GM Q2 Profit Beats View, Reiterates 2015 Outlook

(RTTNews) - Automaker General Motors Co. (GM) on Thursday reported a profit for the second quarter that soared from last year, reflecting strong truck sales in North America and continued strength in China.

Adjusted earnings per share for the quarter beat analysts' expectations, while revenues missed their estimates. Looking ahead, the company reaffirmed its guidance for the full-year 2015.

GM CEO Mary Barra said, "The first two quarters of the year were strong as we fully capitalized on a robust North American industry and maintained our strength in China, despite the challenging conditions in that market. We said our goal was to improve our earnings and margins this year, and we are on-plan."

GM reported record margins in North America and strong margins in China during the quarter.

Detroit, Michigan-based GM's second-quarter net income attributable to common stockholders rose to $1.12 billion or $0.67 per share, up sharply from $278 million or $0.11 per share in the prior-year quarter.

The latest quarter's results include special charges of $0.62 per share, related to a previously-announced currency devaluation in Venezuela, asset impairments primarily for GM Thailand, and an adjustment to the estimated cost of the ignition switch compensation program.

Excluding items, adjusted earnings for the latest quarter were $1.29 per share, compared to $0.58 per share in the year-ago period.

On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $1.08 per share for the quarter. Analysts' estimates typically exclude one-time items.

However, total net sales and revenue for the quarter declined 4 percent to $38.18 billion from $39.65 billion in the same quarter last year, due to foreign currency exchange impact. Analysts were looking for revenue of $40.62 billion.

Automotive revenues decreased 5 percent from last year to $36.67 billion, while GM Financial revenues grew 27 percent to $1.51 billion.

Total costs and expenses declined 8 percent from last year to $36.89 billion.

GM's total global retail vehicle sales volume for the quarter declined 2 percent to 2.46 million from 2.51 million in the year-ago period, with decreases in South America, APMEA and Europe.

The company's global market share also edged down to 11.1 percent from 11.3 percent in the year-ago quarter, with declines in the U.S., Europe, North America and South America.

GM's adjusted earnings before interest and tax or adjusted EBIT, for the quarter rose to $2.87 billion from $1.35 billion in the year-ago quarter.

In North America, GM reported adjusted EBIT of $2.78 billion, up from $1.39 billion in the year-ago period, which was weighed down by recall-related costs of $1.0 billion.

In Europe, GM's adjusted EBIT loss was $45 million, narrower than adjusted loss of $300 million in the year-ago quarter.

GM International Operations, including China, reported adjusted EBIT of $349 million, up from $315 million in the prior-year period.

GM South America reported adjusted EBIT loss of $144 million, wider than adjusted loss of $81 million in the prior-year period. GM Financial earnings before tax was $225 million, lower than $258 million last year.

Looking ahead to fiscal 2015, GM reaffirmed its outlook for improved adjusted EBIT and adjusted EBIT margins, compared to 2014.

GM is trading at $31.62, up $1.32 or 4.36 percent on a volume of 13.62 million shares.