed-in tariff.

Shares if GE were up 1.53 percent to $21.31, on a day the market surged after news that the U.S. Congress actually prevented income tax increases on people making less than $400,000.

Upon completion of the transaction, subject to regulatory approval, the wind portfolio’s ownership will be: GE Energy Financial Services and MEAG at 40 percent apiece, and EDF Energies Nouvelles at 20 percent. EDF Energies Nouvelles will provide asset management and operation & maintenance services for the wind farms. The consortium envisions re-powering some of the wind farms, which feature 160 turbines, to improve their efficiency and reliability using GE technology.

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