GE 2015 Annual Report Download - page 60

MD&A CONSOLIDATED RESULTS
32 GE 2015 FORM 10-K
GE CAPITAL
CAPITAL SEGMENT AND DISCONTINUED OPERATIONS
GE Capital results include continuing operations, which are reported in the Capital segment (see Segment discussion), and
discontinued operations (see Discontinued Operations section and Note 2).
THE GE CAPITAL EXIT PLAN
SALES AGREEMENTS
During 2015, GE signed agreements to sell approximately $157 billion of ENI, excluding liquidity (as originally reported at December 31,
2014), of which approximately $98 billion, $34 billion and $25 billion related to our Commercial Lending and Leasing (CLL), Real Estate
and Consumer businesses, respectively.
Of the signed agreements, sales representing approximately $104 billion of ENI, excluding liquidity (as originally reported at December
31, 2014) have closed, including approximately $46 billion, $34 billion and $24 billion related to our CLL, Real Estate and Consumer
businesses, respectively. Real Estate transactions that have closed included the majority of GE Capital’s Real Estate debt and equity
portfolio sold to funds managed by The Blackstone Group (which, in turn, sold a portion of this portfolio to Wells Fargo & Company). In
connection with The Blackstone Group transactions, GE Capital provided $3.2 billion of seller financing to The Blackstone Group, which
GE Capital intends to syndicate by the end of 2016. As of December 31, 2015, GE Capital has collected or sold approximately $2.3
billion of this seller financing.
AFTER-TAX CHARGES RELATED TO THE GE CAPITAL EXIT PLAN
In connection with the April 10, 2015 announcement of the GE Capital Exit Plan, the Company estimated that it would incur
approximately $23 billion in after-tax charges through 2016, approximately $6 billion of which were expected to result in future net cash
expenditures. These charges relate to: business dispositions, including goodwill allocations (approximately $13 billion), tax expense
related to expected repatriation of foreign earnings and write-off of deferred tax assets (approximately $7 billion), and restructuring and
other charges (approximately $3 billion).
During 2015, GE recorded $22.0 billion of after-tax charges related to the GE Capital Exit Plan, of which $7.7 billion was recorded in
continuing operations and $14.3 billion was recorded in discontinued operations. A description of after-tax charges for 2015 is provided
below.
x $9.5 billion of net loss primarily related to the completed and planned dispositions of the Real Estate business, the Consumer
business and most of the CLL business, which was recorded in discontinued operations under the caption “Earnings (loss)
from discontinued operations, net of taxes” in the Statement of Earnings.
x $6.5 billion of tax expense related to expected repatriation of foreign earnings and write-off of deferred tax assets, of which
$6.3 billion was recorded in continuing operations and reported in GE Capital’s Corporate component and $0.1 billion was
recorded in discontinued operations in our Consumer business under the caption “Earnings (loss) from discontinued
operations, net of taxes” in the Statement of Earnings.
x $4.7 billion of net asset impairments due to shortened hold periods, of which $3.2 billion was recorded in discontinued
operations in our Consumer business and $1.5 billion was recorded in discontinued operations in our CLL business, all under
the caption “Earnings (loss) from discontinued operations, net of taxes” in the Statement of Earnings.
x $0.8 billion impairment charge of a coal-fired power plant in the U.S. related to a decision in the fourth quarter to exit the
investment over time recorded in continuing operations in GE Capital’s Corporate component under the caption “Other costs
and expenses” in the Statement of Earnings.
x $0.6 billion of restructuring and other charges, of which $0.5 billion was recorded in continuing operations in GE Capital’s
Corporate component under the captions “Selling, general and administrative expenses” and “Other costs and expenses” in
the Statement of Earnings and less than $0.1 billion was recorded in discontinued operations under the caption “Earnings
(loss) from discontinued operations, net of taxes” in the Statement of Earnings.
32 GE 2015 FORM 10-K