“We have a number of problems we need to work through this year,” Culp said. “This is the year that we share with the world what those issues are.”
Culp pointed Cramer to the company’s 2019 earnings forecast, released on Thursday morning, as “the plan” to address those problems, he said.
“It’s going to take some time, and we won’t be finished come New Year’s Eve, but if you give us a little bit of time we will, I think, make a lot of progress,” Culp said to Cramer.
His comments came after the first forecast he’s given at GE, nearly six months after the company’s board of directors appointed Culp as CEO in October. GE announced the company expects 2019 adjusted earnings between 50 cents and 60 cents a share, below the 70 cents a share analysts expected according to Refinitiv.
One of those issues is the often-discussed power business. Culp expects power’s cash flow to take an even deeper hit this year. But the power business “will get significantly better in 2020,” Culp said, “and we expect positive free cash flow in 2021.”
In talking to Cramer, Culp extended an olive branch to shareholders, employees, retirees and others who he said “are very much a part of the GE family.” He said he hears from “all sorts of folks who have really borne a deep and personal financial pain given what’s happened at the company the last several years.” Those messages are a part of Culp’s motivation and told Cramer he wants GE to “embrace the reality that we have.”
“We have opportunities, we certainly have some problems. It’ll take us a while but if people give us the benefit of the doubt I think they’re going to see improvement over time.”