GM Earns a Strong $2.9 billion USD in Q2 of 2016

Discussion in 'In the News' started by xcel, Jul 24, 2016.

  1. xcel

    xcel PZEV, there's nothing like it :) Staff Member

    [​IMG] North America and Trucks is where the $s were found.

    [​IMG]Wayne Gerdes – CleanMPG – July 22, 2016

    On Thursday GM blew out Wall Street’s Q2 earnings estimates and in doing so, shows again how important truck sales in North America truly are. During the release, company executives reaffirmed their strong outlook through the rest of the year.

    Net to common shareholders was $2.9 billion was up 157 percent over to $1.1 billion recorded in the Q2 of 2015. Earnings per share was a strong $1.81, compared to $0.67 in the second quarter a year ago.

    Revenue for the Q2 rose 11.0 percent to $42.4 billion compared to $38.2 billion in the second quarter of 2015. Adjusted earnings (EBIT) of $3.9 billion USD profit margins increased to 9.3 percent of revenue from 7.5 percent a year earlier.

    EPS diluted-adjusted was a record at $1.86/share, up 44 percent compared to $1.29 in the second quarter of 2015 and well above Street estimates of $1.52.

    For the week, shares closed at $32.16, up $1.34 or 4.2 percent. The IPO of $33 price back in 2010 continues to be a more of a ceiling with the 5 year high of 40.99 set at the end of 2013 a long ways away despite four straight quarters of record-breaking pretax profits. The Dividend of $0.38/share creates a yield of 4.7 percent. Not a bad return to sit on while investors wait for an eventual realization that the auto sector in its entirety is vastly underperforming despite record sales, revenues and sales. The current PE ratio of 4.1 speaks volumes.

    GM Share Price from 2011 - 2016


    Looking forward, GM said it expected 2016 full year earnings of $5.50 – $6.00, up from the previously announced $5.25 – $5.75 range and well above the $5.02 earned in 2015.

    GM Q2 Regional Sales and Financial Results

    GM sold 2.4 million vehicles globally in the second quarter of 2016, about equal to the second quarter of 2015. Through June 30, the company sold 4.76 million vehicles globally.

    GM North America reported a record EBIT-adjusted of $3.6 billion compared with $2.8 billion in the second quarter of 2015. For the quarter, EBIT-adjusted margin was a record 12.1 percent, compared to 10.5 percent a year ago. Considering GMs June 2016 U.S. Sales Results, June’s ATP was $35,423, more than $4,400 above the industry average and more than $1,800 above last June’s pricing. The 12.1 percent margin is a very attractive result in this business.

    In Europe, the company reported it earned $0.1 billion compared with breakeven results in the second quarter of 2015. This result is the first profitable quarter since the second quarter of 2011.

    GM International Operations reported $0.2 billion compared with $0.3 billion in the second quarter of 2015. Results included Chinese and GM joint venture sales of a record 1.81 million vehicles during the first half of the year, an increase of 5.3 percent. EBIT income was $0.5 billion in both periods.

    GM South America reported a loss of $0.1) billion, about equal with the second quarter of 2015 and actually ok given the economic hardships being felt across much of the continent at this time.

    GM Chairman and CEO Mary Barra:
    North America continues to account for over 92 percent of GM's earnings reflecting the large profits generated from U.S. SUV/CUV and pickup truck sales, both of which benefit from the continuing low gasoline prices.

    GM Q2 2016 Results Overview

    Q2 2016/Q2 2015

    Global deliveries (millions of vehicles): 2.4/2.4

    Net revenue: $42.4/$38.2 (billion $USD)
    Net income attributable to common stockholders: $2.9/$1.1 (billion $USD)
    EPS diluted: $1.81/$0.67 (per share)
    Impact of special items on EPS: $(0.05)/$(0.62)
    EPS diluted–adjusted: $1.86/$1.29 (per share)
    EBIT-adjusted: $3.9/$2.9 (billion $USD)
    % EBIT-adjusted margin: 9.3/7.5 (%)

    Automotive net cash flow from operating activities: $5.0/$5.1 (billion $USD)
    Adjusted automotive free cash flow: $3.2/$3.3 (billion $USD)

    % return on invested capital (ROIC): 30.5/23.4 (%)

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