General Motors Co. beat analysts’ consensus estimate for the latest quarter thanks to strong performance from its financial unit and a one-time gain, and said full-year results would come in at the “high end” of its previous guidance.
The automaker reported adjusted earnings per share of US$1.52 for the third quarter, above the 97 cents analyst consensus forecast compiled by Bloomberg. That compares to US$1.97 a share the previous quarter and US$2.83 a share a year ago.
A global shortage of semiconductors that cut production was offset by a solid showing from GM Financial and a windfall of cash from battery partner LG Electronics Inc., which agreed to pay GM US$1.9 billion for nearly all of the costs of recalling its Chevy Bolt electric vehicle.
“Our third-quarter 2021 results clearly illustrate the strength of the underlying business that is funding our future, especially when you put them in the context of the calendar year,” Mary Barra, the company’s chief executive officer, said Wednesday in a letter to shareholders. “As a result, we now believe GM’s full-year results will approach the high end of our guidance.”
The Detroit automaker expects adjusted earnings before interest and taxes of US$11.5 billion to US$13.5 billion in all of 2021, or US$5.70 to US$6.70 a share.
GM’s shares reversed course from an early premarket surge as high as 3.8 per cent to trade down 1.5 per cent to US$56.50 as of 7:56 a.m. in New York. The stock had gained 38 per cent this year as of the close on Tuesday.
The upbeat earnings came despite a previously announced 33 per cent drop in sales volume for the quarter, stemming from citing low production at factories and thin inventory at dealers.
GM’s all-important North American business made half the earnings before interest and taxes that the company brought in a year ago at US$2.1 billion. China income was slightly better, rising to US$270 million from US$262 million.
Advertisement