General Electric is looking for savings. And it does so by announcing a 50% cut in the dividend with which it rewards shareholder loyalty. The measure is extreme if you think it is the third time you do it in the 110 years listed on Wall Street. The first was coinciding with the years of the Great Depression. The second, after the last financial crisis.
The measure will enter into force in December. It will be reduced to $0.12 per share compared to the current $0.24. "We understand the importance of the decision for our shareholders and that is why we have not adopted it lightly," explains GE CEO John Flannery, who put himself in front of the industrial conglomerate in June.
The last quarterly results reflected that the company's cash flow was reduced even faster than expected, to the point that Flannery described the horrific situation. "We believe this is the right decision to align the dividend payment with the generation of cash," Justified GE's executive chairman.
The announcement was made a couple of hours before he intervened at a conference with investors to expose his plans. Flannery wants to concentrate all the operational burden on aviation, health and energy businesses. Their idea is to detach themselves from smaller business units, such as light bulbs and train locomotives.
His Predecedor, Jeff Immelt, had to carry out a profound transformation after the financial crisis. It thus detached itself from the NBCUniversal Media Division, sold the appliance business and dismantled the financial GE Capital, which became the largest of the company. The idea was to concentrate on the business that could bring more returns.
Publish Date : 13 Kasım 2017 Pazartesi 16:01
Breaking News Headlines