GM posts quarterly net income of $1.96 billionWed, 10 Nov 2010 00:00:00 -0800
General Motors Co., in its final financial snapshot before next week's initial public offering of stock, posted third quarter net income of $1.96 billion on revenues of $34.06 billion.
The results, released Wednesday, were in line with a forecast issued last week. GM now has earned $4.16 billion on revenues of $98.71 billion through three straight profitable quarters this year--a dramatic swing after five consecutive annual losses.
The automaker expects profitability to fall in the fourth quarter because of higher new-product development and vehicle-launch costs. The latter includes those for the Chevrolet Volt and Cruze.
“The results of the third quarter clearly point to the amount of progress GM has made,” CEO Dan Akerson said in a conference call. An accelerating turnaround in North America contributed to the performance.
In the third quarter of 2009, GM posted a $1.15 billion loss after going through a U.S.-funded overhaul in bankruptcy court.
Through October, GM's U.S. sales are up 6 percent to 1.8 million units. The company has lost share in an overall market that is up 11 percent.
Most of GM's market share losses stem from the sale of Saab and the elimination of the Pontiac, Hummer and Saturn brands.
GM's results topped rival Ford Motor Co's $1.7 billion third-quarter profit. Chrysler Group, which exited its U.S.-steered bankruptcy a month before GM, had a third-quarter operating profit of $239 million and a net loss of $84 million.
GM said it expects to report positive earnings before interest and taxes in the fourth quarter, but “at a significantly lower run rate” than each of the first three quarters, and expects to be profitable for all of 2010.
By James B. Treece- Automotive News