Friday, July 17, 2009

No Wonder GE Changed The Reporting Pattern.....

New equipment orders down over 40 percent........No problem with bad numbers, especially when they have to compete with a very high 2008 comparison.....But it is not transparent when after several years "celebrating" one of the most important components of the operating business in the headlines you suddenly choose to bury it in the conference call presentation.... I´m pretty sure that when there is an uptick they will once again switch back to the old pattern..... ;-)

Neue Investotionsgüteraufträge für GE mal eben über 40% eingebrochen..... Da diese aber im Verhältnis zu einem sehr starken Vorjahresquartal zu sehen sind relativiert sich dieser Absturz zum Glück um einiges..... Was mich hier am meisten stört ist das GE diese wohl wichtigste Kennziffer des operativen Geschäfts im Gegensatz zu all den Vorjahren, als noch jede winzige Veränderung in der Überschrift bejubelt worden ist, mit keinem Wort in der Ergebnisveröffentlichung erwähnt und man sich erst die Mühe machen muß die Analystenpräsentation zu durchforsten..... Denke wir wissen alle was passiert wenn die Zahlen wieder etwas erfreulicher aussehen........ ;-)

> As CNBC puts it best.... "Nothing troubling in the press release......"

> Besser als CNBC kann man es nicht formulieren.... "Nichts besorgniserregendes in der Presseveröffentlichung".......

GE Press Release / Fineprint press release.....

Highlights for the quarter included sustained strength in high-margin services where orders grew 2% and contractual services backlog reached an all-time high of $122 billion.

A highlight for the quarter was a record $8 billion in wins by GE and its two aircraft engine joint ventures at the Paris Air Show

> Nice to see how they pump up the 2% growth in services but fail to mention brutal slump in equipment orders.......

> Schon bemerkenswer wir man den 2% Anstieg im Servicesegment immerhin im Kleingedruckten findet aber den wohl historisch einmaligen Einbruch nicht einmal in der Fußnote der Presseveröffentlichung auffindbar ist...

GE Presentation ( Slide 6 )

GE 1st Quarter 2009 / Headline Press Release

Total equipment and services backlog steady at $171 billion; 1Q
Infrastructure orders totaled $19 billion, down 10%

GE 4th Quarter 2008 Headline Press Release

Infrastructure 4Q orders declined 6%; Total equipment and services backlog grew to $172 billion, up 9%

GE 3rd Quarter 2008 Headline Press Release
GE 3rd Quarter 2008 Total orders backlog of $170 billion; equipment backlog up 19%; service backlog up 22%

GE 2nd Quarter 2008 Headline Press Release

Services orders of $9.5 billion, up 19%; major equipment orders of $13.7 billion, up 4%, outpacing shipments 1.3x; total orders of $26.9 billion, up 8% Major equipment backlog of $55 billion, up 25%; customer service agreements (CSA) backlog of $113 billion, up 17%

GE 1st Quarter 2008 Headline Press Release

Total orders of $24 billion, up 8%; major equipment orders of $12 billion, up 11%; services orders of $8.3 billion, up 5% Major equipment backlog of $52 billion, up 41%; customer service agreement (CSA) backlog of $110 billion, up 16%

> The "old" style of reporting goes back at least to the the first quarter of 2006 ( see Earnings Reports 2006, 2007 )......Siemens, ABB & Alstom ( all with orders down up to 30 percent (Alstom) , all reporting the slump within the top of the first page / see links) havn´t switched to a more "favourable" reporting system.....Thank god GE´s financial arm has such a "Strong Asset Quality" ...... Some thanks to the $46 billion Temporary Liquidity Guarantee Program ( more than anybody else ) issuance some are already calling GE "Guaranteed Electric" / see also TLPG Issuance Table via Winkler......;-)

> Die "alte" jetzt unerwünschte Weise der Berichterstattung ist mindestens seit dem Jahr 2006 Standart gewesen ( sieheEarnings Reports 2006, 2007 ) .....Siemens, ABB & Alstom haben übrigens trotz ebefalls happiger Einbrüche ( bis zu 30% , bei allen auf den ersten Blick zu erkennen / siehe Links ) Ihre Methodik nicht verändert....... Zum Glück hat der Finanzarm von GE ja eine extrem "Starke Asset Qualität" ..... Und dank der 4 Mrd $ die GE unter dem TLGP Programm mit staatlicher Garantie emitieren konnte ( mehr als jeder andere ) nennen einige GE nicht ganz zu unrecht "Guaranteed Electric" / siehe auch TLPG Issuance Table via Winkler ......;-)

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Anonymous eh said...

So what kind of economy is it when a company like GE, which actually does make useful products, does poorly but GS, a bunch of money parasites, does well?

That's a rhetorical question of course -- keine Antwort benotigt oder erwartet.

1:00 AM  
Blogger jmf said...

Moin Eh,

regarding the markets i have the same feeling as in 2007.......

I´m even more pessimistic on the economy than in 2007.....

Trillions of money already spent / committed with little progress on main street....

8:50 AM  
Blogger jmf said...

What a surprise...... Read the entire piece....

Inside G.E., a Little Bit of Enron Floyd Norris

The commission evidently found three violations, two in hedge accounting and the other in an Enronesque scheme to inflate profits with fake sales.

“It was like peeling an onion,” said David P. Bergers, the director of the Boston office of the S.E.C., as one accounting issue led to another.

This all took place in January 2003, days before G.E. was to announce its annual profits for 2002, Jeff Immelt’s first full year as chief executive. Had G.E. not fudged the accounting, it would have missed its profit forecast by $200 million. Not since 1994 had G.E. failed to make the numbers.

But that sympathy vanishes when considering the accounting alchemy that G.E. used to make its numbers at the end of 2003. In a move reminiscent of Enron’s Nigerian barges deal, it “sold” some railroad locomotives to banks, with side letters and verbal promises to assure the banks they could not lose money. That enabled G.E. to book profits early and make the numbers.

“I was sometimes asked to squirrel away ‘excess earnings’ in fake accounts with made-up names, to be used when earnings were down in later months,” he said. One such account was called “Plug.”

10:01 PM  

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