IN HIGH GEAR\GM reports record $6.9 billion earnings.
Strong overseas profits, cost-cutting in North America and substantially lower tax rates helped General Motors Corp. earn $1.9 billion in the fourth quarter and post the highest annual earnings in its history.
The world's largest automaker said Tuesday that its fourth-quarter profit was 18.7 percent higher than a year ago, when net income was $1.6 billion. Earnings per share rose to $1.98 from $1.74.
For the year, GM earned $6.9 billion, or $7.21 a share, compared with 1994's $4.9 billion, or $5.15 a share, the previous record.
Wall Street endorsed GM's report. General Motors shares were up almost 3 percent, rising 1-3/8 to close at 53-5/8 on the New York Stock Exchange.
The performance also results in a payout for GM employees.
About 352,000 U.S. employees will receive profit-sharing payments of about $800.
About 6,700 workers at GM's Saturn division will get payments of $6,615, in addition to payments of $3,385 they received for the first three quarters of 1995. Their separate union agreement bases profit sharing on Saturn's performance, not on that of the corporation as a whole.
GM revenue for the quarter rose to $43.9 billion from $42.6 billion. For all of 1995, revenue rose to $168.8 billion from $155 billion in 1994.
Improved profitability at GM's North American Operations unit, its main car and truck business, was the most significant factor in the record profits, said J. Michael Losh, the chief financial officer.
"The pretax net income for NAO for the calendar year roughly doubled," Losh said. "It is primarily as a result of improvements in our cost structure."
He said North American Operations reduced manufacturing expenses, material costs and sales expenses. Its net profit for the year was $2.4 billion vs. $677 million in 1994. The profit margin, or earnings expressed as a proportion of sales, was 2.3 percent, compared with 0.7 percent in 1994.
"The record fourth-quarter and calendar-year results demonstrate the solid progress we've made toward achieving our goal of consistent industry-leading financial results, even though the overall worldwide industry was slightly weaker in 1995," said GM Chairman Jack Smith.
CHART[ordinal indicator, masculine]PHOTO
Photo (Color) Larry Zeff, 53, of West Bloomfield, Mich., leans from the driver's seat of the 1996 Pontiac Grand Am SE. Associated Press Chart (Color) GM Earnings Knight-Ridder Tribune Graphics Network
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|Publication:||Daily News (Los Angeles, CA)|
|Article Type:||Statistical Data Included|
|Date:||Jan 31, 1996|
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