GM reports $4.3-billion loss as it looks to repay Treasury
By Corinna Petry
Published: April 8, 2010
CHICAGO -- General Motors Co. said it is working in the short term to repay U.S. and Canadian government loans and in the longer term to become a publicly held corporation again.
The company, which emerged from Chapter 11 bankruptcy reorganization last summer, this week reported a net loss attributed to shareholders of $4.3 billion for the period from July 10 to Dec. 31, 2009, on global revenue of $57.5 billion. The Form 10-K filing with the U.S. Securities and Exchange Commission falls under "fresh start" accounting rules. The "Old GM" reported net income of $109.1 million for the period from Jan. 1 to July 9 on revenue of $47.1 billion.
The second-half loss included the pre-tax impact of a $2.6-billion settlement related to the United Auto Workers union retiree medical plan and a $1.3-billion foreign currency re-measurement loss, the automaker said in its filing.
"We are building the foundation that will allow us to return to public ownership," vice chairman and chief financial officer Chris Liddell said in a statement. "Completing fresh-start accounting is an important step in that process."
As of Dec. 31, the U.S. Treasury owned 304.1 million shares of GM, or 60.8 percent of its common stock, while the Canadian government owned 11.7 percent. GM last year borrowed approximately $48.7 billion from U.S. taxpayers under Treasury Department debtor-in-possession finance arrangements and other loans.
Going public would enable GM to invest "in designing, building and selling the world's best vehicles, attract the best people and access the capital markets. One of the most important measures in establishing the foundation for going public is the company's ability to return to sustainable profitability," Liddell said.
But as last year's financial results show, "there is still significant work to be done," he said. "I continue to believe we have a chance of achieving profitability in 2010. We are dedicated to delivering on our commitments to our stakeholders. For example, we remain committed to repaying the outstanding balance of the U.S. Treasury and Export Development Canada loans by June 2010 at the latest."
Meanwhile, GM said this week it is adding more than 100 workers to the second shift at its Warren, Mich., transmission plant to meet growing customer demand for models currently in high demand. The Warren plant supplies transmissions for the Chevrolet Equinox, Impala, Malibu and Traverse, the Buick Enclave, LaCrosse and Lucerne and the GMC Acadia and Terrain models, a line-up that "includes some of the hottest-selling vehicles in the United States," the company said.
"Increased market demand is driving expansion of our production operations," plant manager Dave Tatman said in a statement. "Additional jobs will allow us to grow the business while meeting increasing customer demand for our products."
The plant employs about 660 hourly and 120 salaried workers.