GM Posts Q2 loss (and Q2 profit)

I wrote earlier on GM’s pending 2nd quarter results and their importance in the whole Renault/Nissan alliance thing.

Post a profit = tell Ghosn to go jump.

Post a loss = Kirk Kerkorian riding you like a shopping mall horsey ride.

Well, we got both.

From an Automotive New email alert:

DETROIT (Reuters) — General Motors on Wednesday posted a larger-than-expected operating profit, but a wider quarterly net loss after writing down costs associated with buyouts for almost a third of its factory work force.

The world’s largest automaker posted a second-quarter net loss of $3.2 billion, or $5.62 per share, compared with a loss of $987 million, or $1.75 per share, for the year-ago quarter.

But excluding charges, GM posted a profit of $2.03 per share. Analysts, on average, had forecast an operating profit on that basis of 51 cents per share, according to Reuters Estimates.

GM had not forecast its results, and analyst estimates ranged widely between 29 cents and 80 cents per share for the automaker’s second-quarter earnings after charges.

So, by the rules it’s a decent size loss, but one incurred in writing down structural costs for the benefit of future periods, without which there was actually a reasonable profit.

There’s something here for both sides here, but I’d still side with Rick at this point.

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  1. Actually this is good news, through and through. Kerkorian can hardly complain about write-offs related to restructuring, and $2 per share operating profit is excellent, excellent news.

  2. And Wall Street agrees with me – GM is up nearly $2 today, trading just under $32 a share right now, which is up considerably from the 27-28 range reached afer Kerkorian’s arbitrage efforts were revealed.

  3. “too funny”

    Thank you, I’ll be here all week. Try the fish…

    I don’t know exactly how many shares KK has, but he did indeed make a decent clip overnight.

    Here’s hoping Wagoner’s commissioned all the staff and customers at that Vegas GM driving exerience thingy to flip Kirk the bird as they go around the track.

    Maybe I’m being too harsh. The shadow he casts over the board table has certainly put some vigour into the whole restructuring effort. As long as he doesn’t continue to advocate the dissolving of Saab then I’d almost promote keeping him around. Rick could sit him in the corner as a conversation piece or something.

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