Report: Ethiopia’s garment workers are world’s lowest paid

People working on an assembly line at Huajian shoe factory in Dukem, Ethiopia, on April 19, 2012. Ethiopian garment factory workers are now, on average, the lowest paid in any major garment-producing company worldwide, a new report says. In comparison, Chinese garment workers earn $340 a month, those in Kenya earn $207 and those in Bangladesh earn $95. The new report is based on a visit earlier this year to the flagship Hawassa Industrial Park that opened in June 2017 in southern Ethiopia and cu


People working on an assembly line at Huajian shoe factory in Dukem, Ethiopia, on April 19, 2012. Ethiopian garment factory workers are now, on average, the lowest paid in any major garment-producing company worldwide, a new report says. In comparison, Chinese garment workers earn $340 a month, those in Kenya earn $207 and those in Bangladesh earn $95. The new report is based on a visit earlier this year to the flagship Hawassa Industrial Park that opened in June 2017 in southern Ethiopia and cu
Report: Ethiopia’s garment workers are world’s lowest paid Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-07
Keywords: news, cnbc, companies, report, worlds, set, ethiopia, workers, industrial, lowest, park, ethiopias, earn, month, paid, garment


Report: Ethiopia's garment workers are world's lowest paid

People working on an assembly line at Huajian shoe factory in Dukem, Ethiopia, on April 19, 2012.

Ethiopian garment factory workers are now, on average, the lowest paid in any major garment-producing company worldwide, a new report says.

The report by the New York University Stern Center for Business and Human Rights comes as Ethiopia, one of Africa’s fastest-growing economies, pursues a bold economic experiment by inviting the global garment industry to set up shop in its mushrooming industrial parks.

“The government’s eagerness to attract foreign investment led it to promote the lowest base wage in any garment-producing country — now set at the equivalent of $26 a month,” according to the authors of the report, Paul M. Barrett and Dorothée Baumann-Pauly.

In comparison, Chinese garment workers earn $340 a month, those in Kenya earn $207 and those in Bangladesh earn $95.

Drawn by the newly built industrial parks and a range of financial incentives, manufacturers for some of the world’s best-known brands — among them H&M, Gap, and PVH — employ tens of thousands of Ethiopian workers in a sector the government predicts will one day have billions of dollars in sales.

The new report is based on a visit earlier this year to the flagship Hawassa Industrial Park that opened in June 2017 in southern Ethiopia and currently employs 25,000 people. Ethiopian leaders often show off the industrial park, 140 miles (225 kilometers) south of Addis Ababa, to visiting foreign dignitaries.


Company: cnbc, Activity: cnbc, Date: 2019-05-07
Keywords: news, cnbc, companies, report, worlds, set, ethiopia, workers, industrial, lowest, park, ethiopias, earn, month, paid, garment


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South Korea’s Asiana Airlines to receive $1.4 billion from creditors

South Korean creditors plan to provide 1.6 trillion won ($1.4 billion) in financial support to debt-laden Asiana Airlines, the country’s finance minister said on Tuesday, alleviating liquidity problems after a bruising month. Asiana Airlines’ biggest shareholder earlier this month said it would sell its entire stake worth 564 billion won as of Monday’s closing share price, in response to creditors’ rejection of an earlier request for support of 500 billion won. Creditors have now offered to buy


South Korean creditors plan to provide 1.6 trillion won ($1.4 billion) in financial support to debt-laden Asiana Airlines, the country’s finance minister said on Tuesday, alleviating liquidity problems after a bruising month. Asiana Airlines’ biggest shareholder earlier this month said it would sell its entire stake worth 564 billion won as of Monday’s closing share price, in response to creditors’ rejection of an earlier request for support of 500 billion won. Creditors have now offered to buy
South Korea’s Asiana Airlines to receive $1.4 billion from creditors Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-04-23  Authors: seongjoon cho, bloomberg, getty images
Keywords: news, cnbc, companies, receive, industrial, airlines, asiana, 14, koreas, sell, worth, south, won, creditors, billion, kumho, air


South Korea's Asiana Airlines to receive $1.4 billion from creditors

South Korean creditors plan to provide 1.6 trillion won ($1.4 billion) in financial support to debt-laden Asiana Airlines, the country’s finance minister said on Tuesday, alleviating liquidity problems after a bruising month.

Asiana Airlines’ biggest shareholder earlier this month said it would sell its entire stake worth 564 billion won as of Monday’s closing share price, in response to creditors’ rejection of an earlier request for support of 500 billion won.

Creditors have now offered to buy Asiana Airlines’ perpetual bonds worth 500 billion won and set a credit limit of 800 billion won, among other conditions, said Minister of Economy and Finance Hong Nam-ki.

Speaking at a meeting, Hong also said creditors wanted top shareholder Kumho Industrial Co Ltd to sell its stake within this year.

State-funded Korea Development Bank, the lead creditor of Asiana Airlines — the country’s second-biggest carrier after Korean Air Lines — declined to comment.

A spokesman for the parent group of both Asiana and Kumho Industrial said it will “do its utmost” to sell Asiana Airlines, adding that it expects to sign a preliminary deal with creditors later on Tuesday.

Shares of Asiana Airlines and budget affiliate Air Busan, like those of across the industry, have been falling since crude oil prices reached six-month highs.

On Tuesday, Asiana Airlines fell 4.6 percent, whereas Air Busan lost 5.8 percent. Kumho Industrial fell 3.6 percent.

In March, auditors raised doubts about Asiana’s financial statements, after which the airline reported steeper losses and bigger debts, triggering warnings of credit-rating downgrades. Co-Chief Executive Park Sam-koo resigned to take responsibility.


Company: cnbc, Activity: cnbc, Date: 2019-04-23  Authors: seongjoon cho, bloomberg, getty images
Keywords: news, cnbc, companies, receive, industrial, airlines, asiana, 14, koreas, sell, worth, south, won, creditors, billion, kumho, air


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Economy could be weaker than expected, and the reason is manufacturing

Total industrial production declined by 0.1% in March, after rising 0.1% in February. Natixis economist Joseph LaVorgna said the Federal Reserve’s industrial production index correlates very closely to GDP growth, and the correlation between its quarterly annualized changes and real GDP growth is around 70%. LaVorgna is forecasting 1% for first quarter GDP growth, reported April 26, but he said it could be even closer to flat. Goldman Sachs economists said they were upping their first quarter tr


Total industrial production declined by 0.1% in March, after rising 0.1% in February. Natixis economist Joseph LaVorgna said the Federal Reserve’s industrial production index correlates very closely to GDP growth, and the correlation between its quarterly annualized changes and real GDP growth is around 70%. LaVorgna is forecasting 1% for first quarter GDP growth, reported April 26, but he said it could be even closer to flat. Goldman Sachs economists said they were upping their first quarter tr
Economy could be weaker than expected, and the reason is manufacturing Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-04-16  Authors: patti domm, source
Keywords: news, cnbc, companies, economist, expected, reason, weaker, economy, industrial, growth, gdp, lavorgna, economists, inventory, production, manufacturing, quarter


Economy could be weaker than expected, and the reason is manufacturing

Industrial production declined in the first three months of the year for the first time since the third quarter of 2017, and that could signal economic growth is weaker than some economists are forecasting.

Total industrial production declined by 0.1% in March, after rising 0.1% in February. For the quarter, it slipped at a 0.3% annual rate, after a gain of 4% in the fourth quarter of 2018.

Natixis economist Joseph LaVorgna said the Federal Reserve’s industrial production index correlates very closely to GDP growth, and the correlation between its quarterly annualized changes and real GDP growth is around 70%.

“It correlates to GDP pretty well, and I did notice within the data that there was a big inventory build within the fourth quarter,” said LaVorgna, the firm’s chief economist for the Americas.

“It seems if there was a time that industrial production and GDP would match up well it would be at time when there’s a relatively large inventory build,” he said. “When you unwind inventory, you would expect to see production slow.”

LaVorgna is forecasting 1% for first quarter GDP growth, reported April 26, but he said it could be even closer to flat. He added economists’ consensus forecast is 2%.

“To me the production data suggests there’s may more downside risk to Q1 than people currently believe,” he said.

Goldman Sachs economists said they were upping their first quarter tracking forecast to 1.7% because they had been expecting even weaker industrial production.

“We still expect real GDP output in the first quarter to hit 1.5%, but much of the increase will come from a temporary build-up of inventories rather than factories producing more goods,” noted Chris Rupkey, chief economist at MUFG.

LaVorgna expects 2.5% growth for the second quarter.

Wells Fargo Securities economists said earlier there could be a 0.2 percentage point hit to second-quarter growth, due to

Boeing’s decision to halt deliveries and scale back production of the 737 MAX family of aircraft.

“While the economy should perform better [in the second] quarter, relative to last, because of a strong seasonal bias for such outperformance, it remains unclear that GDP growth will be robust. Consumer spending has been modest at best, and there has been little evidence pointing to an upswing in capital spending. Consequently, we are less sanguine on the economy’s first-half economic performance compared to our peers,” LaVorgna noted.


Company: cnbc, Activity: cnbc, Date: 2019-04-16  Authors: patti domm, source
Keywords: news, cnbc, companies, economist, expected, reason, weaker, economy, industrial, growth, gdp, lavorgna, economists, inventory, production, manufacturing, quarter


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Europe’s economy is experiencing a crisis of confidence

An array of data has pointed to worrying signs of a slowdown in the euro zone with further signs last week that Europe’s largest economy Germany is weakening. Euro zone industrial production data for February is due Friday and economists polled by Reuters expect it to have declined by 0.6 percent month-on-month. Data released by German statistics office Destatis Friday showed that German industrial production (excluding energy and construction) fell 0.2 percent in February on the previous month.


An array of data has pointed to worrying signs of a slowdown in the euro zone with further signs last week that Europe’s largest economy Germany is weakening. Euro zone industrial production data for February is due Friday and economists polled by Reuters expect it to have declined by 0.6 percent month-on-month. Data released by German statistics office Destatis Friday showed that German industrial production (excluding energy and construction) fell 0.2 percent in February on the previous month.
Europe’s economy is experiencing a crisis of confidence Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-04-09  Authors: holly ellyatt, christopher furlong, getty images news, getty images, dan kitwood
Keywords: news, cnbc, companies, germany, signs, manufacturing, experiencing, production, data, industrial, zone, confidence, crisis, economy, showed, german, europes, released


Europe's economy is experiencing a crisis of confidence

An array of data has pointed to worrying signs of a slowdown in the euro zone with further signs last week that Europe’s largest economy Germany is weakening. And more bad news could be on the way.

Euro zone industrial production data for February is due Friday and economists polled by Reuters expect it to have declined by 0.6 percent month-on-month.

“National data for February that have already been released show declines in total industrial production of 0.4 percent in Germany, 1.1 percent in Spain and 0.1 percent in Ireland,” Jack Allen, senior Europe economist at Capital Economics said in a note Friday, after what he said was “another set of weak economic data in the euro-zone” with specific reference to Germany.

Data released by German statistics office Destatis Friday showed that German industrial production (excluding energy and construction) fell 0.2 percent in February on the previous month. The day before, data showed new manufacturing orders fell 4.2 percent from January with declines seen both at a domestic and foreign level.

The data came after IHS Markit’s purchasing manager’s index (PMI) released on April 1 showed the manufacturing sector figure in Germany for March had fallen to an 80-month low (of 44.1). A level under 50 indicates contraction.


Company: cnbc, Activity: cnbc, Date: 2019-04-09  Authors: holly ellyatt, christopher furlong, getty images news, getty images, dan kitwood
Keywords: news, cnbc, companies, germany, signs, manufacturing, experiencing, production, data, industrial, zone, confidence, crisis, economy, showed, german, europes, released


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Dow starts week with 80-point decline led by Boeing

Stocks fell on Monday as Wall Street digested strong gains from the previous week and looked ahead to the start of the corporate earnings season. Shares of Boeing and General Electric led the decline. Boeing dropped more than 4% after Bank of America Merrill Lynch cut its rating on the aerospace giant to neutral from buy. The bank said it expects production of the 737 Max jet to be delayed by six to nine months. This follows a deadly plane crash from last month that involved a 737 Max plane.


Stocks fell on Monday as Wall Street digested strong gains from the previous week and looked ahead to the start of the corporate earnings season. Shares of Boeing and General Electric led the decline. Boeing dropped more than 4% after Bank of America Merrill Lynch cut its rating on the aerospace giant to neutral from buy. The bank said it expects production of the 737 Max jet to be delayed by six to nine months. This follows a deadly plane crash from last month that involved a 737 Max plane.
Dow starts week with 80-point decline led by Boeing Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-04-08  Authors: fred imbert, spencer platt, getty images
Keywords: news, cnbc, companies, boeing, max, bank, 737, decline, dow, fell, winning, newton, 80point, industrial, starts, led, week


Dow starts week with 80-point decline led by Boeing

Stocks fell on Monday as Wall Street digested strong gains from the previous week and looked ahead to the start of the corporate earnings season.

The Dow Jones Industrial Average declined by 84 points. The S&P 500 eked out a 0.1% gain at 2,895.75, in danger of snapping a seven-day winning streak, as the industrial sector dipped 0.4%. The Nasdaq Composite ended Monday 0.2% higher.

“Equity trends remain steadfastly bullish but are now getting stretched, and have arrived at near-term areas where resistance could set in,” said Mark Newton, managing member at Newton Advisors. “Momentum is nearing overbought territory yet again after one of the best quarters in over 20 years time, while the groups that have led this rally, namely technology, consumer discretionary and industrials, are now up to levels near prior highs which are thought to be important from a price perspective.”

Shares of Boeing and General Electric led the decline. Boeing dropped more than 4% after Bank of America Merrill Lynch cut its rating on the aerospace giant to neutral from buy. The bank said it expects production of the 737 Max jet to be delayed by six to nine months. This follows a deadly plane crash from last month that involved a 737 Max plane.

GE, meanwhile, fell more than 5% after J.P. Morgan downgraded the stock, noting: “We believe many investors are underestimating the severity of the challenges and underlying risks at GE, while overestimating the value of small positives.”


Company: cnbc, Activity: cnbc, Date: 2019-04-08  Authors: fred imbert, spencer platt, getty images
Keywords: news, cnbc, companies, boeing, max, bank, 737, decline, dow, fell, winning, newton, 80point, industrial, starts, led, week


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China’s industrial output grew at the slowest rate in 17 years

China’s industrial output grew 5.3 percent in the first two months of this year, the slowest pace of expansion in 17 years, official data showed on Thursday. But fixed-asset investment rose 6.1 percent, while retail sales rose 8.2 percent, both more than expected. Analysts polled by Reuters had predicted industrial output growth would slow to 5.5 percent in January-February from December’s 5.7 percent gain. Investment growth had been expected to edge up slightly to 6.0 percent, from 5.9 percent


China’s industrial output grew 5.3 percent in the first two months of this year, the slowest pace of expansion in 17 years, official data showed on Thursday. But fixed-asset investment rose 6.1 percent, while retail sales rose 8.2 percent, both more than expected. Analysts polled by Reuters had predicted industrial output growth would slow to 5.5 percent in January-February from December’s 5.7 percent gain. Investment growth had been expected to edge up slightly to 6.0 percent, from 5.9 percent
China’s industrial output grew at the slowest rate in 17 years Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-03-14  Authors: afp, getty images
Keywords: news, cnbc, companies, grew, investment, slowest, rose, expected, rate, sales, data, growth, rise, output, industrial, chinas, 17


China's industrial output grew at the slowest rate in 17 years

China’s industrial output grew 5.3 percent in the first two months of this year, the slowest pace of expansion in 17 years, official data showed on Thursday.

But fixed-asset investment rose 6.1 percent, while retail sales rose 8.2 percent, both more than expected.

Analysts polled by Reuters had predicted industrial output growth would slow to 5.5 percent in January-February from December’s 5.7 percent gain.

Investment growth had been expected to edge up slightly to 6.0 percent, from 5.9 percent in 2018.

Private-sector fixed-asset investment, which accounts for about 60 percent of overall investment in China, rose 7.5 percent in the same period, compared with an 8.7 percent rise in 2018, data from the National Bureau of Statistics showed.

Retail sales had been expected to rise 8.1 percent, easing marginally from December’s 8.2 percent pace.

China combines January and February activity data in an attempt to smooth distortions created by the long Lunar New Year holidays early each year, but some analysts say a clearer picture of the economy may not emerge first-quarter data is released in April.

China’s economic growth cooled to 6.6 percent last year, the slowest in nearly three decades, and it is expected to lose more momentum in the next few months.

Beijing is rolling out more support measures to avert a sharper slowdown, but many analysts do not expect activity to convincingly bottom out until summer.


Company: cnbc, Activity: cnbc, Date: 2019-03-14  Authors: afp, getty images
Keywords: news, cnbc, companies, grew, investment, slowest, rose, expected, rate, sales, data, growth, rise, output, industrial, chinas, 17


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Asia markets: Brexit deal, pound and China economic data in focus

Asia Pacific markets traded mixed on Thursday after data showed growth in China’s industrial output fell. Overnight, British lawmakers rejected the idea of leaving the European Union without a Brexit deal in place. The Nikkei 225 in Japan gave up its gains to finish flat at 21,287.02 while the Topix index fell 0.24 percent to 1,588.29. Data on Thursday showed China’s industrial output growth fell to a 17-year low in the first two months of the year, according to Reuters. The on-shore yuan traded


Asia Pacific markets traded mixed on Thursday after data showed growth in China’s industrial output fell. Overnight, British lawmakers rejected the idea of leaving the European Union without a Brexit deal in place. The Nikkei 225 in Japan gave up its gains to finish flat at 21,287.02 while the Topix index fell 0.24 percent to 1,588.29. Data on Thursday showed China’s industrial output growth fell to a 17-year low in the first two months of the year, according to Reuters. The on-shore yuan traded
Asia markets: Brexit deal, pound and China economic data in focus Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-03-14  Authors: saheli roy choudhury, toshifumi kitamura, afp, getty images
Keywords: news, cnbc, companies, markets, fell, economic, china, asia, showed, midpoint, data, growth, brexit, focus, deal, traded, pound, output, industrial, chinas, index, yuan


Asia markets: Brexit deal, pound and China economic data in focus

Asia Pacific markets traded mixed on Thursday after data showed growth in China’s industrial output fell. Overnight, British lawmakers rejected the idea of leaving the European Union without a Brexit deal in place.

The Nikkei 225 in Japan gave up its gains to finish flat at 21,287.02 while the Topix index fell 0.24 percent to 1,588.29.

In South Korea, the Kospi wavered between gains and losses to close up 0.34 percent at 2,155.68. Hong Kong’s Hang Seng Index was down 0.22 percent in afternoon trade.

Chinese mainland shares withdrew as the Shanghai composite fell 1.2 percent to 2,990.68 while the Shenzhen composite tumbled 2.311 percent.

Data on Thursday showed China’s industrial output growth fell to a 17-year low in the first two months of the year, according to Reuters. That further pointed to an economic slowdown in the world’s second-largest economy. But investments picked up pace as the government fast-tracked more road and rail projects, the news agency added.

Beijing has already pledged hundreds of billions of dollars in tax cuts and infrastructure spending to support the flagging economy.

The on-shore yuan traded at 6.7134 to the dollar at 2:44 p.m. HK/SIN after the People’s Bank of China set the day’s yuan midpoint at 6.7009. China’s central bank allows the currency exchange rate to rise or fall 2 percent from the midpoint rate.

Australia’s benchmark ASX 200 closed up 0.3 percent at 6,179.60.


Company: cnbc, Activity: cnbc, Date: 2019-03-14  Authors: saheli roy choudhury, toshifumi kitamura, afp, getty images
Keywords: news, cnbc, companies, markets, fell, economic, china, asia, showed, midpoint, data, growth, brexit, focus, deal, traded, pound, output, industrial, chinas, index, yuan


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GE will be transparent about challenges in its turnaround plan, CEO Larry Culp says

General Electric will be open about its struggles and the goals it expects to achieve in the company’s turnaround plan, CEO Larry Culp told CNBC Thursday. Culp, who became head of the company last September, said he studied the company for years and the top priority is to strengthen its balance sheet. “We want to strengthen the balance sheet and set our businesses up to play and win,” Culp said. “We’ve been very clear about our intent to reduce both the leverage on our industrial balance sheet a


General Electric will be open about its struggles and the goals it expects to achieve in the company’s turnaround plan, CEO Larry Culp told CNBC Thursday. Culp, who became head of the company last September, said he studied the company for years and the top priority is to strengthen its balance sheet. “We want to strengthen the balance sheet and set our businesses up to play and win,” Culp said. “We’ve been very clear about our intent to reduce both the leverage on our industrial balance sheet a
GE will be transparent about challenges in its turnaround plan, CEO Larry Culp says Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-03-14  Authors: tyler clifford
Keywords: news, cnbc, companies, ceo, transparent, strengthen, larry, culp, industrial, ge, balance, turnaround, challenges, company, billion, leverage, gonna, sheet, plan


GE will be transparent about challenges in its turnaround plan, CEO Larry Culp says

General Electric will be open about its struggles and the goals it expects to achieve in the company’s turnaround plan, CEO Larry Culp told CNBC Thursday.

“I think what we’re gonna try to do, frankly, is to share with people in as transparent a way as we possibly can, what those issues are … and the plan that we have,” he said in a sit-down interview with “Mad Money’s” Jim Cramer. “But it will take– time. And we don’t wanna sugarcoat this.”

The industrial conglomerate, which once donned the title of America’s most valuable company, has faced debt and management problems for some time. Culp, who became head of the company last September, said he studied the company for years and the top priority is to strengthen its balance sheet.

GE has made moves to sell off $25 billion worth of assets in GE Capital.

“We want to strengthen the balance sheet and set our businesses up to play and win,” Culp said. “We’ve been very clear about our intent to reduce both the leverage on our industrial balance sheet and at GE Capital.”

The chief said his company will have access to “the better part of $40 billion of proceeds” after Danaher’s $21.4 billion acquisition of GE’s biopharmaceutical business goes through. Culp also said he anticipates monetizing GE’s stake in Baker Hughes and other deals.

“There’s a lot of capital there that we’re gonna be able to put to use to bring down the leverage on the industrial balance sheet,” he said. “Will it work on the capital side in a similar fashion? We have $10 billion of dispositions planned this year to continue to bring the leverage down.”


Company: cnbc, Activity: cnbc, Date: 2019-03-14  Authors: tyler clifford
Keywords: news, cnbc, companies, ceo, transparent, strengthen, larry, culp, industrial, ge, balance, turnaround, challenges, company, billion, leverage, gonna, sheet, plan


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General Electric shares plummet—Jim Cramer and other experts react to the drop

General Electric shares continued to plummet Wednesday after the company said this week that its industrial unit would be cash flow negative for 2019. The stock took another hit after renowned GE analyst Stephen Tusa doubled down on his scathing call on the industrial giant. Shares of GE fell more than 8 percent in early Wednesday trading before regaining some ground. All we wanted to figure out was how bad it really was versus how bad it was. And I don’t really care if it was 50 megaton or 70 m


General Electric shares continued to plummet Wednesday after the company said this week that its industrial unit would be cash flow negative for 2019. The stock took another hit after renowned GE analyst Stephen Tusa doubled down on his scathing call on the industrial giant. Shares of GE fell more than 8 percent in early Wednesday trading before regaining some ground. All we wanted to figure out was how bad it really was versus how bad it was. And I don’t really care if it was 50 megaton or 70 m
General Electric shares plummet—Jim Cramer and other experts react to the drop Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-03-06  Authors: lizzy gurdus, michael nagle, bloomberg, getty images, nicolas asfouri, afp, luke sharrett, kcna, thomas barwick getty images, source
Keywords: news, cnbc, companies, stock, shares, really, plummetjim, drop, think, unit, electric, bad, cramer, experts, ge, general, culps, power, industrial, react, weve


General Electric shares plummet—Jim Cramer and other experts react to the drop

General Electric shares continued to plummet Wednesday after the company said this week that its industrial unit would be cash flow negative for 2019. The stock took another hit after renowned GE analyst Stephen Tusa doubled down on his scathing call on the industrial giant.

Tusa, a well-known J.P. Morgan research analyst with a strong track record on GE, wrote in a note to investors that his $6 price target for the stock “looks generous” now, calling CEO Larry Culp’s warnings about 2019 and GE’s struggling power unit “worse than even we expected.” He also said the company’s prized aviation finance business is “already in liquidation mode.”

In another note Wednesday, Tusa reiterated those calls, arguing that as long as Wall Street continues to say GE’s power unit isn’t that bad, “we don’t think the stock can bottom.”

Shares of GE fell more than 8 percent in early Wednesday trading before regaining some ground. Here’s what three experts think of the drop:

•CNBC’s Jim Cramer, host of “Mad Money,” was flabbergasted, saying on “Squawk on the Street” that Culp’s announcements felt like someone dropping a bomb on his head: “I went out with a group of portfolio managers last night. All we wanted to figure out was how bad it really was versus how bad it was. […] I mean, come on. You dropped a bomb on my head. And I don’t really care if it was 50 megaton or 70 megaton, but it was really sobering.”

•Tim Seymour, chief investment officer of Seymour Asset Management, said on “Fast Money” that he had more confidence in Culp’s long-term vision: “I think things are in a very different place, and I think Larry Culp is giving people some sense of confidence that, while it doesn’t turn around overnight, we see the pathway to, call it normalcy, on the fiscal side, not cutting these power deals that are lost leaders for the sake of cutting deals.”

•Nicholas Heymann, a William Blair & Co. analyst who covers GE, also harbored some hope for the struggling industrial giant, telling “Squawk Box” that while one-time charges and costs tied to the power business would continue to weigh on GE, the next few years will likely see improvement: “We’ve got organic growth, [a] smaller company because we’ve been divesting assets, we’ve got margins improving, there’s operating cash flow from continuing [operations], and then you’ve got all these legacy issues. And then [some of] those legacy issues will still … be there in 2020, but they’ll come down, and this rig’ll start rolling.”


Company: cnbc, Activity: cnbc, Date: 2019-03-06  Authors: lizzy gurdus, michael nagle, bloomberg, getty images, nicolas asfouri, afp, luke sharrett, kcna, thomas barwick getty images, source
Keywords: news, cnbc, companies, stock, shares, really, plummetjim, drop, think, unit, electric, bad, cramer, experts, ge, general, culps, power, industrial, react, weve


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GE shares tumble as CEO Culp says cash flow will be negative in 2019, power unit to struggle more

General Electric CEO Larry Culp said at a J.P. Morgan conference on Tuesday that the company’s industrial free cash flow “in 2019 will be negative.” The CEO was speaking with J.P. Morgan analyst Stephen Tusa at the firm’s aviation, transportation and industrials conference in New York City. Free cash flow is a financial term defined as money left over after a company pays for operating expenses and capital spending and is often used as a gauge of efficiency. GE’s industrial free cash flow is a k


General Electric CEO Larry Culp said at a J.P. Morgan conference on Tuesday that the company’s industrial free cash flow “in 2019 will be negative.” The CEO was speaking with J.P. Morgan analyst Stephen Tusa at the firm’s aviation, transportation and industrials conference in New York City. Free cash flow is a financial term defined as money left over after a company pays for operating expenses and capital spending and is often used as a gauge of efficiency. GE’s industrial free cash flow is a k
GE shares tumble as CEO Culp says cash flow will be negative in 2019, power unit to struggle more Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-03-05  Authors: michael sheetz
Keywords: news, cnbc, companies, shares, cash, culp, ceo, industrial, tumble, tusa, struggle, negative, free, morgan, flow, ges, ge, jp, unit, power


GE shares tumble as CEO Culp says cash flow will be negative in 2019, power unit to struggle more

General Electric CEO Larry Culp said at a J.P. Morgan conference on Tuesday that the company’s industrial free cash flow “in 2019 will be negative.”

GE shares closed down 4.7 percent at $9.89 after Culp’s comment. The CEO was speaking with J.P. Morgan analyst Stephen Tusa at the firm’s aviation, transportation and industrials conference in New York City.

Free cash flow is a financial term defined as money left over after a company pays for operating expenses and capital spending and is often used as a gauge of efficiency. GE’s industrial free cash flow is a key measure watched by investors.

GE generated $4.5 billion in industrial free cash flow last year. Culp is working on turning around GE’s fortunes as he focuses on improving the company’s cash generation, as well as cutting costs.

“If we’re going from $4.5 billion in 2018 to what I’m framing as negative territory in 2019 … it’s really a combination of operational pressure, power … renewables, and then the non-operational pressures that I’m calling ‘policy,'” Culp said.

Tusa is widely followed on Wall Street for his work covering GE. Ahead of his meeting with Culp, the J.P. Morgan analyst warned investors that GE’s prized aviation financing and leasing business is “already in liquidation mode” and has weakening earnings that are “masked by gains.”

“You’ve got a commitment from me and the senior team to continue to improve our disclosures. Full stop,” Culp told Tusa. “We highlight restructuring in a host of different ways but what I’d like to have it be is more consistent.”

Culp also believes GE’s battered power business will struggle even more this year than last year, as he said the company expects “an even greater level of negative free cash” in the division “as we work through these issues.” He said GE power will continue to face challenges for “a couple of years” more.

“We know power is in a turnaround mode and that’s not going to be a quick turnaround by any stretch,” Culp said. “It’s going to be a few years before we can call the end of that.”

Tusa asked Culp about the company’s issues with its line of gas-fired power turbines, called H-class turbines.

“We had an oxidation issue that created cracking … we’ve upgraded about 23 of the 33” turbines in the operation, Culp said.

Tusa both began and ended the conversation with Culp by talking about his admiration for the CEO.

“People ask me all the time if you hate me or not … anything you want to say on that?” Tusa asked.

“As I’ve told my daughter: We’re friends,” Culp said.


Company: cnbc, Activity: cnbc, Date: 2019-03-05  Authors: michael sheetz
Keywords: news, cnbc, companies, shares, cash, culp, ceo, industrial, tumble, tusa, struggle, negative, free, morgan, flow, ges, ge, jp, unit, power


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