GM Chairman and CEO Mary Barra said the company's first-quarter earnings show the maker is "growing where it counts."
General Motors Co. reported first-quarter net income of $2 billion, or $1.24 per share, compared with $900 million, or 56 cents per share, a year ago despite losing money in recession-scarred South America, and breaking even in its European operations during the first three months of 2016.
“We’re growing where it counts, gaining retail share in the U.S., outpacing the industry in Europe and capitalizing on robust growth in SUV and luxury segments in China,” said Chairman and CEO Mary Barra in a statement.
Overall, GM’s earnings per share after adjustment for special items was a first-quarter record at $1.26, up 47% compared with the first quarter of 2015. GM also beat analysts’ estimates and kept in place its guidance calling for larger full-year profits this year than in 2015.
“This strong quarter also reflects the excellent progress we’re making to improve results in our more challenged global markets. Importantly, the continued success of our core business is enabling us to invest in advanced technology and innovations that will help shape the future of personal mobility,” said Barra.
(GM no longer offering vehicles without airbags. For more, Click Here.)
The earnings increase was driven by improved year-over-year results in all reporting segments, including break-even performance in Europe and $500 million dividend from its joint ventures in China. The first-quarter net income from its China operations was equal to the GM’s share of profits from China during the first quarter of 2015.
Despite the expense of a new labor contract, GM North America reported first-quarter record earnings before interest or taxes or EBIT of $2.3 billion, which includes $200 million for restructuring costs. This compares with $2.2 billion in the first quarter of 2015.
GM International Operations reported EBIT-adjusted of $400 million compared with $0.4 billion in the first quarter of 2015. The results included China equity income of $500 million in both periods.
(Click Here for details about GM’s recall of 1 million full-size pickups due to seat belt issue.)
GM South America reported EBIT-adjusted of $100 million compared with $200 million in the first quarter of 2015. GM Financial reported earnings before tax of $200 million, about equal to a year ago.
The company set first-quarter records for earnings and margin, with earnings EBIT of $2.7 billion and EBIT-adjusted margin of 7.1%. These compare to EBIT-adjusted of $2.1 billion and an EBIT-adjusted margin of 5.8 % in the first quarter of 2015.
First-quarter 2016 EBIT-adjusted results included the impact of $0.3 billion restructuring costs, primarily in North America, compared to $0.1 billion in restructuring costs a year ago.
(To see more about GM’s better-than-expected sales in China, Click Here.)
Net revenue during the quarter was $37.3 billion compared to $35.7 billion in the first quarter of 2015. Holding exchange rates constant, net revenue was $2.9 billion higher than the first quarter of 2015.