Thursday, July 17, 2003 | 9:48 a.m.
DETROIT -- General Motors Corp.'s earnings fell 30 percent from a year ago, hurt by lower volume and pricing pressure, but it still handily beat Wall Street expectations.
The world's biggest automaker said today it earned $901 million, or $1.58 a share, in the April-June quarter, down from $1.3 billion, or $2.43 a share, a year ago in better economic conditions.
The Wall Street consensus for earnings in the second quarter was $1.19 a share, according to a survey by Thomson First Call.
Total revenue was $48.3 billion, essentially unchanged from a year ago.
Sharply lower volume year-to-year and continued pricing pressure eroded the company's financial performance.
Excluding GM's Hughes Electronics Corp. subsidiary, GM earned $879 million, or $1.57 a share. That's down from $1.5 billion, or $2.63 a share, in the year-ago quarter, when the company had a one-time expense of $55 million.
In morning trading on the New York Stock Exchange, GM shares dropped 29 cents to $35.63.
GM, like others in the industry, has seen profits decline because of costly consumer incentives used to spur sales.
"Overall, we had reasonable financial results in a challenging global economic environment," Chairman and Chief Executive Rick Wagoner said in a statement. "These results clearly demonstrate the benefits of our global portfolio of businesses, ranging from our core automotive operations ... to vehicle financing and mortgage operations."
GM's global automotive operations dropped dramatically. Earnings fell from $1.1 billion a year ago to $140 million in the most recent quarter. Global production declined 6.6 percent in the second quarter.
In North America, GM earned $83 million, compared with $1.3 billion in the year-ago period. Through June, GM's U.S. auto sales were off 5 percent from a year ago.
GM's U.S. market share was 27.9 percent in the second quarter, down from 28.1 percent last year. But the second-quarter figure was up from 26.6 percent in the first quarter.
"We're working hard to improve financial results in North America," Wagoner said. "We're going to stay focused on the straightforward business strategy that's worked very well for us in recent times."
GM Europe narrowed its loss to $3 million from $115 million a year ago. GM Asia Pacific earned a record $163 million in the April-June period -- four times better than the year-ago result.
GMAC, GM's finance arm, earned $834 million -- its best-ever quarterly performance.
Hughes Electronics earned $22 million, compared with a loss of $156 million in the prior-year period, led by strong results from DirecTV.
GM said last month its full-year profit target of $5 a share was uncertain because of questions about the economy. Today, the automaker said it was more optimistic about the outlook for the remainder of the year. GM said full-year earnings could range from current analysts' estimates of $4.50 to $5 a share, excluding Hughes and any special items.
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