GM Second Quarter 2010 Results Show Sustained Progress
GM achieves second consecutive quarter of profitability and positive cash flow Net income of $1.3 billion and EPS of $2.55, free cash flow of $2.8 billion </pre> <p><span class="xn-location">DETROIT</span>, <span class="xn-chron">Aug. 12</span> /CNW/ -- General Motors Company today announced its second quarter 2010 results, marked by revenue of <span class="xn-money">$33.2 billion</span> and net income attributable to common stockholders of <span class="xn-money">$1.3 billion</span>, resulting in earnings per share on a diluted basis of <span class="xn-money">$2.55</span>. GM's second quarter earnings before interest and tax (EBIT) was <span class="xn-money">$2.0 billion</span>.</p> <p/> <p>GM <span class="xn-location">North America</span> had EBIT in the second quarter 2010 of <span class="xn-money">$1.6 billion</span>, up from <span class="xn-money">$1.2 billion</span> in the first quarter. GM <span class="xn-location">Europe</span> had a loss before interest and taxes of <span class="xn-money">$0.2 billion</span>, an improvement of <span class="xn-money">$0.3 billion</span> from the first quarter. GM International Operations posted EBIT of <span class="xn-money">$0.7 billion</span>, down from <span class="xn-money">$1.2 billion</span> in the first quarter.</p> <p/> <p>Cash flow from operating activities was <span class="xn-money">$3.9 billion</span> and after adjusting for capital expenditures of <span class="xn-money">$1.1 billion</span>, free cash flow was <span class="xn-money">$2.8 billion</span>. GM ended the second quarter with <span class="xn-money">$32.5 billion</span> in cash and marketable securities, including funds in the Canadian Health Care Trust escrow.</p> <p/> <p>"I am pleased with our progress on achieving our business objectives," said <span class="xn-person">Chris Liddell</span>, vice chairman and chief financial officer. "We have delivered strong product, maintained cost discipline, progressed strategic initiatives such as restructuring <span class="xn-location">Europe</span> and acquiring AmeriCredit, and delivered two consecutive quarters of profitability and positive cash flow."</p> <pre> Forward-Looking Statements </pre> <p>In this press release and in related comments by our management, our use of the words "expect," "anticipate," "possible," "potential," "target," "believe," "commit," "intend," "continue," "may," "would," "could," "should," "project," "projected," "positioned" or similar expressions is intended to identify forward-looking statements that represent our current judgment about possible future events. We believe these judgments are reasonable, but these statements are not guarantees of any events or financial results, and our actual results may differ materially due to a variety of important factors. Among other items, such factors might include: our ability to realize production efficiencies and to achieve reductions in costs as a result of our restructuring initiatives and labor modifications; our ability to maintain quality control over our vehicles and avoid material vehicle recalls; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt, including as required to fund our planning significant investment in new technology; our ability to realize successful vehicle applications of new technology; and our ability to comply with the continuing requirements related to U.S. and other government support.</p> <p/> <p>GM's most recent annual report on Form 10-K and quarterly report on Form 10-Q provides information about these and other factors, which we may revise or supplement in future reports to the SEC.</p> <p/> <p> </p> <p> Exhibit 1</p> <p> </p> <pre> General Motors Company and Subsidiaries Supplemental Material </pre> <p> </p> <p> (Unaudited)</p> <p> </p> <pre> The accompanying tables and charts for securities analysts include earnings (loss) before interest and taxes (EBIT), adjusted EBIT and free cash flow which are not prepared in accordance with Accounting Principles Generally Accepted in the United States of America (U.S. GAAP) and have not been audited or reviewed by GM's independent auditors. EBIT, adjusted EBIT and free cash flow are considered non-GAAP financial measures. </pre> <p> </p> <pre> Management believes these non-GAAP financial measures provide meaningful supplemental information regarding GM's operating results because they exclude amounts that management does not consider part of operating results when assessing and measuring the operational and financial performance of the organization. Management believes these measures allow it to readily view operating trends, perform analytical comparisons, benchmark performance among geographic regions and assess whether GM's plan to return to sustained profitability is on target. Accordingly, GM believes these non-GAAP financial measures are useful in allowing for greater transparency of GM's core operations and they are therefore used by management in its financial and operational decision-making. </pre> <p> </p> <pre> While management believes that these non-GAAP financial measures provide useful information, they are not operating measures under U.S. GAAP and there are limitations associated with their use. GM's calculation of these non-GAAP financial measures may not be completely comparable to similarly titled measures of other companies due to potential differences between companies in the method of calculation. As a result, the use of these non-GAAP financial measures has limitations and should not be considered in isolation from, or as a substitute for, other measures such as Net income (loss) or Net income (loss) attributable to common stockholders. Due to these limitations, these non-GAAP financial measures are used as a supplement to U.S. GAAP measures. </pre> <p> </p> <pre> The following table summarizes the reconciliation of EBIT to its most comparable U.S. GAAP measure (dollars in millions): </pre> <p> </p> <p> </p> <pre> Successor Three Six Three Three Months Months Months Months Ended Ended Ended Ended June 30, June 30, March 31, December 2010 2010 2010 31, 2009 --------- --------- ---------- -------- Operating segments GMNA(a) $1,592 $2,810 $1,218 $(3,443) GME(a)(b) (160) (637) (477) (799) GMIO(a)(b) 672 1,838 1,166 722 - - Total operating segments 2,104 4,011 1,907 (3,520) Corporate and eliminations(b) (71) (154) (83) (526) --- ---- --- ---- EBIT 2,033 3,857 1,824 (4,046) Interest income 114 204 90 75 Interest expense 250 587 337 329 Income tax expense (benefit) 361 870 509 (861) --- --- --- ---- Net income (loss) attributable to stockholders $1,536 $2,604 $1,068 $(3,439) ====== ====== ====== ======= __________ </pre> <p> </p> <p> </p> <pre> (a) Interest and income taxes are recorded centrally in Corporate; therefore, there are no reconciling items for GM's operating segments between EBIT and Net income (loss) attributable to stockholders. (b) In the three months ended June 30, 2010 we changed our managerial reporting structure so that certain entities geographically located within Russia and Uzbekistan were transferred from our GME segment to our GMIO segment. We have revised the segment presentation for all periods presented. </pre> <p> </p> <pre> General Motors Company and Subsidiaries Supplemental Material </pre> <p> </p> <pre> (Unaudited) The following tables summarize the reconciliation of adjusted EBIT to EBIT and free cash flow to Net cash provided by (used in) operating activities (dollars in millions): </pre> <p> </p> <p>-------------------------------------------</p> <p> </p> <pre> Successor --------- Three Months Six Months Three Months Three Months Ended Ended Ended Ended June 30, June 30, March 31, December 31, 2010 2010 2010 2009 --------- --------- ---------- ------------- Adjusted EBIT $2,033 $3,734 $1,701 $(954) Adjustments - 123 123 (3,092) ------ EBIT $2,033 $3,857 $1,824 $(4,046) ====== ====== ====== ======= </pre> <p> </p> <pre> Free Cash Flow(a) $2,834 $3,804 $970 $(2,919) Capital expenditures(a) 1,011 1,851 840 1,033 ----- ----- --- ----- Net cash provided by (used in) operating $3,845 $5,655 $1,810 $(1,886) activities(a) ====== ====== ====== ======= __________ </pre> <p> </p> <p> </p> <pre> (a) In the three months ended June 30, 2010 we identified several items which had not been properly classified in our condensed consolidated statement of cash flows for the three months ended March 31, 2010. For the six months ended June 30, 2010, we have correctly presented these items in our condensed consolidated statement of cash flows and corrected the amounts presented for the three months ended March 31, 2010. </pre> <p> </p> <pre> In the three months ended March 31, 2010 Adjustments included the following: </pre> <p> </p> <pre> Gain of $123 million as a result of the sale of Saab o Automobile AB to Spyker Cars NV. </pre> <p> </p> <p> </p> <pre> In the three months ended December 31, 2009 Adjustments included the following: </pre> <p> </p> <pre> o Settlement loss of $2.6 billion related to the termination of GM's UAW hourly retiree medical plan and Mitigation Plan, under which GM agreed that an independent VEBA would be formed to pay certain healthcare costs of UAW hourly retirees and their beneficiaries; o Impairment charge of $270 million related to GM's investment in Ally Financial common stock; o Charges of $150 million related to the settlement of existing Delphi obligations upon consummation of the Delphi Master Disposition Agreement and GM's agreement to fund the wind-down costs of certain Delphi facilities; and o Loss on extinguishment of debt of $101 million related to the repayment of secured long-term debt of $400 million (in connection with the purchase of the remaining noncontrolling interest in CAMI Automotive, Inc.). </pre> <p> </p> <pre> General Motors Company and Subsidiaries Supplemental Material </pre> <p> </p> <p> (Unaudited)</p> <p> </p> <pre> Successor Predecessor --------- ----------- Three Six Three Six Months Months Months Months Ended Ended Ended Ended June 30, June 30, June 30, June 30, 2010 2010 2009 2009 --------- --------- --------- --------- </pre> <p> </p> <pre> Production Volume (units in thousands)(a) GMNA - Cars 279 523 170 287 GMNA - Trucks 452 876 225 480 </pre> <p> </p> <pre> Total GMNA 731 1,399 395 767 GME 331 636 315 579 GMIO(b)(c) 1,195 2,307 828 1,523 ----- ----- --- ----- Total Worldwide 2,257 4,342 1,538 2,869 ===== ===== ===== ===== __________ </pre> <p> </p> <p> </p> <pre> (a) Production volume represents the number of vehicles manufactured by GM's and Old GM's assembly facilities and also includes vehicles produced by certain joint ventures. (b) Includes Shanghai General Motors Co., Ltd. (SGM), SAIC-GM Wuling Automobile Co., Ltd. (SGMW), FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM) joint venture production in China and SAIC GM Investment Ltd. (HKJV) joint venture production in India. (c) The joint venture agreements with SGMW (34%) and FAW-GM (50%) allows for significant rights as a member as well as the contractual right to report SGMW and FAW-GM joint venture production volume in China. These entities are not consolidated for financial reporting purposes. Income and losses related to these entities are recorded in Equity income (loss), net of tax. </pre> <p> </p> <pre> General Motors Company and Subsidiaries Supplemental Material </pre> <p> </p> <p> (Unaudited)</p> <p> </p> <pre> Successor Predecessor --------- ----------- Three Three Months Six Months Months Six Months Ended Ended Ended Ended June 30, June 30, June 30, June 30, 2010 2010 2009 2009 --------- --------- --------- --------- Vehicle Sales (units in thousands)(a)(b)(c) United States Chevrolet - Cars 192 348 148 241 Chevrolet - Trucks 252 434 202 356 Cadillac 35 65 25 49 Buick 38 70 27 47 GMC 83 152 64 118 Other 3 11 76 143 </pre> <p> </p> <pre> Total United States 603 1,081 541 954 Canada, Mexico and Other 113 199 115 203 --- --- --- --- Total GMNA(d) 716 1,280 657 1,157 ----- ----- GME Opel/Vauxhall 314 608 348 645 Chevrolet 127 232 117 216 Other 1 5 9 20 </pre> <p> </p> <p> Total GME(e) 442 846 474 881</p> <p> </p> <pre> GMIO Chevrolet 441 898 347 671 Buick 132 254 114 196 GM Daewoo 32 60 28 47 Holden 37 73 30 59 Wuling 303 637 262 493 FAW-GM 22 50 - - Cadillac 5 10 3 5 Other 23 45 23 45 </pre> <p> </p> <pre> Total GMIO(e)(f)(g) 995 2,026 807 1,517 ----- ----- Total Worldwide 2,153 4,152 1,938 3,555 ===== ===== ===== ===== __________ </pre> <p> </p> <p> </p> <pre> (a) Includes HUMMER, Saturn and Pontiac vehicle sales data. (b) Includes Saab vehicle sales data through February 2010. (c) Vehicle sales data may include rounding differences. (d) Vehicle sales represent sales to the ultimate customer. (e) Vehicle sales primarily represent estimated sales to the ultimate customer. (f) Includes SGM, SGMW and FAW-GM joint venture sales in China and HKJV joint venture sales in India. (g) The joint venture agreements with SGMW (34%) and FAW-GM (50%) allows for significant rights as a member as well as the contractual right to report SGMW and FAW-GM joint venture vehicle sales in China as a part of global market share. These entities are not consolidated for financial reporting purposes. Income and losses related to these entities are recorded in Equity income (loss), net of tax. </pre> <p> </p> <pre> General Motors Company and Subsidiaries Supplemental Material </pre> <p> </p> <p> (Unaudited)</p> <p> </p> <pre> Successor Predecessor --------- ----------- Three Three Months Six Months Months Six Months Ended Ended Ended Ended June 30, June 30, June 30, June 30, 2010 2010 2009 2009 --------- --------- --------- --------- Market Share(a)(b) United States - Cars 15.4% 15.1% 17.5% 16.5% United States - Trucks 23.2% 22.6% 23.5% 22.5% Total United States 19.4% 18.9% 20.5% 19.5% Total GMNA(c) 18.7% 18.3% 19.9% 19.0% Total GME(d) 8.8% 8.6% 9.2% 9.1% Total GMIO(d)(e)(f) 10.3% 10.3% 10.4% 10.2% Total Worldwide 11.6% 11.4% 11.9% 11.6% </pre> <p> </p> <pre> U.S. Retail/Fleet Mix % Fleet Sales - Cars 42.4% 41.6% 29.7% 25.6% % Fleet Sales - Trucks 27.8% 26.4% 28.4% 22.5% Total Vehicles 33.5% 32.3% 28.9% 23.8% </pre> <p> </p> <pre> GMNA Capacity Utilization(g) 92.9% 88.8% 39.4% 38.5% __________ </pre> <p> </p> <p> </p> <pre> (a) Includes HUMMER, Saturn and Pontiac vehicle sales data. (b) Includes Saab vehicle sales data through February 2010. (c) Vehicle sales represent sales to the ultimate customer. (d) Vehicle sales primarily represent estimated sales to the ultimate customer. (e) Includes SGM, SGMW, FAW-GM joint venture sales in China and HKJV joint venture sales in India. (f) The joint venture agreements with SGMW (34%) and FAW-GM (50%) allows for significant rights as a member as well as the contractual right to report SGMW and FAW-GM joint venture vehicle sales in China as part of global market share. These entities are not consolidated for financial reporting purposes. Income and losses related to these entities are recorded in Equity income (loss), net of tax. (g) Two shift rated, annualized. </pre> <p> </p> <p> </p> <pre> Successor --------- December 31, June 30, 2010 2009 ------------- ------------- Worldwide Employment (thousands) GMNA 105 103 GME(a) 42 50 GMIO(b) 61 62 </pre> <p> </p> <p>Total Worldwide 208 215</p> <p> </p> <p> </p> <pre> United States - Salaried 26 26 United States - Hourly 53 51 __________ </pre> <p> </p> <p> </p> <pre> (a) Decrease in GME primarily relates to the sale of Saab, employees located within Russia and Uzbekistan transferred from the GME segment to the GMIO segment and restructuring initiatives in Germany, Spain, and the United Kingdom. (b) Decrease in GMIO reflects a reduction of 2,400 employees due to the sale of the India Operations. </pre> <p> </p> <p> </p> <pre> Successor Predecessor --------- ----------- Three Months Six Months Three Months Six Months Ended Ended Ended Ended June 30, June 30, June 30, June 30, 2010 2010 2009 2010 --------- --------- --------- --------- Worldwide Payroll (billions) $3.1 $6.1 $2.9 $5.9 </pre> <p> </p> <pre> General Motors Company and Subsidiaries Condensed Consolidated Statements of Operations </pre> <p> </p> <pre> (In millions, except per share amounts) (Unaudited) </pre> <p> </p> <pre> Successor Predecessor --------- ----------- Three Six Three Six Months Months Months Months Ended Ended Ended Ended June 30, June 30, June 30, June 30, 2010 2010 2009 2009 ----- --------- --------- --------- Net sales and revenue $33,174 $64,650 $23,047 $45,478 ------- ------- ------- ------- Costs and expenses Cost of sales 28,759 56,350 29,384 53,995 Selling, general and administrative expense 2,623 5,307 2,936 5,433 Other expenses, net 39 85 169 1,154 </pre> <p> </p> <pre> Total costs and expenses 31,421 61,742 32,489 60,582 ------ ------ ------ ------ Operating income (loss) 1,753 2,908 (9,442) (15,104) Equity in income of and disposition of interest in Ally Financial - - 1,880 1,380 Interest expense (250) (587) (3,375) (4,605) Interest income and other non- operating income, net 59 544 408 833 Loss on extinguishment of debt - (1) (1,994) (1,088) Reorganization expenses, net - - (1,157) (1,157) --- --- ------ ------ Income (loss) before income taxes and equity income 1,562 2,864 (13,680) (19,741) Income tax expense (benefit) 361 870 (445) (559) Equity income (loss), net of tax 411 814 (2) 46 --- --- --- --- Net income (loss) 1,612 2,808 (13,237) (19,136) Less: Net income (loss) attributable to noncontrolling interests 76 204 (332) (256) --- --- ---- ---- Net income (loss) attributable to stockholders 1,536 2,604 (12,905) (18,880) Less: Cumulative dividends on preferred stock 202 405 - - --- --- --- --- Net income (loss) attributable to common stockholders $1,334 $2,199 $(12,905) $(18,880) ====== ====== ======== ======== Earnings (loss) per share Basic Net income (loss) attributable to common stockholders $2.67 $4.40 $(21.12) $(30.91) Weighted-average common shares outstanding 500 500 611 611 Diluted Net income (loss) attributable to common stockholders $2.55 $4.21 $(21.12) $(30.91) Weighted-average common shares outstanding 522 522 611 611 </pre> <p> </p> <pre> General Motors Company and Subsidiaries Condensed Consolidated Balance Sheets </pre> <p> </p> <pre> (In millions, except share amounts) (Unaudited) </pre> <p> </p> <pre> Successor --------- June December 30, 31, 2010 2009 ----- --------- ASSETS Current Assets Cash and cash equivalents $26,773 $22,679 Marketable securities 4,761 134 </pre> <p> </p> <pre> Total cash, cash equivalents and marketable securities 31,534 22,813 Restricted cash and marketable securities 1,393 13,917 Accounts and notes receivable (net of allowance of $272 and $250) 8,662 7,518 Inventories 11,533 10,107 Assets held for sale - 388 Equipment on operating leases, net 3,008 2,727 Other current assets and deferred income taxes 1,677 1,777 ----- ----- Total current assets 57,807 59,247 Non-Current Assets Equity in net assets of nonconsolidated affiliates 8,296 7,936 Assets held for sale - 530 Property, net 18,106 18,687 Goodwill 30,186 30,672 Intangible assets, net 12,820 14,547 Other assets 4,684 4,676 </pre> <p> </p> <p> Total non-current assets 74,092 77,048</p> <p> </p> <pre> Total Assets $131,899 $136,295 ======== ======== LIABILITIES AND EQUITY Current Liabilities Accounts payable (principally trade) $20,755 $18,725 Short-term debt and current portion of long-term debt (including debt at GM Daewoo of $1,021 at 5,524 10,221 June 30, 2010) Liabilities held for sale - 355 Accrued expenses (including derivative liabilities at GM Daewoo of $352 at June 30, 2010) 24,068 23,134 ------ ------ Total current liabilities 50,347 52,435 Non-Current Liabilities Long-term debt (including debt at GM Daewoo of $722 at June 30, 2010; Note 10) 2,637 5,562 Liabilities held for sale - 270 Postretirement benefits other than pensions 8,649 8,708 Pensions 25,990 27,086 Other liabilities and deferred income taxes 13,377 13,279 ------ ------ Total non-current liabilities 50,653 54,905 ------ ------ Total Liabilities 101,000 107,340 Commitments and contingencies 6,998 6,998 Preferred stock, $0.01 par value (1,000,000,000 shares authorized, 360,000,000 shares issued and outstanding (each with a $25.00 liquidation preference) at June 30, 2010 and December 31, 2009) Equity Common stock, $0.01 par value (2,500,000,000 shares authorized, 500,000,000 shares issued and 5 5 outstanding at June 30, 2010 and December 31, 2009) Capital surplus (principally additional paid-in capital) 24,052 24,050 Accumulated deficit (2,195) (4,394) Accumulated other comprehensive income 1,153 1,588 ----- ----- Total stockholders' equity 23,015 21,249 Noncontrolling interests 886 708 </pre> <p> </p> <p> Total equity 23,901 21,957</p> <p> </p> <pre> Total Liabilities and Equity $131,899 $136,295 ======== ========
For further information: Renee Rashid-Merem, Office, +1-313-665-3128, or Cell, +1-313-701-8560, [email protected], or Randy Arickx, Office, +1-313-667-0006, or Cell, +1-313-268-7070, [email protected], both of General Motors
Share this article