GM has just announced that it has completed fresh-start accounting as part of its goal to once again become a public company. At the same time, GM also reported a $4.3 net billion loss for the time period of July 10 through December 31, 2009.
The $4.3 billion loss consists of a $2.6 billion settlement loss related to the UAW retiree medical plan and a $1.3 billion foreign currency re-measurement loss.
That said, GM also reported a $1 billion surplus of net cash provided by operating activities. Going public will enable The General to invest in designing, building, and selling the world’s best vehicles, attract the best people, and access the (much-needed) capital markets.
This is not to say that there still isn’t work to be done. According to GM’s new Vice-Chairman and CFO Chris Liddell,
“As the results for 2009 show there is still significant work to be done. However, I continue to believe we have a chance of achieving profitability in 2010,” said Liddell. “We are also dedicated to delivering on our commitments to our stakeholders. For example we remain committed to repaying the outstanding balance of the U.S. Treasury and Export Development Canada loans by June 2010 at the latest.”
This isn’t the first time Liddell has expressed his belief that 2010 will be a profitable year for The General, as he has done so back in March.
Later today, GM will file its third quarter 2009 Form 10-Q and 2009 Form 10-K with the United States Securities and Exchange Commission (SEC).
We have GM’s full presser after the jump!
The GM Authority Take
Some may look at the $4.3 billion loss as terrible news while others have even gone so far as to say that – given GM’s involvement with the Federal Government and TARP Funds – this is the equivalent of paying off one credit card with another. What these individuals fail to take into consideration, however, is the time period of this news – the last six months of 2009. Even though GM went through Chapter 11 bankruptcy proceedings and came out as New GM (General Motors Company, to be exact) during the summer of 2009, this was mostly in name. Only now are we seeing the effects of GM’s turnaround plan in action, which includes executive reassignments and product repositioning, among other things.