GM Tops Earnings Estimates, Sees Continued Europe Losses
DETROIT -- (TheStreet) -- GM (GM) third quarter results beat analysts' estimates despite earnings declines in North America and in Europe, where the automaker said it could lose as much as $1.8 billion this year.
Excluding items, GM earned $1.6 billion, or 93 cents a share. Analysts surveyed by Thomson Reuters had estimated 60 cents. Revenue rose 2% to $37.6 billion. Analysts had estimated $35.9 billion.
Including items, the automaker earned $1.5 billion, or 89 cents a share. In the same quarter a year earlier, GM earned $1.7 billion, or $1.03 a share.
"GM had a solid quarter because customers around the world love our new vehicles and we're also seeing green shoots take hold on tough issues like complexity reduction, pensions and Europe," said CEO Dan Akerson, in a prepared statement.
During the quarter, earnings before interest and tax rose to $2.3 billion from $2.2 billion a year earlier. By segment, GM North America reported EBIT-adjusted of $1.8 billion, down from $2.2 billion a year earlier. GM Europe reported an EBIT-adjusted loss of $478 million, compared with a loss of $292 million a year earlier.
In Asia, GM International Operations reported EBIT-adjusted of $689 million, compared with $365 million a year earlier. GM South America reported EBIT-adjusted of $114 million, compared with a loss of $44 million a year ago. GM financial reported earnings before tax of $200 million, up from $178 million a year ago.
Looking ahead, GM said consolidated fourth-quarter EBIT-adjusted will follow typical seasonal trends with results estimated to be similar to or slightly better than the same period a year ago.
In Europe, GM expects to lose $1.5 billion to $1.8 billion for the full year, depending on the level of restructuring activity in the fourth quarter. The company is targeting full-year 2013 EBIT-adjusted in Europe to be slightly better than 2012. Break-even EBIT-adjusted results are targeted by mid-decade.
"While we still have a lot of work to do, especially in Europe, it is encouraging to see our results begin to reflect the discipline we are bringing to bear on the overall business," said Chief Financial Officer Dan Ammann.
-- Written by Ted Reed in Charlotte, N.C.
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