1st Quarter Results
GM Reports Preliminary Q1 Financial Results
* Reported Net Loss $323 Million, About $1 Billion Improvement From 2005
* Record Quarterly Revenue of $52.2 Billion
* $567 Million GMNA Improvement Despite $484 Million Health-Care Charge
* Automotive Liquidity Stronger at $21.6 Billion
DETROIT, April 20 -- General Motors Corp. (NYSE: GM) today reported
significantly improved financial results for the first quarter of 2006, with
operations from every automotive region in the world contributing to the
turnaround efforts.
"The first quarter represented an important milestone in GM and GM North
America's turnaround," said GM Chairman and Chief Executive Officer Rick
Wagoner. "Not only did we see significant improvement in the financial
results of all our automotive units, we also announced numerous additional
actions to improve our North American competitiveness and liquidity. And, we
made significant progress in implementing those and previously announced
initiatives, such as the UAW health-care agreement and the North American
capacity plan.
"We're pleased to see the significant progress in our first-quarter
results and in the implementation of all four elements of our North American
turnaround plan," Wagoner continued. "And we remain focused on accelerating
our return to profitability and cash generation."
GM reported a preliminary net loss of $323 million, or $0.57 per share, in
the first quarter of 2006, including special items. This was more than
accounted for by the inclusion of a $681 million after-tax charge, or $1.20
per share, related to the recently approved health-care settlement agreement
for U.S. hourly retirees. These first-quarter results represent a significant
improvement from the year-ago loss of $1.3 billion, or $2.22 per share.
Reported revenue rose 14.1 percent to a record $52.2 billion in the first
quarter of 2006.
Excluding special items but including the effect of the $681 million
health-care charge ($1 billion pretax), GM reported a preliminary adjusted
loss of $529 million, or $0.94 per share in the first quarter of 2006. In the
year-ago quarter, GM reported an adjusted loss before special items of $988
million, or $1.75 per share.
The reported results for the first quarter of 2006 include special items
totaling a favorable $206 million after tax, or $0.37 per diluted share.
These results include a gain of $317 million, or $0.56 per share, from the
sale of most of GM's stake in Suzuki, partially offset by restructuring
charges totaling $111 million, or $0.19 per share, at GM North America (GMNA),
GM Europe (GME) and GM Latin America/Africa/Middle East (GMLAAM). Additional
details on the special items are included in the "Highlights" section of this
press release.
GM's results for the first quarter of 2006 are preliminary and may be
revised prior to the filing of GM's first quarter report on Form 10-Q in early
May, depending on factors such as the final determination of the accounting
treatment for the retiree health-care settlement agreement.
Health Care Agreement to Reduce Liability by $15 billion
The unprecedented health-care settlement between GM and its largest labor
union, the United Auto Workers, was approved by the U.S. District Court on
March 31, 2006.
"The health-care agreement is expected to result in an immediate
25-percent reduction in GM's hourly retiree health-care liability, or about
$15 billion," Wagoner said. "The court approval is an important milestone,
enabling us to implement this on the schedule we had anticipated."
As part of the agreement, GM will make contributions to a new independent
Defined Contribution Voluntary Employees' Beneficiary Association (DC VEBA) of
$1 billion in each of 2006, 2007, and 2011. GM will also make supplemental
contributions to the DC VEBA related to events like profit-sharing payments
and increases in the value of GM stock.
Because the settlement received final court approval on March 31, the
first $1 billion DC VEBA contribution is being recorded in the first quarter
of 2006 even though the cost savings will not be realized until the second
half of the year. Beginning July 1, the pretax savings associated with the
health-care agreement will be approximately $750 million per quarter through
2011.
According to the accounting treatment that GM believes is appropriate
under U.S. Generally Accepted Accounting Principles, the obligation to make
the contributions would be recognized in each of the three periods in which
they become due and payable. Other possible accounting treatments include
recognizing the present value of all three payments as expense on March 31,
2006, which would significantly increase the amount of the first-quarter
charge and eliminate any future charges. GM is currently in discussions with
the U.S. Securities and Exchange Commission to determine the final accounting
treatment and expects the issue to be resolved before it files its Form 10-Q.
GM financial results described throughout the remainder of this release
exclude special items unless otherwise noted (see "Highlights").
GM Automotive Operations
GM's automotive operations reported an adjusted loss of $721 million in
2006, including the health-care charge, halving the year-ago adjusted loss of
$1.5 billion. All of the company's automotive units reported progress in the
quarter, with three out of the four units posting profitable results.
Global automotive sales rose 4.4 percent to 2.2 million units as strong
sales in GM's Asia Pacific and Latin American regions were partially offset by
declines in the United States and Canada. Global market share was down
slightly to 13.2 percent from 13.3 percent a year ago.
GM North America Shows Improvement
GM North America reported an adjusted loss of $946 million in the first
quarter of 2006, including $484 million of the retiree health-care settlement
charge. This compares to an adjusted loss of $1.5 billion a year ago. Higher
production volumes, improved mix and better net pricing contributed $1.1
billion of improvement to GMNA operating earnings, offset in part by the
health-care charge. Revenue per unit sold in GMNA was significantly higher in
the quarter versus a year ago, mostly attributable to better pricing and
richer mix. U.S. dealer inventories ended the quarter at 1,169,000 vehicles,
down 74,000 units from the year-ago period, and well positioned for the spring
selling season.
GM recently increased its structural cost reduction target in North
America by more than $1 billion, to $7.5 billion on a running rate basis by
the end of 2006, excluding the cost of the three $1 billion DC VEBA
contributions in 2006, 2007 and 2011. Approximately $4 billion of this
reduction will be cash savings. GM also continues to focus on achieving the
previously reported $1 billion target of material cost savings in 2006, which
is under pressure due to high raw material and commodity prices.
GM remains committed to revitalizing its product portfolio through an
aggressive product spending program. In 2006, GM expects capital spending to
total approximately $8.7 billion. This represents an increase of
approximately $800 million over 2005 levels.
"We are very pleased with the market's reaction to our launch products,"
Wagoner said. "In the first three months of the year, our new products
accounted for about 30 percent of our total sales -- more than double where we
were a couple of years ago. We're especially encouraged by the early sales of
the Chevrolet Tahoe, GMC Yukon, and Cadillac Escalade. And we're pleased with
the reaction last week to the new Saturn Sky and Aura at the New York Auto
Show."
GM is revitalizing its sales and marketing strategy by focusing on the
strength of its products, emphasizing their great value and features in
relation to the competition. GM is focused on improving the mix and quality
of its share by reducing incentives and the volume of sales to daily rental
car companies. While this may result in short-term declines in sales and
market share, it also is expected to result in improved retail sales and
financial performance over time.
"Despite even higher incentives by many of our competitors, we think our
new product-focused marketing strategy is the right one, and early results are
in line with our expectations," Wagoner said.
GM Europe Posts Profitable Quarter
GM Europe reported adjusted earnings of $88 million in the first quarter
of 2006, a significant improvement from the year-ago loss of $92 million,
reflecting improved pricing, continued progress in reducing structural and
material costs, better mix and lower warranty and policy costs. In addition,
Saab showed significant financial improvement and sold more than 34,000
vehicles worldwide, an all-time first-quarter record.
"Our European turnaround plan moved into high gear in the first quarter,"
Wagoner said. "Looking forward, we'll continue to focus on that, as well as
growing our multi-brand strategy in Europe and on important vehicle launches.
The Cadillac BLS is arriving in dealerships now, followed by the Chevrolet
Epica in June and the Opel Corsa and Chevrolet Captiva in the third quarter."
GM Asia Pacific Reports Improved Results
GM Asia Pacific (GMAP) reported adjusted earnings of $81 million in the
first quarter of 2006, up from $70 million a year ago, reflecting improved
sales volumes in China and higher sales volumes from GM Daewoo.
"Asia Pacific continues to be a very positive story for GM," Wagoner said.
"GM vehicle sales in China were up 76 percent during the quarter, and our
steady commitment to expanding our product line-up continues to pay dividends.
Likewise, our investment in GM Daewoo continues to pay returns, with domestic
sales and export shipments rising 60 percent in the first quarter."
GM Latin America/Africa/Middle East
GM Latin America/Africa/Middle East reported adjusted earnings of $56
million in the first quarter of 2006, up from $31 million in the same period
last year. This reflects a significant improvement in Brazil.
"GM continues to set sales and market share records in the Latin
America/Africa/Middle East region," Wagoner said. "In the first quarter, LAAM
achieved an all-time first quarter sales record of 230,100 units, up 26
percent from the year-ago period. Of the 11 major markets in the region, four
set all-time quarterly GM sales records and another four set first-quarter
sales records."
GMAC
General Motors Acceptance Corporation (GMAC) earned $605 million in the
first quarter of 2006, compared to $728 million in the year-ago period,
reflecting improved earnings from financing operations and insurance, offset
by lower mortgage earnings.
"GMAC continued to post strong earnings despite lower credit ratings and
higher borrowing costs," Wagoner said. "The agreement that we announced
earlier this month to sell a 51-percent controlling interest in GMAC to a
consortium of investors led by Cerberus Capital Management is expected to
close later this year. Once implemented, the new ownership structure should
strengthen GMAC's ability to support GM's automotive operations, improve
GMAC's access to cost-effective funding and provide $14 billion in liquidity
to GM over the next three years."
GMAC had cash reserve balances at March 31, 2006 of approximately $22.1
billion, including $17.3 billion in cash and cash equivalents and $4.8 billion
in marketable securities. This compares with cash balances of approximately
$20 billion at Dec. 31, 2005.
GMAC's financing operations reported earnings of $270 million in the first
quarter of 2006, compared to $216 million a year ago. The increase is largely
due to the effect of lower consumer credit provisions, primarily as a result
of automotive whole loan activity and favorable international credit
performance.
ResCap earnings were $197 million in the first quarter 2006, down from the
$351 million earned in the year-ago period. While revenues were strong from
higher asset levels, results were negatively affected by lower net margins
resulting from both pricing pressures and higher funding costs. In addition,
gains on sales of loans were down due to a significant gain in the year-ago
quarter from the sale of a portfolio of distressed mortgage loans. Mortgage
originations were $41.6 billion for the latest quarter, representing an
increase from the $36.4 billion in the year-ago period.
GMAC completed the sale of approximately 78 percent of its equity in GMAC
Commercial Mortgage on March 23, 2006, for approximately $1.5 billion in cash.
At the closing, GMAC Commercial Mortgage, now named CapMark Financial Group
Inc., also repaid to GMAC approximately $7.3 billion in intercompany loans,
bringing the total cash proceeds from the transaction to $8.8 billion. GMAC
earnings related to Commercial Mortgage were $9 million, representing
operating income of $50 million and a loss on sale of $41 million, after
closing costs.
GMAC's insurance operations generated net income of $129 million in the
first quarter of 2006, up from $94 million in the same period a year ago
primarily reflecting the impact of strong underwriting results. In addition,
first quarter results also benefited from the strategic acquisition of MEEMIC
Insurance Co., a personal lines business that offers automobile and homeowners
insurance in the Midwest.
Cash and Liquidity
Cash, marketable securities, and readily-available assets of the Voluntary
Employees' Beneficiary Association (VEBA) trust totaled $21.6 billion at
March 31, 2006, up from $20.4 billion on Dec. 31, 2005 and $19.8 billion on
March 31, 2005. GM withdrew approximately $2 billion from the VEBA trust in
the first quarter of 2006, including $1 billion from the short-term VEBA.
Liquidity remains a key focus of the corporation. GM sold most of its
20-percent stake in Suzuki during the first quarter, generating approximately
$2 billion in cash. Also, GM recently announced the sale of its stake in
Isuzu which generated approximately $300 million in proceeds in the second
quarter of 2006. In February, GM reduced its common stock dividend by 50
percent, which is expected to save approximately $565 million annually.
Finally, the planned sale of 51-percent of GMAC is expected to provide GM with
up-front cash proceeds of about $10 billion and significant ongoing cash flow
from retained assets and GMAC distributions over time.
Outlook
GM has made significant progress to turn around its North American
operations, including the UAW retiree health-care agreement, the manufacturing
capacity actions, the changes to GM's U.S. salaried retiree health-care
benefits and salaried pension plan benefits and the hourly accelerated
attrition program.
"While we are encouraged by the speed and scale of the changes we're
implementing, there is clearly more work to be done," Wagoner said. "Our next
key priority is to reach a consensual agreement with Delphi and its unions
that makes sense for all of the parties. The agreement we recently reached
with the UAW on the attrition program is a significant step in achieving this
objective, but there is more important work to do."
Forward-Looking Statements
In this press release and in related comments by General Motors' and
General Motors Acceptance Corporation's management, the use of the words
"expect," "anticipate," "estimate," "forecast," "initiative," "objective,"
"plan," "goal," "project," "outlook," "priorities," "target," "intend,"
"evaluate," "pursue," "seek," "may," "would," "could," "should," "believe,"
"potential," "continue," "designed," "impact," or the negative of any of those
words or similar expressions is intended to identify forward-looking
statements. Other than statements of historical fact, all statements in this
press release and in related comments, including without limitation,
statements about future events and financial performance, are forward-looking
statements that involve certain risks and uncertainties. While these
statements represent our current judgment on possible future events, and we
believe that when we made these judgments they were reasonable, these
statements are not guarantees of any events or financial results, and GM's
actual results may differ materially due to numerous important factors that
may be revised or supplemented in subsequent reports on SEC Forms 10-Q and
8-K.
Such factors include, among others, the following: the ability of GM to
realize production efficiencies, to achieve reductions in costs as a result of
the turnaround restructuring, health care cost reductions and an accelerated
attrition program and to implement capital expenditures at levels and times
planned by management; the pace of product introductions; market acceptance of
the Corporation's new products; significant changes in the competitive
environment and the effect of competition in the Corporation's markets,
including on GM's pricing policies; our ability to maintain adequate liquidity
and financing sources and an appropriate level of debt; restrictions on GMAC's
and ResCap's ability to pay dividends and prepay subordinated debt obligations
to us; changes in the existing, or the adoption of new, laws, regulations,
policies or other activities of governments, agencies and similar
organizations where such actions may affect the production, licensing,
distribution or sale of our products, the cost thereof or applicable tax
rates; costs and risks associated with litigation; the final results of
investigations and inquiries by the SEC; changes in our accounting principles,
or their application or interpretation, and our ability to make estimates and
the assumptions underlying the estimates, including the range of estimates for
the Delphi pension benefit guarantees, which could result in an impact on
earnings; changes in relations with unions and employees/retirees and the
legal interpretations of the agreements with those unions with regard to
employees/retirees; negotiations and bankruptcy court actions with respect to
Delphi's obligations to GM, negotiations with respect to GM's obligations
under the pension benefit guarantees to Delphi employees, and GM's ability to
recover any indemnity claims against Delphi; labor strikes or work stoppages
at GM or its key suppliers such as Delphi or financial difficulties at GM's
key suppliers such as Delphi; additional credit rating downgrades and the
effects thereof; our ability to complete the sale of a 51-percent controlling
interest in GMAC and the effect of that sale on the results of GM's and GMAC's
operations and liquidity; other factors affecting financing and insurance
operating segments' results of operations and financial condition such as
credit ratings, adequate access to the market, changes in the residual value
of off-lease vehicles, changes in U.S. government-sponsored mortgage programs
or disruptions in the markets in which its mortgage subsidiaries operate, and
changes in its contractual servicing rights; shortages of and price increases
for fuel; and changes in economic conditions, commodity prices, currency
exchange rates or political stability in the markets in which we operate.
In addition, GMAC's actual results may differ materially due to numerous
important factors that are described in GMAC's most recent report on SEC Form
10-K, which may be revised or supplemented in subsequent reports on SEC Forms
10-Q and 8-K. Such factors include, among others, the following: the ability
of GM to complete the sale of a 51-percent controlling interest in GMAC;
significant changes in the competitive environment and the effect of
competition in GMAC's and GM's markets, including on GMAC's and GM's pricing
policies; GMAC's ability to maintain adequate financing sources and an
appropriate level of debt; the profitability and financial condition of GM,
including changes in production or sales of GM vehicles, risks based on GM's
contingent benefit guarantees and the possibility of labor strikes or work
stoppages at GM or at key suppliers such as Delphi; funding obligations under
GM and its subsidiaries' qualified U.S. defined benefits pension plans;
restrictions on ResCap's ability to pay dividends and prepay subordinated debt
obligations to GMAC; changes in the residual value of off-lease vehicles;
changes in U.S. government-sponsored mortgage programs or disruptions in the
markets in which GMAC's mortgage subsidiaries operate; changes in GMAC's
contractual servicing rights; costs and risks associated with litigation;
changes in GMAC's accounting assumptions that may require or that result from
changes in the accounting rules or their application, which could result in an
impact on earnings; changes in the credit ratings of GMAC or GM; the threat of
natural calamities; changes in economic conditions, currency exchange rates or
political stability in the markets in which we operate; and changes in the
existing, or the adoption of new, laws, regulations, policies or other
activities of governments, agencies and similar organizations.
Investors are cautioned not to place undue reliance on forward-looking
statements. GM undertakes no obligation to update publicly or otherwise
revise any forward-looking statements, whether as a result of new information,
future events or other such factors that affect the subject of these
statements, except where expressly required by law.
General Motors Corporation
Non-GAAP Disclosure
GM includes the use of non-GAAP adjusted net income (loss) in its
earnings releases and charts for securities analysts. GM management
evaluates its business and makes certain operating decisions (e.g.,
budgeting, forecasting, employee compensation, asset management
and resource allocation) using adjusted net income. Management
believes that because this measure provides it with useful
supplemental information for evaluating and operating the business,
investors would find it beneficial to have the opportunity to view
the business in the same manner. Adjusted net income is a measure
that focuses on the Corporation's core business operations and
facilitates comparison of those businesses from period to
period on a consistent basis. Management also believes it is
appropriate in evaluating the Corporation's operations to exclude
restructuring charges and any gain or losses from one-time items
because these costs vary in size and frequency among the four
geographic regions, since inclusion of these events would make
results less comparable between periods and between regions.
GM also includes the use of non-GAAP managerial automotive operating
cash flow in its earnings releases and charts for securities
analysts. Management believes that providing managerial automotive
operating cash flow furnishes it and investors with useful
information by representing the cash flow generated or consumed by
its automotive operations, including cash consumed by automotive
capital expenditures and equity investments in companies related
to our core business and cash generated by sales of automotive
operating assets and equity investments in companies related to
our core business, before funding non-operating-related obligations
including debt maturities, dividends and other non-operating items.
GM's earnings releases and charts for securities analysts also
include the use of non-GAAP measures of revenue per vehicle and
the GM North American structural cost reduction target. Management
uses revenue per vehicle to track operating efficiency and to
facilitate comparisons between periods and between manufacturers,
and believes that it would provide valuable information to investors
who are interested in identifying trends and comparing different
companies. Revenue per vehicle includes certain sales to other GM
regions that are excluded from GAAP reporting, and excludes
non-vehicle sales such as service parts and operations and OnStar
service and other income that GM does not derive from the sale of
vehicles such as interest or the GM credit card. Management also
includes sales to daily car rental companies in revenue per vehicle,
although they are excluded from GAAP reporting because of GM's
repurchase obligations. GM North America's structural cost
reduction target excludes the cost of the three $1 billion DC VEBA
contributions in 2006, 2007, and 2011. Management uses this measure
to track the structural cost reduction target on a running rate
basis since a significant portion of the benefit of the health-care
Settlement Agreement related to hourly employees is anticipated to
extend well beyond the periods in which the expense related to the
contributions will be incurred. Management believes that this
measure is useful to investors as it allows them to evaluate the
ongoing effects of GM's structural cost reduction initiatives.
Non-GAAP measures should not be considered as a substitute for
measures of financial performance prepared in accordance with GAAP.
Investors and potential investors are encouraged to review the
reconciliation of non-GAAP financial measures contained within the
attached press release with their most directly comparable GAAP
financial results.
General Motors Corporation
List of Special Items - After Tax
(Dollars in millions except per share amounts)
(Unaudited)
Three Months Ended
March 31, 2006
------------------
Net $1-2/3
Income EPS
------ -----
REPORTED
--------
Net (loss) $(323) $(0.57)
ADJUSTMENTS
-----------
Restructuring (A) 111 0.19
Sale of Suzuki investment (B) (317) (0.56)
--- ----
Subtotal (206) (0.37)
ADJUSTED
-------- --- ----
Adjusted income $(529) $(0.94)
=== ====
(A) Relates to various restructuring initiatives, as follows (all
amounts after tax):
o Estimated charges of $65 million related to separations of
salaried employees at GMNA.
o Curtailment charges associated with modifications to the
U.S. Retirement Program for Salaried Employees announced in
the first quarter of 2006. GMNA and Other Operations
recognized charges of $12 million and $3 million respectively
associated with these modifications.
o A favorable adjustment of $88 million for higher than
anticipated headcount reductions associated with previously
announced GMNA plant idling activities,
o A charge of $52 million for certain components of the hourly
attrition program related to retroactive lump-sum payments,
recognized at GMNA.
o Other restructuring charges of $40 million and $27 million,
recognized at GME and GMLAAM, respectively.
(B) Relates to the sale of 92.36 million shares of GM's investment
in Suzuki for approximately $2.0 billion in cash, reducing GM's
equity stake in Suzuki from 20.4% to approximately 3.7% (16.3
million shares). The after-tax gain of $317 million was
recognized at GMAP.
General Motors Corporation
List of Special Items - After Tax
(Dollars in millions except per share amounts)
(Unaudited)
Three Months Ended
March 31, 2005
------------------
Net $1-2/3
Income EPS
------ -----
REPORTED
--------
Net (loss) $(1,253) $(2.22)
ADJUSTMENTS
-----------
Salaried Attrition Program (A) 148 0.26
Plant and Facility Impairments (B) 84 0.15
GME Restructuring Charge (C) 422 0.75
Tax Items (D) (389) (0.69)
--- ----
Subtotal 265 0.47
ADJUSTED
-------- --- ----
Adjusted (loss) $(988) $(1.75)
=== ====
(A) Salaried Attrition Program relates to voluntary early retirement
and other separation programs in the U.S. in the first quarter
of 2005.
(B) Plant and Facility Impairments relates to the write-down to
fair market value of various plant assets in connection with
the discontinuance of production at the Lansing assembly plant
during the second quarter of 2005.
(C) In the fourth quarter of 2004, GM Europe announced a
restructuring plan targeting a reduction in annual structural
costs of an estimated $600 million by 2006. A total reduction
of 12,000 employees, including 10,000 in Germany, from
2005-2007 through separation programs, early retirements, and
selected outsourcing initiatives is expected. The after-tax
separation cost of $422 million in the first quarter of 2005
covers approximately 5,650 people, of whom 4,900 are in
Germany.
(D) Tax Items relate to tax benefits (including the Medicare Part D
benefit in the U.S.), in excess of GM's previously communicated
annual effective tax rate of 15%, which do not vary with the
level of pre-tax income. Adjusted loss reflects an effective
tax rate of 15%.
General Motors Corporation
Summary Corporate Financial Results
(Unaudited)
First Quarter
--------------
2006 2005
---- ----
(Dollars in millions except per share amounts)
Total net sales and
revenues $52,245 $45,773
Adjusted $51,706 $45,773
Net income (loss) $(323) $(1,253)
Adjusted $(529) $(988)
Net margin
(Net income /Total net sales
and revenues) (0.6)% (2.7%)
Adjusted (1.0)% (2.2%)
Earnings (losses) per share - basic
$1-2/3 par value $(0.57) $(2.22)
Earnings (losses) per share - diluted
$1-2/3 par value $(0.57) $(2.22)
Earnings (losses) per share - adjusted
diluted
$1-2/3 par value $(0.94) $(1.75)
GM $1-2/3 par value average
shares outstanding (Mil's)
Basic shares 566 565
Diluted shares 566 565
Cash dividends per share
of common stocks
GM $1-2/3 par value $0.25 $0.50
See reconciliation of adjusted financial results.
General Motors Corporation
Summary Corporate Financial Results
(Unaudited)
First Quarter
--------------
2006 2005
---- ----
Book value per share of
common stocks at March 31
GM $1-2/3 par value $26.02 $44.37
Auto & Other total cash & marketable
securities at March 31 ($Bil's) $18.8 $15.6
Readily-available assets in VEBA 2.8 4.2
---- ----
Total Auto & Other cash &
marketable securities plus
readily-available assets in VEBA $21.6 $19.8
==== ====
Auto & Other Operations ($Mil's)
Depreciation $1,114 $1,270
Amortization of special
tools 733 816
Amortization of intangible
assets 14 10
----- -----
Total $1,861 $2,096
===== =====
GM's share of nonconsolidated
affiliates' net income (loss)
($Mil's)
Italy * NA $21
Japan $21 $50
China $70 $33
South Korea # NA $(8)
* During the second quarter of 2005, GM and Fiat S.p.A. completed
the liquidation and termination of all joint ventures between
them in existence at that time. As a result, GM regained
complete ownership of all assets it originally contributed to
each joint venture.
# Effective for the third quarter 2005, the results of GM Daewoo's
operations are consolidated by GM.
General Motors Corporation
Summary Corporate Financial Results
(Unaudited)
First Quarter
2006 and 2005
--------------
(Dollars in millions) Reported Special Items Adjusted
-------- ------------- --------
2006 2005 2006 2005 2006 2005
---- ---- ---- ---- ---- ----
Total net sales
and revenues
GMNA(1) $28,531 $25,227 $ - $ - $28,531 $25,227
GME(1) 8,091 8,108 - - 8,091 8,108
GMLAAM 3,140 2,299 - - 3,140 2,299
GMAP 3,933 1,694 (539) - 3,394 1,694
------ ------ --- -- ------ ------
Total GMA 43,695 37,328 (539) - 43,156 37,328
Other(2) (305) (25) - - (305) (25)
------ ------ --- -- ------ ------
Total Auto &
Other 43,390 37,303 (539) - 42,851 37,303
------ ------ --- -- ------ ------
GMAC 8,822 8,221 - - 8,822 8,221
Other Financing(2) 33 249 - - 33 249
----- ----- -- -- ----- -----
Total FIO 8,855 8,470 - - 8,855 8,470
------ ------ --- -- ------ ------
Total net sales
and revenues $52,245 $45,773 $(539) $ - $51,706 $45,773
====== ====== === == ====== ======
Income (loss)
before income
taxes, equity
income and
minority interests
GMNA $(1,364) $(2,212) $64 $357 $(1,300) $(1,855)
GME 75 (860) 63 671 138 (189)
GMLAAM 80 55 27 - 107 55
GMAP 579 (23) (575) - 4 (23)
--- ----- --- ----- ----- -----
Total GMA (630) (3,040) (421) 1,028 (1,051) (2,012)
Other (827) (412) 4 13 (823) (399)
--- ----- --- ----- ----- -----
Total Auto &
Other (1,457) (3,452) (417) 1,041 (1,874) (2,411)
----- ----- --- ----- ----- -----
GMAC 924 1,160 - - 924 1,160
Other Financing 2 (2) - - 2 (2)
--- ----- -- -- --- -----
Total FIO 926 1,158 - - 926 1,158
--- ----- --- ----- --- -----
Total income (loss)
before income taxes,
equity income and
minority
interests $(531) $(2,294) $(417) $1,041 $(948) $(1,253)
=== ===== === ===== === =====
See footnotes.
General Motors Corporation
Summary Corporate Financial Results
(Unaudited)
First Quarter
2006 and 2005
-------------
(Dollars in millions) Reported Special Items Adjusted
-------- ------------- --------
2006 2005 2006 2005 2006 2005
---- ---- ---- ---- ---- ----
Net income (loss)
GMNA(1) $(987) $(1,737) $41 $224 $(946) $(1,513)
GME(1) 48 (514) 40 422 88 (92)
GMLAAM 29 31 27 - 56 31
GMAP 398 70 (317) - 81 70
--- ----- --- --- --- -----
Total GMA (512) (2,150) (209) 646 (721) (1,504)
Other (417) 168 3 (381) (414) (213)
--- ----- --- --- ----- -----
Total Auto &
Other (929) (1,982) (206) 265 (1,135) (1,717)
--- ----- --- --- ----- -----
GMAC 605 728 - - 605 728
Other Financing 1 1 - - 1 1
--- --- -- -- --- ---
Total FIO 606 729 - - 606 729
--- ----- --- --- --- ---
Net income (loss) $(323) $(1,253) $(206) $265 $(529) $(988)
=== ===== === === === ===
Income tax expense
(benefit)
GMNA $(379) $(506) $23 $133 $(356) $(373)
GME 29 (333) 23 249 52 (84)
GMLAAM 50 25 - - 50 25
GMAP 237 (10) (258) - (21) (10)
--- --- --- --- --- ---
Total GMA (63) (824) (212) 382 (275) (442)
Other (409) (574) 1 394 (408) (180)
--- ----- --- --- --- ---
Total Auto &
Other (472) (1,398) (211) 776 (683) (622)
--- ----- --- --- --- ---
GMAC 330 429 - - 330 429
Other Financing 1 (3) - - 1 (3)
--- --- -- -- --- ---
Total FIO 331 426 - - 331 426
--- --- --- --- --- ---
Income tax expense
(benefit) $(141) $(972) $(211) $776 $(352) $(196)
=== === === === === ===
See footnotes.
General Motors Corporation
Summary Corporate Financial Results
(Unaudited)
First Quarter
2006 and 2005
--------------
(Dollars in millions) Reported Special Items Adjusted
-------- ------------- --------
2006 2005 2006 2005 2006 2005
---- ---- ---- ---- ---- ----
Effective tax rate
Total GM Corp. 27% 42% 51% 75% 37% 16%
GMNA 28% 23% 36% 37% 27% 20%
GME 39% 39% 37% 37% 38% 44%
GMAC 36% 37% - - 36% 37%
Equity income (loss)
and minority interests
GMNA $(2) $(31) $ - $ - $(2) $(31)
GME 2 13 - - 2 13
GMLAAM (1) 1 - - (1) 1
GMAP 56 83 - - 56 83
-- -- -- -- -- --
Total GMA $55 $66 $ - $ - $55 $66
== == == == == ==
General Motors Corporation
Operating Statistics
First Quarter
----------------
2006 2005
---- ----
(Units in thousands)
Worldwide Production Volume
GMNA - Cars 496 470
GMNA - Trucks 759 712
----- -----
Total GMNA 1,255 1,182
GME 494 502
GMLAAM 194 185
GMAP 468 335
----- -----
Total Worldwide 2,411 2,204
===== =====
Vehicle Unit Deliveries
Chevrolet - Cars 195 218
Chevrolet - Trucks 376 397
Pontiac 99 100
GMC 105 123
Buick 62 61
Oldsmobile - 1
Saturn 47 48
Cadillac 51 50
Other 28 17
----- -----
Total United States 963 1,015
Canada, Mexico, and Other 163 167
----- -----
Total GMNA 1,126 1,182
GME 522 514
GMLAAM 230 183
GMAP 323 231
----- -----
Total Worldwide 2,201 2,110
===== =====
Market Share
United States - Cars 20.7% 23.3%
United States - Trucks 26.4% 27.1%
Total United States 23.8% 25.4%
Total North America 23.7% 25.2%
Total Europe 9.5% 9.7%
Total LAAM 16.9% 15.4%
Asia Pacific 6.4% 5.0%
Total Worldwide 13.2% 13.3%
U.S. Retail/Fleet Mix
% Fleet Sales - Cars 41.6% 39.5%
% Fleet Sales - Trucks 22.4% 18.1%
Total Vehicles 30.0% 26.9%
GMNA Capacity Utilization
(2 shift rated) 98.8% 87.6%
General Motors Corporation
Operating Statistics
First Quarter
----------------
2006 2005
---- ----
GMAC's Worldwide Cost of
Borrowing (3) 5.41% 4.30%
GMAC Period End Debt Spreads Over
U.S. Treasuries
2 Year 445 bp 350 bp
5 Year 449 bp 465 bp
10 Year 474 bp 460 bp
GMAC Cash Reserve Balance ($Bil's)(4) $22.1 $18.5
GMAC Automotive Finance Operations
Consumer Credit (North America)
Net charge-offs as a % of
managed receivables 1.14% 0.96%
Retail contracts 30 days
delinquent - % of average number
of contracts outstanding (5) 2.34% 2.09%
Share of GM retail sales (U.S. only)
Total consumer volume (retail
and lease) as % of retail sales 45% 54%
SmartLease as % of retail sales 22% 17%
Off-lease vehicle
remarketing (U.S. only)
Sales proceeds on scheduled lease
terminations (36-month) per vehicle $13,579 $13,724
Off-lease vehicles
terminated (units in 000s) 69 72
ResCap
Originations ($ Bil's) $41.6 $36.4
Mortgage servicing rights, net ($Bil's) $4.5 $3.7
GMAC Insurance Operations ($Mil's)
Combined ratio (6) 91.3% 93.8%
Premiums/revenue written $1,101 $1,118
Investment portfolio market value $7,900 $7,322
After-tax net unrealized capital gains $622 $463
Worldwide Employment
at March 31 (in 000's)
United States Hourly 102 109
United States Salary 36 39
--- ---
Total United States 138 148
Canada, Mexico, and Other 31 31
--- ---
GMNA 169 179
GME (7) 64 58
GMLAAM 31 30
GMAP (8) 32 15
GMAC 31 34
Other 2 5
--- ---
Total 329 321
=== ===
Worldwide Payrolls ($Bil's) $5.3 $5.3
See footnotes.
General Motors Corporation
Footnotes:
---------
(1) Effective January 1, 2006, four powertrain entities were
transferred from GMNA to GME for management reporting.
Accordingly, first quarter 2005 amounts have been revised for
comparability by reclassifying $151 million of revenue and
$33 million of net income from GMNA to GME.
(2) Other Operations and Other Financing include intercompany
eliminations.
(3) Calculated by dividing total interest expense (excluding mark
to market adjustments) by total debt.
(4) Balance at March 31, 2006 comprises $17.3 billion of cash and
cash equivalents and $4.8 billion in marketable securities
with maturities greater than 90 days. Balance at March 31, 2005
comprises $16.1 billion of cash and cash equivalents and
$2.4 billion in marketable securities with maturities greater than
90 days.
(5) Excludes accounts in bankruptcy.
(6) Calculated as the sum of all reported losses and expenses
(excluding interest and income tax expense) divided by the
total of premiums and service revenues earned and other income.
(7) Approximately 7,000 employees were added in the fourth quarter
of 2005 from a former powertrain joint venture with Fiat.
(8) Approximately 13,000 employees were added as a result of the
GM Daewoo consolidation in the third quarter of 2005.
GENERAL MOTORS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
March 31,
------------------
2006 2005
-------- --------
(dollars in millions
except per share amounts)
Total net sales and revenues $52,245 $45,773
------ -------
Cost of sales and other expenses 43,013 39,499
Selling, general, and administrative expenses 5,534 4,889
Interest expense 4,229 3,679
------ ------
Total costs and expenses 52,776 48,067
------ ------
Income (loss) before income taxes, equity
income and minority interests (531) (2,294)
Income tax expense (benefit) (141) (972)
Equity income (loss) and minority interests 67 69
------ ------
Net income (loss) $ (323) $(1,253)
====== ======
Basic earnings (loss) per share attributable to
common stock $ (0.57) $ (2.22)
====== ======
Earnings (loss) per share attributable to
common stock assuming dilution $ (0.57) $ (2.22)
====== ======
GENERAL MOTORS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION TO THE CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
March 31,
------------------
2006 2005
-------- --------
(dollars in millions)
AUTOMOTIVE AND OTHER OPERATIONS
Total net sales and revenues $43,390 $37,303
------- -------
Cost of sales and other expenses 40,615 37,146
Selling, general, and administrative expenses 3,402 2,837
------- -------
Total costs and expenses 44,017 39,983
Interest expense 684 685
Net expense from transactions with Financing
and Insurance Operations 146 87
------- -------
Income (loss) before income taxes, equity
income, and minority interests (1,457) (3,452)
Income tax (benefit) (472) (1,398)
Equity income (loss) and minority interests 56 72
------- -------
Net income (loss) -- Automotive and Other
Operations $ (929) $(1,982)
======= =======
FINANCING AND INSURANCE OPERATIONS
Total revenues $ 8,855 $ 8,470
------- -------
Interest expense 3,545 2,994
Depreciation and amortization expense 1,511 1,398
Operating and other expenses 2,287 2,089
Provisions for financing and insurance losses 732 918
------- -------
Total costs and expenses 8,075 7,399
Net income from transactions with Automotive
and Other Operations (146) (87)
------- -------
Income before income taxes, equity income, and
minority interests 926 1,158
Income tax expense 331 426
Equity income (loss) and minority interests 11 (3)
------- -------
Net income -- Financing and Insurance
Operations $ 606 $ 729
====== ======
GENERAL MOTORS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
Mar. 31, Dec. 31, Mar. 31,
2006 2005 2005
-------- -------- --------
(dollars in millions)
ASSETS
Cash and cash equivalents $34,868 $ 30,726 $26,389
Marketable securities 19,839 19,726 26,256
------- -------- -------
Total cash and marketable
securities 54,707 50,452 52,645
Finance receivables -- net 180,161 180,793 190,646
Loans held for sale 18,171 21,865 22,569
Accounts and notes receivable (less
allowances) 16,801 15,578 18,001
Inventories (less allowances) 15,519 14,354 13,189
Assets held for sale - 19,030 -
Deferred income taxes 29,495 29,889 26,967
Net equipment on operating leases --
(less accumulated depreciation) 39,787 38,187 34,371
Equity in net assets of
nonconsolidated affiliates 1,830 3,291 6,500
Property -- net 40,235 40,214 38,106
Intangible assets -- net 4,458 4,339 4,864
Other assets 62,835 58,086 60,239
------- ------- -------
Total assets $463,999 $476,078 $468,097
======= ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable (principally trade) $30,210 $ 29,913 $28,519
Notes and loans payable 277,007 285,750 291,831
Liabilities related to assets held
for sale - 10,941 -
Postretirement benefits other than
pensions 36,445 33,997 28,462
Pensions 11,723 11,304 9,295
Deferred income taxes 5,275 4,477 6,709
Accrued expenses and other
liabilities 87,544 84,060 77,774
------- -------- -------
Total liabilities 448,204 460,442 442,590
Minority interests 1,075 1,039 416
Stockholders' equity
$1-2/3 par value common stock
(outstanding, 565,559,329;
565,518,106; and 565,470,511 shares) 943 943 942
Capital surplus (principally
additional paid-in capital) 15,296 15,285 15,234
Retained earnings 1,884 2,361 12,526
------- -------- -------
Subtotal 18,123 18,589 28,702
Accumulated foreign currency
translation adjustments (1,639) (1,722) (1,784)
Net unrealized gains (losses) on
derivatives 1,109 733 612
Net unrealized gains on securities 956 786 535
Minimum pension liability adjustment (3,829) (3,789) (2,974)
------- -------- -------
Accumulated other comprehensive
loss (3,403) (3,992) (3,611)
------- -------- -------
Total stockholders' equity 14,720 14,597 25,091
------- -------- -------
Total liabilities and stockholders'
equity $463,999 $476,078 $468,097
======= ======= =======
GENERAL MOTORS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION TO THE CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
Mar. 31, Dec. 31, Mar. 31,
2006 2005 2005
-------- -------- --------
(dollars in millions)
ASSETS
Automotive and Other Operations
Cash and cash equivalents $17,427 $15,187 $10,205
Marketable securities 1,396 1,416 5,447
------- ------- -------
Total cash and marketable
securities 18,823 16,603 15,652
Accounts and notes receivable (less
allowances) 9,440 7,758 6,493
Inventories (less allowances) 14,862 13,851 12,736
Net equipment on operating leases --
(less accumulated depreciation) 7,217 6,993 6,329
Deferred income taxes and other
current assets 10,032 8,877 10,975
------- ------- -------
Total current assets 60,374 54,082 52,185
Equity in net assets of
nonconsolidated affiliates 1,830 3,291 6,500
Property -- net 38,457 38,466 36,265
Intangible assets -- net 1,851 1,862 1,550
Deferred income taxes 21,401 22,849 18,093
Other assets 41,724 41,103 40,405
------- ------- -------
Total Automotive and Other
Operations assets 165,637 161,653 154,998
Financing and Insurance Operations
Cash and cash equivalents 17,441 15,539 16,184
Investments in securities 18,443 18,310 20,809
Finance receivables -- net 180,161 180,793 190,646
Loans held for sale 18,171 21,865 22,569
Assets held for sale - 19,030 -
Net equipment on operating leases
(less accumulated depreciation) 32,570 31,194 28,042
Other assets 31,576 27,694 34,849
Net receivable from Automotive and
Other Operations 4,609 4,452 2,300
------- ------- -------
Total Financing and Insurance
Operations assets 302,971 318,877 315,399
------- ------- -------
Total assets $468,608 $480,530 $470,397
======= ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Automotive and Other Operations
Accounts payable (principally trade) $26,614 $26,182 $24,168
Loans payable 1,207 1,519 2,446
Accrued expenses 44,350 42,665 44,544
Net payable to Financing and
Insurance Operations 4,609 4,452 2,300
------- ------- -------
Total current liabilities 76,780 74,818 73,458
Long-term debt 31,021 31,014 29,879
Postretirement benefits other than
pensions 31,431 28,990 23,754
Pensions 11,568 11,214 9,204
Other liabilities and deferred
income taxes 21,714 22,023 15,924
------- ------- -------
Total Automotive and Other
Operations liabilities 172,514 168,059 152,219
Financing and Insurance Operations
Accounts payable 3,596 3,731 4,351
Liabilities related to assets held
for sale - 10,941 -
Debt 244,779 253,217 259,506
Other liabilities and deferred
income taxes 31,924 28,946 28,814
------- ------- -------
Total Financing and Insurance
Operations liabilities 280,299 296,835 292,671
------- ------- -------
Total liabilities 452,813 464,894 444,890
Minority interests 1,075 1,039 416
Total stockholders' equity 14,720 14,597 25,091
------- ------- -------
Total liabilities and stockholders'
equity $468,608 $480,530 $470,397
======= ======= =======
SOURCE General Motors Corporation
-0- 04/20/2006 P
NOTE TO EDITORS: For additional media information visit
http://media.gm.com .
CONTACT: Toni Simonetti, +1-212-418-6380, Mobile: +1-917-822-3392, or
Jerry Dubrowski, +1-212-418-6261, Mobile: +1-917-544-4885, both of General
Motors Corporation
Web site: http://media.gm.com
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