General Motors has announced third quarter net income took a US$300m hit from “special items” but net profit for the recall-troubled quarter was still $1.4bn, or $0.81 a share – double the result for Q3 2013.
The carmaker booked a $900m charge in the second quarter of 2014 to cover the cost of potential recalls over the next decade on top of the US$400m it had put aside to pay compensation to victims of the recall that first emerged in February. The third quarter special items were primarily related to flood damage sustained at the GM Technical Center in Michigan and long-lived asset impairments in Russia.
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In the third quarter of 2013, GM booked net income of $0.7bn, or $0.45 a share, which included a net loss from special items that reduced net income by $0.9bn, or $(0.51) per diluted share.
“Strong global sales and growing margins in North America and China helped GM deliver very solid third quarter results,” said CEO Mary Barra in a statement.
“Despite industry challenges in Russia and South America, our earnings were on plan as we continue to execute our customer-focused strategy.”
Earnings before interest and tax (EBIT) adjusted was $2.3bn and included $0.2bn in restructuring costs at GM Europe. This was down on Q3 2013 when the company booked EBIT-adjusted profit of $2.6bn after $0.1bn in restructuring costs.
Net revenue in the third quarter of 2014 was $39.3bn, compared to $39.0bn in 2013. In the first nine months of 2014, revenue rose to $116.3bn from $114.9bn in the same period a year ago.
GM North America reported EBIT-adjusted of $2.5bn, compared with $2.2bn in the third quarter of 2013.
As noted above, GM Europe reported an EBIT-adjusted loss of $(0.4)bn which included restructuring costs of $0.2bn, double the loss of $0.2bn in Q3 2013.
GM International Operations booked an EBIT-adjusted profit of $0.3bn, flat compared with $0.3bn a year ago.
GM South America broke even after an EBIT-adjusted 0.3bn profit in 2013.
GM Financial reported post-tax profit of $0.2bn, the sames as third quarter 2013.
“Strong performance in North America, where we achieved a 9.5% margin, anchored our overall results,” said GM CFO Chuck Stevens.
“We remain focused on flawlessly launching key vehicles globally in the coming months.”
Fourth quarter launches will include the recently introduced GMC Canyon and Chevrolet Colorado mid-sized pickups in the US, Cadillac ATS-L, Buick Envision and Chevrolet Cruze in China, and redesigned Opel/Vauxhall Corsa and Adam Rocks in Europe.
GM Results Overview (in US$ billions except for per share amounts)
|
Q3 2014 |
Q3 2013 |
|
|
Revenue |
$39.3 |
$39.0 |
|
Net income attributable to common stockholders |
$1.4 |
$0.7 |
|
Earnings per share (EPS) diluted |
$0.81 |
$0.45 |
|
Impact of special items on EPS diluted |
$(0.16) |
$(0.51) |
|
EBIT-adjusted |
$2.3 |
$2.6 |
|
Automotive net cash flow from operating activities |
$0.7 |
$3.3 |
|
Adjusted automotive free cash flow |
$(0.8) |
$1.3 |
