The troubled aviation industry continued to weigh on General Electric Co. , which reported another quarter of shrinking revenue, but the conglomerate posted a smaller loss and was able to generate cash from its industrial operations.
Layoffs and cost cutting have helped GE weather the coronavirus pandemic’s damage to the commercial airlines that ultimately buy its jet engines. Belt tightening has also helped reverse losses in GE’s long-struggling power turbine unit.
While orders for new equipment fell in several of its key businesses, the company said it generated $514 million in industrial free-cash flow in the quarter ended Sept. 30. On that basis, the company also predicted it would generate $2.5 billion in cash in the fourth quarter.
The measure is closely watched as a sign of the health of the company’s operations and ability to pay down debts. In the first half of the year, GE’s industrial operations burned through $4.3 billion in cash.
“Clearly aviation is the challenge right now,” CEO Larry Culp said in an interview, noting improvement in other segments and continuing cost cuts. “We’re making more progress and are encouraged by the positive free cash in the third quarter.”
