General Electric (NYSE:GE) told shareholders on Thursday that the wounded behemoth expects 2019 earnings to be below what analysts anticipated as it continues to be plagued by problems in its power business.
The company founded by Thomas Edison said it expects 2019 adjusted earnings between 50 cents and 60 cents a share, below the 70 cents a share Wall Street expected.
This was the first outlook from GE Chairman and CEO Larry Culp, who was appointed in October.
"We have work to do in 2019, but we expect 2020 and 2021 performance to be significantly better."
GE revised the company's reported 2018 earnings and revenue lower. On an adjusted basis, GE lowered its 2018 earnings to 53 cents a share, down from 65 cents a share. On a GAAP (non-adjusted) basis, GE revised total 2018 revenue to $105.2 billion from $113.6 billion.
With the company's power business expected to continue to struggle, Culp is working on turning around GE's fortunes. Culp says he remains focused on improving the company's cash generation, as well as cutting costs.
GE's industrial free cash flow was $4.5 billion in 2018. Free cash flow is a financial term defined as money left over after a company pays for operating expenses and capital spending and is often used as a gauge of efficiency. GE's industrial free cash flow is a key measure watched by investors.
Shares in GE started Thursday trading up 23 cents, or 2.3%, to $10.25
