THE WALL STREET JOURNAL. Thursday, October 31, 2019 |B5
tional reserves for the policies
after revamping its assump-
tions for the portfolio.
GE said those assumptions
remain in line with actual re-
sults.
Evercore ISI analysts said
the insurance shortfall was on
the low end of expectations.
“Following its mega charge in
early 2018 and the resulting
black cloud cast over the life-
insurance industry...we think
this news should come as a re-
lief,” the analysts said.”
GE said its claims are devel-
oping as expected, while some
other insurers have reported
adverse development.
The power division, which
had been GE’s biggest in terms
of revenue, has been at the cen-
ter of financial and operational
woes.
The century-old business has
suffered from losses amid a
global drop in demand for
power-generating equipment.
GE said business remains in
the middle of a multiyear turn-
around as the unit’s revenue
fell 14% from a year earlier to
$3.93 billion, but the division
narrowed its losses to $144 mil-
lion.
GE has been selling assets to
pay down its debt, including
the biotechnology sale for over
$20 billion to Danaher Corp.,
Mr. Culp’s former company.
Danaher said last week that
it is making progress on closing
the deal, but doesn’t expect it
to close until the first quarter.
—Leslie Scism
contributed to this article.are earning are up.
Anything from STEM, that
increase is huge. We’re going
to have up to 100,000 of
those badges being earned
their first year.
And we’re introducing our-
selves to new girls. We’re
just a point or two away
from growth nationally.WSJ: In the age of Instagram
and iPhones, how do you
keep girls engaged?
Ms. Acevedo : It’s challenging.
Girls write something on-
line and what they get back
is nothing more than a
thumbs up, thumbs down, a
like. That impacts girls’ self-
esteem. You see that in their
levels of confidence and, un-
fortunately, the increasing
suicide rates.
If you ignore that there’s a
digital device in almost every
girl’s hand, you really miss
how she’s defining the world
around her.WSJ: Girlhood has changed
and so has parenthood. How
do you handle helicopter
parents?So when we have some-
body who is new to Girl
Scouts and just focuses on
the name Scout and not Girl
Scouts, we are concerned
people don’t realize we are
completely separate organi-
zations, and we worry that’s
impacting our brand.[The Boy Scouts of Amer-
ica declined to comment on
litigation but said in a state-
ment, “We have been clear
that the Boy Scouts of Amer-
ica and GSUSA are separate
and distinct organizations.”]WSJ: Has it affected partici-
pation in Girl Scouts?
Ms. Acevedo : For us, girl re-
tention is up around 10%.
What we’re very excited
about is that the badges girls‘That persistence,
that resilience
is so important for
girls to learn.’In July, GE raised its outlook
for 2019 cash flow to a range of
negative $1 billion to positive
$1 billion.
In an interview, Mr. Culp
said the cash flow benefited
from increased internal con-
trols, more spending discipline
and fewer surprises arising in
the operations.
The company also benefited
from lower-than-expected re-
structuring costs, Mr. Culp said.
“We are getting the cost out
with less investment,” he said.
The full-year projection
translates to fourth-quarter
cash flow of at least $1.6 bil-
lion. Mr. Culp has said he wants
to move away from GE’s long-
held pattern of having the
strongest sales at the end of
the year and the end of quar-
ters, but it will take years to
break the habit.
“Every day of the quarter
and the year needs to matter as
much as the last day of the
quarter and year,” he said
Wednesday.
For the third quarter, GE re-
ported a net loss attributable to
common shareholders of $9.47
billion, compared with a loss of
$22.8 billion a year earlier,
when it booked a charge on its
power business. Revenue was
flat at $23.36 billion as gains in
aviation and health-care units
were offset by declines in the
power business.
GE booked an $8.7 billion
charge to reflect the lowered
value of its investment in oil
equipment and services firm
Baker Hughes.
GE had previously warned
investors about the charge as it
sold down its stake and gave up
majority control of Baker
Hughes.
The company also recorded
a $1 billion charge on its legacy
insurance business and a $740
million write-down on the
value of its hydropower busi-
ness.
Excluding charges, GE said
its adjusted earnings were 15
Continued from page B1
GE Reports
A Loss for
Quarter
More Positive
Investors are closely watching how much cash GE is generating
from its core operations.Adjusted industrial cash flow* Share price*Non-GAAP
Note: Transportation division not included in 2Q and 3Q of 2019
Sources: the company (cash flow); FactSet (share price)1Q 3Q
’191Q
20183Q$5–2–101234billion $10.50 a share8.509.009.5010.00Tues. Weds.$10.11
s11%cents a share, ahead of an ana-
lyst projection of 12 cents a
share, according to Refinitiv.
Mr. Culp said the company
was raising its cash-flow goals
despite a drag from Boeing
Co.’s grounding of its 737 Max
airplane. The jet is powered by
engines made by GE in partner-
ship with France’s Safran SA.
GE reduced its production rate
of its Leap engines used in the
plane.
GE still expects the 737
MAX’s grounding to reduce
cash flow by $1.4 billion for thefull year if the plane remains
unable to fly.
Mr. Culp said GE was follow-
ing Boeing’s lead and is being
conservative in assuming the
MAX won’t fly again this year.
Orders for its Leap engine
dropped 90% in the quarter.
The company said it com-
pleted a test on its long-term-
care insurance holdings in the
third quarter to see whether it
has enough cash reserved for
its expected future obligations.
The $1 billion deficiency
charge largely resulted from
lower market interest rates.
Last year, the company had
to commit $15 billion in addi-Mr. Culp said cash
flow benefited from
increased internal
controls.courage them not to do that.
We want the girls to set
their own goals. They learn,
how are you going to achieve
those goals? How do you
manage the money? How do
you deliver good customer
service?
That is the beauty of the
Cookie Program.
I learned in Girl Scouts to
never walk away from a sale
until you’ve heard “no” three
times, because when some-
body says “no,” you have to
figure out how to get them to
a“yes.”
That persistence, that re-
silience is so important for
girls to learn.WSJ: The Boy Scouts began
admitting girls last year. How
has that decision affected
you?
Ms. Acevedo : It was really dis-
appointing they decided to
accept girls, but that’s their
organization.
What is impacting us is
the [Boy Scouts-related]
news about [sexual-assault]
lawsuits and the discussion
around bankruptcy.WASHINGTON—The Trump
administration’s pick to oversee
the nation’s derivatives mar-
kets plans to take a more in-
dustry-friendly approach than
some of his Democratic prede-
cessors and wrap up unfinished
business.
Heath Tarbert began a five-
year term when he took over
the Commodity Futures Trad-
ing Commission in July. In an
interview, he said he is looking
for opportunities to make
changes “that we can actually
get done in a relatively short
period of time.”
Among his priorities is put-
ting in place long-delayed lim-
its on speculation in energy
and precious metals.
Mr. Tarbert said he plans for
the CFTC to meet in public as
often as once a month to make
progress on its goals.
“In the last few years, there
has been a lot of talk and a lot
of discussion, but not a lot of
things have been finalized,” he
said.
The CFTC has struggled to
pass federal position limits de-
signed to curb sharp increases
in energy and metals prices
that affect consumers and busi-
nesses.
Mr. Tarbert said position
limits are necessary and appro-
priate but should be focused on
the current-month contract,
when the futures price is likely
to be closest to the underlying
commodity’s price in spot mar-
kets.
The CFTC’s approach would
set a ceiling on the maximum
number of contracts a single
trader could amass.
In earlier versions of the
rule proposal, the commission
sought to apply the limits to
contracts expiring in future
months.
A federal court struck down
the CFTC’s first effort to pass a
rule in 2012.
BYDAVEMICHAELS
CFTC
To Tackle
Position
Limits
MANAGEMENT
Ms. Acevedo : The number of
parents who want to be troop
leaders is declining, but the
number of parents who at-
tend the troop meeting to
watch the troop leader is in-
creasing. So it’s like, wait,
why don’t you just become
the leader, instead of critiqu-
ing the troop leader?
Parentshavegottenso
used to the immediacy of the
interaction with their kids.
A norm we have to create
with the parents is to let
them know, here’s how much
we will communicate while
your daughter is away at
camp.
And we have to help the
parents understand that that
doesn’t mean your daughter’s
not safe. She’s very safe here.WSJ: Is an all-girl environ-
ment still necessary?
Ms. Acevedo : We know that in
a coed environment, a girl
tends not to be called on as
much. She tends not to try
and persist, and she doesn’t
get steered toward nontradi-
tional activities.
In Girl Scouts, we call fail-
ure the first attempt at learn-
ing. So she can keep trying
and being persistent.
That happened to me. My
first rockets, I failed over and
over. But in that environment
I knew I could persist.
Had I been in a coed envi-
ronment, especially in ele-
mentary school, they would
have said, “Oh, you’re not
good at that. You only get
that first try.”WSJ: How are cookie sales?
Ms. Acevedo : Most of the Girl
Scout experience, around
60% of local councils’ bud-
gets, is subsidized by the
Cookie Program and it keeps
dues very economical.
We try to keep up with so-
cietal tastes. We have gluten-
free options. Many of our
cookies are vegan. Girls
worked with our bakers to
make sure we use sustainably
harvested palm oil.
But people do tell me,
don’t ever change “Thin
Mints.”Leading the Girl Scouts of
the USA may not technically
be rocket science. But if it
were, Sylvia Acevedo would be
well-equipped for the mission.
A former NASA engineer,
the 62-year-old Ms. Acevedo
once wrote algorithms for
the Voyager 2 spacecraft be-
fore going on to an executive
career in technology. She got
a taste for the
cosmic as a
Brownie in Las
Cruces, N.M., earning science
badges for building model
rockets.
Now as chief executive of
the Girl Scouts since 2017,
Ms. Acevedo is focused on
turning around a member-
ship decline and bringing the
century-old organization into
the digital age.
One way she hopes to do
both is with new badges for
science, technology, engineer-
ing and math skills, including
several space-related badges.
Though the decrease in Girl
Scouts has slowed from previ-
ous years, the number of
members has fallen to 1.7 mil-
lion in 2019 from 1.9 million
in 2017. Dues of $25 a year al-
low girls to participate in
leadership-development activ-
ities and outdoor programs.
Ms. Acevedo recently sat
down with The Wall Street
Journal in New York. Here
are edited excerpts:WSJ: How do you make sure
parents aren’t selling the
cookies? In my office, parents
bring in order sheets and
leave them in the coffee area.
Ms. Acevedo : We try so hard.WSJ: I don’t want to get any-
body in trouble.
Ms. Acevedo :Wedohave
cases where parents try to
increase their daughters’
sales, and I would really en-BYLAURENWEBERGirl Scouts Chief Ready for Liftoff
Ex-NASA engineer
looks to boost group’s
membership, interest
in science and techThe Scouts face challenges from digital distractions and hovering parents, says CEO Sylvia Acevedo.MARIE D. DE JESUS/HOUSTON CHRONICLE/ASSOCIATED PRESSBUSINESS NEWS
BOSS TALK