Wednesday, January 23, 2019

General Electric ($GE) may be trying to sell its capital aviation services business (GECAS). On Jan. 21, the Wall Street Journal reported that Air Lease Corp. wasn’t interested in buying GECAS. The next day, Barron’s wrote about value of GECAS.

GE has several operating segments: Power, Renewable Energy, Oil & Gas, Aviation, Healthcare, Transportation, Lighting, and Capital. Their performance is reported in the segment footnotes in GE’s 10-Ks and 10-Qs. GECAS, however, is part of GE’s Capital segments — so it performance was not separately reported in those disclosures.

Nevertheless, GE does report information about GECAS. You just need to know where to look.

The information can be found in different places. GE has been reporting GECAS’s performance in “sub-segment” information included in 8-K earning releases, or in the Management Discussion & Analysis (MD&A) section of its filings. More information about GECAS can be found in Supplemental Information About “The Credit Quality of Financing Receivables and Allowance For Losses, as GE reports GECAS’s receivables”.

So, how to make sense out of it? Calcbench can help.

In 2014 and 2015, GECAS was reported in a format that gave the information to you — and Calcbench maintains the ability to get it. You can download information directly, or do a search within our tools. Here is what you will get:


But in 2016, that reporting scheme changed. GE disclosed GECAS in a new format (which Calcbench also has).


And in 2017, GE reporting in a third way:

As you see, the firm now reports the revenues from GECAS as a sub-segment of GE Capital revenues. All you now need to do is to get a time series of GE Capital revenues to start the valuation process. That can be done in Calcbench by accessing the segment disclosure and asking for a time series. (See picture below.)

Now it’s possible to assemble enough information to piece together a valuation framework for GECAS based on historical revenues and some profit levels. *Note that in third-quarter 2017, GECAS stopped explicitly disclosing net income.

It just goes to show that while companies might change up their reporting, often times you can find the insights you want, by pulling together pieces of data sprinkled across multiple disclosures. Calcbench lets you do that.

-30-

FREE Calcbench Premium
Two Week Trial

Research financial & accounting data like never before. Get features designed for better insights. Try our enhanced Excel Add-in. Sign up now to try the Premium Suite.