Revenue Up, Net Income Down for GM in the Third Quarter

Nov. 9, 2011
'Deteriorating economic conditions' in Europe will dent GM's full-year bottom line, the automaker said.

General Motors on Wednesday said its third-quarter earnings fell 5.9% from a year earlier, and said Europe's turmoil likely will keep earnings flat in the current period.

GM reported third-quarter net earnings of $2.1 billion, compared with $2.2 billion a year earlier. The figure was sharply lower than the previous quarter's $2.5 billion.

On a fully diluted basis, earnings per share fell to $1.03 from $1.20 a year earlier.

Revenues were up to $36.7 billion from $34.1 billion.

After a strong recovery over the past year from the 2008-2009 recession and government-led rescue, GM predicted that the fourth quarter will show little change from a year earlier, "as a result of seasonal trends in North America and weakness in Europe."

The automaker said restructuring charges in Europe also will hit its full-year bottom line "due to deteriorating economic conditions."

CEO Dan Akerson called the quarter "solid" and said it was rooted in GM's gaining sales and market share in both the U.S. and Chinese markets this year.

"But solid isn't good enough, even in a tough global economy," he said in a news release.

"Our overall results underscore the work we have to do to leverage our scale and further improve our margins everywhere we do business."

In Europe, the company took a $300 billion loss on earnings calculated before interest and tax, compared with a $300 billion gain a year earlier.

It also endured smaller declines in its Asian and Latin American businesses.

Copyright Agence France-Presse, 2011

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