GM First Quarter Net Income of $1.0 Billion image

General Motors Co. (NYSE: GM) reported first quarter net income attributable to common stockholders of $1.0 billion, or $0.60 per fully diluted share.

These results include a net loss from special items related to goodwill impairment that reduced net income by $0.6 billion, or $0.33 per fully diluted share.

A year earlier, the company’s earnings were lifted by $1.5 billion in gains on sale of holdings in Delphi Automotive LLP and Ally Financial.

GM’s earnings beat investors’ expectations and underscored continuing strength in its core North American operations, where the auto maker bolstered both revenue and its operating margin.

“The U.S. economic recovery, record demand for GM vehicles in China and the global growth of the Chevrolet brand helped deliver solid earnings for General Motors,” said Dan Akerson, GM’s chief executive.

But the Detroit automaker, which reported $1 billion in profits for the first three months of the year, has legally avoided paying U.S. federal income taxes since exiting bankruptcy. And GM likely will pay no income taxes for many more years.

The tax-free years are the result of GM’s stint in bankruptcy in 2009. Detroit News reported the Treasury Department gave GM permission to use the $18 billion in losses from the pre-bankruptcy company, the so-called old GM, to cancel out any profits it has made since it emerged from bankruptcy.

In essence, GM would have to make $1 billion for 18 consecutive quarters before the federal government, which bailed out the company, sees a nickel in income tax from GM.

GM Results Overview (in billions except for per share amounts)

Q1 2012 Q1 2011
Revenue $37.8 $36.2
Net income attributable to common stockholders $1.0 $3.2
Earnings per share (EPS) fully diluted $0.60 $1.77
Impact of special items on EPS fully diluted

$(0.33) $0.82

$2.2 $2.0
Automotive net cash flow from operating activities $2.3 $(0.6)
Automotive free cash flow $0.3 $(1.9)