NOTE 27. OPERATING SEGMENTS
Basis for presentation
Our operating businesses are organized based on the nature of markets and customers. Segment accounting policies are the same as described in Note 1. Segment results for our financial services businesses reflect the discrete tax effect of transactions.
Results of our formerly consolidated subsidiary, NBCU, and our equity method investment in NBCU LLC, which we sold in the first quarter of 2013 are reported in the Corporate items and eliminations line on the Summary of Operating Segments.
A description of our operating segments as of December 31, 2013, can be found below, and details of segment profit by operating segment can be found in the Summary of Operating Segments table in Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations.”
Power & Water
Power plant products and services, including design, installation, operation and maintenance services are sold into global markets. Gas, steam and aeroderivative turbines, nuclear reactors, generators, combined cycle systems, controls and related services, including total asset optimization solutions, equipment upgrades and long-term maintenance service agreements are sold to power generation and other industrial customers. Renewable energy solutions include wind turbines. Water treatment services and equipment include specialty chemical treatment programs, water purification equipment, mobile treatment systems and desalination processes.
Oil & Gas
Oil & Gas supplies mission critical equipment for the global oil and gas industry, used in applications spanning the entire value chain from drilling and completion through production, liquefied natural gas (LNG) and pipeline compression, pipeline inspection, and including downstream processing in refineries and petrochemical plants. The business designs and manufactures surface and subsea drilling and production systems, equipment for floating production platforms, compressors, turbines, turboexpanders, high pressure reactors, industrial power generation and a broad portfolio of auxiliary equipment.
Energy Management
Energy Management is GE's electrification business. Global teams design leading technology solutions for the delivery, management, conversion and optimization of electrical power for customers across multiple energy-intensive industries. GE has invested in our Energy Management capabilities, with strategic acquisitions and joint ventures that enable GE to increase its offerings to the utility, industrial, renewables, oil and gas, marine, metals and mining industries. Plant automation hardware, software and embedded computing systems including controllers, embedded systems, advanced software, motion control, operator interfaces and industrial computers are also provided by Energy Management.
Aviation
Aviation products and services include jet engines, aerospace systems and equipment, replacement parts and repair and maintenance services for all categories of commercial aircraft; for a wide variety of military aircraft, including fighters, bombers, tankers and helicopters; for marine applications; and for executive and regional aircraft. Products and services are sold worldwide to airframe manufacturers, airlines and government agencies.
Healthcare
Healthcare products include diagnostic imaging systems such as Magnetic Resonance (MR), Computed Tomography (CT) and Positron Emission Tomography (PET) scanners, X-ray, nuclear imaging, digital mammography, and Molecular Imaging technologies. Healthcare-manufactured technologies include patient and resident monitoring, diagnostic cardiology, ultrasound, bone densitometry, anesthesiology and oxygen therapy, and neonatal and critical care devices. Related services include equipment monitoring and repair, information technologies and customer productivity services. Products also include diagnostic imaging agents used in medical scanning procedures, drug discovery, biopharmaceutical manufacturing and purification, and tools for protein and cellular analysis for pharmaceutical and academic research, including a pipeline of precision molecular diagnostics in development for neurology, cardiology and oncology applications. Products and services are sold worldwide to hospitals, medical facilities, pharmaceutical and biotechnology companies, and to the life science research market.
Transportation
Transportation is a global technology leader and supplier to the railroad, mining, marine and drilling industries. GE provides freight and passenger locomotives, diesel engines for rail, marine and stationary power applications, railway signaling and communications systems, underground mining equipment, motorized drive systems for mining trucks, information technology solutions, high-quality replacement parts and value added services.
Appliances & Lighting
Products include major appliances and related services for products such as refrigerators, freezers, electric and gas ranges, cooktops, dishwashers, clothes washers and dryers, microwave ovens, room air conditioners, residential water systems for filtration, softening and heating, and hybrid water heaters. These products are distributed both to retail outlets and direct to consumers, mainly for the replacement market, and to building contractors and distributors for new installations. Lighting products include a wide variety of lamps and lighting fixtures, including light-emitting diodes. Products and services are sold in North America and in global markets under various GE and private-label brands.
GE Capital
CLL has particular mid-market expertise, and primarily offers secured commercial loans, equipment financing and other financial services to companies across a wide range of industries including construction, retail, manufacturing, transportation, media, communications, technology and healthcare. Equipment financing activities include industrial, medical, fleet vehicles, corporate aircraft, construction, office imaging and many other equipment types.
Consumer offers a full range of financial products including private-label credit cards; personal loans; bank cards; auto loans and leases; mortgages; debt consolidation; home equity loans; deposit and other savings products; and small and medium enterprise lending on a global basis.
Real Estate offers a comprehensive range of capital and investment solutions and finances, with both equity and loan structures, the acquisition, refinancing and renovation of office buildings, apartment buildings, retail facilities, hotels and industrial properties.
Energy Financial Services offers financial products to the global energy industry including structured equity, debt, leasing, partnership financing, product finance, and broad-based commercial finance.
GECAS, our commercial aircraft financing and leasing business, offers a wide range of aircraft types and financing options, including operating leases and secured debt financing, and also provides productivity solutions including spare engine leasing, airport and airline consulting services, and spare parts financing and management.
| Revenues | ||||||||||||||||||||||||||
| Total revenues(a) | Intersegment revenues(b) | External revenues | ||||||||||||||||||||||||
| (In millions) | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||
| Power & Water | $ | 24,724 | $ | 28,299 | $ | 25,675 | $ | 947 | $ | 1,119 | $ | 794 | $ | 23,777 | $ | 27,180 | $ | 24,881 | ||||||||
| Oil & Gas | 16,975 | 15,241 | 13,608 | 360 | 314 | 302 | 16,615 | 14,927 | 13,306 | |||||||||||||||||
| Energy Management | 7,569 | 7,412 | 6,422 | 848 | 487 | 504 | 6,721 | 6,925 | 5,918 | |||||||||||||||||
| Aviation | 21,911 | 19,994 | 18,859 | 500 | 672 | 417 | 21,411 | 19,322 | 18,442 | |||||||||||||||||
| Healthcare | 18,200 | 18,290 | 18,083 | 14 | 37 | 65 | 18,186 | 18,253 | 18,018 | |||||||||||||||||
| Transportation | 5,885 | 5,608 | 4,885 | 12 | 11 | 33 | 5,873 | 5,597 | 4,852 | |||||||||||||||||
| Appliances & Lighting | 8,338 | 7,967 | 7,693 | 25 | 23 | 22 | 8,313 | 7,944 | 7,671 | |||||||||||||||||
| Total industrial | 103,602 | 102,811 | 95,225 | 2,706 | 2,663 | 2,137 | 100,896 | 100,148 | 93,088 | |||||||||||||||||
| GE Capital | 44,067 | 45,364 | 48,324 | 1,150 | 1,037 | 977 | 42,917 | 44,327 | 47,347 | |||||||||||||||||
| Corporate items | ||||||||||||||||||||||||||
| and eliminations(c) | (1,624) | (1,491) | 2,993 | (3,856) | (3,700) | (3,114) | 2,232 | 2,209 | 6,107 | |||||||||||||||||
| Total | $ | 146,045 | $ | 146,684 | $ | 146,542 | $ | - | $ | - | $ | - | $ | 146,045 | $ | 146,684 | $ | 146,542 | ||||||||
(a) Revenues of GE businesses include income from sales of goods and services to customers and other income.
(b) Sales from one component to another generally are priced at equivalent commercial selling prices.
(c) Includes the results of NBCU (our formerly consolidated subsidiary) and our former equity method investment in NBCUniversal LLC.
Revenues from customers located in the United States were $68,617 million, $70,466 million and $69,910 million in 2013, 2012 and 2011, respectively. Revenues from customers located outside the United States were $77,428 million, $76,218 million and $76,632 million in 2013, 2012 and 2011, respectively.
| Property, plant and | ||||||||||||||||||||||||||
| Assets(a)(b) | equipment additions(c) | Depreciation and amortization | ||||||||||||||||||||||||
| At December 31 | For the years ended December 31 | For the years ended December 31 | ||||||||||||||||||||||||
| (In millions) | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||
| Power & Water | $ | 29,526 | $ | 27,174 | $ | 27,074 | $ | 714 | $ | 661 | $ | 770 | $ | 668 | $ | 647 | $ | 605 | ||||||||
| Oil & Gas | 26,181 | 20,099 | 18,855 | 1,185 | 467 | 904 | 479 | 426 | 434 | |||||||||||||||||
| Energy Management | 9,962 | 9,253 | 9,835 | 137 | 155 | 414 | 323 | 287 | 239 | |||||||||||||||||
| Aviation | 32,272 | 25,144 | 23,567 | 1,178 | 781 | 699 | 677 | 644 | 569 | |||||||||||||||||
| Healthcare | 27,956 | 28,458 | 27,981 | 316 | 322 | 378 | 861 | 879 | 869 | |||||||||||||||||
| Transportation | 4,472 | 4,389 | 2,633 | 282 | 724 | 193 | 167 | 90 | 88 | |||||||||||||||||
| Appliances & Lighting | 4,237 | 4,133 | 3,675 | 405 | 485 | 268 | 300 | 265 | 260 | |||||||||||||||||
| GE Capital | 516,829 | 539,351 | 584,643 | 9,978 | 11,879 | 9,871 | 7,738 | 7,348 | 7,480 | |||||||||||||||||
| Corporate items | ||||||||||||||||||||||||||
| and eliminations(d) | 5,125 | 26,998 | 19,740 | 194 | (99) | 56 | 260 | 218 | 186 | |||||||||||||||||
| Total | $ | 656,560 | $ | 684,999 | $ | 718,003 | $ | 14,389 | $ | 15,375 | $ | 13,553 | $ | 11,473 | $ | 10,804 | $ | 10,730 | ||||||||
(a) Assets of discontinued operations, NBCU (our formerly consolidated subsidiary) and our former equity method investment in NBCUniversal LLC are included in Corporate items and eliminations for all periods presented.
(b) Total assets of the Power & Water, Oil & Gas, Energy Management, Aviation, Healthcare, Transportation, Appliances & Lighting and GE Capital operating segments at December 31, 2013, include investment in and advances to associated companies of $507 million, $108 million, $788 million, $1,463 million, $576 million, $10 million, $388 million and $17,348 million, respectively. Investments in and advances to associated companies contributed approximately $(26) million, $18 million, $3 million, $4 million, $(48) million, $0 million, $40 million and $1,809 million to segment pre-tax income of Power & Water, Oil & Gas, Energy Management, Aviation, Healthcare, Transportation, Appliances & Lighting and GE Capital operating segments, respectively, for the year ended December 31, 2013. Aggregate summarized financial information for significant associated companies assuming a 100% ownership interest included: total assets of $98,658 million, primarily financing receivables of $46,655 million; total liabilities of $66,535 million, primarily debt of $40,030 million; revenues totaled $22,692 million; and net earnings totaled $2,431 million.
(c) Additions to property, plant and equipment include amounts relating to principal businesses purchased.
(d) Includes deferred income taxes that are presented as assets for purposes of our consolidating balance sheet presentation.
| Interest and other financial charges | Provision (benefit) for income taxes | ||||||||||||||||
| (In millions) | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||
| GE Capital | $ | 9,267 | $ | 11,596 | $ | 13,760 | $ | (992) | $ | 521 | $ | 906 | |||||
| Corporate items and eliminations(a) | 849 | 811 | 662 | 1,668 | 2,013 | 4,839 | |||||||||||
| Total | $ | 10,116 | $ | 12,407 | $ | 14,422 | $ | 676 | $ | 2,534 | $ | 5,745 | |||||
(a) Included amounts for Power & Water, Oil & Gas, Energy Management, Aviation, Healthcare, Transportation, Appliances & Lighting, for which our measure of segment profit excludes interest and other financial charges and income taxes.
Property, plant and equipment – net associated with operations based in the United States were $28,657 million, $27,192 million and $25,974 million at year-end 2013, 2012 and 2011, respectively. Property, plant and equipment – net associated with operations based outside the United States were $40,170 million, $41,441 million and $38,573 million at year-end 2013, 2012 and 2011, respectively.