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October 21, 2016 7:37 AM EDT

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 21, 2016
 
 
General Electric Company
  
 
(Exact name of registrant as specified in its charter)
  
 
New York
  
001-00035
  
14-0689340
(State or other jurisdiction
 of incorporation)
  
(Commission
 File Number)
  
(IRS Employer
 Identification No.)
   
 
    
41 Farnsworth Street, Boston, MA
      
02210
(Address of principal executive offices)
      
(Zip Code)
   
 
    
Registrant's telephone number, including area code   (617) 443-3000
 
     
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 

Item 2.02 Results of Operations and Financial Condition.
On October 21, 2016, General Electric Company (the "Company") released its third-quarter 2016 financial results on its investor relations website at www.ge.com/investor-relations. A copy of these is attached as Exhibit 99 and incorporated by reference herein.

Except as indicated below, the information provided pursuant to this Item 2.02, including Exhibit 99, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act.  The information set forth in Exhibit 99 under the headings "Condensed Statement of Earnings (Loss) (Unaudited),"  "Summary of Operating Segments (Unaudited)," and "Condensed Statement of Financial Position (Unaudited)" is being filed.

Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibit is being furnished (except for those portions that are deemed "filed" as indicated above) as part of this report:

Exhibit Description

99 Third-quarter 2016 financial results released on General Electric Company's website on October 21, 2016.

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

   
General Electric Company
  
   
(Registrant)
  
   
 
 
 
  
Date: October 21, 2016
  
/s/ Jan R. Hauser
  
   
Jan R. Hauser
Vice President and Controller
  


 
Exhibit 99
 
 
 
 
 

 
GENERAL ELECTRIC COMPANY
                                        
CONDENSED STATEMENT OF EARNINGS (LOSS) (UNAUDITED)
                    
                                         
 
Consolidated
    
GE(a)
    
Financial Services (GE Capital)
Three months ended September 30
2016
2015
  
V%
    
2016
2015
  
V%
2016
2015
  
V%
                                         
Revenues and other income
                                        
Sales of goods and services
$
26,814
$
25,527
  
5%
    
$
26,934
$
25,612
  
5%
$
34
$
21
  
62%
Other income
  
227
  
169
          
213
  
201
      
-
  
-
    
GE Capital earnings (loss) from continuing operations
  
-
  
-
          
26
  
(154)
      
-
  
-
    
GE Capital revenues from services
  
2,224
  
2,332
          
-
  
-
      
2,566
  
2,639
    
   Total revenues and other income
  
29,266
  
28,028
  
4%
      
27,172
  
25,659
  
6%
  
2,600
  
2,660
  
(2)%
Costs and expenses
                                        
Cost of sales
  
20,965
  
19,855
          
20,545
  
19,336
      
574
  
624
    
Selling, general and administrative expenses
  
4,343
  
4,258
          
3,880
  
3,549
      
631
  
861
    
Interest and other financial charges
  
961
  
897
          
483
  
440
      
617
  
586
    
Investment contracts, insurance losses and
                                        
   insurance annuity benefits
  
684
  
673
          
-
  
-
      
700
  
714
    
Other costs and expenses
  
238
  
295
          
-
  
-
      
241
  
313
    
   Total costs and expenses
  
27,191
  
25,978
  
5%
      
24,909
  
23,325
  
7%
  
2,763
  
3,098
  
(11)%
Earnings (loss) from continuing operations
                                        
   before income taxes
  
2,074
  
2,050
  
1%
      
2,263
  
2,334
  
(3)%
  
(163)
  
(438)
  
63%
Benefit (provision) for income taxes
  
(18)
  
(135)
          
(241)
  
(413)
      
223
  
278
    
Earnings (loss) from continuing operations
  
2,056
  
1,915
  
7%
      
2,022
  
1,921
  
5%
  
60
  
(160)
  
F
Earnings (loss) from discontinued
                                        
   operations, net of taxes
  
(105)
  
629
          
(103)
  
541
      
(105)
  
630
    
Net earnings (loss)
  
1,951
  
2,545
  
(23)%
      
1,918
  
2,462
  
(22)%
  
(45)
  
470
  
U
Less net earnings (loss) attributable to
                                        
   noncontrolling interests
  
(76)
  
39
          
(76)
  
(43)
      
-
  
83
    
Net earnings (loss) attributable to the Company
  
2,027
  
2,506
  
(19)%
      
1,994
  
2,506
  
(20)%
  
(45)
  
387
  
U
Preferred stock dividends
  
(33)
  
-
          
-
  
-
      
(33)
  
-
    
Net earnings (loss) attributable to
                                        
   GE common shareowners
$
1,994
$
2,506
  
(20)%
    
$
1,994
$
2,506
  
(20)%
$
(78)
$
387
  
U
Amounts attributable to GE common
                                        
   shareowners:
                                        
   Earnings (loss) from continuing operations
$
2,056
$
1,915
  
7%
    
$
2,022
$
1,921
  
5%
$
60
$
(160)
  
F
   Less net earnings (loss) attributable
                                        
     to noncontrolling interests, continuing operations
  
(74)
  
(50)
          
(76)
  
(43)
      
1
  
(6)
    
   Earnings (loss) from continuing operations
                                        
     attributable to the Company
  
2,131
  
1,965
  
8%
      
2,097
  
1,965
  
7%
  
59
  
(154)
  
F
   Preferred stock dividends
  
(33)
  
-
          
-
  
-
      
(33)
  
-
    
   Earnings (loss) from continuing operations
                                        
     attributable to GE common shareowners
  
2,097
  
1,965
  
7%
      
2,097
  
1,965
  
7%
  
26
  
(154)
  
F
   Earnings (loss) from discontinued
                                        
     operations, net of taxes
  
(105)
  
629
          
(103)
  
541
      
(105)
  
630
    
   Less net earnings (loss) attributable to
                                        
      noncontrolling interests, discontinued operations
  
(2)
  
89
          
-
  
-
      
(2)
  
89
    
Net earnings (loss) attributable to GE
                                        
   common shareowners
$
1,994
$
2,506
  
(20)%
    
$
1,994
$
2,506
  
(20)%
$
(78)
$
387
  
U
       
–
              
#REF!
          
#REF!
    
Per-share amounts - earnings (loss) from
                                        
   continuing operations
                                        
Diluted earnings (loss) per share
$
0.23
$
0.19
  
21%
                            
Basic earnings (loss) per share
$
0.24
$
0.19
  
26%
                            
Per-share amounts - net earnings (loss)
                                        
Diluted earnings (loss) per share
$
0.22
$
0.25
  
(12)%
                            
Basic earnings (loss) per share
$
0.22
$
0.25
  
(12)%
                            
Total average equivalent shares
                                        
Diluted
  
9,016
  
10,173
  
(11)%
                            
Basic
  
8,904
  
10,103
  
(12)%
                            
Dividends declared per common share
$
0.23
$
0.23
  
-%
                            

(a)
Represents the adding together of all affiliated companies except GE Capital, which is presented on a one-line basis.


Amounts may not add due to rounding. Dollar amounts and share amounts in millions; per-share amounts in dollars.


"GE Capital" means GE Capital Global Holdings, LLC (GECGH) and its predecessor General Electric Capital Corporation (GECC) and all of their affiliates and associated companies. Separate information is shown for "GE" and "Financial Services (GE Capital)." Transactions between GE and GE Capital have been eliminated from the "Consolidated" column. See Note 1 to the 2015 consolidated financial statements at www.ge.com/ar2015 for further information about consolidation matters.
4
GENERAL ELECTRIC COMPANY
CONDENSED STATEMENT OF EARNINGS (LOSS) (UNAUDITED)
 
 
Consolidated
    
GE(a)
Financial Services (GE Capital)
Nine months ended September 30
2016
2015
  
V%
    
2016
2015
  
V%
2016
2015
  
V%
                                         
Revenues and other income
                                        
Sales of goods and services
$
80,156
$
75,266
  
6%
    
$
80,490
$
75,592
  
6%
$
88
$
64
  
38%
Other income
  
3,385
  
1,092
          
3,359
  
1,023
      
-
  
-
    
GE Capital earnings (loss) from continuing operations
-
  
-
          
(1,466)
  
(6,207)
      
-
  
-
    
GE Capital revenues from services
  
7,063
  
7,136
          
-
  
-
      
8,168
  
8,152
    
   Total revenues and other income
  
90,604
  
83,494
  
9%
      
82,382
  
70,408
  
17%
  
8,256
  
8,215
  
-%
                                         
Costs and expenses
                                        
Cost of sales
  
63,710
  
59,110
          
62,394
  
57,769
      
1,738
  
1,730
    
Selling, general and administrative expenses
  
13,833
  
13,058
          
12,094
  
11,035
      
2,238
  
2,458
    
Interest and other financial charges
  
4,023
  
2,228
          
1,490
  
1,243
      
3,006
  
1,348
    
Investment contracts, insurance losses and
                                        
   insurance annuity benefits
  
2,101
  
1,942
          
-
  
-
      
2,186
  
2,061
    
Other costs and expenses
  
801
  
873
          
-
  
-
      
822
  
903
    
   Total costs and expenses
  
84,467
  
77,211
  
9%
      
75,977
  
70,048
  
8%
  
9,990
  
8,500
  
18%
Earnings (loss) from continuing operations
                                        
    before income taxes
  
6,137
  
6,283
  
(2)%
      
6,405
  
360
  
F
  
(1,734)
  
(285)
  
U
Benefit (provision) for income taxes
  
(302)
  
(7,227)
          
(1,034)
  
(1,302)
      
732
  
(5,925)
    
Earnings (loss) from continuing operations
  
5,835
  
(945)
  
F
      
5,370
  
(942)
  
F
  
(1,002)
  
(6,210)
  
84%
Earnings (loss) from discontinued
                                        
    operations, net of taxes
  
(954)
  
(11,253)
          
(956)
  
(11,523)
      
(954)
  
(11,249)
    
Net earnings (loss)
  
4,881
  
(12,198)
  
F
      
4,414
  
(12,465)
  
F
  
(1,956)
  
(17,459)
  
89%
Less net earnings (loss) attributable to
                                        
    noncontrolling interests
  
(283)
  
229
          
(275)
  
(38)
      
(8)
  
267
    
Net earnings (loss) attributable to the Company
  
5,164
  
(12,427)
  
F
      
4,689
  
(12,427)
  
F
  
(1,948)
  
(17,726)
  
89%
Preferred stock dividends
  
(474)
  
-
          
-
  
-
      
(474)
  
(161)
    
Net earnings (loss) attributable to
                                        
   GE common shareowners
$
4,689
$
(12,427)
  
F
    
$
4,689
$
(12,427)
  
F
$
(2,422)
$
(17,887)
  
86%
Amounts attributable to GE common
                                        
   shareowners:
                                        
   Earnings (loss) from continuing operations
$
5,835
$
(945)
  
F
    
$
5,370
$
(942)
  
F
$
(1,002)
$
(6,210)
  
84%
   Less net earnings (loss) attributable
                                        
     to noncontrolling interests, continuing operations
  
(285)
  
(41)
          
(275)
  
(38)
      
(10)
  
(3)
    
   Earnings (loss) from continuing operations
                                        
     attributable to the Company
  
6,120
  
(904)
  
F
      
5,645
  
(904)
  
F
  
(992)
  
(6,207)
  
84%
   Preferred stock dividends
  
(474)
  
-
          
-
  
-
      
(474)
  
(161)
    
   Earnings (loss) from continuing operations
                                        
      attributable to GE common shareowners
  
5,645
  
(904)
  
F
      
5,645
  
(904)
  
F
  
(1,466)
  
(6,368)
  
77%
   Earnings (loss) from discontinued
                                        
      operations, net of taxes
  
(954)
  
(11,253)
          
(956)
  
(11,523)
      
(954)
  
(11,249)
    
   Less net earnings (loss) attributable to
                                        
      noncontrolling interests, discontinued operations
  
2
  
270
          
-
  
-
      
2
  
270
    
Net earnings (loss) attributable to GE
                                        
   common shareowners
$
4,689
$
(12,427)
  
F
    
$
4,689
$
(12,427)
  
F
$
(2,422)
$
(17,887)
  
86%
                                         
Per-share amounts - earnings (loss) from
                                        
   continuing operations
                                        
Diluted earnings (loss) per share
$
0.61
$
(0.09)
  
F
                            
Basic earnings (loss) per share
$
0.62
$
(0.09)
  
F
                            
Per-share amounts - net earnings (loss)
                                        
Diluted earnings (loss) per share
$
0.51
$
(1.23)
  
F
                            
Basic earnings (loss) per share
$
0.51
$
(1.23)
  
F
                            
Total average equivalent shares
                                        
Diluted
  
9,201
  
10,085
  
(9)%
                            
Basic
  
9,096
  
10,085
  
(10)%
                            
Dividends declared per common share
$
0.69
$
0.69
  
-%
                            

(a)
Represents the adding together of all affiliated companies except GE Capital, which is presented on a one-line basis.


Amounts may not add due to rounding. Dollar amounts and share amounts in millions; per-share amounts in dollars.

"GE Capital" means GE Capital Global Holdings, LLC (GECGH) and its predecessor General Electric Capital Corporation (GECC) and all of their affiliates and associated companies. Separate information is shown for "GE" and "Financial Services (GE Capital)." Transactions between GE and GE Capital have been eliminated from the "Consolidated" column. See Note 1 to the 2015 consolidated financial statements at www.ge.com/ar2015 for further information about consolidation matters.
5
GENERAL ELECTRIC COMPANY
                              
SUMMARY OF OPERATING SEGMENTS (UNAUDITED)
                    
                               
 
Three months ended September 30
  
Nine months ended September 30
(Dollars in millions)
2016
  
2015
  
V%
  
2016
  
2015
  
V%
                               
Revenues(a)
                              
   Power
$
6,506
  
$
4,738
  
 37 %
  
$
18,348
  
$
14,405
  
 27 %
   Renewable Energy
  
2,770
    
1,666
  
 66 %
    
6,533
    
4,335
  
 51 %
   Oil & Gas
  
2,964
    
3,938
  
 (25)%
    
9,497
    
12,096
  
 (21)%
   Aviation
  
6,300
    
6,001
  
 5 %
    
19,074
    
17,927
  
 6 %
   Healthcare
  
4,482
    
4,255
  
 5 %
    
13,190
    
12,666
  
 4 %
   Transportation
  
1,249
    
1,593
  
 (22)%
    
3,471
    
4,322
  
 (20)%
   Energy Connections & Lighting(b)
  
3,151
    
4,065
  
 (22)%
    
11,808
    
11,695
  
 1 %
        Total industrial segment revenues
  
27,421
    
26,256
  
 4 %
    
81,920
    
77,445
  
 6 %
   Capital
  
2,600
    
2,660
  
 (2)%
    
8,256
    
8,215
  
 - %
        Total segment revenues
  
30,021
    
28,916
  
 4 %
    
90,176
    
85,660
  
 5 %
   Corporate items and eliminations(a)
  
(755)
    
(888)
        
429
    
(2,166)
    
Consolidated revenues and other income
                              
  from continuing operations
$
29,266
  
$
28,028
  
 4 %
  
$
90,604
  
$
83,494
  
 9 %
                               
Segment profit (loss)(a)
                              
   Power
$
1,197
  
$
1,071
  
 12 %
  
$
2,910
  
$
2,874
  
 1 %
   Renewable Energy
  
202
    
174
  
 16 %
    
413
    
375
  
 10 %
   Oil & Gas
  
353
    
610
  
 (42)%
    
981
    
1,712
  
 (43)%
   Aviation
  
1,494
    
1,353
  
 10 %
    
4,366
    
3,936
  
 11 %
   Healthcare
  
717
    
652
  
 10 %
    
2,130
    
1,944
  
 10 %
   Transportation
  
309
    
379
  
 (18)%
    
747
    
934
  
 (20)%
   Energy Connections & Lighting(b)
  
48
    
292
  
 (84)%
    
209
    
669
  
 (69)%
        Total industrial segment profit
  
4,320
    
4,530
  
 (5)%
    
11,756
    
12,445
  
 (6)%
   Capital
  
26
    
(154)
  
F
    
(1,466)
    
(6,368)
  
 77 %
   Total segment profit (loss)
  
4,345
    
4,376
  
 (1)%
    
10,290
    
6,076
  
 69 %
Corporate items and eliminations(a)
  
(1,524)
    
(1,559)
        
(2,120)
    
(4,436)
    
GE interest and other financial charges
  
(483)
    
(440)
        
(1,490)
    
(1,243)
    
GE provision for income taxes
  
(241)
    
(413)
        
(1,034)
    
(1,302)
    
Earnings (loss) from continuing operations
                              
   attributable to GE common shareowners
  
2,097
    
1,965
  
 7 %
    
5,645
    
(904)
  
F
Earnings (loss) from discontinued operations,
                              
   net of taxes
  
(105)
    
629
  
U
    
(954)
    
(11,253)
  
 92 %
Less net earnings attributable to
                              
   noncontrolling interests, discontinued operations
  
(2)
    
89
  
U
    
2
    
270
  
 (99)%
Earnings (loss) from discontinued operations,
                              
   net of tax and noncontrolling interest
  
(103)
    
541
  
U
    
(956)
    
(11,523)
  
 92 %
Consolidated net earnings (loss)
                              
   attributable to GE common shareowners
$
1,994
  
$
2,506
  
 (20)%
  
$
4,689
  
$
(12,427)
  
F
                               
(a)
Segment revenues include revenues and other income related to the segment. Segment profit excludes results reported as discontinued operations and material accounting changes, the portion of earnings or loss attributable to noncontrolling interests of consolidated subsidiaries, and as such only includes the portion of earnings or loss attributable to our share of the consolidated earnings or loss of consolidated subsidiaries. Segment profit excludes or includes interest and other financial charges and income taxes according to how a particular segment's management is measured – excluded in determining segment profit, which we sometimes refer to as "operating profit," for Power, Renewable Energy, Oil & Gas, Aviation, Healthcare, Transportation and Energy Connections & Lighting; included in determining segment profit, which we sometimes refer to as "net earnings," for Capital. Certain corporate costs, such as shared services, employee benefits and information technology are allocated to our segments based on usage. A portion of the remaining corporate costs are allocated based on each segment's relative net cost of operations. Total industrial segment revenues and profit include the sum of our seven industrial reporting segments without giving effect to the elimination of transactions among such segments. Total segment revenues and profit include the sum of our seven industrial segments and one financial services segment, without giving effect to the elimination of transactions among such segments.  We believe that this provides investors with a view as to the results of all of our segments, without inter-segment eliminations and corporate items.
(b)
Beginning in the third quarter of 2016, the former Energy Connections and Appliances & Lighting segments will be presented as one reporting segment called Energy Connections & Lighting. This segment will include the historical results of the Appliances business prior to its sale in June 2016.

Amounts may not add due to rounding

6
GENERAL ELECTRIC COMPANY
                                    
CONDENSED STATEMENT OF FINANCIAL POSITION (UNAUDITED)
 
                                     
 
Consolidated
    
GE(a)
  
Financial Services (GE Capital)
 
September 30,
  
December 31,
    
September 30,
  
December 31,
  
September 30,
  
December 31,
(Dollars in billions)
2016
  
2015
    
2016
  
2015
  
2016
  
2015
                         
Assets
                                    
Cash and marketable securities
$
98.9
  
$
102.5
    
$
10.8
  
$
10.5
  
$
88.1
  
$
91.9
Receivables
  
25.2
    
27.0
      
13.4
    
14.7
    
-
    
-
Inventories
  
24.1
    
22.5
      
24.0
    
22.4
    
0.1
    
0.1
GE Capital financing receivables - net
  
11.9
    
12.1
      
-
    
-
    
25.0
    
25.0
Property, plant & equipment - net
  
51.5
    
54.1
      
19.6
    
20.1
    
32.7
    
34.8
Receivable from GE Capital (debt assumption)
  
-
    
-
      
59.8
    
84.7
    
-
    
-
Investment in GE Capital
  
-
    
-
      
29.0
    
46.2
    
-
    
-
Goodwill & intangible assets
  
86.8
    
83.3
      
84.1
    
80.5
    
2.7
    
2.8
Contract assets
  
24.4
    
21.2
      
24.4
    
21.2
    
-
    
-
Other assets
  
33.5
    
46.7
      
19.6
    
20.5
    
23.3
    
36.0
Assets of businesses held for sale
  
0.6
    
2.8
      
0.6
    
2.8
    
-
    
-
Assets of discontinued operations
  
30.9
    
121.0
      
-
    
-
    
30.9
    
120.9
Total assets
$
387.7
  
$
493.1
    
$
285.2
  
$
323.7
  
$
202.7
  
$
311.5
                                     
Liabilities and equity
                                    
Borrowings
$
149.4
  
$
197.6
    
$
84.6
  
$
103.1
  
$
126.4
  
$
180.2
Investment contracts, insurance liabilities and
                                    
   insurance annuity benefits
  
27.1
    
25.7
      
-
    
-
    
27.6
    
26.2
Non-current compensation and benefits
  
40.4
    
40.5
      
39.4
    
39.5
    
1.0
    
1.0
Other liabilities
  
74.3
    
78.8
      
74.9
    
77.0
    
8.6
    
11.1
Liabilities of businesses held for sale
  
-
    
0.9
      
0.1
    
1.4
    
-
    
-
Liabilities of discontinued operations
  
9.8
    
46.5
      
0.1
    
0.1
    
9.7
    
46.4
Redeemable noncontrolling interest
  
3.1
    
3.0
      
3.1
    
3.0
    
-
    
-
GE shareowners' equity
  
81.9
    
98.3
      
81.9
    
98.3
    
29.0
    
46.2
Noncontrolling interests
  
1.7
    
1.9
      
1.2
    
1.4
    
0.4
    
0.5
Total liabilities and equity
$
387.7
  
$
493.1
    
$
285.2
  
$
323.7
  
$
202.7
  
$
311.5
                                     
(a)
Represents the adding together of all affiliated companies except GE Capital, which is presented on a one-line basis.


Amounts may not add due to rounding


"GE Capital" means GE Capital Global Holdings, LLC (GECGH) and its predecessor General Electric Capital Corporation (GECC) and all of their affiliates and associated companies. Separate information is shown for "GE" and "Financial Services (GE Capital)." Transactions between GE and GE Capital have been eliminated from the "Consolidated" column. See Note 1 to the 2015 consolidated financial statements at www.ge.com/ar2015 for further information about consolidation matters.

7
GENERAL ELECTRIC COMPANY
Financial Measures That Supplement GAAP


 We sometimes use financial measures derived from consolidated financial information but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP). Certain of these are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. The following non-GAAP financial measures supplement our GAAP disclosures and should not be considered an alternative to the GAAP measure.
Industrial operating and GE Capital earnings (loss) from continuing operations and EPS
Industrial operating + Verticals earnings and EPS
Industrial operating profit and operating profit margin (excluding certain items)
Industrial segment organic revenues
Industrial cash flows from operating activities (Industrial CFOA) and Industrial CFOA excluding deal taxes

The reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures follow. Certain columns, rows or percentages within these reconciliations may not add or recalculate due to the use of rounded numbers. Totals and percentages presented are calculated from the underlying numbers in millions.
8
INDUSTRIAL OPERATING AND GE CAPITAL EARNINGS (LOSS)
FROM CONTINUING OPERATIONS AND EPS
               
   
Three months ended September 30
(Dollars in millions; except per share amounts)
  
2016
    
2015
  
V%
               
Consolidated earnings (loss) from continuing operations
              
   attributable to GE common shareowners (GAAP)
$
2,097
  
$
1,965
  
7%
      Non-operating pension costs (pre-tax)
  
511
    
693
    
      Tax effect on non-operating pension costs(a)
  
(179)
    
(243)
    
Adjustment: non-operating pension costs (net of tax)
  
332
    
450
    
Operating earnings (loss) (Non-GAAP)
$
2,429
  
$
2,415
  
1%
               
Adjustment: GE Capital earnings (loss) from continuing operations
              
   attributable to GE common shareowners
  
26
    
(154)
    
Industrial operating earnings (Non-GAAP)
$
2,404
  
$
2,569
  
(6)%
   
              
Earnings (loss) per share (EPS) - diluted(b)
              
Consolidated EPS from continuing operations attributable to GE common shareowners (GAAP)
$
0.23
  
$
0.19
  
21%
Adjustment: non-operating pension costs (net of tax)
  
0.04
    
0.04
    
Operating EPS (Non-GAAP)
  
0.27
    
0.24
  
13%
GE Capital EPS from continuing operations attributable to GE common shareowners (GAAP)
  
-
    
(0.02)
  
100%
Industrial operating EPS (Non-GAAP)
$
0.27
  
$
0.25
  
8%
               
(a)
The tax effect on non-operating pension costs was calculated using a 35% U.S. federal statutory tax rate, based on its applicability to such cost.
(b)
Earnings (loss) per-share amounts are computed independently. As a result, the sum of per-share amounts may not equal the total.

Operating earnings (loss) excludes non-service related pension costs of our principal pension plans comprising interest cost, expected return on plan assets and amortization of actuarial gains/losses. The service cost, prior service cost and any curtailment gain or loss components of our principal pension plans are included in operating earnings. We believe that these components of pension cost better reflect the ongoing service-related costs of providing pension benefits to our employees. As such, we believe that our measure of operating earnings (loss) provides management and investors with a useful measure of the operational results of our business. Other components of GAAP pension cost are mainly driven by capital allocation decisions and market performance, and we manage these separately from the operational performance of our businesses. Non-operating pension costs are not necessarily indicative of the current or future cash flow requirements related to our pension plan. We also believe that this measure, considered along with the corresponding GAAP measure, provides management and investors with additional information for comparison of our operating results to the operating results of other companies.

INDUSTRIAL OPERATING + VERTICALS EARNINGS AND EPS
              
               
   
Three months ended September 30
(Dollars in millions; except per share amounts)
  
2016
    
2015
  
V%
               
GE Capital earnings (loss) from continuing operation attributable to GE common shareowners (GAAP)
$
26
  
$
(154)
  
F
Adjustment: GE Capital other continuing earnings (loss) (Other Capital)
  
(441)
    
(504)
    
Verticals earnings(a)
$
466
  
$
351
  
33%
               
Industrial operating earnings (Non-GAAP)
$
2,404
  
$
2,569
  
(6)%
Verticals earnings(a)
  
466
    
351
    
Industrial operating earnings + Verticals earnings (Non-GAAP)
$
2,870
  
$
2,920
  
(2)%
Adjustment: Non-operating pension costs and Other Capital
  
(773)
    
(954)
    
Earnings (loss) from continuing operations attributable to GE common shareowners (GAAP)
$
2,097
  
$
1,965
  
7%
               
Earnings (loss) per share (EPS) - diluted(b)
              
Industrial operating EPS (Non-GAAP)
$
0.27
  
$
0.25
  
8%
Verticals EPS
  
0.05
    
0.03
    
Industrial operating + Verticals EPS (Non-GAAP)
$
0.32
  
$
0.29
  
10%
Adjustment: Non-operating pension costs and Other Capital
  
(0.09)
    
(0.09)
    
EPS from continuing operations (GAAP)
$
0.23
  
$
0.19
  
21%
               
(a)
Verticals include businesses expected to be retained (GECAS, EFS, Industrial Finance, and run-off Insurance), including allocated corporate costs of $25 million after tax in both the three months ended September 30, 2016 and 2015.
(b)
Earnings-per-share amounts are computed independently. As a result, the sum of per-share amounts may not equal the total.

As described above, Verticals represents the GE Capital businesses that we expect to retain. We believe that presenting Industrial operating + Verticals earnings-per-share amounts provides management and investors with a useful measure to evaluate the performance of the businesses we expect to retain after the disposition of most of our financial services business.
9
INDUSTRIAL OPERATING PROFIT AND OPERATING PROFIT MARGIN (EXCLUDING CERTAIN ITEMS)
           
 
Three months ended September 30
(Dollars in millions)
  
2016
    
2015
           
Revenues
          
   GE total revenues and other income
$
27,172
  
$
25,659
      Less: GE Capital earnings (loss) from continuing operations
  
26
    
(154)
   GE revenues and other income excluding GE Capital earnings (loss) (Industrial revenues) (GAAP)
$
27,146
  
$
25,813
           
      Less: gains
  
208
    
-
      Less: Alstom revenues
  
3,226
    
-
   Adjusted Industrial revenues (Non-GAAP)
$
23,712
  
$
25,813
           
Costs
          
   GE total costs and expenses
$
24,909
  
$
23,325
      Less: GE interest and other financial charges
  
483
    
440
   Industrial costs excluding interest and other financial charges (GAAP)
$
24,426
  
$
22,885
           
      Less: Alstom costs and expenses
  
3,082
    
-
      Less: non-operating pension costs (pre-tax)
  
511
    
693
      Less: restructuring and other
  
683
    
346
      Less: noncontrolling interests
  
76
    
43
   Adjusted Industrial costs (Non-GAAP)
$
20,074
  
$
21,803
           
Industrial profit (GAAP)
$
2,720
  
$
2,928
Industrial margins (GAAP)
  
10.0%
    
11.3%
           
Industrial operating profit (Non-GAAP)
$
3,638
  
$
4,009
Industrial operating profit margins (Non-GAAP)
  
15.3%
    
15.5%
           
We have presented our Industrial operating profit and operating profit margin excluding gains, non-operating pension costs (pre-tax) restructuring and other, noncontrolling interests, GE Capital preferred stock dividends, as well as the results of Alstom. We believe that Industrial operating profit and operating profit margin adjusted for these items are meaningful measures because they increase the comparability of period-to-period results.

INDUSTRIAL SEGMENT ORGANIC REVENUES
               
 
Three months ended September 30
(Dollars in millions)
  
2016
    
2015
  
V%
               
Industrial segment revenues (GAAP)
$
27,421
  
$
26,256
  
4%
Adjustments:
              
   Acquisitions
  
(3,261)
    
-
    
   Business dispositions (other than dispositions of businesses acquired for investment)
  
-
    
(2,219)
    
   Currency exchange rates
  
37
    
-
    
Industrial segment organic revenues (Non-GAAP)
$
24,198
  
$
24,038
  
1%
               
Organic revenue growth measures revenue excluding the effects of acquisitions, business dispositions and currency exchange rates. We believe that this measure provides management and investors with a more complete understanding of underlying operating results and trends of established, ongoing operations by excluding the effect of acquisitions, dispositions and currency exchange, which activities are subject to volatility and can obscure underlying trends. We also believe that presenting organic revenue growth separately for our industrial businesses provides management and investors with useful information about the trends of our industrial businesses and enables a more direct comparison to other non-financial businesses and companies. Management recognizes that the term "organic revenue growth" may be interpreted differently by other companies and under different circumstances. Although this may have an effect on comparability of absolute percentage growth from company to company, we believe that these measures are useful in assessing trends of the respective businesses or companies and may therefore be a useful tool in assessing period-to-period performance trends.
10
INDUSTRIAL CASH FLOWS FROM OPERATING ACTIVITIES (INDUSTRIAL CFOA)
              
AND INDUSTRIAL CFOA EXCLUDING DEAL TAXES
               
 
Nine months ended September 30
(Dollars in millions)
  
2016
    
2015
  
V%
               
Cash from GE's operating activities (continuing operations), as reported (GAAP)
$
18,342
  
$
6,526
  
F
Adjustment: dividends from GE Capital
  
16,050
    
450
    
Industrial CFOA (Non-GAAP)
$
2,292
  
$
6,076
  
(62)%
Adjustment: deal taxes related to the Appliances business sale
  
1,076
    
-
    
Industrial CFOA excluding deal taxes (Non-GAAP)
$
3,368
  
$
6,076
  
(45)%
               
We define "Industrial CFOA" as GE's cash from operating activities (continuing operations) less the amount of dividends received by GE from GE Capital. This includes the effects of intercompany transactions, including GE customer receivables sold to GE Capital; GE Capital services for trade receivables management and material procurement; buildings and equipment leased by GE from GE Capital; information technology (IT) and other services sold to GE Capital by GE; aircraft engines manufactured by GE that are installed on aircraft purchased by GE Capital from third-party producers for lease to others; and various investments, loans and allocations of GE corporate overhead costs.  We believe that investors may find it useful to compare GE's operating cash flows without the effect of GE Capital dividends, since these dividends are not representative of the operating cash flows of our industrial businesses and can vary from period to period based upon the results of the financial services businesses. We also believe that investors may find it useful to compare Industrial CFOA excluding the effects of deal taxes paid related to the Appliances business sale. Management recognizes that these measures may not be comparable to cash flow results of companies which contain both industrial and financial services businesses, but believes that this comparison is aided by the provision of additional information about the amounts of dividends paid by our financial services business and the separate presentation in our financial statements of the GE Capital cash flows. We believe that our measure of Industrial CFOA and Industrial CFOA excluding Appliances deal-related taxes provides management and investors with useful measures to compare the capacity of our industrial operations to generate operating cash flow with the operating cash flow of other non-financial businesses and companies and as such provides useful measures to supplement the reported GAAP CFOA measure.

11

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