GE Vernova Inc. Q1 FY2024 Earnings Call

· Earnings call transcript and AI-powered summary

Overview

  • First earnings call as a fully independent public company, following the April 2, 2024 separation.
  • Management highlighted strong demand across power generation, wind, and grid/electrification markets, driven by rising electricity demand and decarbonization efforts.
  • Lean execution remains central, with over 800 Kaizen events in Q1 and significant operational improvements.

Safety and Operational Execution

  • Injury and illness rate improved 5% over the last 12 months; no fatalities year-to-date.
  • Lean initiatives driving measurable improvements in inventory, output, and productivity—example: grid automation plant saw 50% reduction in work-in-progress and 15% output growth.

Financial Highlights (vs. Q1 2023)

  • Orders: $9.7 billion, down 1% year-over-year due to lower wind and electrification equipment orders, but service orders grew double digits.
  • Revenue: Up 5% organically, led by Electrification and Power. Wind revenue declined.
  • Backlog: Grew by $8 billion year-over-year to $116 billion.
  • EBITDA Margin: Expanded 470 bps year-over-year; all segments delivered at least 300 bps expansion.
  • Free Cash Flow: Outflow of $661 million, but still ~$150 million better than last year’s first quarter.

Segment Performance

Power

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Operator: Good day, ladies and gentlemen, and welcome to GE Vernova's First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. My name is Liz, and I will be your conference coordinator today. If you experience issues with the webcast slides refreshing or there appears to be delays in the slide advancement, please hit F5 on your keyboard to refresh. As a reminder, this conference is being recorded. I would now like to turn the program over to your host for today's conference, Michael Lapides, Vice President of Investor Relations. Please proceed. Michael Lapides: Thank you. Welcome to GE Vernova's first quarter 2024 earnings call. I'm joined today by our CEO, Scott Strazik; and our CFO, Ken Parks. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and in the presentation slides available on our website. During this call, we will make forward-looking statements about our performance. These statements are based on how we see things today. However, while we may elect to update these forward-looking statements at some point in the future, we specifically do not have any obligation to do so. As described in our SEC filings, actual results may differ materially due to risks and uncertainties. With that, I'll hand the call over to Scott. Scott Strazik: Thanks, Michael. Good morning, everyone, and welcome to our first ear

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