General Electric (NYSE:GE) has reported strong fourth-quarter and fiscal 2022 results as it concentrates its focus on its aviation business.
The company, which completed the separation of its healthcare business in early January, finished 2022 “strong, delivering revenue growth, margin expansion, and better cash generation,” GE chairman and CEO Lawrence Culp said in a statement.
“2022 marked the beginning of a new era for GE,” Culp added. “We successfully launched GE HealthCare, delivered strong financial performance, made significant operational progress, and continued our steadfast commitment to our customers.”
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For the fourth quarter, GE said orders grew significantly across all segments, up 18% to $25.4 billion organically. Revenue rose 11% to $21 billion organically, led by GE Aerospace, Power, and GE HealthCare as those businesses saw solid market demand, price realization, and improved delivery.
The company’s adjusted operating profit margin expanded 290 basis points to 10.3% organically, with particular strength in Power. Revenue and profit growth resulted in over 50% growth in adjusted earnings per share (EPS) to $1.24.
GE also generated $4.3 billion of free cash flow in the quarter, driven primarily by strong earnings and the company’s focus on improving working capital.
For the full year to December 31, orders were up 7% to $83 billion, with 22% organic growth in GE Aerospace and 13% growth at Power. Notably, total services orders were up 12%, supporting profitable growth next year, the company said.
Revenue grew 6% to $73.6 billion organically, driven largely by GE Aerospace, up 23% organically. Its adjusted profit margin expanded by 160 basis points to 7.9% organically for the year, with robust services growth.
The company has guided investors to expect organic revenue growth in the high single digits for 2023, with adjusted earnings per share of $1.60 to $2 and free cash flow of $3.4 billion to $4.2 billion.
Contact the author at stephen.gunnion@proactiveinvestors.com