General Motors reported second quarter 2015 net income of $1.1 billion, or $0.67 per fully diluted share, on net revenue of $38.2 billion. The results include a net loss from special items before tax of $1.1 billion, or $(0.62) per diluted share. Earnings before interest and taxes (EBIT) adjusted increased to $2.9 billion and EBIT-adjusted margin grew to 7.5 percent.
“The first two quarters of the year were strong as we fully capitalized on a robust North American industry and maintained our strength in China, despite the challenging conditions in that market,” said GM CEO Mary Barra. “We said our goal was to improve our earnings and margins this year, and we are on-plan. Consistent with that, we believe our results in the second half of the year will be even better than the first half, and we’re confident we will meet our 2016 targets.”
Compared to Q2 of 2014, GM’s Q2 2015 net income attributable to common stockholders was up $900 million, or 56 cents per fully-diluted share.
Special items before tax in the quarter included:
- $0.6 billion related to a previously-announced currency devaluation in Venezuela
- $0.4 billion for asset impairments primarily for GM Thailand
- $0.1 billion for an adjustment to the estimated cost of the ignition switch compensation program
Net revenue in the second quarter of 2015 was $38.2 billion, down $1.4 billion compared to the $39.6 billion in the second quarter of 2014. GM attributes the change in revenue to a negative net foreign currency exchange impact. Holding exchange rates constant, net revenue was $0.9 billion higher than the second quarter of 2014.
“Our plan is generating results and giving us momentum,” said Chuck Stevens, executive vice president and chief financial officer. “Record margins in North America and strong margins in China produced a second quarter that demonstrates the earnings power of this company. We expect continued strong performance in these key markets.”
General Motors Q2 2015 Financial ResultsAll figures in billions except for per share and ROIC amounts
|METRIC||Q2 2015||Q2 2014||Q2 2015 - Q2 2014||% CHANGE Q2 2015 / Q2 2014|
|NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS||$1.10||$0.20||+0.90||+450%|
|EARNINGS PER SHARE (EPS) DILUTED||$0.67||$0.11||+0.56||+509.09%|
|IMPACT OF SPECIAL ITEMS ON EPS FULLY DILUTED||$(0.62)||$(0.47)||-0.15||-31.91%|
|AUTOMOTIVE NET CASH FLOW FROM OPERATING ACTIVITIES||$5.10||$3.60||+1.40||+73.68%|
|ADJUSTED AUTOMOTIVE FREE CASH FLOW||$3.30||$1.90||+1.40||+73.68%|
|% RETURN ON INVESTED CAPITAL (ROIC)||23.4||14.7||+8.70||+59.18%|
Regional Division EBIT-Adjusted Results
- GM North America reported EBIT-adjusted of $2.8 billion with an EBIT-adjusted margin of 10.5 percent. These results included the impact of $0.2 billion for restructuring costs. The results compare with EBIT-adjusted of $1.4 billion in the second quarter of 2014, which included the impact of recall-related costs of $1.0 billion.
- GM Europe reported EBIT-adjusted of $(45) million. This compares with EBIT-adjusted of $(305) million in the second quarter of 2014, which included $0.2 billion for restructuring costs.
- GM International Operations reported EBIT-adjusted of $0.3 billion, compared to $0.3 billion in the second quarter of 2014. Results included China equity income of $0.5 billion, which generated a 10.2 percent net income margin.
- GM South America reported EBIT-adjusted of $(0.1) billion, compared with EBIT-adjusted of $(0.1) billion in the second quarter of 2014.
- GM Financial earnings before tax was $0.2 billion for the quarter, compared to $0.3 billion in the second quarter of 2014.
Cash Flow, Capital Return, Liquidity
Second quarter automotive cash flow from operating activities of $5.1 billion and adjusted automotive free cash flow of $3.3 billion, were up from $3.6 billion and $1.9 billion a year ago, respectively.
Year-to-date through July 21, GM has returned more than $3.1 billion of cash to shareholders through share repurchases of $2.1 billion and dividends of $1.1 billion.
GM ended the quarter with strong total automotive liquidity of $34.9 billion. Automotive cash and marketable securities was $22.8 billion compared with $25.2 billion at year-end 2014.