GE Aerospace announces $15bn share buyback ahead of spin-off
By Benjamin Chiou
Date: Thursday 07 Mar 2024
(Sharecast News) - US conglomerate General Electric shares were on the rise on Thursday after GE Aerospace unveiled plans for a $15bn share buyback ahead of its launch as a standalone company next month.
The news came as GE Aerospace - the unit that will be left after GE spins off its energy business GE Vernova into a separate entity on 2 April - hosted an investor day in New York, outlining plans to achieve $10bn in operating profit by 2028, up from an estimated $6-6.5bn this year.
"As a global leader in propulsion, services, and systems, we are delivering exceptional value for our customers with unrivaled technology and service, and the highest levels of operational reliability," said GE chair and chief executive Henry Lawrence Culp Jr.
"With FLIGHT DECK, our proprietary lean operating model, as the foundation, we will define flight for today, tomorrow, and the future," he said.
For 2024 and 2025, the company expects adjusted revenues to grow by low double-digit percentage rates, before normalising to a high single-digit compound annual growth rate between 2025 and 2028.
GE Aerospace said the $15bn share repurchase is part of its policy to return 70-75% of available funds to shareholders through dividends and buybacks, at an initial dividend payout ratio of 30% of net income.
GE first announced plans to separate the company into three brands in November 2021, with the spin-off of GE HealthCare taking place in January 2023.
The stock was up 2.7% at $163.74 by 1016 in New York.
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