GE Continues Rebuilding a Fortress Balance Sheet
Three years ago, General Electric's (NYSE: GE) balance sheet was in tatters. Meanwhile, net income and cash flow were plummeting due to a combination of weak market conditions and bad management. In short, the storied industrial conglomerate was facing financial ruin.
However, since the beginning of 2018, GE has acted aggressively to fix its balance sheet, mainly by selling assets. These efforts have paid off handsomely. Despite the negative impact of the COVID-19 pandemic, General Electric is poised to exit 2020 with a very strong balance sheet.
At the end of 2017, General Electric's core industrial business had $81.6 billion in debt, offset by just $19.4 billion of cash and investments. Including its GE Capital finance business, the company had gross borrowings of $134.6 billion. GE also sported a massive $28.7 billion pension deficit. Adding to its woes, the company took a multibillion-dollar charge at the end of 2017 to increase its insurance reserves. It ended the year with $38.1 billion of insurance and related liabilities on its books.
Source Fool.com
