GM managed to keep itself in the black for the first quarter, after covering hefty recall-related expenses.

After writing down more than $1.3 billion to cover the cost of a burst of embarrassing recalls, General Motors saw its earnings for the first quarter of 2014 fall by more than 85%, it reported today, though it was still able to squeak out a modest profit.

The $125 million net earnings, at 6 cents per share, came in under the 9 cents consensus among top industry analysts. Some were even more bearish, Brian Johnson, of Barclays Plc, forecasting a one cent loss for the January to March quarter. But the crisis that began with the recall of 800,000 vehicles due to a faulty ignition switch in mid-February – and which ultimately saw GM call back nearly 7 million vehicles by the end of March – is likely to take its toll for some time to come.

“The performance of our core operations was very strong this quarter, reflecting the positive response of customers to the new vehicles we are bringing to market,” said GM CEO Mary Barra, in a statement aimed at putting a positive spin on the results. “Our focus remains on creating the world’s best vehicles with the highest levels of safety, quality and customer service, while aggressively addressing our business opportunities and challenges globally.”

Barra has been in the hot seat for the past two months, ever since the initial announcement of the ignition switch recall – which has been expanded since then to cover about 2.6 million vehicles, with safety-related problems involving other GM products expanding the total number of recalled vehicles to nearly 7 million. GM took a Q1 write-down of $1.3 billion to cover the anticipated costs for repairs. But it is expected to spend significantly more in the months, and possibly years, ahead.

The maker is studying options that include setting up a victims’ fund for those injured, as well as for the families of those killed, due to the ignition switch defect. And it is considered by industry observers highly likely that the maker will have to pay eventual fines as a result of ongoing investigations by both the National Highway Traffic Safety Administration and the U.S. Justice Department. Justice reached a separate settlement in March with Toyota for the improper handling of recalls that resulted in a $1.2 billion settlement.

(Barra defends GM’s handling of recall investigation. Click Here for the latest.)

The first quarter GM numbers were impacted by other problems, including charges related to currency restructuring in Venezuela, as well as ongoing losses in Europe where GM has lost a total of $18 billion since 1999.

All told, various one-time “special items” delivered a $2 billion hit to the bottom line. Factor those out, and GM’s earnings would have jumped to 29 cents a share – still a big decline from the 67 cents it earned during the first quarter of 2013.

Not all the numbers were down for the latest three-month period. Net revenues rose modestly, from $36.9 billion to $37.4 billion. That improvement was driven by a number of factors, including its strong performance in China, the world’ largest automotive market, where GM is a close second to Chinese sales leader Volkswagen AG. China is now GM’s largest global market, while overseas sales account for roughly two-thirds of its volume.

But despite the maker’s well-publicized recall problems, it actually has done a bit better than many expected at home. March sales were up 4%, despite Barra’s widely-followed appearance during two days of hearings on Capitol Hill.

A new study, the YouGov BrandIndex Buzz score, shows that GM has clearly taken a hit to its image over the last several months. On a scale ranging from +100 to -100, the overall domestic auto sector has been averaging around 10 to 12. Since the recall scandal began, GM has seen its overall score dip as low as -33, recovering only slightly in recent days.

(GM engineering undergoes shake-up to improve safety controls, Click Here.)

But that is still better than the -63 score Toyota generated during the worst of its own recall problems in 2010. And GM’s leading U.S. brand, Chevrolet, is running at a roughly neutral score, despite several of its products being targeted by the ignition switch recall.

Of course, it helps that Chevy has received a number of third-party kudos in recent months. It swept the North American Car and Truck of the Year awards with its Corvette sports car and Silverado pickup in January, while influential Consumer Reports magazine had nothing but praise for the new Chevrolet Silverado.

(Feds launch probe of possible braking problem with new Chevy Impala. Click Here for the story.)

But the impact of the recall crisis, and the subsequent hit on GM’s image, as well as its balance sheet, is far from over, industry analysts have warned.  Bob Ferguson, the head of the Cadillac brand, and an advisor to CEO Barra on handling the scandal, has warned that it could take two years before the maker can get past the problem. And that would likely involve settling any case the Justice Department might bring, never mind dealing with lawsuits related to the ignition switch issue.

So, while the first quarter of 2014 may have been an especially rough one for GM, the months to come will still bring problems likely to continue hurting the company’s bottom line.