General Motors reported first quarter 2015 net income of $0.9 billion, or $0.56 per fully diluted share, on net revenue of $35.7 billion. The results include a net loss from special items of $0.5 billion, or $(0.30) per diluted share.
Special items in the quarter included:
- $0.4 billion related to the decision to change GM’s business model in Russia
- $0.1 billion for an adjustment to the estimated costs of the ignition switch compensation program
“Our results in the first quarter provide a solid foundation to achieve our financial commitments for the year,” said GM CEO Mary Barra. “Continued execution of our plan, including our capital allocation framework, will drive profitable growth, return on invested capital and shareholder value.”
Compared to Q1 of 2014, GM’s Q1 2015 net income attributable to common stockholders was up $800 million, or 50 cents per fully-diluted share. Revenue was down $1.7 billion compared to the first quarter of 2014.
Earnings before interest and tax (EBIT) adjusted was $2.1 billion in Q1 2015, and included the impact of $0.1 billion in restructuring costs, compared to the $0.5 billion in the the first quarter of 2014, which included recall-related pre-tax costs of $1.3 billion and $0.3 billion in restructuring costs.
General Motors Q1 2015 Financial ResultsAll figures in billions except for per share amounts
|METRIC||Q1 2015||Q1 2014||Q1 2015 - Q1 2014||% CHANGE Q1 2015 / Q1 2014|
|NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS||$0.90||$0.10||+0.80||+800%|
|EARNINGS PER SHARE (EPS) DILUTED||$0.56||$0.06||+0.50||+833.33%|
|IMPACT OF SPECIAL ITEMS ON EPS FULLY DILUTED||$(0.30)||$(0.23)||-0.07||-30.43%|
|AUTOMOTIVE NET CASH FLOW FROM OPERATING ACTIVITIES||$0.00||$2.00||-1.50||-750%|
|ADJUSTED AUTOMOTIVE FREE CASH FLOW||$(1.70)||$(0.20)||-1.50||-750%|
|% RETURN ON INVESTED CAPITAL (ROIC)||19.5||16.9||+2.60||+15.38%|
Regional Division Results
- GM North America reported EBIT-adjusted of $2.2 billion, compared with EBIT-adjusted of $0.6 billion in the first quarter of 2014, which included the impact of a $1.3 billion pre-tax charge for recall costs.
- GM Europe reported EBIT-adjusted of $(0.2) billion, compared with with EBIT-adjusted of $(0.3) billion in the first quarter of 2014, which included $0.2 billion for restructuring costs.
- GM International Operations reported EBIT-adjusted of $0.4 billion, compared with EBIT-adjusted of $0.3 billion in the first quarter of 2014.
- GM South America reported EBIT-adjusted of $(0.2) billion, approximately equal to the first quarter of 2014.
- GM Financial reported earnings before tax of $0.2 billion, matching its results for the first quarter of 2014.
“Key vehicles like our recently launched full and mid-size trucks, and our cost discipline helped us deliver a solid quarter,” said Chuck Stevens, GM executive vice president and chief financial officer. “We continue to take decisive actions to address issues head-on and to drive the company to generate strong results.”
Cash Flow, Capital Return, Liquidity And ROIC
First quarter automotive cash flow from operating activities of $0.0 billion and adjusted automotive free cash flow of $(1.7) billion, were down from $2.0 billion and $0.2 billion a year ago, respectively. The declines in automotive operating and adjusted automotive free cash flows were primarily related to one extra weekly payment cycle to suppliers during the quarter compared with the same quarter a year ago, and cash payments related to recalls and restructuring.
Since announcing its $5 billion common stock repurchase program on March 9, 2015, GM has repurchased 19.4 million shares through April 21. Of this total, 10 million shares were repurchased through the March 31 trading date for approximately $0.4 billion. Additionally, GM paid common stock dividends of approximately $0.5 billion to shareholders during the quarter.
GM ended the quarter with strong total automotive liquidity of $34.2 billion. Automotive cash and marketable securities was $22.1 billion compared with $25.2 billion at year-end 2014.
As previously announced, GM will reinvest in its business with the objective of driving 20 percent or higher average return on invested capital (ROIC) through investments in world-class vehicles and leading technology. Beginning this quarter, the company will report trailing four quarter ROIC. On this basis, ROIC at the end of the quarter was 19.5 percent, compared to 16.9 percent at the end of the first quarter of 2014.
Based on its first quarter results, the company reaffirmed the 2015 annual outlook it communicated on January 14. GM expects its total EBIT adjusted and EBIT-adjusted margin to increase in 2015, compared to 2014, after adjusting 2014 for the impact of recall costs, with improved automotive results anticipated in all regions.