Currency losses hit GM's
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[February 07, 2017]
By Bernie Woodall and Joseph White
(Reuters) - General Motors Co <GM.N> said on Tuesday that fourth-quarter
net income fell partly because of $500 million in foreign exchange
losses, while the automaker forecast 2017 profit per share would be flat
to slightly up from 2016.
GM said fourth-quarter net income fell to $1.8 billion, or $1.19 per
share, from $6.3 billion, or $3.92 a share, a year earlier.
Excluding one-time items, GM earned $2.4 billion, or $1.28 a share, in
the latest quarter, down 14 percent from a year earlier. The adjusted
result beat analysts' expectations of $1.17 per share.
GM forecast adjusted earnings per share for all of 2017 at $6.00 to
$6.50 a share, compared with $6.12 for all of 2016.
Shares were up 1.5 percent at $37.40 in premarket trading.
Most of the currency impact was caused by the decline in the value of
the British pound after the United Kingdom's vote to leave the European
Union, GM said.
GM Chief Financial Officer Chuck Stevens said the company does not
expect to break even in Europe this year, but will push to "get to that
point in 2018."
GM said profits were pressured in 2016 because it launched several car
models at a time when consumers were turning away from cars to buy SUVs.
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The GM logo is seen at
the General Motors Lansing Grand River Assembly Plant in Lansing,
Michigan October 26, 2015. Photo taken October 26. REUTERS/Rebecca
Cook - RTX1TGK9
adjusted fourth-quarter profit margin in North America fell to 8.4 percent from
10 percent a year earlier. Adjusted profit margin in North America for full-year
2016 was 10.1 percent, down from 10.3 percent in 2015.
Inventories of unsold vehicles at its U.S. dealers rose by one-third to 845,000
vehicles at the end of 2016. Stevens said the company built up stocks ahead of
product launches, and intends to bring inventories down through the year.
Stevens said GM is assessing the ways in which proposals by U.S. President
Donald Trump for a border tax on goods imported into the United States could
affect the company.
"We support tax reform that would make the U.S. manufacturing base stronger. A
border tax is one part," he said. "There are a lot of moving pieces."
GM's 52,000 hourly U.S. workers represented by the United Auto Workers union
will get an annual bonus of $12,000, up from $11,000 a year ago. This is based
on GM's North American adjusted profit.
(Editing by Chizu Nomiyama and Jeffrey Benkoe)
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