News Column

GM Expected to Post Small 3Q Earnings Gain

October 28, 2013

Associated Press

General Motors Co. is expected to report higher earnings this week.

DETROIT (AP) General Motors Co. is expected to report revenue gains and higher earnings when it releases third-quarter results before the market opens on Wednesday.

While North American profits were likely strong on revenue from new pickup trucks, Europe was an uncertainty, and the company faced challenges from July through September in South America and its international operations including Asia.

WHAT TO WATCH FOR: GM started rolling out new full-size pickups in the U.S. late in the spring, just as small businesses were gaining enough confidence to replace their old work trucks. Pickup prices were up during the quarter because GM started the rollout with higher-priced V8 and crew cab models. Since the Chevrolet Silverado pickup is GM's top-selling vehicle, that likely means profits will be higher in North America.

But Barclays analyst Brian Johnson, in a note to investors, wrote that he expects a large loss in Europe, where auto sales have been in a slump. The loss likely will be less than a year ago, but bigger than last quarter, Johnson wrote. International operations are expected to take a hit as a big recall in India and weakness in Australia offset profits in China. He also expects South American profits to dip because of competition and currency disadvantages due to GM lacking local suppliers.

WHY IT MATTERS: GM still is 7 percent owned by the U.S. government, which is selling off shares it got in exchange for a $49.5 billion bailout in 2008 and 2009. Although it's gotten smaller, GM is still a major U.S. employer with 80,000 workers. It has 213,000 employees worldwide.

WHAT'S EXPECTED: Analysts polled by data provider FactSet expect net income of $1.64 billion, or 89 cents per share. Excluding one-time items, they estimate earnings per share at 94 cents. Revenue is expected to be $39.2 billion.

LAST YEAR'S QUARTER: The Detroit company reported net income of $1.5 billion, or 89 cents per share. Without one-time items, the company made 93 cents per share. Revenue was $37.6 billion.


For more coverage on the automotive industry, please see HispanicBusiness' Auto Channel



Source: Copyright 2013 The Associated Press. All rights reserved.


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters