(By Balaseshan) General Electric Co. (NYSE:GE) said it will reorganize its Energy business into three standalone units later this year, and Vice Chairman John Krenicki will oversee the new structure transition before leaving the industrial conglomerate at year-end.
During the third quarter, GE Vice Chairman and GE Energy Infrastructure Chief Executive Krenicki will oversee the transition to the new Energy structure. During the fourth quarter, he will continue to serve as a GE vice chairman and advisor to Chief Executive Jeff Immelt. Krenicki has decided to leave the company at the end of 2012.
GE would reorganize, effective in the fourth quarter of 2012, its Energy business into three standalone businesses, in order to reduce layers, decrease cost and increase decision making speed. The Energy headquarters organizational layer will be phased out by the end of 2012.
GE will split its energy arm into: GE Power and Water, headed by Steve Bolze; GE Oil and Gas, under Dan Heintzelman, and GE Energy Management, under Dan Jenki. All three -- Bolze, Heintzelman, Jenki -- will have the chief executive title of their unit and will report directly to GE Chairman and CEO Immelt.
GE said it would begin reporting separate segment financial results for these three businesses beginning with the fourth quarter of 2012. GE Energy Infrastructure includes about 100,000 employees and will have revenues of about $50 billion in 2012.
GE Power and Water is expected have about 41,000 employees and planned revenue of about $28 billion in 2012. GE Oil and Gas is anticipated to have about 33,000 employees and planned revenue of about $15 billion in 2012. GE Energy Management is predicted have about 27,000 employees and would have about $7 billion of planned revenue in 2012.
Separately, GE reported better-than-expected quarterly earnings, and said the company is on course for double-digit profit growth at its Industrial and GE Capital segments this year.
Operating earnings per share (EPS) increased 12 percent to 38 cents, topping market expectations by a penny. Revenue rose 2 percent to $36.5 billion, yet was shy of consensus estimate of a 3.3 percent growth.
GE closed Thursday's regular session at $19.80. The stock has been trading between $14.02 and $21 for the past 52 weeks.