2021 Cash Flow Analysis for General Electric Co GE

General Electric Company is a multinational conglomerate that operates in various sectors, including aviation, healthcare, power, renewable energy, and digital industry. The company is headquartered in Boston, Massachusetts, and was founded in 1892. General Electric is known for its wide range of industrial products and services, as well as its commitment to innovation and sustainability.

The cash flow statement provides insight into how much cash or cash equivalents a company has generated and utilized over a specific period. It is divided into three sections: operating activities, investing activities, and financing activities. This statement is crucial for investors and analysts to understand how a company manages its cash resources.

How to read the chart

The chart above illustrates the cash flow of General Electric in 2021. The width of the bars corresponds to the amount of cash flow, with wider bars indicating larger amounts.

We begin on the left with the company's cash position at the start of the year. During the year, the cash decreased significantly, primarily due to financing activities. The cash flow from operating activities was a positive contributor, while investing activities also added a substantial amount to the cash flow.

The cash flow from investing activities is positive, suggesting that the company received more from selling assets or investments than it spent on new investments. Conversely, the cash flow from financing activities is negative, indicating that the company paid out more cash for purposes such as debt repayments, share buybacks, or dividend payments.

After accounting for the change in cash, we conclude on the right with the company's cash position at the end of the year.

Real-Time Cash Flow Counter

To provide a sense of the scale of General Electric's cash flow, we have created a real-time counter that simulates the company's cash flow for 2021. The counter starts when you scroll to this section and runs at the same speed as the company's reported cash flow.

This is not a live counter of real cash flows as they happen, but a simulation based on the company's reported cash flow for 2021. The counter is designed to give you an understanding of the scale of the company's cash flow and how quickly it moves.

Cash Flow Statement

In 2021, General Electric generated $3,481 million in cash from operating activities, received $21,379 million from investing activities, and spent $45,397 million on financing activities. Consequently, the company's cash balance decreased by $20,750 million during the year.

The company's beginning cash balance was $36,630 million. Typically, this amount includes cash and cash equivalents, such as short-term investments that can be easily converted into cash. The company's ending cash balance was $15,770 million.

The company's capital expenditures for the year were $2,474 million. This amount represents the cash the company spent on investments in property, plant, and equipment. Subtracting capital expenditures from cash flow from operations gives the company's free cash flow, which was $1,007 million in 2021. This amount represents the cash the company has available to pay dividends, repurchase stock, or make other investments.

Summary

General Electric's cash flow in 2021 highlights several key aspects. The company managed to generate a positive cash flow from operating activities, which is crucial for sustaining its operations. The significant positive cash flow from investing activities indicates successful asset sales or investments. However, the large negative cash flow from financing activities reflects substantial outflows, likely due to debt repayments or other financial obligations. Despite these challenges, General Electric maintained a considerable cash balance, providing a buffer for future operations and investments.