GENERAL ELECTRIC CO - 10-Q Quarterly Report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)
þ	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2004 OR
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ____

Commission file number 1-35 GENERAL ELECTRIC COMPANY (Exact name of registrant as specified in its charter)

New York		14-0689340

(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

3135 Easton Turnpike, Fairfield, CT		06828-0001

(Address of principal executive offices)		(Zip Code)

(Registrant's telephone number, including area code) (203) 373-2211 _______________________________________________ (Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes þ No ¨.

There were 10,212,648,000 shares of common stock with a par value of $0.06 per share outstanding at March 31, 2004.

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Table of Contents

General Electric Company

Part I – Financial Information		Page

Item 1. Financial Statements
Condensed Statement of Earnings		3
Condensed Statement of Financial Position		4
Condensed Statement of Cash Flows		5
Summary of Operating Segments		6
Notes to Condensed, Consolidated Financial Statements		7
Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition		17
Item 4. Controls and Procedures		29

Part II – Other Information

Item 2. Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities		29
Item 6. Exhibits and Reports on Form 8-K		30
Signatures		31

Forward-Looking Statements

This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "will" or words of similar meaning and include, but are not limited to, statements about the expected future business and financial performance of GE. Forward-looking statements are based on management's current expectations and assumptions, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Actual outcomes and results may differ materially from these expectations and assumptions due to changes in global political, economic, business, competitive, market, regulatory and other factors. We undertake no obligation to publicly update or review any forward-looking information, whether as a result of new information, future developments or otherwise.

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Table of Contents

Part I. Financial Information

Item 1. Financial Statements

Condensed Statement of Earnings
General Electric Company and consolidated affiliates

	First quarter ended March 31 (Unaudited)

	Consolidated						GE						Financial Services (GECS)

(In millions; per-share amounts in dollars)	2004			2003			2004			2003			2004			2003

Sales of goods	$	11,764		$	11,117		$	11,255		$	10,635		$	576		$	487
Sales of services		5,346			5,050			5,425			5,123			–			–
Other income		137			55			139			76			–			–
Earnings of GECS before accounting change		–			–			1,845			1,670			–			–
GECS revenues from services (note 5)		15,778			14,234			–			–			16,042			14,380
Consolidated, liquidating securitization entities (note 3)		325			–			–			–			325			–

Total revenues		33,350			30,456			18,664			17,504			16,943			14,867

Cost of goods sold		9,112			8,092			8,628			7,660			551			437
Cost of services sold		3,506			3,189			3,585			3,262			–			–
Interest and other financial charges		2,646			2,596			239			208			2,507			2,463
Insurance losses and policyholder and annuity benefits		3,588			3,985			–			–			3,624			3,985
Provision for losses on financing receivables		955			760			–			–			955			760
Other costs and expenses		9,050			7,515			2,468			2,413			6,712			5,194
Minority interest in net earnings of consolidated affiliates		69			70			37			32			32			38
Consolidated, liquidating securitization entities (note 3)		202			–			–			–			202			–

Total costs and expenses		29,128			26,207			14,957			13,575			14,583			12,877

Earnings before income taxes and accounting change		4,222			4,249			3,707			3,929			2,360			1,990
Provision for income taxes		(982	)		(1,035	)		(467	)		(715	)		(515	)		(320	)

Earnings before accounting change		3,240			3,214			3,240			3,214			1,845			1,670
Cumulative effect of accounting change (note 4)		–			(215	)		–			(215	)		–			–

Net earnings	$	3,240		$	2,999		$	3,240		$	2,999		$	1,845		$	1,670

Per-share amounts before accounting change
Diluted earnings per share	$	0.32		$	0.32
Basic earnings per share	$	0.32		$	0.32

Per-share amounts after accounting change
Diluted earnings per share	$	0.32		$	0.30
Basic earnings per share	$	0.32		$	0.30

Dividends declared per share	$	0.20		$	0.19


See notes to condensed, consolidated financial statements. Consolidating information is shown for "GE" and "Financial Services (GECS)." Transactions between GE and GECS have been eliminated from the "Consolidated" columns.

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Table of Contents

Condensed Statement of Financial Position
General Electric Company and consolidated affiliates

		Consolidated						GE						Financial Services (GECS)

(In millions)		3/31/04			12/31/03			3/31/04			12/31/03			3/31/04			12/31/03

Cash and equivalents		$	13,371		$	12,664		$	5,784		$	1,670		$	7,839		$	11,273
Investment securities			124,905			120,724			317			380			124,588			120,344
Current receivables			9,952			10,732			10,089			10,973			–			–
Inventories			9,007			8,752			8,794			8,555			213			197
Financing receivables – net			232,678			226,029			–			–			232,678			226,029
Other GECS receivables			36,400			36,598			–			–			39,586			38,954
Property, plant and equipment (including equipment leased to others) – net			57,776			53,382			14,284			14,566			43,492			38,816
Investment in GECS			–			–			48,471			45,308			–			–
Intangible assets – net			57,083			55,025			30,233			30,204			26,850			24,821
Consolidated, liquidating securitization entities (note 3)			23,706			26,463			–			–			23,706			26,463
All other assets			97,228			97,114			30,198			30,448			68,116			67,629

Total assets		$	662,106		$	647,483		$	148,170		$	142,104		$	567,068		$	554,526

Short-term borrowings		$	143,212		$	134,917		$	2,305		$	2,555		$	141,438		$	132,988
Accounts payable, principally trade accounts			19,794			19,824			8,542			8,753			14,100			13,440
Progress collections and price adjustments accrued			3,993			4,433			3,993			4,433			–			–
Other GE current liabilities			16,925			17,356			16,967			17,356			–			–
Long-term borrowings			169,472			170,004			8,324			8,388			162,055			162,540
Insurance liabilities, reserves and annuity benefits			137,633			136,264			–			–			138,039			136,264
Consolidated, liquidating securitization entities (note 3)			22,865			25,721			–			–			22,865			25,721
All other liabilities			40,768			41,357			18,720			18,449			21,975			22,828
Deferred income taxes			14,667			12,647			1,724			1,911			12,943			10,736

Total liabilities			569,329			562,523			60,575			61,845			513,415			504,517

Minority interest in equity of consolidated affiliates			6,291			5,780			1,109			1,079			5,182			4,701
Accumulated gains (losses) – net (a)
Investment securities			3,287			1,620			3,287			1,620			3,524			1,823
Currency translation adjustments			2,915			2,987			2,915			2,987			2,587			2,639
Derivatives qualifying as hedges			(1,797	)		(1,792	)		(1,797	)		(1,792	)		(1,751	)		(1,727	)
Common stock (10,212,648,000 and 10,063,120,000 shares outstanding at March 31, 2004 and December 31, 2003, respectively)			669			669			669			669			1			1
Other capital			18,545			17,497			18,545			17,497			12,341			12,268
Retained earnings			84,014			82,796			84,014			82,796			31,769			30,304
Less common stock held in treasury			(21,147	)		(24,597	)		(21,147	)		(24,597	)		–			–

Total shareowners' equity			86,486			79,180			86,486			79,180			48,471			45,308

Total liabilities and equity		$	662,106		$	647,483		$	148,170		$	142,104		$	567,068		$	554,526


(a)	The sum of accumulated gains (losses) on investment securities, currency translation adjustments and derivatives qualifying as hedges constitutes "Accumulated nonowner changes other than earnings," and was $4,405 million and $2,815 million at March 31, 2004 and December 31, 2003, respectively.

See notes to condensed, consolidated financial statements. Consolidating information is shown for "GE" and "Financial Services (GECS)." March 31, 2004, information is unaudited. Transactions between GE and GECS have been eliminated from the "Consolidated" columns.

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Table of Contents

Condensed Statement of Cash Flows
General Electric Company and consolidated affiliates

	First quarter ended March 31 (Unaudited)

	Consolidated				GE				Financial Services (GECS)

(In millions)	2004		2003		2004		2003		2004		2003

Cash flows – operating activities
Net earnings	$	3,240	$	2,999	$	3,240	$	2,999	$	1,845	$	1,670
Adjustments to reconcile net earnings to cash provided from operating activities
Cumulative effect of accounting change		–		215		–		215		–		–
Depreciation and amortization of property, plant and equipment		1,997		1,665		557		554