General Electric (GE - Get Report) posted stronger-than-expected first quarter earnings Tuesday, and confirmed its full-year guidance, as new CEO Larry Culp moves towards steadying the financial fortunes of the former Dow component.
General Electric said continuing earnings for the three months ending in March came in at 11 cents per share, while adjusted GAAP earnings were pegged at 14 cents per share, down 2 cents from the same period last year and five cents ahead of the Street consensus forecast. Group revenues, GE said, slipped 4.8% to $27.286 billion and beat analysts' forecasts of $27.05 billion.
GE also confirmed its full-year financial guidance, which includes negative industrial flow generation of $1.2 billion, a figure Culp says will turn positive in 2020 and continue to accelerate after that.
"I am encouraged by the improvements we are making inside GE. This is one quarter in what will be a multi-year transformation, and 2019 remains a reset year for us," said CEO Larry Culp. "We continue to focus on reducing leverage and improving the underlying performance of our businesses to create sustainable, long-term value for our customers, employees, and shareholders."
General Electric shares rose 4.7% to $10.19 at midday Tuesday.
Culp told investors in February that 2019 would be a "year of change" for the group, and pledged to focus on both developing GE's critical power business while reducing debt through asset sales and spin-offs.
Culp said debt reduction and boosting its dividend to a level "in line with our peers" would be the company's near-term focus, adding the payout, which was slashed to just one penny last year amid a series of profit warnings, asset write-downs and broader investor skepticism, allowed GE to retain around $4 billion in cash.
Culp, in only a few months at helm of the struggling group, has raised more than $21 billion through the sale of GE's biopharma unit to his former company, Danaher Corp. (DHR - Get Report) , pledged to shed the group's healthcare division and reduced its stake in Baker Hughes (BHGE - Get Report) .
GE said revenues at the Houston-based oil services division rose 4% to $5.6 billion as orders rose 9% to 5.7 billion.
GE is currently rated BBB+ by Standard & Poor's, three notches above junk status, but it unlikely to be lifted into the single-A range thanks in part to its struggling power business.