Fourth Quarter 2024
- Revenue growth was 2% year-over-year; Organic revenue growth*
was 2%
- Net income margin was 13.5% versus 7.7% for the prior year;
Adjusted earnings before interest and taxes (EBIT) margin* was
18.7% versus 16.1%
- Diluted earnings per share (EPS) were $1.57 versus $0.88 for
the prior year; Adjusted EPS* was $1.45 versus $1.18
- Cash flow from operating activities was $913 million versus
$1.1 billion for the prior year; Free cash flow* was $811 million
versus $956 million
Full Year 2024
- Revenue growth was 1% year-over-year; Organic revenue growth*
was 1%
- Net income margin was 10.1% versus 8.0% for the prior year;
Adjusted EBIT margin* was 16.3% versus 15.1%
- Diluted EPS was $4.34 versus $3.04 for the prior year; Adjusted
EPS* was $4.49 versus $3.93
- Cash flow from operating activities was $2.0 billion versus
$2.1 billion for the prior year; Free cash flow* was $1.6 billion
versus $1.7 billion
- Company introduces full-year 2025 financial guidance
GE HealthCare (Nasdaq: GEHC) today reported financial results
for the fourth quarter and full year ended December 31, 2024.
GE HealthCare President and CEO Peter Arduini said, “We were
pleased with the strong momentum in orders, backlog and
book-to-bill that we saw in the fourth quarter. We also continued
to deliver revenue growth driven by demand in our Advanced
Visualization Solutions and Pharmaceutical Diagnostics businesses,
with overall strength in the U.S., and robust margin expansion and
earnings growth. Customer interest in new, differentiated products
contributed to orders growth and recurring revenue in the year. We
remain committed to our precision care strategy for growth,
supported by innovation, productivity initiatives, and commercial
execution.”
Fourth quarter 2024 total company financial
performance
- Revenues of $5.3 billion increased 2% on both a reported and
Organic* basis year-over-year. Revenue growth was driven by
Advanced Visualization Solutions (AVS) and Pharmaceutical
Diagnostics (PDx), with overall strength in the U.S.
- Total company book-to-bill was 1.09 times. Total company orders
increased 6% organically year-over-year.
- Net income attributable to GE HealthCare was $720 million
versus $403 million for the prior year, and Adjusted EBIT* was $994
million versus $837 million.
- Net income margin was 13.5% versus 7.7% for the prior year, up
580 basis points (bps). Adjusted EBIT margin* was 18.7% versus
16.1%, up 260 bps as both measures saw benefits from productivity
and volume.
- Diluted EPS was $1.57 versus $0.88, up $0.69 from the prior
year. Adjusted EPS* was $1.45 versus $1.18, up $0.27 from the prior
year as both measures saw improved EBIT and lower interest
expense.
- Cash flow from operating activities was $913 million, down $137
million year-over-year. Free cash flow* was $811 million, down $145
million year-over-year.
Fourth quarter 2024 segment financial performance
(Unaudited)
Segment
($ in millions)
Imaging
Advanced
Visualization
Solutions
Patient Care
Solutions
Pharmaceutical
Diagnostics
Segment Revenues
$2,393
$1,440
$827
$646
YoY % change
—%
4%
—%
9%
YoY % Organic* change
—%
4%
—%
9%
Segment EBIT
$302
$374
$106
$212
YoY % change
19%
15%
(4)%
47%
Segment EBIT Margin
12.6%
25.9%
12.8%
32.9%
YoY change
200 bps
240 bps
(50) bps
850 bps
YoY refers to year-over-year comparison on
a recast basis
Results recast in line with move of Image
Guided Therapies from Imaging to Advanced Visualization
Solutions
Full year 2024 total company financial performance
- Revenues of $19.7 billion increased 1% on both a reported and
Organic* basis year-over-year. Revenue growth in the U.S. and in
PDx was partially offset by continued market softness in
China.
- Total company book-to-bill was 1.05 times. Total company orders
increased 3% organically year-over-year.
- Net income attributable to GE HealthCare was $2.0 billion
versus $1.6 billion for the prior year, and Adjusted EBIT* was $3.2
billion versus $3.0 billion.
- Net income margin was 10.1% versus 8.0% for the prior year, up
210 bps. Adjusted EBIT margin* was 16.3% versus 15.1%, up 120 bps
as both measures saw benefits from productivity and price.
- Diluted EPS was $4.34 versus $3.04, up $1.31 from the prior
year. Adjusted EPS* was $4.49 versus $3.93, up $0.56 from the prior
year as both measures saw improved EBIT and lower interest
expense.
- Cash flow from operating activities was $2.0 billion, down $146
million year-over-year. Free cash flow* was $1.6 billion, down $161
million year-over-year.
- Cash flow conversion, defined as cash from operating activities
divided by net income attributable to GE HealthCare, was 98% while
Free cash flow conversion* was 75%.
Growth and innovation
Mr. Arduini continued, “In 2024, we introduced approximately 40
innovations and closed more than 50 strategic enterprise deals
globally, laying a solid foundation for future growth. We started
2025 with commercial momentum announcing two strategic long-term
enterprise deals – Sutter Health in the U.S., and Nuffield Health
in the UK. These collaborative agreements help increase capacity,
expand access to quality care for patients, and drive growth for
our customers and GE HealthCare.”
Recent innovation and commercial highlights
- GE HealthCare invests $138 million in Cork, Ireland
manufacturing facility to address increasing contrast media
demand
- GE HealthCare named to 2025 Fortune World’s Most Admired
Companies™ list
- Nuffield Health and GE HealthCare announce £200 million
collaboration to install the latest AI-enabled diagnostic equipment
across UK hospital network
- Sutter Health and GE HealthCare enter strategic partnership to
benefit patients, physicians and clinicians with advanced,
AI-powered imaging
- Alfred Health becomes first in Southern Hemisphere to adopt GE
HealthCare’s Command Center software proven to optimize
operations
- GE HealthCare to acquire remaining 50% stake in Nihon
Medi-Physics (NMP), a leading radiopharmaceutical company in Japan,
from Sumitomo Chemical
- GE HealthCare highlights new solutions including AI-enabled
innovations to drive precision care at RSNA 2024
- GE HealthCare unveils Pristina Via to streamline technologist
workflow and improve patient-centered breast care
- Investigating cancer: GE HealthCare and Peter MacCallum Cancer
Centre aim to advance cancer research and help enable improved
patient outcomes with new total body PET/CT technology
- GE HealthCare announces advanced imaging innovations for OEC 3D
C-arm to help improve precision care in practice of interventional
pulmonology
- GE HealthCare receives FDA clearance for head-only SIGNA MAGNUS
3.0T MRI system
- GE HealthCare and RadNet forge collaboration to transform
imaging systems and accelerate the adoption of Artificial
Intelligence with SmartTechnology™
- GE HealthCare begins manufacturing in Wisconsin its
fastest-selling PET/CT, installs 100th system in the U.S.
2025 guidance
Today, the Company introduces 2025 full-year guidance, which
includes the estimated impact from recently implemented U.S.
tariffs on products from China.
2025 guidance is as follows:
- Organic revenue growth* of 2% to 3% year-over-year, which
reflects continued demand for our products and services as well as
a measured view of market conditions in China
- Adjusted EBIT margin* of 16.7% to 16.8%, reflecting an
expansion of approximately 40 to 50 basis points versus 2024
Adjusted EBIT margin* of 16.3%
- Adjusted effective tax rate (ETR)* in the range of 22% to
23%
- Adjusted EPS* in the range of $4.61 to $4.75, representing 3%
to 6% growth versus Adjusted EPS* of $4.49 for 2024
- Free cash flow* of at least $1.75 billion
The Company provides its outlook on a non-GAAP basis. Refer to
the Non-GAAP Financial Measures in Outlook section below for more
details.
Financial rounding
Certain columns and rows in this document may not sum due to the
use of rounded numbers. Percentages presented are calculated from
the underlying whole-dollar amounts.
Consolidated and Combined Statements of
Income
For the three months ended
December 31
(In millions, except per share
amounts)
2024
2023
Sales of products
$
3,621
$
3,597
Sales of services
1,698
1,609
Total revenues
5,319
5,206
Cost of products
2,226
2,268
Cost of services
818
782
Gross profit
2,275
2,156
Selling, general, and administrative
1,130
1,152
Research and development
344
315
Total operating expenses
1,474
1,467
Operating income
801
689
Interest and other financial charges –
net
121
131
Non-operating benefit (income) costs
(100
)
(50
)
Other (income) expense – net
(53
)
(1
)
Income from continuing operations
before income taxes
834
609
Benefit (provision) for income taxes
(96
)
(193
)
Net income from continuing
operations
737
416
Income (loss) from discontinued
operations, net of taxes
—
—
Net income
737
416
Net (income) loss attributable to
noncontrolling interests
(17
)
(13
)
Net income attributable to GE
HealthCare
720
403
Deemed preferred stock dividend of
redeemable noncontrolling interest
—
—
Net income attributable to GE
HealthCare common stockholders
$
720
$
403
Earnings per share from continuing
operations attributable to GE HealthCare common
stockholders:
Basic
$
1.58
$
0.89
Diluted
1.57
0.88
Earnings per share attributable to GE
HealthCare common stockholders:
Basic
$
1.58
$
0.89
Diluted
1.57
0.88
Weighted-average number of shares
outstanding:
Basic
457
455
Diluted
459
458
Consolidated and Combined Statements of
Income
For the years ended December
31
(In millions, except per share
amounts)
2024
2023
2022
Sales of products
$
13,075
$
13,127
$
12,044
Sales of services
6,597
6,425
6,297
Total revenues
19,672
19,552
18,341
Cost of products
8,271
8,465
7,975
Cost of services
3,196
3,165
3,187
Gross profit
8,205
7,922
7,179
Selling, general, and administrative
4,269
4,282
3,631
Research and development
1,311
1,205
1,026
Total operating expenses
5,580
5,487
4,657
Operating income
2,625
2,435
2,522
Interest and other financial charges –
net
504
542
77
Non-operating benefit (income) costs
(406
)
(382
)
(5
)
Other (income) expense – net
(55
)
(86
)
(62
)
Income from continuing operations
before income taxes
2,581
2,361
2,512
Benefit (provision) for income taxes
(531
)
(743
)
(563
)
Net income from continuing
operations
2,050
1,618
1,949
Income (loss) from discontinued
operations, net of taxes
—
(4
)
18
Net income
2,050
1,614
1,967
Net (income) loss attributable to
noncontrolling interests
(57
)
(46
)
(51
)
Net income attributable to GE
HealthCare
1,993
1,568
1,916
Deemed preferred stock dividend of
redeemable noncontrolling interest
—
(183
)
—
Net income attributable to GE
HealthCare common stockholders
$
1,993
$
1,385
$
1,916
Earnings per share from continuing
operations attributable to GE HealthCare common
stockholders:
Basic
$
4.37
$
3.06
$
4.18
Diluted
4.34
3.04
4.18
Earnings per share attributable to GE
HealthCare common stockholders:
Basic
$
4.37
$
3.05
$
4.22
Diluted
4.34
3.03
4.22
Weighted-average number of shares
outstanding:
Basic
456
455
454
Diluted
459
458
454
Consolidated Statements of Financial
Position
As of
(In millions, except share and per
share amounts)
December 31, 2024
December 31, 2023
Cash, cash equivalents, and restricted
cash
$
2,889
$
2,504
Receivables – net of allowances of $103
and $98
3,564
3,525
Due from related parties
5
32
Inventories
1,939
1,960
Contract and other deferred assets
974
1,000
All other current assets
529
389
Current assets
9,901
9,410
Property, plant, and equipment – net
2,550
2,500
Goodwill
13,136
12,936
Other intangible assets – net
1,078
1,253
Deferred income taxes
4,474
4,474
All other non-current assets
1,950
1,881
Total assets
$
33,089
$
32,454
Short-term borrowings
$
1,502
$
1,006
Accounts payable
3,022
2,947
Due to related parties
20
99
Contract liabilities
1,943
1,918
Current compensation and benefits
1,521
1,518
All other current liabilities
1,545
1,493
Current liabilities
9,553
8,981
Long-term borrowings
7,449
8,436
Non-current compensation and benefits
5,583
5,782
Deferred income taxes
56
68
All other non-current liabilities
1,796
1,877
Total liabilities
24,437
25,144
Commitments and contingencies
Redeemable noncontrolling
interests
188
165
Common stock, par value $0.01 per share,
1,000,000,000 shares authorized, 457,246,971 shares issued as of
December 31, 2024; 455,342,290 shares issued as of December 31,
2023
5
5
Treasury stock, at cost, 291,053 shares as
of December 31, 2024 and 0 shares as of December 31, 2023
(25
)
—
Additional paid-in capital
6,583
6,493
Retained earnings
3,262
1,326
Accumulated other comprehensive income
(loss) – net
(1,379
)
(691
)
Total equity attributable to GE
HealthCare
8,446
7,133
Noncontrolling interests
18
12
Total equity
8,464
7,145
Total liabilities, redeemable
noncontrolling interests, and equity
$
33,089
$
32,454
Consolidated and Combined Statements of
Cash Flows
For the years ended December
31
(In millions)
2024
2023
2022
Net income
$
2,050
$
1,614
$
1,967
Less: Income (loss) from discontinued
operations, net of taxes
—
(4
)
18
Net income from continuing
operations
$
2,050
$
1,618
$
1,949
Adjustments to reconcile Net income from
continuing operations to Cash from (used for) operating activities
– continuing operations
Depreciation of property, plant, and
equipment
268
248
228
Amortization of intangible assets
312
362
405
Gain on fair value remeasurement of
contingent consideration
(19
)
(17
)
(65
)
Net periodic postretirement benefit plan
(income) expense
(357
)
(332
)
9
Postretirement plan contributions
(332
)
(357
)
(18
)
Share-based compensation
125
114
67
Provision for income taxes
531
743
563
Cash paid during the year for income
taxes
(491
)
(474
)
(851
)
Changes in operating assets and
liabilities, excluding the effects of acquisitions:
Receivables
(178
)
(185
)
(231
)
Due from related parties
25
4
13
Inventories
(81
)
111
(402
)
Contract and other deferred assets
3
10
(222
)
Accounts payable
126
(13
)
481
Due to related parties
(61
)
(84
)
(33
)
Contract liabilities
68
26
138
Current compensation and benefits
39
153
(37
)
All other operating activities – net
(74
)
174
140
Cash from (used for) operating
activities – continuing operations
1,955
2,101
2,134
Cash flows – investing
activities
Additions to property, plant and equipment
and internal-use software
(401
)
(387
)
(310
)
Dispositions of property, plant, and
equipment
—
1
4
Purchases of businesses, net of cash
acquired
(313
)
(147
)
—
Purchases of investments
(40
)
(48
)
(59
)
All other investing activities – net
(160
)
23
(33
)
Cash from (used for) investing
activities – continuing operations
(914
)
(558
)
(398
)
Cash flows – financing
activities
Net increase (decrease) in borrowings
(maturities of 90 days or less)
—
(12
)
9
Newly issued debt, net of debt issuance
costs (maturities longer than 90 days)
995
2,006
8,198
Repayments and other reductions
(maturities longer than 90 days)
(1,418
)
(855
)
(3
)
Dividends paid to stockholders
(55
)
(41
)
—
Redemption of noncontrolling interests
—
(211
)
—
Net transfers (to) from GE
—
(1,317
)
(8,934
)
Proceeds from stock issued under employee
benefit plans
33
34
—
Taxes paid related to net share settlement
of equity awards
(93
)
(33
)
—
All other financing activities – net
(34
)
(49
)
(92
)
Cash from (used for) financing
activities – continuing operations
(573
)
(478
)
(822
)
Cash from (used for) operating activities
– discontinued operations
(4
)
—
(21
)
Effect of foreign currency rate changes on
cash, cash equivalents, and restricted cash
(77
)
(10
)
(3
)
Increase (decrease) in cash, cash
equivalents, and restricted cash
387
1,055
890
Cash, cash equivalents, and restricted
cash at beginning of year
2,506
1,451
561
Cash, cash equivalents, and restricted
cash at end of year
$
2,893
$
2,506
$
1,451
Supplemental disclosure of cash flows
information
Cash paid during the year for interest
$
(550
)
$
(570
)
$
—
Non-cash investing activities
Acquired but unpaid property, plant, and
equipment
$
143
$
140
$
136
Non-GAAP Financial Measures
The non-GAAP financial measures presented in this press release
are supplemental measures of GE HealthCare’s performance and its
liquidity that the Company believes will help investors understand
its financial condition, cash flows, and operating results, and
assess its future prospects. When read in conjunction with the
Company’s U.S. GAAP results, these non-GAAP financial measures
provide a baseline for analyzing trends in GE HealthCare’s
underlying businesses and can be used by management as one basis
for making financial, operational, and planning decisions.
Descriptions of the reported non-GAAP measures are included
below.
The Company reports Organic revenue and Organic revenue growth
rate to provide management and investors with additional
understanding and visibility into the underlying revenue trends of
the Company’s established, ongoing operations, as well as provide
insights into overall demand for its products and services. To
calculate these measures, the Company excludes the effect of
acquisitions, dispositions, and foreign currency rate
fluctuations.
The Company reports EBIT, Adjusted EBIT, Adjusted EBIT margin,
Adjusted net income, and Adjusted earnings per share to provide
management and investors with additional understanding of its
business by highlighting the results from ongoing operations and
the underlying profitability factors, on a normalized basis. To
calculate these measures the Company excludes, and reflects in the
detailed reconciliations below, the following adjustments as
applicable: Interest and other financial charges – net, Net
(income) loss attributable to noncontrolling interests,
Non-operating benefit (income) costs, Benefit (provision) for
income taxes and certain tax related adjustments, and certain
non-recurring and/or non-cash items. GE HealthCare may from time to
time consider excluding other non-recurring items to enhance
comparability between periods. Adjusted EBIT margin is calculated
by taking Adjusted EBIT divided by Total revenues for the same
period.
The Company reports Adjusted tax expense and Adjusted effective
tax rate (“Adjusted ETR”) to provide management and investors with
a better understanding of the normalized tax rate applicable to the
business and provide more consistent comparability across periods.
Adjusted tax expense excludes the income tax related to the pre-tax
income adjustments included as part of Adjusted net income and
certain income tax adjustments, such as adjustments to deferred tax
assets or liabilities. The Company may from time to time consider
excluding other non-recurring tax items to enhance comparability
between periods. Adjusted ETR is Adjusted tax expense divided by
income before income taxes less the pre-tax income adjustments
referenced above.
The Company reports Free cash flow and Free cash flow conversion
to provide management and investors with an important measure of
the ability to generate cash on a normalized basis and provide
insight into the Company’s flexibility to allocate capital. Free
cash flow is Cash from (used for) operating activities – continuing
operations including cash flows related to the additions and
dispositions of property, plant, and equipment (“PP&E”) and
additions of internal-use software. Free cash flow does not
represent residual cash flows available for discretionary
expenditures, due to the fact that the measure does not deduct the
capital required for debt repayments. Free cash flow conversion is
calculated by taking Free cash flow divided by Adjusted net
income.
Management recognizes that these non-GAAP financial measures
have limitations, including that they may be calculated differently
by other companies or may be used under different circumstances or
for different purposes. In order to compensate for the discussed
limitations, management does not consider these measures in
isolation from or as alternatives to the comparable financial
measures determined in accordance with U.S. GAAP. The detailed
reconciliations of each non-GAAP financial measure to the most
directly comparable U.S. GAAP financial measure are provided below,
and no single financial measure should be relied on to evaluate our
business.
Non-GAAP Financial Reconciliations
Organic Revenue*
Unaudited
For the three months ended
December 31
For the years ended December
31
($ in millions)
2024
2023
% change
2024
2023
% change
Imaging revenues
$
2,393
$
2,392
—
%
$
8,855
$
8,944
(1
)%
Less: Acquisitions(1)
17
—
47
—
Less: Dispositions(2)
—
—
—
—
Less: Foreign currency exchange
(7
)
—
(71
)
—
Imaging Organic revenue*
$
2,383
$
2,392
—
%
$
8,880
$
8,944
(1
)%
AVS revenues
$
1,440
$
1,382
4
%
$
5,131
$
5,094
1
%
Less: Acquisitions(1)
—
—
—
—
Less: Dispositions(2)
—
—
—
—
Less: Foreign currency exchange
(4
)
—
(25
)
—
AVS Organic revenue*
$
1,443
$
1,382
4
%
$
5,157
$
5,094
1
%
PCS revenues
$
827
$
827
—
%
$
3,125
$
3,142
(1
)%
Less: Acquisitions(1)
—
—
—
—
Less: Dispositions(2)
—
—
—
—
Less: Foreign currency exchange
(2
)
—
(6
)
—
PCS Organic revenue*
$
829
$
827
—
%
$
3,131
$
3,142
—
%
PDx revenues
$
646
$
591
9
%
$
2,508
$
2,306
9
%
Less: Acquisitions(1)
—
—
—
—
Less: Dispositions(2)
—
—
—
—
Less: Foreign currency exchange
3
—
(10
)
—
PDx Organic revenue*
$
642
$
591
9
%
$
2,518
$
2,306
9
%
Other revenues
$
13
$
14
(4
)%
$
52
$
66
(21
)%
Less: Acquisitions(1)
—
—
—
—
Less: Dispositions(2)
—
—
—
—
Less: Foreign currency exchange
—
—
—
—
Other Organic revenue*
$
13
$
14
(4
)%
$
52
$
66
(21
)%
Total revenues
$
5,319
$
5,206
2
%
$
19,672
$
19,552
1
%
Less: Acquisitions(1)
17
—
47
—
Less: Dispositions(2)
—
—
—
—
Less: Foreign currency exchange
(8
)
—
(112
)
—
Organic revenue*
$
5,310
$
5,206
2
%
$
19,737
$
19,552
1
%
(1)
Represents revenues attributable to
acquisitions from the date the Company completed the transaction
through the end of four quarters following the transaction.
(2)
Represents revenues attributable to
dispositions for the four quarters preceding the disposition
date.
Adjusted EBIT*
Unaudited
For the three months ended
December 31
For the years ended December
31
($ in millions)
2024
2023
% change
2024
2023
% change
Net income attributable to GE
HealthCare
$
720
$
403
79
%
$
1,993
$
1,568
27
%
Add: Interest and other financial charges
– net
121
131
504
542
Add: Non-operating benefit (income)
costs
(100
)
(50
)
(406
)
(382
)
Less: Benefit (provision) for income
taxes
(96
)
(193
)
(531
)
(743
)
Less: Income (loss) from discontinued
operations, net of taxes
—
—
—
(4
)
Less: Net (income) loss attributable to
noncontrolling interests
(17
)
(13
)
(57
)
(46
)
EBIT*
$
854
$
690
24
%
$
2,679
$
2,521
6
%
Add: Restructuring costs(1)
30
20
120
54
Add: Acquisition and disposition-related
charges (benefits)(2)
9
—
3
(15
)
Add: Spin-Off and separation costs(3)
68
95
251
270
Add: (Gain) loss on business and asset
dispositions(4)
—
—
—
—
Add: Amortization of acquisition-related
intangible assets
36
32
137
127
Add: Investment revaluation (gain)
loss(5)
(4
)
—
22
(1
)
Adjusted EBIT*
$
994
$
837
19
%
$
3,211
$
2,956
9
%
Net income margin
13.5
%
7.7
%
580 bps
10.1
%
8.0
%
210 bps
Adjusted EBIT margin*
18.7
%
16.1
%
260 bps
16.3
%
15.1
%
120 bps
(1)
Consists of severance, facility closures,
and other charges associated with restructuring programs.
(2)
Consists of legal, consulting, and other
transaction and integration fees, and adjustments to contingent
consideration, as well as other purchase accounting related charges
and other costs directly related to the transactions.
(3)
Costs incurred in the Spin-Off and
separation from GE, including system implementations, audit and
advisory fees, legal entity separation, Founders Grant equity
awards, separation agreements with GE, and other one-time
costs.
(4)
Consists of gains and losses resulting
from the sale of assets and investments.
(5)
Primarily relates to valuation adjustments
for equity investments.
Adjusted Net Income*
Unaudited
For the three months ended
December 31
For the years ended December
31
($ in millions)
2024
2023
% change
2024
2023
% change
Net income attributable to GE
HealthCare
$
720
$
403
79
%
$
1,993
$
1,568
27
%
Add: Non-operating benefit (income)
costs
(100
)
(50
)
(406
)
(382
)
Add: Restructuring costs(1)
30
20
120
54
Add: Acquisition and disposition-related
charges (benefits)(2)
9
—
3
(15
)
Add: Spin-Off and separation costs(3)
68
95
251
270
Add: (Gain) loss on business and asset
dispositions(4)
—
—
—
—
Add: Amortization of acquisition-related
intangible assets
36
32
137
127
Add: Investment revaluation (gain)
loss(5)
(4
)
—
22
(1
)
Add: Tax effect of reconciling
items(6)
(16
)
(21
)
(42
)
(24
)
Add: Spin-Off and other tax
adjustments(7)
(78
)
60
(17
)
196
Less: Income (loss) from discontinued
operations, net of taxes
—
—
—
(4
)
Adjusted net income*
$
666
$
539
24
%
$
2,060
$
1,797
15
%
(1)
Consists of severance, facility closures,
and other charges associated with restructuring programs.
(2)
Consists of legal, consulting, and other
transaction and integration fees, and adjustments to contingent
consideration, as well as other purchase accounting related charges
and other costs directly related to the transactions.
(3)
Costs incurred in the Spin-Off and
separation from GE, including system implementations, audit and
advisory fees, legal entity separation, Founders Grant equity
awards, separation agreements with GE, and other one-time
costs.
(4)
Consists of gains and losses resulting
from the sale of assets and investments.
(5)
Primarily relates to valuation adjustments
for equity investments.
(6)
The tax effect of reconciling items is
calculated using the statutory tax rate, taking into consideration
the nature of the items and the relevant taxing jurisdiction.
(7)
Consists of certain income tax
adjustments, including the accrual of a deferred tax liability on
the prior period earnings of certain of the Company’s foreign
subsidiaries for which the Company is no longer permanently
reinvested, the impact of adjusting deferred tax assets and
liabilities to stand-alone GE HealthCare tax rates, and the impact
of tax legislation changes. As of the third quarter of 2024 this
line additionally includes discrete tax impacts resulting from the
Spin-Off and separation from GE previously reported under Tax
effect of reconciling items.
Adjusted Earnings Per Share*
Unaudited
For the three months ended
December 31
For the years ended December
31
(In dollars, except shares outstanding
presented in millions)
2024
2023
$ change
2024
2023
$ change
Diluted earnings per share – continuing
operations
$
1.57
$
0.88
$
0.69
$
4.34
$
3.04
$
1.31
Add: Deemed preferred stock dividend of
redeemable noncontrolling interest
—
—
—
0.40
Add: Non-operating benefit (income)
costs
(0.22
)
(0.11
)
(0.88
)
(0.83
)
Add: Restructuring costs(1)
0.06
0.04
0.26
0.12
Add: Acquisition and disposition-related
charges (benefits)(2)
0.02
—
0.01
(0.03
)
Add: Spin-Off and separation costs(3)
0.15
0.21
0.55
0.59
Add: (Gain) loss on business and asset
dispositions(4)
—
—
—
—
Add: Amortization of acquisition-related
intangible assets
0.08
0.07
0.30
0.28
Add: Investment revaluation (gain)
loss(5)
(0.01
)
—
0.05
(0.00
)
Add: Tax effect of reconciling
items(6)
(0.03
)
(0.05
)
(0.09
)
(0.05
)
Add: Spin-Off and other tax
adjustments(7)
(0.17
)
0.13
(0.04
)
0.43
Adjusted earnings per share*
$
1.45
$
1.18
$
0.27
$
4.49
$
3.93
$
0.56
Diluted weighted-average shares
outstanding
459
458
459
458
(1)
Consists of severance, facility closures,
and other charges associated with restructuring programs.
(2)
Consists of legal, consulting, and other
transaction and integration fees, and adjustments to contingent
consideration, as well as other purchase accounting related charges
and other costs directly related to the transactions.
(3)
Costs incurred in the Spin-Off and
separation from GE, including system implementations, audit and
advisory fees, legal entity separation, Founders Grant equity
awards, separation agreements with GE, and other one-time
costs.
(4)
Consists of gains and losses resulting
from the sale of assets and investments.
(5)
Primarily relates to valuation adjustments
for equity investments.
(6)
The tax effect of reconciling items is
calculated using the statutory tax rate, taking into consideration
the nature of the items and the relevant taxing jurisdiction.
(7)
Consists of certain income tax
adjustments, including the accrual of a deferred tax liability on
the prior period earnings of certain of the Company’s foreign
subsidiaries for which the Company is no longer permanently
reinvested, the impact of adjusting deferred tax assets and
liabilities to stand-alone GE HealthCare tax rates, and the impact
of tax legislation changes. As of the third quarter of 2024 this
line additionally includes discrete tax impacts resulting from the
Spin-Off and separation from GE previously reported under Tax
effect of reconciling items.
Adjusted Tax Expense* and Adjusted
ETR*
Unaudited
For the three months ended
December 31
For the years ended December
31
($ in millions)
2024
2023
2024
2023
Benefit (provision) for income
taxes
$
(96
)
$
(193
)
$
(531
)
$
(743
)
Add: Tax effect of reconciling
items(1)
(16
)
(21
)
(42
)
(24
)
Add: Spin-Off and other tax
adjustments(2)
(78
)
60
(17
)
196
Adjusted tax expense*
$
(189
)
$
(154
)
$
(590
)
$
(571
)
Effective tax rate
11.5
%
31.7
%
20.6
%
31.5
%
Adjusted effective tax rate*
21.7
%
21.8
%
21.8
%
23.7
%
(1)
The tax effect of reconciling items is
calculated using the statutory tax rate, taking into consideration
the nature of the items and the relevant taxing jurisdiction.
(2)
Consists of certain income tax
adjustments, including the accrual of a deferred tax liability on
the prior period earnings of certain of the Company’s foreign
subsidiaries for which the Company is no longer permanently
reinvested, the impact of adjusting deferred tax assets and
liabilities to stand-alone GE HealthCare tax rates, and the impact
of tax legislation changes. As of the third quarter of 2024 this
line additionally includes discrete tax impacts resulting from the
Spin-Off and separation from GE previously reported under Tax
effect of reconciling items.
Free Cash Flow*
Unaudited
For the three months ended
December 31
For the years ended December
31
($ in millions)
2024
2023
% change
2024
2023
% change
Cash from (used for) operating
activities – continuing operations
$
913
$
1,050
(13
)%
$
1,955
$
2,101
(7
)%
Cash flow conversion
98
%
134
%
(36
)pts
Add: Additions to PP&E and
internal-use software
(102
)
(94
)
(401
)
(387
)
Add: Dispositions of PP&E
—
—
—
1
Free cash flow*
$
811
$
956
(15
)%
$
1,554
$
1,715
(9
)%
Free cash flow conversion*
75
%
95
%
(20
)pts
Non-GAAP Financial Measures in Outlook
GE HealthCare calculates forward-looking non-GAAP financial
measures, including Organic revenue growth, Adjusted EBIT margin,
Adjusted ETR, Adjusted EPS, and Free cash flow based on internal
forecasts that omit certain amounts that would be included in GAAP
financial measures. GE HealthCare does not provide reconciliations
of these forward-looking non-GAAP financial measures to the
respective GAAP metrics as it is unable to predict with reasonable
certainty and without unreasonable effort certain items such as the
impact of changes in currency exchange rates, impacts associated
with business acquisitions or dispositions, timing and magnitude of
restructuring activities, and revaluation of strategic investments,
amongst other items. The timing and amounts of these items are
uncertain and could have a substantial impact on GE HealthCare’s
results in accordance with GAAP.
Key Performance Indicators
Management uses the following metrics to provide a leading
indicator of current business demand from customers for products
and services.
- Organic orders growth: Rate of change period-over-period of
contractual commitments with customers to provide specified goods
or services for an agreed upon price, and excluding the effects of:
(1) recent acquisitions and dispositions with less than a full year
of comparable orders; and (2) foreign currency exchange rate
fluctuations in order to present orders on a constant currency
basis.
- Book-to-bill: Total orders divided by Total revenues within a
given financial period (e.g., quarter or FY).
Conference Call and Webcast Information
GE HealthCare will discuss its results during its live earnings
call today, February 13, 2025 at 8:30 am ET/7:30 am CT. The webcast
and accompanying slide presentation containing financial
information can be accessed by visiting the investor section of the
website at https://investor.gehealthcare.com/news-events/events. An
archived version of the webcast will be available on the website
after the call.
Forward-looking Statements
This release contains forward-looking statements. These
forward-looking statements might be identified by words, and
variations of words, such as “will,” “expect,” “may,” “would,”
“could,” “plan,” “believe,” “anticipate,” “intend,” “estimate,”
“potential,” “position,” “forecast,” “target,” “guidance,”
“outlook,” and similar expressions. These forward-looking
statements may include, but are not limited to, statements about
the Company’s business and expected financial performance,
financial condition, and results of operations, including revenue,
revenue growth, profit, taxes, earnings per share, and cash flows,
and the Company’s outlook; and the Company’s strategy, innovation,
and investments. These forward-looking statements involve risks and
uncertainties, many of which are beyond the Company’s control.
Factors that could cause the Company’s actual results to differ
materially from those described in its forward-looking statements
include, but are not limited to, operating in highly competitive
markets; global geopolitical and economic instability, including as
a result of the conflict between Ukraine and Russia, tensions in
the Middle East, and changes in trade and tariff policy; public
health crises, epidemics, and pandemics, and their effects on the
Company’s business; changes in third-party and government
reimbursement processes, rates, and contractual relationships,
including related to government shutdowns, and changes in the mix
of public and private payers; demand for the Company’s products,
services, or solutions and factors that affect that demand; the
delayed China stimulus and the ongoing anti-corruption campaign;
the Company’s ability to control increases in healthcare costs and
any subsequent effect on demand for the Company’s products,
services, or solutions; the Company’s ability to successfully
complete strategic transactions; the impacts related to the
Company’s increasing focus on and investment in cloud, edge
computing, artificial intelligence, and software offerings;
management of the Company’s supply chain and the Company’s ability
to cost-effectively secure the materials it needs to operate its
business; disruptions in the Company’s operations; the actions or
inactions of third parties with whom the Company partners and the
various collaboration, licensing, and other partnerships and
alliances the Company has with third parties; the impact of
potential information technology, cybersecurity, or data security
breaches; maintenance and protection of the Company’s intellectual
property rights, as well as maintenance of successful research and
development efforts with respect to commercially successful
products and technologies; the Company’s ability to attract and/or
retain key personnel and qualified employees; environmental,
social, and governance matters; compliance with the various legal,
regulatory, tax, privacy, and other laws to which the Company is
subject, such as the Foreign Corrupt Practices Act and similar
anti-corruption and anti-bribery laws globally, and related
changes, claims, inquiries, investigations, or actions; the impact
of potential product liability claims; the Company’s level of
indebtedness, as well as the Company’s general ability to comply
with covenants under its debt instruments, and any related effect
on its business; and the Company’s ability to operate effectively
as an independent, publicly traded company. Please also see Item
1A, “Risk Factors” of the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2024 filed with the U.S.
Securities and Exchange Commission and any updates or amendments it
makes in future filings. There may be other factors not presently
known to the Company or which it currently considers to be
immaterial that could cause the Company’s actual results to differ
materially from those projected in any forward-looking statements
the Company makes. The Company does not undertake any obligation to
update or revise its forward-looking statements except as required
by applicable law or regulation.
About GE HealthCare Technologies Inc.
GE HealthCare is a trusted partner and leading global healthcare
solutions provider, innovating medical technology, pharmaceutical
diagnostics, and integrated, cloud-first AI-enabled solutions,
services and data analytics. We aim to make hospitals and health
systems more efficient, clinicians more effective, therapies more
precise and patients healthier and happier. Serving patients and
providers for more than 125 years, GE HealthCare is advancing
personalized, connected and compassionate care, while simplifying
the patient’s journey across care pathways. Together, our Imaging,
Advanced Visualization Solutions, Patient Care Solutions and
Pharmaceutical Diagnostics businesses help improve patient care
from screening and diagnosis to therapy and monitoring. We are a
$19.7 billion business with approximately 53,000 colleagues working
to create a world where healthcare has no limits.
GE HealthCare is proud to be among 2025 Fortune World’s Most
Admired Companies™.
Follow us on LinkedIn, X, Facebook, Instagram, and Insights for
the latest news, or visit our website https://www.gehealthcare.com
for more information.
* Non-GAAP financial measure.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250213730558/en/
Investor Relations Contact: Carolynne Borders
+1-631-662-4317 carolynne.borders@gehealthcare.com
Media Contact: Jennifer Fox +1-414-530-3027
jennifer.r.fox@gehealthcare.com
GE HealthCare Technologies (NASDAQ:GEHC)
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GE HealthCare Technologies (NASDAQ:GEHC)
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