GM Q1 Profits Triple
GM solidly trounced analysts’ expectations and delivered $3.2 billion if Q1 2011 net income. The consensus of a Bloomberg panel was $1.74 billion. Compared with the first quarter of 2010, revenue increased $4.7 billion to $36.2 billion, says GM press release. GM’s first-quarter profit more than tripled to its highest in at least 21 years.
About half of the glad tidings were not earned in the showroom. Says the communiqué:
“Net income attributable to common stockholders includes gains of $1.6 billion and $0.3 billion respectively related to the sales of the company’s ownership interest in Delphi Automotive LLP and Ally Financial Inc. preferred stock. It also includes a $0.4 billion goodwill impairment charge at GM Europe (GME) resulting from a change in accounting standards and charges totaling $0.1 billion at GM International Operations (GMIO) related to revised tax regulations affecting the company’s India joint venture. Combined, these special items increased net income attributable to common stockholders by $1.5 billion or $0.82 per fully-diluted share.”
However, even excluding these items, profit was 95 cents a share, topping the 91-cent average estimate of 13 analysts surveyed by Bloomberg.
GM is not breaking out how much money it made in its largest market China. The release only says that “GMIO reported EBIT of $0.5 billion compared with $0.9 billion in the first quarter of 2010. On an EBIT-adjusted basis, GMIO earned $0.6 billion in the first quarter, a decline of $0.3 billion compared with the first quarter of 2010.” GMIO stands for “GM International Operations.”
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
More by Bertel Schmitt
Comments
Join the conversation
Since GM is so successful, let's have them buy back some stock from the government. How much does the US Treasury hold? Last I heard, the plan was for Treasury to sell large pieces of stock this Summer, netting a loss for the taxpayers. GM fans, please hold your applause until the those of us who won't buy GM products see money returned to the government to be wasted on other programs. Still, congrats on the good news.
Good for GM! While Ford has been getting pretty much all the kudos lately, it's interesting to note that one of the areas that Ford is weakest (sales in the fast growing BRIC auto markets - esp. China) is where GM has done really well. And as for all the talk about how Ford didn't need bailout $$, they were fortuitous in being able to hock themselves to the hilt before the credit market froze; if they had delayed, they would have been in the exact same shape as GM and Chrysler. Also, w/o the bailouts, the suppliers supplying GM and Chrysler would have gone under and many of them also supply Ford which would have eventually sent Ford over the edge as well. And then there's Ford Credit ...so it's not so black and white.
Living in metro Detroit obviously I'm glad GM & Chrysler got bailed out. I still think the end result will prove the government made a financially wise decision to keep both companies in business. Don't forget what the state of the entire economy was at the time of the bailouts and what effect both companies going under would have had. I completely understand the opinions of those that remain opposed to the bailouts but I also vehemently disagree with that stance. The bailouts had an enormous positive effect on our local economy and I am a beneficiary of that.
Oh...so the taxpayers aren't going to lose any money on this bailout then?? Let me know when (if?) that happens...