General Motors Company (GM) released today preliminary results for its first 83 days of operation, providing an initial look at its still tenuous financial health.
GM’s earnings before taxes for the July 10-Sept. 30 period resulted in a loss of $1.0 billion since it began operations as a reorganized company on July 10.
GM recorded special items for the same period of $505 million, attributed primarily to dealer restructuring, attrition-related charges and Delphi.
For the July 10-Sept. 30 period GM posted a loss after taxes of $1.2 billion.
The results did not conform to Generally Accepted Accounting Procedures (GAAP), which are required of publicly traded companies in the U.S. , since GM is privately held, largely by taxpayers.
In spite of its restructuring, the company is not yet at a break even point, according to Fritz Henderson, CEO, primarily because of costs, including the enormous cost of health care in the U.S.
Henderson characterized the results as “not satisfactory.”
General Motors Company Q3 2009 Unaudited Non-GAAP Results
|“Old GM”July 1-July 9, 2009||GM July 10-Sept. 30, 2009|
|Earnings before interest and taxes (before special items)||$(627)||$(261)|
|Special items (1)||$79,672||$(505)|
|Earnings before taxes||$78,836||$(1,016)|
|Total managerial income/(loss)||$79,358||$(1,151)|
|Managerial operating cash flow (before special items)($bils)||$(3.6)||$3.3|
|Global cash and cash-related balance ($bils)||$37.6||$42.6|
|(1) Special items for July 1-July 9, 2009 includes a reorganization gain of $80.7 billion.|
The revenue, cost and cash flow numbers are indicators of GM’s actual health. These and subsequent results are needed to gauge the effectiveness of the reorganization imposed on it by the U.S. Treasury Department, and to assess the likelihood of how much U.S. and Canadian taxpayers will be paid back of the $50 billion in loans advanced via their ownership stake of 61% of the company.