General Motors announced on Thursday it achieved record profits for the first three months of the year, mainly due to strong sales results in North America.
The biggest US automaker reported this week 2.36 million vehicles sold worldwide in the first quarter of 2016, down 2.5 percent compared to a year ago because of challenging conditions on some markets, especially in South America. Nevertheless, General Motors posted higher-than-expected earnings, with first-quarter records for incomes and margins. The company said its earnings before interest and tax adjusted rose of 2.7 billion dollars and EBIT-adjusted margins to 7.1 percent, while net income for the period more than doubled to 2 billion dollars, or 1.24 dollars a share. “We’re growing where it counts, gaining retail share in the US, outpacing the industry in Europe and capitalizing on robust growth in SUV and luxury segments in China,” Chairman and CEO Mary Barra said. “This strong quarter also reflects the excellent progress we’re making to improve results in our more challenged global markets.”
North America accounted for 85 percent of GM’s earnings before interest and taxes, but margins from the region fell to 8.7 percent from 8.8 percent a year earlier because of the 300 million dollars in restructuring costs. After a 200-million-dollar quarterly loss last year in Europe, the automaker managed to break-even this time. “The quarter was a great start to a year in which we anticipate strong growth in earnings and free cash flow,” Chuck Stevens, GM executive vice president and chief financial officer, stated.