GE GE Aerospace

By Thomas Gryta 

General Electric Co. expects cash flow to be negative in the first quarter, typically the slowest period of the year, but the conglomerate isn't changing its outlook for 2021.

Speaking at an investor conference Tuesday, Chief Executive Officer Larry Culp said the first-quarter performance would still be better than a year ago when the company burned through $2.2 billion in cash for the period. He played down the first-quarter results so far, saying they were "nothing more than what we see typically at the start of a new year."

GE shares, recently up 10 cents to $11.83, are up 78% in the past six months as the company has posted improving results.

The Boston company booked $4.4 billion of cash flow in the fourth quarter, resulting in cash flow coming in positive by about $600 million for the full year. GE projects 2021 cash flow of $2.5 billion to $4.5 billion.

Mr. Culp has pledged to make GE's business more consistent throughout the year rather than depending on strong fourth-quarter results. Last month, he said the timing of projects and orders can be difficult to predict. The company wasn't sure if the deals that helped boost results at the end of 2020 would close in time or if they would land in the first quarter instead, he said.

GE has improved its cash generation by cutting overhead costs and jobs in its aviation unit while streamlining its power business. The pandemic continues to pressure GE's jet-engine business, its largest division, but the company continues to work on putting past problems behind it.

Mr. Culp became the first CEO from outside of GE in late 2018 after deep problems in its power unit and financial-services arm led the company to slash its dividend and sell off businesses.

The company, which also makes healthcare machines and power-generating equipment, cut head count by 15% in 2020 to 174,000 employees, it disclosed last week, and it lost about a quarter of its workers in 2019. GE had 82 U.S. manufacturing plants at the end of 2020, down from 162 at the end of 2018.

Write to Thomas Gryta at thomas.gryta@wsj.com

(END) Dow Jones Newswires

February 16, 2021 15:30 ET (20:30 GMT)

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