GM posts $1 billion first-quarter profit

GM posts $1 billion first-quarter profit

General Motors reported a first-quarter profit of $ 1 billion on strong results in North America and continuing losses in Europe.

The results were 60 cents per share (about a fourth of which are still owned by taxpayers). The profit beat Wall Street analysts expectations by eight cents per share.

GM was strong in North America with an operating profit of $ 1.7 billion, but the skunk at the party was GM Europe, which lost $ 256 million and also was responsible for a special charge of nearly $ 600 million for a writedown of goodwill. The unit's annual loss last year was its 12th consecutive year of losses.

The restructuring of the Opel operation has been gaining little traction and now is battling the headwind of the recession in most of Europe.

GM's profit in the quarter a year ago was $ 1.7 billion billion before special items. But GM's operating proft before interest and taxes this quarter was $ 2.2 billion, up 10 from a year ago. And net revenue this quarter was up $ 1.6 billion, or more than 4, from a year ago to $ 37.8 billion.

"The U.S. economic recovery, record demand for GM vehicles in China and the global growth of the Chevrolet brand helped deliver solid earnings for General Motors," said CEO Dan Akerson in a statement.

"New products are starting to make a difference in South America, but Europe remains a work in progress. We'll continue to work on both revenue and cost opportunities until we have brought GM to competitive levels of profitability," he said.

GM's stock continues to trade below its $ 33 IPO price in 2010 and closed Wednesday at $ 22.93. Taxpayers need a price of $ 53 to break even on the billions spent on GM's 2009 bankruptcy restructuring.

Among the Detroit automakers, GM's first-quarter profit compares to profits of $ 1.4 billion at Ford and $ 473 million at Chrysler.

GM raise d its forecast for overall industry sales this year in the U.S, saying "pent-up demand" would result in sales of 14 to 14.5 million, up a half million. And it said it expects its North American results in the second and third quarters "to be comparable to the first quarter of 2012 due to the scheduled downtime at factories that produce full-size trucks" for new models.