GE optimistic about power division
25 July 2023
CEO: Profits will increase this year
GE expects its power portfolio profits in 2023 will be better than what it achieved in 2022, according to GE CEO Larry Culp.
Culp made the prediction during the company’s second-quarter earnings call. Overall, the power portfolio saw orders increase 7% to $4.3 billion in the quarter with profits increasing 11%.
GE reported 26 gas turbine orders in the second quarter compared to 27 in the second quarter of 2022. For the year, the company reported 39 gas turbine orders, compared to 42 for the same period in 2022. The company said higher HA deliveries were primarily offset by lower aeroderivative shipments.
Revenue from power equipment sales was down 12%, but service revenues were up 2% year-over-year. The figures do not include the renewable energy portfolio.
“GE turned in another strong quarter with double-digit growth in orders, revenue, operating profit, and cash… supported by services strength, robust market demand, and the lean transformation within our more focused businesses,” Culp said. “In the first half alone, earnings have surpassed our full-year 2022 results…GE Vernova is strengthening pre-spin with record orders and improving profitability at Renewable Energy, and continued margin expansion at Power.”
In 2021GE announced plans to break up into three publicly traded companies. In January, GE HealthCare was spun off. The power division, GE Vernova, will be spun-off in early 2024. GE’s remaining divisions will then be renamed GE Aerospace.
After the spin-off, GE Vernova will be made up of GE’s current portfolio of energy businesses. GE Vernova will be based in Cambridge, Massachusetts.