General Motors Company · NYSE:GM
General Motors — Q3 2016 Earnings Presentation
38 slides from General Motors's earnings presentation, Oct 25, 2016
Slide 1: Q3 2016 Results
GENERAL MOTORS Q3 2016 Results October 25, 2016 = @ oc ea HY @ SE DW& GENERAL MOTORS
Slide 2: Forward-Looking Statements
Forward-Looking Statements In this presentation and in related comments by management, we use words ike “anticipate,” “appears,” ‘approximataly,” “believe,” “continue,” ‘could, “designed,” “effect” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” ‘initative,” “intend,” ‘may,” “objective,” “outl
Slide 3: GM Is a Compelling Investment Opportunity
GM Is a Compelling Investment Opportunity . Disciplined Robust Downside [SEDATE ST Capital Allocation Continued EPS Disciplined Enables growth trajectory reinvestment and sustained expected returning cash to performance shareholders through the cycle GENERAL MOTORS 3
Slide 4: Q3 global deliveries up 4% year over year
Q3 global deliveries up 0.1 million units Y-O-Y, a 4% increase. Volume gains primarily in China, offset by reductions in other International Operations. Q3 market share is down 40 bps Y-O-Y, driven primarily by our strategy to reduce daily rental volumes in the United States and market growth outpac
Slide 5: Third Quarter 2016 Highlights
Third Quarter 2016 Highlights Earn Customers For Life GM received six segment-level awards - the most of any automaker - in the 2016 J.D. Power U.S. Automotive Performance, Execution, and Layout Study. GM total retail sales up 0.8% YTD in the United States and market share up 50 bps compared to 2015
Slide 6: Third Quarter 2016 Highlights (Cont.)
Third Quarter 2016 Highlights (Cont.) Lead in Technology and Innovation MILES 23 2017 Chevrolet Bolt receives EPA-estimated range of 238 miles per full charge. GM's Cruise Automation expanded testing of self-driving car technology to Scottsdale, Arizona Maven car-sharing customers in 10 U.S. markets
Slide 7: Consolidated net revenue increased $4.0 billion
Consolidated net revenue increased $4.0 billion. Key drivers include: • Volume - $2.2 billion favorable due to increased wholesales in North America (92,000 units), partially offset by decreased wholesales in International Operations. North American wholesales were driven by strong retail demand for
Slide 8: EPS-diluted was a Q3 record of $1.76 per share
EPS-diluted was a Q3 record of $1.76 per share. Special items consisted of a net benefit for legal related matters related to the ignition switch recall had a net after-tax favorable impact on reported Net Income to common stockholders of $0.1 billion or $0.04 per share during Q3. EPS-diluted-adjust
Slide 9: Consolidated EBIT-adjusted improved to Q3 record $3.5 billion
Consolidated EBIT-adjusted improved to a Q3 record $3.5 billion, up $0.4 billion Y-O-Y. Consolidated EBIT-adjusted margin improved to a Q3 record 8.3%, up 30 bps Y-O-Y. Five consecutive record EBIT-adjusted quarters going back to Q3 2015. Consolidated wholesales for Q3 increased 78,000 units, primar
Slide 10: Consolidated EBIT-adjusted drivers
Consolidated EBIT-adjusted increased approximately $0.4 billion Y-O-Y. Key drivers included: • Volume – favorable impact from increased wholesales in North America driven by strong retail demand for full-size trucks and launch vehicles in passenger car segments. • Mix – unfavorable primarily in Nort
Slide 11: Record consolidated Q3 EBIT-adjusted by region
Record consolidated Q3 EBIT-adjusted of $3.5 billion with broad-based Y-O-Y improvement, strong results and Q3 record EBIT-adjusted margin of 8.3%. All regions posted flat or improved Y-O-Y EBIT-adjusted performance. • GMNA achieved Q3 record EBIT-adjusted of $3.5 billion and has improved YTD EBIT-
Slide 12: U.S. market share and incentive spending
Market share in the U.S. was 17.0% during Q3, essentially flat Y-O-Y. • Retail market share increased 40 bps in Q3 2016 based primarily on the successful launches of the Chevrolet Malibu and Cruze. GM’s incentive spending as a % of ATP (GM% / Industry%) was near the industry average for Q3 (1.04) an
Slide 13: North America Q3 record EBIT-adjusted
North America Q3 record EBIT-adjusted grew to $3.5 billion for the quarter, up $0.2 billion Y-O-Y, and EBIT-adjusted margins remained strong at 11.2%, well positioned to meet GM’s full-year 2016 target of 10%+ margins. • GMNA has averaged EBIT-adjusted margins of 10.6% for the last four quarters and
Slide 14: Drivers of North America EBIT-adjusted improvement
Drivers of North America EBIT-adjusted improvement include: • Volume – favorable due to 92,000 unit increase in wholesales. The primary drivers are strong retail demand for full-size trucks and successful launch vehicles such as the Chevrolet Cruze and Malibu. • Mix – unfavorable primarily due to in
Slide 15: GME EBIT-adjusted improved $0.1B
GME EBIT-adjusted improved $0.1B Y-O-Y, improving results to breakeven YTD. • Top-line revenue is down Y-O-Y primarily due to the impacts of Brexit. • Wholesale volume and market share are approximately flat on a Y-O-Y basis, including the impact of GM’s exit from the Russian market. GM Europe have
Slide 16: Drivers of GME's EBIT-adjusted improvement
Drivers of GME’s EBIT-adjusted improvement: • Volume – total volume is flat while products such as the Opel Astra continue to be very well received in their local markets. • Price – Flat as favorable pricing on launches was offset by unfavorable carryover pricing. • Cost –favorable Y-O-Y due to carr
Slide 17: GMIO EBIT-adjusted is flat
GMIO EBIT-adjusted is flat Y-O-Y. • China equity income is flat Y-O-Y at $0.5 billion: • Retail sales are up 134,000 units due to a strong market and the strength of the Baojun, Buick and Cadillac brands. SUVs and luxury vehicles continue to be strong, offset by weakness in demand for small passenge
Slide 18: Drivers of GMIO's EBIT-adjusted performance
Drivers of GMIO’s EBIT-adjusted performance: • Mix - unfavorable due to selling fewer full-size trucks and SUVs in the Middle East. • Cost – favorable cost due primarily to material and freight performance as well as continued focus on cost management actions. • Other – favorable FX due to the Austr
Slide 19: South America remains challenged
South America remains challenged from macro-economic and political standpoints. • EBIT-adjusted improved $0.1 billion due to improved pricing and continued focus on cost. • Wholesales were flat Y-O-Y, however, there was growth in the major markets of Brazil and Argentina. • Chevrolet was the market
Slide 20: Drivers of GMSA's EBIT-adjusted performance
Drivers of GMSA’s EBIT-adjusted performance: • Price – favorable impact driven by price increases in Argentina and Brazil. • Cost – total cost was flat, as unfavorability in majors and material cost performance of $0.1 billion was offset by continued focus on cost management of $0.1 billion. • Other
Slide 21: GMF grew top-line revenue to record $2.5 billion
GMF grew top-line revenue to a record $2.5 billion as it continues to execute on its full captive strategy. EBT-adjusted was relatively flat, in-line with expectations. Credit losses and retail delinquencies remain stable in both the North American and International portfolios. 21
Slide 22: Q3 adjusted automotive free cash flow $3.5 billion
Q3 adjusted automotive free cash flow was $3.5 billion, up $2.7 billion Y-O-Y driven by higher earnings, favorable working capital, and lower recall-related cash payments. This improvement is net of $0.5 billion of higher capital expenditures. GM remains on track to deliver approximately $6 billion
Slide 23: Quarter-end available liquidity $35.5 billion
Quarter-end available liquidity remains strong at $35.5 billion, up $3 billion from year-end 2015. The cash balance of $21.5 billion is in line with our committed average cash balance of approximately $20 billion (YTD average $20.0 billion). GM expects to continue to follow its capital allocation pl
Slide 24: Summary
Summary GM delivered strong operating Q3 performance, putting it on track to deliver on its commitments and deliver another very strong year. + Record’ consolidated revenue of $42.8 billion, Q3 record’ net income attributable to common stockholders of $2.8 billion and EPS-diluted of $1.76 + Q3 recor
Slide 25: GM Is a Compelling Investment Opportunity
GM Is a Compelling Inves Opportunity Earninde Growth Disciplined Robust Downside 9 Capital Allocation Protection Continued EPS Disciplined Enables growth trajectory reinvestment and sustained expected returning cash to performance shareholders through the cycle GENERAL MOTORS 25
Slide 26: Select Supplemental Financial Information
GENERAL MOTORS Select Supplemental Financial Information GENERAL MOTORS 26
Slide 27: Non-GAAP Measures
Non-GAAP Measures See our Form 10-K and Form 10-Q reports filed with the U.S. Securities and Exchange Commission for a description of certain non-GAAP measures used by GM, including EBIT-adjusted, EPS-diluted-adjusted, ROIC-adjusted and adjusted automotive free cash flow, along with a description of
Slide 28: Global Deliveries
Global Deliveries (000's) Q32015 =Q42015 = Q12016 Q22016 Q32016 North America 931 927 799 910 919 Us. 794 763 684 755 773 Europe 289 275 312 328 283 UK 80 68 85 69 at Germany 61 61 63 74 61 International Operations 1,005 1,359 1,132 1,012 1,036 Chinat ata 1,154 976 839 874 Memo: China retail deliver
Slide 29: Global Market Share
Global Market Share Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 North America 16.6% 16.9% 15.9% 15.9% 16.5% U.S. 17.1% 17.3% 16.4% 16.3% 17.0% Europe 6.3% 5.7% 6.1% 6.0% 6.0% UK. 9.6% 10.7% 9.6% 9.1% 9.6% Germany 7.1% 6.9% 7.2% 7.1% 6.7% International Operations 10.0% 10.7% 9.8% 9.2% 9.3% China* 15.2% 1
Slide 30: Reconciliation of EBIT-adjusted
Reconciliation of EBIT-adjusted Net income attributable to stockholders Subtract: Automotive interest expense (0.1) (0.1) (0.4) (0.3) Automotive interest income = - 0.1 0.1 Income tax expense (0.8) (0.2) (2.2) (1.3) Add Back Special Items": Venezuela currency devaluation and asset impairment - - - 0
Slide 31: Aggregate Impact of Special Items on GAAP
Aggregate Impact of Special Items on GAAP Reported Earnings Net sales and revenue 28 — 428 7 3680389 Costs and expenses Automotive cost of sales GM Financial interest, operating and other expenses Automotive SG&A Net automotive interest expense, interest income, other non-operating income, and equit
Slide 32: Calculation of ROIC-adjusted
Calculation of ROIC-adjusted Four Quarters Ended ($B) Q3 2016 Q3 20 Numerator: EBIT-adjusted 12.9 10.5 Denominator: Average equity 42.7 35.9 Add: Average automotive debt and interest liabilities (excluding capital leases) 9.5 Add: Average automotive net pension & OPEB liability 25.2 Less: Average ne
Slide 33: Reconciliation of EBIT-adjusted used in ROIC-adjusted
Reconciliation of EBIT-adjusted used in the calculation of ROIC-adjusted Three Months Ended September 30, June 30, March 31 2016 2015 2016 2015 2016 2015 December 31, 2015 2014 Net income attributable to common stockholders $ 2,773 $ 1,359 $ 2.866 $ 1,117 $ 1953 $ 945 $ 6,266 $ 1,987 Income tax expe
Slide 34: Effective Tax Rate-adjusted
GENERAL MOTORS Note:ETR-adjus Effective Tax Rate-adjusted ($M) YTD Q3 2016 Q3 20: EBIT-adjusted 10,145 3,543 3,096 Less: Noncontrolling interests 99 61 28 Less: Net interest expense 282 104 72 EBT-adjusted 9,764 3,378 2,996 Tax expense 2,206 776 165 Impact of special items 25 (41) 438 Effective tax
Slide 35: Restructuring by region
($B) Q3 2016 Q3 2015 GMNA 0.0 (0.0) GME (0.0) (0.0) GMIO (0.0) (0.1) GMSA (0.0) (0.1) Total restructuring (0.0) (0.1) GM expects CY 2016 restructuring to be ~$0.4 billion Note: Results may not sum due to rounding. GENERAL MOTORS sg 35
Slide 36: GM Financial - Key Metrics
GM Financial - Key Metrics ($B) Q3 201 Earnings Before Tax 0.2 0.2 Total Loan and Lease Originations 11.2 10.9 GM as % of GM Financial Loan and Lease Originations 88% 87% Commercial Finance Receivables’ 9.4 TREE Retail Finance Receivables 32.2 28.0 Ending Earning Assets? 73.8 52.7 Retail Finance Del
Slide 37: EPS-diluted-adjusted Reconciliation
EPS-diluted-adjusted Reconciliation Q3 YTD 2016 2015 2016 ©2015 Diluted earnings per common share $1.76 $0.84 $4.81 $2.07 Adjustments‘ (0.07) 0.93 0.04 1.90 Tax effect on adjustments 0.03 (0.14) (0.01) (0.21) Tax adjustments = (0.13) = (0.13) GENERAL MOTORS *See slides $4-85 for operating income imp
Slide 38: For additional information please visit
po For additional information please visit: GENERAL MOTORS By | cm FINANCIAL http://www.gm.com/investors [email protected] https://www.gmfinancial.com/investors-information.aspx [email protected] = @ oc ao @ S DW © GENERAL MOTORS 38
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