General Motors Company (NYSE:GM) led the way on earnings by posting a profit of 84 cents a share, nine cents ahead of estimates. That was good enough to send shares 2.3 percent higher in pre-market trading.
On Thursday, General Motors Company (NYSE:GM) posted a stronger-than-expected quarterly profit, reflecting strong demand in North America and cost-cutting in its struggling European business.
General Motors Company (NYSE:GM) said it earned $1.2 billion during the second quarter, down from $1.5 billion in the same period a year ago, but better than analyst estimates when factoring in special items that cost $200 million. Revenue rose 4% to $39.1 billion compared with $37.6 billion a year earlier.
Analysts were expecting earnings of 75 cents a share, down from 90 cents a share during the same three months in 2012. General Motors made 84 cents when including 9 cents of special charges, mostly related to costs of acquiring General Motors Korea preferred shares.
Global sales for General Motors Company (NYSE:GM) in the first half of the year are up 3.9 percent to 4.85 million vehicles. Sales in the U.S. are up 8 percent through June, though the automaker’s market share is flat.
General Motors managed bloated inventory of pickup trucks
The results underscore the auto maker’s ability to manage one of its biggest threats in the second quarter—reducing its once bloated inventory of pickup trucks without disrupting the introduction of the 2014 Silverado and Sierra models or resorting to pricing incentives. The North America unit generated a pre-tax profit of $1.98 billion.
General Motors Company (NYSE:GM) sold 172,774 Silverado and Sierra pickup trucks during the April through June time period compared with 137,143 for the same time period a year earlier.
Still, General Motors Company (NYSE:GM) lagged its rival Ford Motor Company (NYSE:F), which generated a North America pre-tax profit of $2.33 billion during the same quarter. Ford reported its financial results Wednesday.
General Motors profit center remains North America
General Motors Company (NYSE:GM) profit center remains North America, where it posted $1.98 billion in profits before interest and taxes, up from $1.9 billion during the period a year ago. The results from its homefront helped the company post its 14th-straight quarterly profit.
But the big surprise was in Europe, where the company’s loss for the three months was just $110 million before interest and taxes, with cost-cutting and new products helping the company in the region. That’s down from $394 million in the period a year ago. For the first six months of 2013, General Motors has lost $285 million in Europe, down significantly from the same six months of last year.
“We continue to perform well in the world’s two most important markets, the U.S. and China,” said GM CEO and Chairman Dan Akerson in a statement. “We also made further progress in our European business and saw the steady performance and our global brands Chevrolet and Cadillac. For the rest of the year, we’ll focus on winning customers with high-quality vehicles at a compelling value.”
General Motors European sales through the first half of 2013 are down
The automaker’s European sales through the first half of 2013 are down 6.5 percent compared to the same period a year ago. General Motors Company (NYSE:GM) Chief Financial Officer Dan Ammann said earlier this month that the European economy doesn’t seem to be improving.
“The European macroeconomic environment is challenging and remains challenging,” he told The Detroit News earlier this month. “We don’t see any significant signs of recovery as of this point in time, from a macroeconomic perspective.”
Ammann said GMGeneral Motors Company (NYSE:GM) still has a goal to break even in Europe by mid-decade. He said the company feels good about its products, management team and efforts taken to manage and reduce manufacturing capacity.