GM CEO Dan Akerson: A strong performance during maker's first year after IPO.
Despite continuing losses in Europe and a drop in income from Asia, General Motors Co. reported a 60% increase in income for 2011, reporting it earned $7.6 billion, or $4.58 per share, up from $4.7
billion, or $2.89 share, in 2010.
But the maker saw earnings flatten out during the fourth quarter of the year.
Nonetheless, the strong upsurge for the full year means GM’s nearly 47,500 hourly employees in the U.S. will receive profit sharing check of up to $7,000 on profits generated in North America.
“In our first full year as a public company, we grew the top and bottom lines, advanced our global market share and made strategic investments in our brands around the world,” said Dan Akerson, chairman and CEO.“We will build on these results as we bring more new cars, crossovers and trucks to market, and make GM a far more efficient global team. This includes reducing our break-even level in Europe and South America and driving higher revenues around the world,” Akerson said.
GM saw revenue increase 11% to $150.3 billion for all of 2011, compared with $135.6 billion in 2010. Full-year earnings before interest and taxes or EBIT climbed to $8.3 billion, compared with $7 billion in 2010, GM reported Thursday.
Revenue in the fourth quarter of 2011 increased 3% to $38 billion, compared with the fourth quarter of 2010. GM’s fourth quarter 2011 net income was $500 million or 28 cents per share, which included a net loss from special items of $200 million or 11 cents per share.
(GM ousts European board in bid to turn around flailing Opel subsidiary. Click Here for the story.)
“We continue to monitor the very weak economic outlook for Europe and now, the prospects that GM’s increased management focus on Europe can reduce losses,” noted ratings agency Standard & Poor’s. While S&P decided not to downgrade the maker’s credit rating, it cautioned, “We currently view GM’s prospects for 2012 as manageably above our previously articulated threshold for a possible downgrade: Reduced prospects for profitable and cash-positive results, or if GM uses a substantial amount of cash in its automotive operations in any quarter and the reasons for that cash use seemed likely to persist.”
In the fourth quarter of 2010, GM’s net income attributable to common stockholders was $500 million or 31 cents per share, including a net loss from special items of $400 million or 21 cents per share. EBIT-adjusted was $1.1 billion in the fourth quarter of 2011, compared with $1 billion in the fourth quarter of 2010. Fourth quarter EBIT-adjusted for 2011 includes the impact of restructuring charges of $0.3 billion.
GM’s fourth quarter 2011 special items include impairment charges related to goodwill and GM’s investment in Ally Financial, and gains related to the Canadian Health Care Trust (HCT) settlement, the
reversal of deferred tax asset valuation allowances in Australia and the extinguishment of debt, GM said in its financial statement.
GM North America reported EBIT-adjusted of $1.5 billion in the fourth quarter of 2011 compared with $800 million in 2010. GMNA full-year EBIT-adjusted was $7.2 billion in 2011 compared with $5.7 billion in 2010.
While the giant automaker clearly benefited from the upturn in the U.S. market, it took a sharp blow in Europe, where the ongoing debt crisis has hurt industry sales, overall, and where the maker’s Opel brand has been in decline for the last decade.
GM Europe reported an EBIT-adjusted loss of $600 million in the fourth quarter of 2011, including $200 million of restructuring costs, matching last year’s results. Full-year EBIT-adjusted was a loss of $700 million in 2011, an improvement of $1.3 billion over 2010.
GM International Operations reported EBIT-adjusted of $400 million in the fourth quarter of 2011 compared with $300 million in 2010. But full-year EBIT, which includes income from GM ventures in China, was $1.9 billion in 2011 compared with $2.3 billion in 2010.
GM South America reported an EBIT-adjusted loss of $200 million in the fourth quarter of 2011, including $100 million in restructuring costs, compared with EBIT-adjusted of $200 million in 2010. Full-year EBIT-adjusted was a loss of $100 million in 2011 compared with EBIT-adjusted of $800 million in 2010.