GE expects tough 'reset' year in 2019, then a rebound; shares climb

REUTERS: General Electric Co said on Thursday that 2019 would be a difficult,"reset" year, but promised a better performance in terms of earnings from 2020 and beyond, sending shares higher.

Chief Executive Officer Larry Culp said GE will invest US$2.5 billion in restructuring that will yield returns after 2019.The company did not note any effect on its jet engine division from the global grounding of Boeing Co 737 MAX aircraft, following the crash of an Ethiopian Airlines flight on Sunday that cost 157 lives.The LEAP engine that powers all of Boeing's 737 MAX planes is produced by CFM International, a joint venture of GE and Safran SA of France.

GE expects free cash flow for its power business to remain negative in 2020 before turning positive in 2021. Investors are looking closely at GE's cash and earnings after the company lost nearly US$23 billion last year.

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