supplemental information Organic Revenue Growth for Energy (In millions) 2006 2005 % change Energy revenues as reported $19,133 $16,525 Less the effects of Acquisitions, business dispositions (other than dispositions of businesses acquired for investment) and currency exchange rates 72 98 Energy revenues excluding the effects of acquisitions, business dispositions (other than dispositions of businesses acquired for invest- ment) and currency exchange rates (organic revenues) $19,061 $16,427 16% GE Operating Profit Excluding Pension 2006 2005 2004 (In millions) Revenues Operating Profit Profit % Revenues Operating Profit Profit % Revenues Operating Profit Profit % GE revenues and operating profi t as reported $101,798 $14,585 14.3% $92,194 $13,316 14.4% $83,290 $11,384 13.7% Less pension costs (877) (329) 124 GE revenues, operating profi t and operating profi t % excluding the effects of pension costs $101,798 $15,462 15.2% $92,194 $13,645 14.8% $83,290 $11,260 13.5% Growth in Industrial CFOA (In millions) 2006 2005 % change Cash from GE’s operating activities as reported Less dividends from GECS $24,627 9,847 $21,609 7,816 14% Cash from GE’s operating activities excluding dividends from GECS (Industrial CFOA) $14,780 $13,793 7% Average Total Shareowners’ Equity, Excluding Effects of Discontinued Operations(a) December 31 (In millions) 2006 2005 2004 2003 2002 Average total shareowners’ equity (b) $109,873 $111,706 $95,711 $71,342 $59,154 Less the effects of Cumulative earnings from discontinued operations 2,094 2,985 925 1,007 Average net investment in discontinued operations 4,050 5,066 Average total shareowners’ equity, excluding effects of discontinued operations(a) $105,823 $104,546 $92,726 $70,417 $58,147 (a) Used for computing return on average shareowners’ equity and return on average total capital invested shown on page 67. (b) On an annual basis, calculated using a fi ve-point average. 110 ge 2006 annual report
supplemental information U.S. GAAP requires earnings of discontinued operations to be displayed separately in the Statement of Earnings. Accordingly, the numerators used in our calculations of returns on average shareowners’ equity and average total capital invested presented in Selected Financial Data on page 67 exclude those earnings (losses). Further, we believe that it is appropriate to exclude from the denominators, specifically the average total shareowners’ equity component, the cumulative effect of those earnings for each of the years for which related discontinued operations were presented, as well as our average net investment in discontinued operations since the second half of 2005. Had we disposed of these operations before mid-2005, proceeds would have been applied to reduce parent-supported debt at GE Capital however, since parent-supported debt at GE Capital was retired in the fi rst half of 2005, we have assumed that any proceeds after that time would have been distributed to shareowners by means of share repurchases, thus reducing average total shareowners’ equity. Definitions indicating how the above-named ratios are calcu- lated using average total shareowners’ equity, excluding effects of discontinued operations, can be found in the Glossary. GE Growth from 2001 to 2006, Excluding Pensions (In millions) 2006 2001 GE earnings from continuing operations as reported $20,666 $12,620 Less after-tax pension costs (570) 1,362 GE earnings from continuing operations excluding after-tax pension costs $21,236 $11,258 GE Tax Rate, Excluding GECS Earnings (In millions) 2006 2005 2004 GE earnings from continuing operations before income taxes $23,246 $21,411 $18,574 Less GECS earnings from continuing operations 10,495 9,527 8,169 Total $12,751 $11,884 $10,405 GE provision for income taxes $ 2,580 $ 2,750 $ 1,973 GE effective tax rate, excluding GECS earnings 20.2% 23.1% 19.0% We believe that meaningful analysis of our fi nancial performance requires an understanding of the factors underlying that perfor- mance and our judgments about the likelihood that particular factors will repeat. In some cases, short-term patterns and long-term trends may be obscured by large factors or events. For example, events or trends in a particular segment may be so significant as to obscure patterns and trends of our industrial or financial services businesses in total. For this reason, we believe that investors may find it useful to see our 2006 revenue growth without the effect of acquisitions, dispositions and currency exchange rates, and without the effects of the 2006 and 2004 Olympics broadcasts, the May 2005 SFAS 133 correction and the GECS commercial paper interest rate swap adjustment, which if included would overshadow trends in ongoing revenues. Similarly, we believe that investors would find it useful to compare our industrial operating profit and consolidated earnings from con- tinuing operations excluding the effects of pension costs which can vary from period to period and our 2006 operating cash fl ow against our 2005 operating cash flow without the effects of GECS dividends which can also vary from period to period. Delinquency Rates on Certain Financing Receivables Delinquency rates on managed Commercial Finance equipment loans and leases and managed GE Money fi nancing receivables follow. COMMERCIAL FINANCE December 31 2006 2005 2004 Managed 1.22% 1.31% 1.40% Off-book 0.52 0.76 0.90 On-book 1.42 1.53 1.58 GE MONEY December 31 2006 2005 2004 Managed 5.05% 5.08% 4.85% Off-book 5.49 5.28 5.09 On-book 5.01 5.07 4.84 We believe that delinquency rates on managed fi nancing receivables provide a useful perspective on our on and off-book portfolio quality and are key indicators of fi nancial performance. ge 2006 annual report 111
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