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GE Oil & Gas Financial Analysis

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I need a Financial Analysis on GE Oil&Gas. Identify internal strengths and weaknesses.

For example, does GE have good or bad cash flow, liquidity, and debt position? How does that compare with their competitors? What capital & cash flow would be required for my strategy?

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GE Oil & Gas strengths begin with its large revenues. According to GE Energy fact sheet the sales revenue of GE Oil & Gas was $37.1 billion in 2009. It also has employee strength of more than 82,000. GE Oil & Gas has improved its hydraulic fracturing and its presence in the services field by investing billions of dollars in the shale oil assets. GE Oil & Gas has further been strengthened with the opening of a laboratory in Oklahoma that will study ways to improve the oil-extraction process. It will study horizontal drilling and fracking. Its strength has been increased by bolstering its shale oil portfolio. During the last few years GE has invested more than $15 billion in oil and gas. At GE, GE Oil & Gas is the fastest growing division which shows a 57% increase in revenue since 2009 (1). The total revenue of GE Oil & Gas was $15.24 billion in 2012 which had increased from $13.61 billion in 2011. The 2012 profit of GE Oil & Gas has increased to $1.92 billion growing from $1.66 billion in the previous year (2). These metrics indicate that not only are the sales revenues of GE Oil & Gas increasing but the profits of the GE Oil & Gas division are also increasing. GE Oil & Gas has given 16% year over year increase in revenue for 2012. These metrics show the financial strength and positive performance of GE Oil & Gas. Other strengths of GE Oil & Gas are that it has enhanced its Bantam Island subsea manufacturing facility by investing $15 million (3). Strength of GE Oil & Gas is that it has invested $282 million in Brazil opening six facilities. These facilities will increase the production of equipment used for onshore and offshore projects in Brazil (4). Brazil is an important growth market for GE Oil & Gas and it is expected that investments will reach $320 billion by 2021 (5).

GE Oil & Gas financial weaknesses stem from the fact that it is a division of GE. The net income of GE has declined from $17.4 billion in 2008 to $ 13.6 billion in 2012. The decline in ...

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