Embattled US engineering giant General Electric on Monday removed its CEO and warned it would fall short of its 2018 earnings guidance as the conglomerate's cash flow struggles continue. The ouster of John Flannery, a 30-year GE veteran, comes barely a year after he took over in a bid to rescue to the company, long a pillar of American industry that has seen its shares tailspin 35 percent since the start of the year.
The company was stricken from the prestigious Dow Jones Industrial Average in June. H. Lawrence Culp, named to the GE board in April, will replace Flannery immediately, the firm said in a statement, following a unanimous decision of the board.
The company said because of weaker performance in the GE Power business, GE would fall short of previous profit guidance for this year. GE will also book a $23 billion non-cash charge related to its power business. Executives are due to brief investors on the charge when GE reports third quarter results later this month.
The once mighty conglomerate, long a standard-bearer of US industrial preeminence, is still working to right the ship following the global financial crisis of a decade ago, which blew a hole in GE's once-massive lending business.
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