General Motors has reported a 42% decline to second quarter profits as it was impacted by a declining US vehicle market and restructuring charges related to the sale of its European division and withdrawal from the Indian and South African markets.
The company earned a profit of US$1.66bn in the second quarter, some 42.1% down on the US$2.87bn it made in the same period of last year. GM said that restructuring charges were US$770m on the loss from sale of Opel/Vauxhall and US$600m in charges related to the decision to stop selling vehicles in India and to sell its operations in South Africa.
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However, GM said that net income from continuing operations was US$2.4bn, down 11% on the same period of last year.
GM said its global Q2 revenue (leaving its European operations outside the calculation) was US$37bn, a 1.1% decline on last year.
GM CEO Mary Barra stressed the importance of restructuring measures to improve profitability. “Disciplined and relentless focus on improving our business performance led to a strong quarter and very solid first half of the year,” she said in a statement. “We will continue transforming GM to capitalise on growth opportunities and deliver even more value for shareholders.”
North American results were strong, in spite of a slowing US market. In North America GM said that improved mix and cost efficiencies largely offset lower volumes and drove strong EBIT-adjusted (US$3.5bn versus US$3.7bn last year)and an EBIT-adjusted margin of 12.2 percent. South American operations were at breakeven and the nternational operations unit posted a small profit of US$300m.
