General Motors Announces Post-Bankruptcy Operating Results

GM has released its operating results for the period following its bankruptcy in July. Thanks to the significant reorganization and a slightly recovering global market, GM’s balance sheet is showing some signs of health.

While GM still has work to do, the company is showing progress following its massive bankruptcy reorganization. The company reported pre-tax revenue of $28 billion, up $4.9 billion compared to second-quarter results posted by the Old GM. After taxes and special items, GM reported a total loss of approximately $1.2 billion, which includes payments related to dealer restructurings and Delphi’s bankruptcy.

Aiding GM’s post-bankruptcy financial earnings are the company’s global market share increase and a slight increase in global sales. Global sales increased to an annual rate of 67.8 million in the third quarter versus an annual rate of 62.7 million units for the second quarter of 2009. GM now has an 11.9 percent share in the global automotive market, up 0.3 percent from the Old GM. It retained a U.S. market share of 19.5 percent.

Because of its strong results, GM anticipates it will begin paying back its government loans next month. It owes the U.S. government $6.7 billion, the Canadian government $1.4 billion, and the German government $1.4 billion. GM must repay the German government soon, as German Chancellor Angela Merkel requested the loan be paid back as soon as possible after the failed sale of Opel to Magna.

Even though GM is still operating at a loss, it has decreased its total operating costs. The company expects to post another loss in the fourth quarter, but mostly because of repaying government loans and the $2.8 billion Delphi settlement.

“We have significantly more work to do, but today’s results provide evidence of the solid foundation we’re building for the new GM. With a healthier balance sheet and a competitive cost structure, our focus is on driving top-line performance,” said Fritz Henderson, GM president and CEO. “We’ll achieve that by winning customers over, one at a time, with vehicles that deliver performance and value.”