GE's Jeff Immelt: "We've Definitely Seen A Slowdown In The Fourth Quarter"

Tyler Durden's picture




 

In what is likely the fist major under the radar profit warning of the current quarter, GE chief, and Obama Job Tzar, Jeff Immelt warned during GE's annual outlook meeting held earlier in Manhattan that the "economic uncertainty" in the current quarter has resulted in an investment "pause" that has resulted in a slowdown of corporate sales. Put into numbers, GE is now calling for about 8% growth this year, from a 10% forecast barely two months ago. Read: Q4 sales, and thus earnings, are set to be a major disappointment. And while no superstorms were blamed in this particular sales warning, the fiscal cliff did feature prominently. As the WSJ reports, "[Immelt] said ongoing jitters over the so-called "fiscal cliff" of tax increases and government spending cuts contributed to the trend." Then again, it is just as likely that the tapped out US consumer, whose savings rate is tumbling, whose real disposable income is now declining on a year over year basis, and whose real wage growth is decidedly negative, would be tapped out even if Obama and Boehner were not playing constant cat and mouse. But whatever the reason for the slowdown may be, one thing is certain: "Clearly, there has been an investment pause in certain industries," Mr. Immelt said. "We've definitely seen a slowdown in the fourth quarter." Bring on the spin brigade.

From the WSJ:

GE is planning for industrial organic revenue growth—which excludes the impact of acquisitions—of 2% to 6% in 2013.

 

Mr. Immelt was upbeat overall, saying GE is on track for solid earnings growth, and he also stood by previous targets for expansions in industrial profit margins this year and next. He noted the company has a sizable cash position and is growing in key markets.

 

Mr. Immelt said the U.S. conglomerate aims for a long-term earnings contribution from GE Capital of around 30% as it continues its efforts to shrink the finance unit. GE Capital contributed about 32% of GE's earnings in 2011, and about 35% through the first nine months of 2012.

 

"Our strategy really hasn't changed," said Mr. Immelt as he opened the annual investor meeting.

 

...

 

Mr. Immelt said Monday that order flow from China was improving, while Europe and the health-care sector remained headwinds.

More can be found in the complete GE investor presentation attached below, which summarizes the key tailwinds and headwinds as follows:

Full presentation below (link):

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Tue, 12/18/2012 - 00:15 | 3073780 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The world will be a different place.  America will need to change (it has been changing slowly already let's see how slowly it will continue to change).  It will need to change from being a place where obiese people can survive easily to a place where people will need to take some time out of their life for sitting on a couch to walking a few miles for a bite of food.

Tue, 12/18/2012 - 00:08 | 3073715 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Because "like goods" have now been introduced in the vamped "chained" CPI we will see inflation of proportions only remembered by boomers coming into the workforce in the '70s. 

Of course this time will be like the last time and in ten years UE will be like it was when Reagen was POTUS (damn him, right boomers?) UE will be below 5% so the economy will be fine and the said boomers will be collecting 4% on their IRAs that are averaging 7% growth a year (7% nominal is good right?) so they will be able to eat dinner downtown everynight, give an inheritence away so that they get the best head stone available, and travel a few times a year to cold places to see family.

Tue, 12/18/2012 - 10:41 | 3074534 madcows
madcows's picture

The current "Real" inflation rate is already at 1970's level.  My calcs are at 11.4%.  ShadowStats are around the same.  The highest rate in the 70's was 11.2% in 1979.  I'd suggest you track all your expenditures to measure real inflation, instead of taking it on faith from the Government.  They have many reasons to be dishonest with you.

Mon, 12/17/2012 - 23:24 | 3073671 hairball48
hairball48's picture

Immelt is just a fucking liar like all the rest of them.

Mon, 12/17/2012 - 23:52 | 3073727 MiltonFriedmans...
MiltonFriedmansNightmare's picture

If he admits to a slowdown, it likely means the world economy is grinding to a complete standstill. Prepare for the warnings season accordingly.

Tue, 12/18/2012 - 00:11 | 3073772 optimator
optimator's picture

His Yacht should be named "Jacks Mistake".

Tue, 12/18/2012 - 00:28 | 3073817 Cabreado
Cabreado's picture

Ignore the words of the Sociopath.

The true health of an organization might best be measured by the relative psychosis of its sycophants and enablers.

GE too.

Tue, 12/18/2012 - 10:45 | 3074545 Jim B
Jim B's picture

Criminal Sociopath.... Just saying

Tue, 12/18/2012 - 02:04 | 3073960 AynRandFan
AynRandFan's picture

Ben Cssselman and Phil Izzo of the WSJ are reporting today (12-17-2012) that everything will get better from here.

Tue, 12/18/2012 - 07:15 | 3074162 Vince Clortho
Vince Clortho's picture

Will GE receive more bailout cash to meet its profit projections?  That is the new business model in America.

Tue, 12/18/2012 - 09:43 | 3074347 d edwards
d edwards's picture

Either that, or run businesses Chinese style, ie dictatorships.

Tue, 12/18/2012 - 10:36 | 3074514 madcows
madcows's picture

I think he's angling for more tax breaks.  I don't trust Kleptocrats

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