
According to a report done by CNN Money, General Motors will save an estimated $14 billion in domestic tax breaks and up to $19 billion in global tax breaks in the years to come, according to a company filing. Ironically, the future tax breaks come from the previous years of operating in the red, as such breaks are usually reserved for companies struggling to stay afloat.
Interestingly, companies that elect to go through bankruptcy tend to lose such perks, as the debts shed during the process tend to balance out the previous losses.
Maybe the retention of this massive tax break shows remarkable work of the bankruptcy lawyers used that helped the company shed around $30 billion in debt during its incredibly brief 40-day bankruptcy purge. Or maybe something else is afoot here. The reasons aren’t quite clear, but both GM and the U.S. Treasury insist that this isn’t some sort of sweetheart deal and that any company that goes through bankruptcy can retain such tax breaks.
This morning, GM posted $4.7 billion in annual net income this morning for 2010, the first full year operating as a new company (in legal terms).
Source: CNN Money

General Motors has officially released its annual earnings just moments ago, posting a $4.7 billion profit — the first time the company has seen a full year of profits since 2004. It also is GM’s first full year of annual results as a new entity (LLC vs. Corporation). The earning come in just under the predicted $5.3 billion profit prediction, with calendar year revenue being $135.6 billion.
Along with the annual results came The General’s Q4 financial report, where The General posted a gain of $500 million, or about half the predicted $1.06 billion mark. Now let’s see where that stock ticker goes…

With the official release of The General’s annual and fourth quarter financial report a mere few hours away, Bloomberg is reporting that we may see an estimated $1.06 billion profit for the fourth quarter alone. It may be significantly lower than the previous three, but it is believed that major factors such as the expensive launch of the Chevrolet Volt and increased spending in future products have contributed to the lower profit margin. That’s money well spent if you ask us. Now… we play the waiting game for the official numbers.
Source: Bloomberg

According to a report from the Detroit Free Press, General Motors plans on releasing its annual earnings this Thursday. Expected to post a profit in the vicinity of $5.3 billion, it will be The General’s first full profitable year since 2004. At the same time, however, the company is keeping its Q4 expectations “significantly lower” than the previous three quarters of 2010.
Across the pond, GM Europe isn’t expected to share the same success as GM’s North American division. GM Europe was $1.9 billion in the red for the first nine months of 2010, with analysts hoping it will break even… at best.
Source: The Detroit Free Press

A trio of Wall Street’s biggest movers and shakers have gone and purchased a combined $384 million worth of General Motors stock, just days before the company will disclose its annual financial report, which is expected to be the company’s first full year of profit since 2004. Billionaires George Soros, David Tepper, and Bill Ackman have all decided to move in on their major investments supposedly based on market research. Ackman was by far the largest investor of the three, throwing in $265 million (7.2 million shares) while Soros and Tepper threw in $53 million (1.3 million shares) and $66 million (7 million shares), respectively. Also of note is Fidelity Investment’s purchase of $696 million in The General’s stock.
GM is expected to report $5.3 billion in annual profits on Thursday.
Sources: The Detroit News, The Detroit Free Press
