DETROIT (AP) -- General Motors Corp. earned $891 million in the second quarter, a huge reversal from the $3.4 billion loss it posted in the same period last year and the third straight quarterly profit for the nation's largest automaker.þþGM said Tuesday the latest results reflected improved sales in growing international markets.þþIts results surpassed Wall Street expectations, and its shares rose 4 percent in morning trading.þþ''Our heavy commitment to key growth markets around the world really paid off in strong growth and earnings,'' Chairman and Chief Executive Rick Wagoner said in a statement.þþThe automaker, though, continued to lose money in its home market, North America, where it reported a net loss from continuing operations of $39 million. That was a vast improvement over the second quarter of last year, when the company reported a net loss of $3.95 billion in North America.þþIn the second quarter of 2006, GM took a giant after-tax charge of $3.7 billion for early retirement and buyout offers that eventually reduced its hourly work force by more than 34,000.þþThe latest profit amounted to $1.56 per share for the April-June period, compared with a loss of $5.98 per share a year ago.þþRevenue fell to $46.81 billion from $53.9 billion a year ago due largely to the sale of 51 percent of GM's former financial arm, GMAC Financial Services.þþGM's earnings results excluding one-time items beat Wall Street expectations.þþThe latest profit total included $520 million in charges associated with the bankruptcy reorganization of Delphi Corp., GM's former parts arm, and other restructuring costs for GM's North American unit.þþGM said its adjusted net income, excluding the special items, was $1.4 billion, or $2.48 per share. On a comparable basis, 15 analysts polled by Thomson Financial forecast earnings of $1.13 per share.þþIts shares rose $1.31 to $33.92 in morning trading.þþThe Detroit-based company said its net income from continuing global automotive operations was $618 million, compared with a net loss of $3.48 billion in the year-ago period.þþThe quarterly results exclude Allison Transmission, which GM intends to sell in the third quarter and has classified as a discontinued operation.þþIn Europe, the company had net income of $217 million, versus a net loss of $39 million in the same quarter last year.þþThe company's Asia Pacific unit posted a net profit of $227 million, compared with $376 million in the year-ago quarter, which included $212 million from the sale of GM's interest in Japanese automaker Isuzu.þþIn its Latin America, Africa and Middle East unit, GM said explosive growth helped it to its best quarterly net income in a decade at $213 million versus $139 million a year ago.þþGM still owns 49 percent of New York-based GMAC, which on Monday reported that losses from its home lending operations caused second-quarter profits to fall 63 percent.þþGMAC reported a quarterly profit of $293 million, compared with $787 million in the same period last year.þþChief Financial Officer Fritz Henderson said GM is confident it will achieve its target this year of $9 billion worth of annual cost cuts.þþHe would not predict when GM would make a net profit in North America, but said restructuring costs for Delphi should be less in the second half of the year, and income should rise with the Allison Transmission sale closing.þþHenderson would not comment when asked what impact the quarterly profit might have on contract talks with the United Auto Workers, which formally began earlier this month.þþThe company likely is to seek concessions from the union and wants to cut a $25 per hour labor cost disparity with its Japanese competitors.þþLehman Brothers analyst Brian Johnson, in a note to investors, said GM's revenue per vehicle increased $1,540 year over year, reflecting the company's strategy to bring sales prices closer to the sticker and rely less on incentives.þþBut he expressed concerns about rising inventories of GM's new pickup trucks, the Chevrolet Silverado and GMC Sierra.þþ''In light of the significant excess inventories of GM's full-size trucks, we remain concerned that there may be some payback,'' in the second half, Johnson said, noting that GM already has increased incentives on full-sized pickups.þþ
Source: NY Times
