A General Electric Healthcare [Physician] Investor Update

Enabling precision health PODCAST

Hi David, and all ME-P Readers and Subscribers

We’re proud to be a part of improving patient lives globally with precision health – personalizing diagnoses and treatments in a smarter and more efficient way.

In case you missed it, last week GE Healthcare’s Pharmaceutical Diagnostics business (PDx) announced the acquisition of Zionexa, a leading innovator of in-vivo oncology and neurology biomarkers that help enable more personalized healthcare.

Healthcare will scale Zionexa’s FDA-approved PET imaging agent Cerianna, which is used as an adjunct to biopsy for the detection of estrogen receptor (ER) positive lesions to help inform treatment selection for patients with recurrent or metastatic breast cancer.

This is the essence of precision health, and our continued commitment to innovation. Read more about Zionexa here.

And, as a reminder, Carolina will be participating in a fireside chat on May 12 at 12:10pm EDT during the Goldman Sachs Industrials & Materials Conference. We hope you and all interested ME-P readers and subscribers will tune in.

GE Healthcare logo

Steve Winoker

[GE Corporate]

Boston, MA

5 Responses

  1. Hi David,

    In the spirit of continuous improvement and creating a newsletter that best serves you, we would appreciate your time to provide feedback on our GE Investor Updates and the company.

    Please use the link below to share your opinion with us – it just takes a moment.

    Thanks for your feedback and continued interest in GE,



  2. Hi David,

    I hope this e-mail finds you and your family well.

    Over the past two weeks, we’ve been busy here at GE. Our senior leadership team has been “on the road” participating in virtual investor conferences and meetings. In case you missed it, Larry presented in a fireside chat at Bernstein’s 37th Annual Strategic Decisions Conference. He provided perspective on how GE’s transformation to a more focused, simpler and stronger high-tech industrial company is accelerating, offering insight from our quarterly operating reviews within each business. We also shared that the U.S. Department of Justice concluded its review of the GECAS and AerCap combination. Additionally, Carolina attended the UBS Global Industrials & Transportation Conference and the Wolfe Global Transportation & Industrials Conference, and GE Healthcare CEO Kieran Murphy participated in the Goldman Sachs Healthcare Conference.

    As we continue to strengthen GE for the future, we’ve acted opportunistically to advance our deleveraging plan. On June 8, we announced the results of our most recent debt tender, using cash on hand to repurchase $7 billion of debt, an upsize from our original expectations. Since the end of 2018, we’ve reduced gross debt by approximately $50 billion as part of our effort towards achieving our leverage target of less than 2.5x net debt to EBITDA.

    At the same time, we’re shifting more towards offense. We’re focused on organic growth first, complemented by inorganic investments to support our businesses. On June 9, we announced that Prolec GE, a 50/50 joint venture between GE and Xignux, plans to acquire SPX’s Transformer Solutions business for $645 million. The acquisition will enhance Prolec GE’s position as a key power and distribution transformers player providing customers with a wider choice of products and an enhanced next-generation portfolio in the Americas. We expect the transaction to close by the end of 2021.

    Finally, I’ll leave you with some words from Larry at the Bernstein conference last week… “I can be excited about the momentum I saw across the businesses here over the last five weeks, but we know there’s a lot more to do… Over time, I think we are going to create a lot of value, and have that resonate both with customers and with investors.”

    Thank you for your continued interest in GE,



  3. Hi David,

    I hope your summer is off to a good start. In case you missed it, I wanted to share two important leadership changes and several other developments at GE from the last few weeks. We announced the appointment of Peter Arduini as president and CEO of GE Healthcare, effective January 3, 2022, who will succeed Kieran Murphy. We also announced the appointment of Jan Kjaersgaard, who will succeed John Lavelle as CEO of our Offshore Wind business. I’m excited to welcome Pete and Jan to the GE team.

    As for our other businesses, GE Aviation CEO John Slattery recently presented at virtual investor meetings, where he shared key business highlights including recent commercial accomplishments and technology advancements like the launch of the CFM RISE program. You can see a copy of John’s presentation here.

    We remain focused on leading the energy transition, where gas has an important role to play. Today, the 1.4GW Track 4A natural gas-fired plant in Malaysia, which is powered by 9HA.02 turbines, has been named POWER Magazine’s plant of the year. Looking to the future, GE Power CEO Scott Strazik delivered a keynote speech at Reuters’ Global Energy Transition event, discussing how the next decade for GE must be one of action – driving decarbonization for all energy use sectors, starting with power generation. GE Gas Power’s Emergent Technologies Director for Decarbonization Jeff Goldmeer presented at BofA’s Hydrogen Conference on different strategies for decarbonization of the power sector, highlighting the recent memorandum of understanding between GE and IHI Corporation to research the potential use of ammonia as a power generation fuel. The companies will examine possible innovative approaches to using ammonia, which is carbon-free and easier to transport than other options, and develop a roadmap across Asia exploring the potential use of ammonia to lower CO2 emissions in both new and existing gas turbines.

    Finally, you may recall that GE previously announced a 1-for-8 reverse stock split that shareholders approved back in May. We recently announced that GE common stock will begin trading on a split-adjusted basis on August 2, 2021. You can find additional information on GE’s reverse stock split on our Investor Relations website.

    Thank you for your continued interest in GE.


  4. Key highlights on GE’s financial performance this quarter:

    Total orders $18.3B, +33%; organic orders +30%

    Total revenues (GAAP) $18.3B, +9%; Industrial organic revenues* $16.9B, +7%

    Industrial profit margin (GAAP) of (1.3)%, +440 bps; adjusted Industrial profit margin* 5.3%, +940 bps, +1,000 bps organically*

    Continuing EPS (GAAP) of $(0.07), +$0.08; adjusted EPS* $0.05, +$0.19

    GE Industrial CFOA (GAAP) $(2.0)B, $(0.4)B; GE Industrial free cash flow* $0.4B, +$2.0B, excluding discontinued factoring programs*

    Increasing 2021 outlook for Industrial free cash flow* range from $2.5B–$4.5B to $3.5B–$5.0B. Outlook for Industrial organic revenue growth*,
    margin expansion*, and adjusted EPS* remains unchanged.



  5. Hi David,

    I am delighted to share that today GE announced an agreement to acquire a leader in advanced surgical visualization, BK Medical, for $1.45 billion cash consideration. This acquisition will expand our current ultrasound platform in one of our best performing businesses. You can read more about the deal here.

    BK Medical’s intra-operative ultrasound technology helps clinicians see inside the patient’s body in real time during surgery, gives them visual information to guide them during procedures and help them make critical decisions. Bringing this fast-growing area together with the pre- and post-operative capabilities in GE Healthcare’s $3 billion Ultrasound business creates a compelling customer offering across the full continuum of care—from diagnostics through surgical and therapeutic interventions.

    BK Medical is delivering double-digit revenue growth and margins have improved significantly. We expect these positive trends to continue under GE’s ownership and GE Healthcare’s Ultrasound management team. This transaction is expected to create value by further strengthening BK Medical, including through significant synergies with the benefit of GE’s technology and commercial scale. This transaction enables BK Medical’s Active Imaging platform to reach new customers and new markets around the world, and the combination of GE Healthcare’s diagnostic imaging technology with BK’s ability to enable decision-making and surgical visualization in intervention will allow better decision-making and patient outcomes throughout the care continuum.

    Given BK Medical’s strong growth and solid returns plus synergies, we expect returns to deliver accretion at very attractive levels, including high-single-digit ROIC by year 5, demonstrating the value-creating power of this business combination.

    As Kieran Murphy, President and CEO of GE Healthcare, said this morning, “Ultrasound today forms an integral part of many care pathways, and BK Medical is a strategic and highly complementary addition to our growing and profitable Ultrasound business. This transaction helps GE Healthcare continue to expand beyond diagnostics into surgical and therapeutic interventions, simplifying decision-making for clinicians and equipping them with greater insights to deliver faster, more personalized care for their patients—representing another step toward delivering precision health.”



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