The company reports Free cash flow and Free cash flow conversion to provide management and investors with an important measure of the ability to generate cash on a normalized basis and provide insight into the company's flexibility to allocate capital. Free cash flow is Cash from (used for) operating activities - continuing operations, including cash flows related to the additions and dispositions of property, plant, and equipment ("PP&E") and additions of internal-use software. Free cash flow does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the capital required for debt repayments. Free cash flow conversion is calculated by taking Free cash flow divided by Adjusted net income.
Management recognizes that these non-GAAP financial measures have limitations, including that they may be calculated differently by other companies or may be used under different circumstances or for different purposes. In order to compensate for the discussed limitations, management does not consider these measures in isolation from or as alternatives to the comparable financial measures determined in accordance with U.S. GAAP. No single financial measure should be relied on to evaluate our business.
Non-GAAP financial measures in outlook
GE HealthCare calculates forward-looking non-GAAP financial measures, including Organic revenue growth, Adjusted EBIT margin, Adjusted ETR, Adjusted EPS, Adjusted EPS growth, Free cash flow, and Free cash flow conversion based on internal forecasts that omit certain amounts that would be included in GAAP financial measures. GE HealthCare does not provide reconciliations of these forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or dispositions, timing and magnitude of restructuring activities, and revaluation of strategic investments, amongst other items. The timing and amounts of these items are uncertain and could have a substantial impact on GE HealthCare's results in accordance with GAAP.
Forward-looking statements
This release contains forward-looking statements. These forward-looking statements might be identified by words, and variations of words, such as "will," "expect," "may," "would," "could," "plan," "believe," "anticipate," "intend," "estimate," "potential," "position," "forecast," "target," "guidance," "outlook," and similar expressions. These forward-looking statements may include, but are not limited to, statements about our business and expected financial performance, financial condition, and results of operations, including revenue, revenue growth, profit, taxes, earnings per share, and cash flows, and the company's outlook and medium-term financial targets; and the company's strategy, innovation, initiatives, and investments. These forward-looking statements involve risks and uncertainties, many of which are beyond the company's control. Factors that could cause the company's actual results to differ materially from those described in its forward-looking statements include, but are not limited to, operating in highly competitive markets; the company's ability to successfully complete strategic transactions; the actions or inactions of third parties with whom the company partners and the various collaboration, licensing, and other partnerships and alliances the company has with third parties; demand for the company's products, services, or solutions and factors that affect that demand; management of the company's supply chain and the company's ability to cost-effectively secure the materials it needs to operate its business; disruptions in the company's operations; changes in third-party and government reimbursement processes, rates, contractual relationships, and mix of public and private payers, including related to government shutdowns; the delayed China stimulus and the ongoing anti-corruption campaign; the company's ability to attract and/or retain key personnel and qualified employees; global geopolitical and economic instability, including as a result of the conflict between Ukraine and Russia, the conflict in the Middle East, and the actions in the Red Sea region; public health crises, epidemics, and pandemics and their effects on the company's business; maintenance and protection of the company's intellectual property rights, as well as maintenance of successful research and development efforts with respect to commercially successful products and technologies; the impact of potential information technology, cybersecurity or data security breaches; compliance with the various legal, regulatory, tax, privacy, and other laws to which the company is subject, such as the Foreign Corrupt Practices Act and similar anti-corruption and anti-bribery laws globally, and related changes, claims, inquiries, investigations, or actions; the company's ability to control increases in healthcare costs and any subsequent effect on demand for the company's products, services, or solutions; the impacts related to the company's increasing focus on and investment in cloud, edge, artificial intelligence, and software offerings; the impact of potential product liability claims; environmental, social, and governance matters; the company's ability to operate effectively as an independent, publicly-traded company; and the company's level of indebtedness, as well as its general ability to comply with covenants under its debt instruments and any related effect on the company's business. Please also see the "Risk Factors" section of the company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the U.S. Securities and Exchange Commission and any updates or amendments it makes in future filings. There may be other factors not presently known to the company or which it currently considers to be immaterial that could cause the company's actual results to differ materially from those projected in any forward-looking statements the company makes. The company does not undertake any obligation to update or revise its forward-looking statements except as required by applicable law or regulation.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241120478927/en/
CONTACT: GE HealthCare Investor Contact:
Carolynne Borders
(631) 662-4317
carolynne.borders@gehealthcare.com
GE HealthCare Media Contact:
Jennifer Fox
(414) 530-3027
jennifer.r.fox@gehealthcare.com
(END) Dow Jones Newswires
November 21, 2024 06:00 ET (11:00 GMT)
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