General Motors Company · NYSE:GM
General Motors — Q3 2017 Earnings Presentation
36 slides from General Motors's earnings presentation, Oct 24, 2017
Slide 1: Q3 2017 Results
GENERAL MOTORS Q3 2017 Results October 24, 2017 =a @ ane = © DY & GENERAL MOTORS
Slide 2: Important Information
Important Information ‘Cautionary Note on Forward-Looking Statements: This presentation and related comments by management May include forward-looking statements. Tnese statements are based on current expectations about possible future events and thus are inherently uncertain. Our actual results may
Slide 3: GM is a More Compelling Investment Opportunity
GM is a More Compelling Investment Opportunity Earnings Disciplined Capital Robust Downside Technology and Growth Allocation Protection Innovation Continued Disciplined Enables sustained Redefining the future EPS-adjusted reinvestment and performance through of personal mobility growth expected retu
Slide 4: Q3 global deliveries of 2.2 million units, up 0.1 million Y-O-Y
Q3 global deliveries of 2.2 million units, up 0.1 million Y-O-Y, driven primarily by growth in China and a modest recovery of the market in South America. • Q3 global market share is up 20 bps Y-O-Y, driven by growing share in our key markets in China, North America and South America. Q3 net revenue
Slide 5: Third Quarter 2017 Continuing Operations Highlights
Third Quarter 2017 Continuing Operations Highlights Earn Customers For Life GM announced its vision for a world with zero crashes, zero emissions and zero congestion. To supportthis vision, GM outlined its all-electric path to zero emissions, announcing it will launch at least 20 electric vehicles b
Slide 6: Third Quarter 2017 Continuing Operations Highlights (Cont.)
Third Quarter 2017 Continuing Operations Highlights (Cont.) Leadin Technologyand Innovation Cadillac is setting new industry standards with ground-breaking driver assistance technologies like Super Cruise, the world’s first true hands-free driving system for the freeway. Super Cruise is available in
Slide 7: Q3 2017 EPS-diluted-adjusted from continuing operations was $1.32 per share
Q3 2017 EPS-diluted-adjusted from continuing operations was $1.32 per share, down $0.39 per share Y-O-Y due to lower earnings as a result of reduced North American wholesale volume. Results include two tax only special items for Q3 2017: • GM established a valuation allowance on deferred tax assets
Slide 8: Q3 continuing operations net revenue decreased $5.3 billion
Q3 continuing operations net revenue decreased $5.3 billion. Key drivers include: • Volume – $7.4 billion unfavorable due primarily to decreased wholesales in North America (268,000 units, 26% Y-O-Y). GM reduced passenger car volume, including the Cruze and Malibu, to match supply with demand, incur
Slide 9: EBIT-adjusted from continuing operations of $2.5 billion
EBIT-adjusted from continuing operations of $2.5 billion, down $1.1 billion Y-O-Y, primarily due to planned and strategic actions in North America that reduced wholesale volume. EBIT-adjusted margin from continuing operations remained strong at 7.5%, down 190 bps Y-O-Y, due primarily to a 26% reduct
Slide 10: Drivers of the change in EBIT-adjusted from continuing operations
Drivers of the change in EBIT-adjusted from continuing operations include: • Volume – unfavorable due to 260,000 unit decrease in wholesales, driven by lower wholesales in North America (268,000) primarily related to planned and strategic downtime to prepare for the upcoming truck launch and to matc
Slide 11: Solid EBIT-adjusted of $2.5 billion, profitability in all segments
Solid EBIT-adjusted from continuing operations of $2.5 billion, including profitability in all operating segments for the first time since Q4 2014: • GMNA generated EBIT-adjusted of $2.1 billion, down $1.5 billion Y-O-Y, due to a 26% reduction in wholesales volumes. • GMIO results improved $0.1 bill
Slide 12: GM market share in the U.S. was 17.3% during Q3
GM market share in the U.S. was 17.3% during Q3, up 30 bps Y-O-Y. GM retail market share in the U.S. was flat YTD at 16.6%. GM continued the refresh of its CUV portfolio in Q3 delivering the all new Chevrolet Traverse and GMC Terrain, and will deliver the Buick Enclave in Q4 2017. Incentive spending
Slide 13: North America generated solid EBIT-adjusted of $2.1 billion
North America generated solid EBIT-adjusted of $2.1 billion with an 8.3% EBIT-adjusted margin when considering the planned downtime and actions to match supply with demand. • GMNA has an EBIT-adjusted margin of 10.3% for the trailing four quarters, exceeding our target of 10%. • U.S. dealer inventor
Slide 14: Drivers of the change in GMNA EBIT-adjusted
Drivers of the change in GMNA EBIT-adjusted include: • Volume – unfavorable $2.1 billion due to 268,000 unit decrease in wholesales. The primary drivers are planned reductions in full sized pick-up trucks due to downtime to prepare for the launch of the next generation truck, other planned downtime
Slide 15: GMIO EBIT-adjusted performance improved $0.1 billion
GMIO EBIT-adjusted performance improved $0.1 billion Y-O-Y to $0.3 billion. • China equity income was flat Y-O-Y at $0.5 billion: • Wholesales were up 58,000 units due to the strength of the Baojun, Buick, Cadillac and Chevrolet brands as well as continued strength in SUVs and luxury vehicles, offse
Slide 16: Drivers of GMIO's EBIT-adjusted performance
Drivers of GMIO’s EBIT-adjusted performance: • Volume – wholesale volume down 25,000 units (15.3%) primarily due to decreased volume in Middle East Operations. • Price – favorable pricing in Australia due to refreshed products. • Cost – favorable primarily due to timing related to labor settlements,
Slide 17: GMSA recorded its first profitable quarter since Q4 2014
GMSA recorded its first profitable quarter since Q4 2014. Although the macroeconomic environment continues to be challenging, Q3 industry volumes indicate a modest recovery off of historic lows. • GMSA Q3 wholesales increased 21.3% Y-O-Y, increasing net revenues by $0.5 billion. • The South American
Slide 18: Drivers of GMSA's EBIT-adjusted performance
Drivers of GMSA’s EBIT-adjusted performance: • Volume – volume increased due to stronger industry performance in the key Brazilian and Argentine markets and significant share growth in Brazil (90 bps). • Price/Other – favorable pricing of $0.1B partially offsetting FX headwinds in Argentina. 18
Slide 19: GM Financial record net revenue of $3.2 billion
Record net revenue from continuing operations of $3.2 billion, up $0.8 billion Y-O-Y and record Q3 EBT from continuing operations of $0.3 billion, up $0.1 billion Y-O-Y, as GM Financial continues to execute on its full captive strategy. Earning assets grew $20 billion to $83.6 billion from Q3 2016.
Slide 20: Q3 2017 adjusted automotive free cash flow
Q3 2017 adjusted automotive free cash flow from continuing operations was $(1.0) billion, down $(5.1) billion Y-O-Y, primarily due to unfavorable working capital and other timing related impacts as a result of lower North American production, as well as $0.8 billion of lower automotive net income (a
Slide 21: Quarter-end available liquidity remains strong at $31.4 billion
Quarter-end available liquidity remains strong at $31.4 billion, down $4.4 billion from year-end 2016. The cash balance of $17.3 billion is in line with GM’s average cash balance commitment of approximately $18 billion for the calendar year (following the close of the Opel/Vauxhall transaction). GM
Slide 22: Summary
Summary GM delivered solid performance from continuing operations in Q3 2017, inclusive of a 26% reduction in GMNA wholesale volumes: * Q3 2017 EPS-diluted-adjusted of $1.32, and YTD EPS-diluted adjusted of $4.97 + EBIT-adjusted of $2.5 billion and EBIT-adjusted margin of 7.5% + GMNA EBIT-adjusted o
Slide 23: GM is a More Compelling Investment Opportunity
GM is a More Compelling Investment Opportunity Earnings Growth Continued EPS-adjusted growth expected Focus on strong franchises Capitalize on adjacencies Drive cost efficiencies GENERAL MOTORS Disciplined Capital Allocation Disciplined reinvestment and returning cash to shareholders Invest in growt
Slide 24: Select Supplemental Financial Information
GENERAL MOTORS Select Supplemental Financial Information GENERAL MOTORS 24
Slide 25: Global Deliveries
Global Deliveries (000's) Q32016 Q42016 Q12017 Q22017 Q32017 North America 919 1,001 816 879 925 us. 773 830 690 725 781 International Operations 1,045 1,421 1,070 1,013 1,130 Chinat 874 1,224 913 852 982 Memo: China retail deliveries 908 1,152 913 852 982 South America 163 161 148 160 179 Brazil 89
Slide 26: Global Market Share
Global Market Brazil Global Market Share - in GM Participating Markets Europe Total Worldwide Share “Beginning in he three months ended Marc veries in China: 2016 China GM volur ted based on wholesale v distribution network Note: Reported or GENERAL MOTORS Q32016 @Q42016 Q12017 Q22017 Q32017 North A
Slide 27: Reconciliation of EBIT-adjusted
Reconciliation of EBIT-adjusted Three Months Ended Net income (loss) attributable to stockholders G0 28 17 29 26 20 18 63 (Income) loss from discontinued operations, net of tax 31 (00) 084) 0) 02 Income tax expense (benefit) 23 09 05 09 08 07 03 G4) Gain on extinguishment of debt - - = - - - — 04) A
Slide 28: Aggregate Impact of Special Items on GAAP Reported Earnings
Aggregate Impact of Special Items on GAAP Reported Earnings Q3 2017 Q3 2016 Special Adjusted Special Adjusted Reported items (Non-GAAP) | Reported items (Non-GAAP) Net sales and revenue Costs and expenses Automotive cost of sales 26.5 _ 26.5 31.1 - 31.1 GM financial operating and other expenses 2.9
Slide 29: Calculation of ROIC-adjusted
Calculation of ROIC-adjusted Four Quarters Ended ($B) Q3 2017 Q3 2016 Numerator: EBIT-adjusted 12.4 13.3 Denominator: Average equity 445 42.7 Add: Average automotive debt and interest liabilities (excluding capital leases) 10.8 9.4 Add: Average automotive net pension & OPEB liability 21.2 22.6 Less:
Slide 30: Effective Tax Rate-adjusted - Continuing Operations
Effective Tax Rate-adjusted - Continuing Operations Q3 YTD 2017 2016 2017 2016 EBIT-adjusted 2,523 3,662 9,759 10,250 Less: Noncontrolling interests 1 61 ” 99 Less: Net interest expense 102 EBT-adjusted 2,430 3,499 9,524 9,875 Tax expense 2,316 902 3,637 2,436 Impact of special items‘ (1,828) (41) (
Slide 31: Restructuring
Restructuring ($B) GMNA 0.0 (0.0) GMIO 0.0 0.0 GMSA 0.0 0.0 GENERAL MOTORS S7 31
Slide 32: GM Financial - Key Metrics
GM Financial - Key Metrics ($B) Q3 2017 Earnings beforetax from continuing operations 0.3 Total loan and lease originations’ a2: GM as % of GM Financial loan and lease originations’ 89% Commercial finance receivables? 92 Retail finance receivables! 32.2 Ending earning assets? 83.6 Retail finance del
Slide 33: EPS-diluted-adjusted from Continuing Operations Reconciliation
PS-diluted-adjusted from Continuing Operations Reconciliation Q3 YTD 2017 2016 2017 2016 Diluted earnings (loss) per common share $(2.03) $1.76 $0.85 $4.81 Diluted EPS - discontinued operations $2.11 — $(0.00) $2.61 —$(0.08) Adjustments' s— $(0.07) $0.43 $0.04 Tax effect on adjustments = $0.02 —$(0.
Slide 34: Q3 2017 Consolidated EBIT-adj. Walk
Q3 2017 Consolidated EBIT-adj. Walk Continuing tinued Operations open ns Net income attributable to stockholders (3.1) (3.0) Interest (expense) “vs Tax expense 0.5 Specialitems Deferredtax assets retained and not realizable" (2.3) Tax settlements* 0.5 Loss on sale of discontinued operations Deferred
Slide 35: Guidance Reconciliation - Continuing Operations
Guidance Reconciliation - Continuing Operations Year Ending Dec. 31, 2017 Diluted earnings per common share $1.66 - 2.16 Diluted loss per common share - discontinued operations (a) 2.83 Adjustments (b) 0.43 Tax effect on adjustments (c) (0.14) Tax adjustments (d) 41.22 EPS-diluted-adjusted $6.00 - 6
Slide 36: For additional information please visit
For additional information please visit: GENERAL MOTORS http:/www.gm.com/investors [email protected] ou | | GM FINANCIAL https://www.gmfinancial.com/investors-information.aspx [email protected] GMs Investor Relations website contains a significant amount of information about updated c
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