GM Posts Large Profits Ahead of IPO
The New York Times reports:
DETROIT — A week before its initial public offering, General Motors reported its largest quarterly profit in 11 years on Wednesday, showing that the slimmed-down automaker no longer needed huge sales to generate significant earnings.
G.M. said it earned $2 billion in the third quarter, nearly equaling its profit for the first half of 2010. G.M. earned $4.2 billion from January through September.
The company said it expected to report a fourth-quarter profit, at least before accounting for interest and taxes, though “at a significantly lower run rate than each of the first three quarters,” and a full-year profit for the first time since 2004.
“As demonstrated by our third consecutive quarter of profitability and positive cash flow, these results continue our significant progress,” G.M.’s chief financial officer, Christopher P. Liddell, said in a statement.
The profit was equal to $1.20 a share, after a three-for-one stock split. There is no meaningful year-ago profit comparison because the company emerged from bankruptcy in the third quarter of 2009.
Revenue increased 27 percent from the third quarter last year, to $34.1 billion.
G.M. earned $2.1 billion in North America, the region that had been responsible for most of its losses in recent years. It lost $559 million in Europe. It had $33.5 billion in cash and marketable securities as of Sept. 30, up from $31.5 billion as of June 30.
