GM Reports Third Quarter Financial Results

DETROIT, Nov. 7 /PRNewswire-FirstCall/ -- General Motors Corp. today announced its financial results for the third quarter of 2007, marked by record global sales, further improvement in its core automotive business driven by solid financial performance in key growth markets around the world and improved liquidity.

"We continue to implement the key elements of our North America turnaround strategy, and these initiatives are driving steady improvement in our financial results, despite challenging North America market conditions. In addition, we are very encouraged by our performance in emerging markets. Our record third quarter global sales are strong evidence that our commitment to great cars and trucks is being embraced by consumers around the globe," said Rick Wagoner, GM chairman and chief executive officer.

The company's improved performance in its automotive operations was more than offset by special charges of $37.4 billion related largely to a previously announced valuation allowance against its deferred tax assets, as well as lower reported GMAC Financial Services income, down $630 million versus the year-ago quarter as a result of continued pressures in the mortgage industry.

GM reported a net loss of $39 billion (including Allison Transmission, which is classified as a discontinued operation), or $68.85 per diluted share, for the third quarter of 2007, compared with a reported net loss of $147 million, or $.26 per diluted share, in the year-ago quarter.

Special items included a net non-cash charge of $38.6 billion due to a valuation allowance against deferred tax assets related to operations in the U.S., Canada and Germany as required under SFAS No. 109, Accounting for Income Taxes. Also included was a favorable $3.5 billion after-tax gain on the sale of the Allison Transmission business in August 2007, for which GM received $5.4 billion in proceeds. GM also had special charges of $1.6 billion in pension service costs related to prior labor agreements, $0.4 billion associated with restructuring actions and $0.4 billion related to an adjustment to the Delphi reserve. Details on all of the special charges are included in the "Highlights" section of this news release.

Excluding special items, GM had a 2007 third-quarter adjusted net loss of $1.6 billion, or $2.80 per diluted share, compared to net income of $497 million, or $.88 per diluted share, in the year-ago quarter. The variance was driven primarily by a significant decline in net income at GMAC, as well as increased corporate expense related to legacy cost, foreign exchange and various 2006 tax benefits, partially offset by improved performance in automotive operations.

GM Automotive Operations

GM's global automotive operations posted net income of $122 million from continuing operations on an adjusted basis in the third quarter of 2007 (reported net loss of $40.6 billion), an improvement of $577 million compared to an adjusted net loss from continuing operations of $455 million (reported net loss of $401 million) in the same quarter 2006. Results for GM's automotive operations, specifically GMNA, exclude Allison Transmission, which was classified as a discontinued operation as a result of the sale of that business which was concluded in August 2007.

GM generated record third quarter automotive revenue of $43.1 billion. The company also achieved record global third quarter sales of 2.39 million cars and trucks, up four percent compared to the third quarter 2006, driven by exceptionally strong demand in emerging markets and improved performance in developed markets. GM also set a number of third quarter sales records around the globe, including a 22 percent increase in GMLAAM, 16 percent increase in the GMAP region, and 15 percent gain in GME.

"We continue to see solid progress in the fundamentals of our automotive business. We're very pleased with our strong sales performance in key markets outside of North America, and growing retail momentum in the U.S. driven by products like the all-new Cadillac CTS. We're also very encouraged by the early reactions to our all-new Chevrolet Malibu and 2008 Chevrolet Tahoe and GMC Yukon two-mode hybrids - the world's only full-size hybrid SUVs," said Wagoner.

GMNA had an adjusted net loss from continuing operations of $247 million in the third quarter 2007 (reported net loss from continuing operations of $38.2 billion, which includes charges of approximately $36.5 billion for a valuation allowance against its deferred tax assets and $1.3 billion for pension service costs related to prior labor agreements), compared to an adjusted net loss of $660 million from continuing operations in the third quarter 2006 (reported net loss from continuing operations of $667 million). GMNA's improved adjusted earnings reflect favorable mix, pricing and better warranty performance, which were partially offset by lower volume and increased material cost.

GME posted an adjusted net loss of $90 million in the third quarter (reported net loss of $2.9 billion, which includes charges of $2.5 billion for a valuation allowance against deferred tax assets in Germany and restructuring charges of $262 million), compared to $39 million loss in the third quarter of 2006 (reported net loss of $126 million). The variance in adjusted net income reflects the softness of the German market and unfavorable currency exchange, which was partially offset by improved pricing and higher volume.

GME achieved record third quarter sales of about 524,000 units, aided by continued momentum of GME's multi-brand strategy during the period. Chevrolet is amongst the fastest growing global vehicle brands in Europe, posting record third quarter sales of 113,000 vehicles. GM gained further ground in the growing Russian market, with sales up by 75 percent over the same quarter 2006, to a record 65,700 vehicles.

GMAP recorded adjusted net income of $138 million in the third quarter (reported net income also $138 million), compared with $57 million in the year ago period (reported net income of $205 million, which included $148 million in favorable tax-related items). This favorable earnings performance was driven largely by strong export growth from GM Daewoo, continued strong sales and profitability in China, and improved earnings in India and Australia.

GM achieved 16 percent sales growth in the Asia Pacific region, resulting in record third quarter sales of 327,500 units. GM China sold 230,000 vehicles, a 21 percent increase compared with the year ago period. GM sales in the region were also aided by the strong performance of GM Daewoo products, including the Chevrolet Captiva.

GMLAAM achieved all-time record earnings and quarterly sales in the third quarter, posting adjusted earnings of $340 million (reported net income also $340 million), up 86 percent compared with strong earnings in the year ago period of $183 million (reported net income also $183 million). The earnings improvement was driven primarily by volume growth, favorable pricing and vehicle mix.

GMLAAM set a third quarter sales record of over 329,000 vehicles, up almost 22 percent year-over-year. All-time sales records were achieved in Brazil, Colombia, Venezuela, Argentina and Egypt. The successful launch of the Chevrolet Captiva in South Africa, Venezuela, Colombia and the Middle East helped drive strong sales in the region.

GMAC

As a standalone company, GMAC Financial Services reported a net loss of $1.6 billion for the third quarter 2007, compared to a net loss of $173 million in the third quarter 2006. The reported results for the third quarter of 2007 included a $455 million goodwill impairment charge at Residential Capital, LLC (ResCap), while a goodwill impairment charge of $695 million related to GMAC Commercial Finance was reflected in results for the third quarter of 2006.

Results were dominated by the effects of the dislocation in the mortgage and credit markets on the real estate finance business, which more than offset the continued strong performance at GMAC's automotive finance, insurance and other operations.

GM recognized $757 million of the net loss attributable to GMAC as a result of its 49 percent equity interest and accrued preferred dividends (reported net loss of $803 million).

Cash and Liquidity

GM continues to have a strong liquidity position. Cash, marketable securities, and readily-available assets of the Voluntary Employees' Beneficiary Association (VEBA) trust grew to $30 billion as of September 30, 2007, up from $27.2 billion on June 30, 2007. The balance includes $5.4 billion of net cash proceeds from the completion of the Allison Transmission transaction in August 2007.

GM had negative adjusted automotive operating cash flow of $2.5 billion in the third quarter of 2007, improved from a negative $3.9 billion in the third quarter 2006.

Forward-looking Statements

In this press release and in related comments by General Motors' management our use of words like "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "seek," "may," "would," "could," "should," "believe," "potential," "continue," "designed," "impact," or the negative of any of those words or similar expressions is intended to identify forward-looking statements that represent our current judgment about possible future events. We believe these judgments are reasonable, but GM's actual results may differ materially due to a variety of important factors. Among other items, such factors include: the ability of GM to realize production efficiencies, to achieve reductions in costs as a result of the turnaround restructuring and health care cost reductions and to implement capital expenditures at levels and times planned by management; the pace of product introductions; market acceptance of our new products; significant changes in the competitive environment and the effect of competition in our markets, including on our pricing policies; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt; changes in the existing, or the adoption of new laws, regulations, policies, or other activities of governments, agencies, and similar organizations where such actions may affect the production, licensing, distribution, or sale of our products, the cost thereof or applicable tax rates; costs and risks associated with litigation; the final results of investigations and inquiries by the SEC and other governmental agencies; changes in accounting principles, or their application or interpretation, and our ability to make estimates and the assumptions underlying the estimates, including the range of estimates for the Delphi pension benefit guarantees, which could result in an impact on earnings; negotiations and bankruptcy court actions with respect to Delphi's obligations to GM, negotiations with respect to GM's obligations under the pension benefit guarantees to Delphi employees, and GM's ability to recover any indemnity claims against Delphi; labor strikes or work stoppages at GM or its key suppliers such as Delphi or financial difficulties at GM's key suppliers such as Delphi; completion of the final settlement with the UAW and UAW retirees, including securing class certification in a form acceptable to GM, the UAW and class counsel; completion of the final settlement with the UAW and UAW retirees, including obtaining court approval in a form acceptable to GM, the UAW, and class counsel; treatment of the terms of the 2006 Settlement Agreement pursuant to the Retiree MOU in a manner acceptable to GM, the UAW and class counsel; GM's completion of discussions with the Staff of the SEC regarding accounting treatment with respect to the New VEBA and the post-retirement medical benefits for the covered group as set forth in the Retiree MOU, on a basis reasonably satisfactory to GM; shortages of and price increases for fuel; factors affecting GMAC's results of operations and financial conditions and changes in the residential mortgage market, especially in the nonprime sector; significant changes in the competitive environment and the effect of competition in GMAC's markets, including on GMAC's pricing policies; GMAC's ability to maintain adequate financing sources; GMAC's ability to maintain an appropriate level of debt; restrictions on the ability of GMAC's residential mortgage subsidiary to pay dividends and prepay subordinated debt obligations to GMAC; changes in the residual value of off-lease vehicles; changes in U.S. government-sponsored mortgage programs or disruptions in the markets in which GMAC's mortgage subsidiaries operate; changes in GMAC's contractual servicing rights; changes in the credit ratings of GMAC or GM; and changes in economic conditions, commodity prices, currency exchange rates, or political stability in the markets in which we or GMAC operate. The most recent annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed by GM and GMAC provide information about these factors, which may be revised or supplemented in future reports to the SEC on those forms.

General Motors Corporation Use of Non-GAAP Financial Measures This press release and the accompanying tables include the following non-GAAP financial measures: (a) adjusted net income, (b) managerial cash flow and (c) GM North America vehicle revenue per unit. Each of these financial measures excludes the impact of certain items and therefore has not been calculated in accordance with U.S. generally accepted accounting principles (GAAP). This press release also contains a reconciliation of each presented non-GAAP measure to its most comparable GAAP financial measure. Management believes these non-GAAP financial measures provide meaningful supplemental information regarding our operating results because they exclude amounts that GM management does not consider part of operating results when assessing the performance of the organization and measuring the results of GM's performance. In addition, GM has historically reported similar non-GAAP financial measures. GM believes that inclusion of these non-GAAP financial measures provides consistency and comparability with past earnings releases. GM management uses these non-GAAP financial measures to evaluate GM's performance and believes these measures allow GM management to readily view operating trends, perform analytical comparisons, benchmark performance among geographic regions and assess whether the GM North American structural cost turnaround plan is on target. Also, GM management uses adjusted net income for forecasting purposes and in determining our future capital investment allocations. Accordingly, GM believes these non-GAAP financial measures are useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. While GM believes that these non-GAAP financial measures provide useful supplemental information, there are limitations associated with the use of these non-GAAP financial measures. These non-GAAP financial measures are not prepared in accordance with GAAP, do not reflect a comprehensive system of accounting and may not be comparable to similarly titled measures of other companies due to potential differences in the method of calculation between companies. Costs such as the special attrition program and restructuring charges that are excluded from GM's non-GAAP financial measures can have a material impact on net earnings. As a result, these non-GAAP financial measures have limitations and should not be considered in isolation from, or as a substitute for, net earnings, cash flow from operations, or other measures of performance or liquidity prepared in accordance with GAAP. GM compensates for these limitations by using these non-GAAP financial measures as supplements to GAAP financial measures and by reviewing the reconciliations of the non-GAAP financial measures to their most comparable GAAP financial measures. Investors are encouraged to review the reconciliations of these non-GAAP financial measures to their most comparable GAAP financial measures that are included elsewhere in this press release. Adjusted Net Income Adjusted net income excludes charges for the special attrition program; restructuring, plant closure and impairment charges; gains and losses on the sale of business units and business interests; charges associated with the Delphi bankruptcy; charges associated with changes in estimates and accounting changes; and certain tax related items. The following is a discussion of each adjustment to the net income (loss) determined in accordance with GAAP to arrive at adjusted net income: -- Deferred tax assets and tax-related items. GM established valuation allowances against its deferred tax assets in the U.S., Canada and Germany. The charge associated with establishing these valuation allowances is excluded from adjusted net income. Other tax related items excluded from adjusted net income are: (1) the impact of the reduction in corporate income and trade tax rates in Germany; (2) the reversal of our deferred tax valuation allowance at GM Daewoo; and (3) unusual tax events that may result as GM is involved in the sales of its business units and business interests from time-to-time. Management believes the exclusion of these valuation allowance charges and tax related items from adjusted net income is useful because management does not consider these charges part of GM's core earnings in evaluating the performance of the business and excludes these costs when evaluating the performance of the Corporation, its business units and its management team and when making decisions to allocate resources among GM's business units. General Motors Corporation Use of Non-GAAP Financial Measures (Continued) -- Gains and losses on the sale of business units and business interests. The gains and losses on the sale of business units and business interests are excluded from adjusted net income. While GM is involved in sales of its business units and business interests from time-to-time and may have significant gains or losses from such sales in the future, such events have historically occurred sporadically. Management excludes the gains and losses associated with these events when it evaluates the Corporation's operations and for internal reporting and forecasting purposes and for allocation of additional resources. -- Change in estimate regarding period of economic benefit of existing pension prior service cost. Our non-GAAP financial measures exclude the charge associated with this change in accounting estimate. Management believes the exclusion of this change in estimate from adjusted net income is useful because management does not consider these non-recurring charges part of GM's core earnings. Accordingly, management does not consider these costs as part of its core earnings for purposes of evaluating the performance of the business, and excludes such costs when evaluating the performance of the Corporation, its business units and its management teams and when making decisions to allocate resources among GM's business units. -- Restructuring, impairment and plant closure charges. Our non-GAAP financial measures exclude exit costs and related charges, primarily consisting of severance costs, lease abandonment costs, product impairments and any subsequent changes in estimates related to exit activities. Management believes the exclusion of restructuring and impairment charges from adjusted net income is useful because management does not consider these costs part of GM's core earnings in evaluating GM's operational managers and the exclusion permits investors to evaluate the performance of our management the same way management does. Additionally, management excludes restructuring and impairment charges in determining the allocation of resources, such as capital investments, among the Corporation's business units and as part of its forecasting and budgeting. -- Delphi charges. Our non-GAAP financial measures exclude the estimated charges associated with comprehensive settlement agreements, consisting of a Global Settlement Agreement and a Master Restructuring Agreement, entered into with Delphi in connection with the restructuring of Delphi's operations. Management does not consider these costs as part of its core earnings for purposes of evaluating the performance of the business, and excludes such costs when evaluating the performance of the Corporation, its business units and its management teams and when making decisions to allocate resources among GM's business units. -- Special attrition program charges. Our non-GAAP financial measures exclude the estimated charge associated with the special attrition program agreement among the UAW, GM and Delphi. Management believes it is useful in evaluating the performance of GM, its management teams and its business units during a particular time period to exclude charges associated with the special attrition program because the charge occurs irregularly. Accordingly, management does not consider these costs as part of its core earnings for purposes of evaluating the performance of the business, and excludes such costs when evaluating the performance of the Corporation, its business units and its management teams and when making decisions to allocate resources among GM's business units. General Motors Corporation Use of Non-GAAP Financial Measures (Concluded) Managerial Cash Flow GM also reports non-GAAP managerial automotive operating cash flow in its earnings releases and charts for securities analysts. Management believes that providing managerial automotive operating cash flow furnishes it and investors with useful information by representing the cash flow generated or consumed by its automotive operations, including cash consumed by automotive capital expenditures and equity investments in companies related to our core business and cash generated by sales of automotive operating assets and equity investments in companies related to GM's core business, before funding non-operating-related obligations including debt maturities, dividends and other non-operating items. Management uses this non-GAAP financial measure to assess its automotive cash flow when evaluating the performance of GM, its business units and its management teams and when making decisions to allocate resources among GM's business units. GM North America Vehicle Revenue per Unit GM's earnings releases and charts for securities analysts also include the use of a non-GAAP measure of revenue per vehicle. Management uses revenue per vehicle to track operating efficiency and to facilitate comparisons between periods and between manufacturers, and believes that it would provide valuable information to investors who are interested in identifying trends and comparing different companies. Revenue per vehicle includes certain vehicle sales to other GM regions that are excluded from GAAP reporting, and excludes non-vehicle sales such as service parts and operations and OnStar service, and other income that GM does not derive from the sale of vehicles, such as interest on the GM credit card. Management also includes sales to daily car rental companies in revenue per vehicle, although they are not treated as sales under GAAP reporting because of GM's repurchase obligations. General Motors Corporation List of Special Items * (Dollars in millions except per share amounts) (Unaudited) Three Months Ended Year to Date September 30, 2007 September 30, 2007 ------------------- ------------------ Net Net Income EPS Income EPS -------- --------- ---------- ------- REPORTED -------- Loss from continuing operations $ (42,512) $ (75.12) $ (41,770) $ (73.82) Income from discontinued operations 45 .08 256 .45 Gain on sale of discontinued operations 3,504 6.19 3,504 6.19 ------ ------ ------ ----- Net loss $ (38,963) $ (68.85) $ (38,010) $ (67.18) ====== ====== ====== ===== ADJUSTMENTS ----------- Valuation on deferred tax assets and associated tax items (A) $ 38,300 $ 67.68 $ 38,300 $ 67.68 Pension prior service cost (B) 1,561 2.76 1,561 2.76 Restructuring (C) ** 387 .68 580 1.03 Delphi (D) ** 350 .62 925 1.63 Other valuation allowance adjustment for YTD Q207 special items (E) 250 .44 - - Special attrition program (F) ** 33 .06 10 .03 Gain on sale of discontinued operations (G) (3,504) (6.19) (3,504) (6.19) Product impairments (H) ** - - 104 .18 Plant closures (I) ** - - (47) (.08) ------ ----- ------ ----- Total adjustments $ 37,377 $ 66.05 $ 37,929 $ 67.04 ====== ===== ====== ===== ADJUSTED -------- Income (loss) from continuing operations $ (1,631) $ (2.88) $ (337) $ (.59) Income from discontinued operations 45 .08 256 .45 ==== ==== ==== ==== Adjusted Loss - Basic $ (1,586) $ (2.80) $ (81) $ (.14) ==== ==== ==== ==== Adjusted Loss - Diluted *** $ (2.80) $ (.14) ==== ==== * Unless separately specified in the narratives that follow, pre-tax and after-tax amounts are the same. ** Year-to-date amounts have been revised, where applicable, to exclude the effect of $250 million in tax benefits that were previously reflected in the second quarter 2007 year-to-date highlights. The revised amounts result due to the valuation allowance recorded on deferred tax assets in the U.S., Canada and Germany in the current quarter. *** See average shares outstanding. General Motors Corporation List of Special Items * (Unaudited) (A) Relates to a net charge during the quarter for a valuation allowance on certain deferred tax assets and associated tax items in the U.S., Canada and Germany. The net charge for the quarter includes the valuation allowance of $39 billion, which includes an adjustment of $.7 billion relating to tax benefits recorded at loss entities through the third quarter. Net charges of $36.4 billion, $2.5 billion and $.1 billion were recorded in GMNA, GME and GMAC, respectively, and a favorable adjustment of $.7 billion was recorded in Corporate and Other. Additionally, GME's adjustment includes a $.5 billion charge associated with a reduction in the value of deferred tax assets due to a reduction in the statutory corporate income tax and trade tax rates in Germany. (B) Relates to a change in the estimate of the amortization period for pension prior service cost for certain of our employee benefit plans. In conjunction with entering into the 2007 GM/UAW labor contract, GM determined that the four year term of the labor contract better reflects the period of future economic benefit received from plan amendments to U.S. hourly pension plans. Concurrently, GM evaluated the remaining economic benefit related to the unamortized prior service cost remaining from prior labor contracts and determined the future economic benefit for those amounts that remained at the end of the third quarter did not extend beyond the third quarter. Accordingly, during the third quarter 2007, GM recorded a charge of $1.3 billion in GMNA and $.3 billion in Corporate and Other to expense the remaining portion of unamortized prior service cost from the plan amendments entered into as part of the 1999 and 2003 labor contracts. (C) Relates to various restructuring initiatives as follows: - For the three and nine months ended September 30, 2007, charges of $125 million and $219 million, respectively, were recognized at GMNA relating to adjustments to a plant closing reserve. - For the three and nine months ended September 30, 2007, charges of $262 million and after-tax charges of $326 million ($349 million pre-tax), respectively, were recognized at GME for separation programs primarily in Belgium, Germany, and Sweden. - After-tax charges of $35 million ($50 million pre-tax) for the nine months ended September 30, 2007 were recognized at GMAP that relate to separation programs at Australian facilities. (D) During the third quarter, GM and Delphi entered into comprehensive settlement agreements consisting of a Global Settlement Agreement (GSA) and a Master Restructuring Agreement (MRA), replacing the Memorandum of Understanding (MOU) that GM and Delphi executed in June 2007. The GSA intends to resolve issues between GM and Delphi that have arisen or may arise in connection with Delphi's emergence from bankruptcy protection, and the MRA intends to govern certain aspects of GM and Delphi's commercial relationship following Delphi's emergence from bankruptcy protection. GM recorded a charge of $575 million during the second quarter upon entering into the MOU. The charge consisted of incremental Delphi retiree health care costs, reimbursement of labor costs at certain Delphi facilities, and reimbursement of certain pension obligations for Delphi employees. GM recorded an additional charge of $350 million during the third quarter upon entering into the GSA and MRA. The third quarter charge consists of an adjustment to GM's estimated recovery under Delphi's new proposed Plan of Reorganization. (E) Relates to adjustments totaling $250 million recorded in the third quarter to remove the tax effect on special items at entities associated with deferred tax asset valuation allowances in the U.S., Canada and Germany that were recorded year-to-date through the second quarter 2007. Adjustments of $41 million were recorded in GMNA related to restructuring, special attrition program, product impairments and plant closure. An adjustment of $8 million was recorded at GME related to restructuring in Germany, and an adjustment of $201 million was recorded at Corporate and Other related to Delphi items. (F) Relates to favorable curtailment adjustments and reserve adjustments related to the Special Attrition Program for GMNA. (G) Relates to the gain on the sale of the commercial and military operations of our Allison Transmission business, which was completed in August 2007. This gain was recorded as discontinued operations. (H) Relates to charges recorded at GMNA of $95 million and after-tax charges of $9 million ($13 million pre-tax) recorded at GMAP for product specific assets. (I) Relates to curtailment gains and favorable reserve adjustments at GMNA related to the closure of two former component plants. * Unless separately specified, pre-tax and after-tax amounts are the same. General Motors Corporation List of Special Items - After-Tax (Dollars in millions except per share amounts) (Unaudited) Three Months Ended Year to Date September 30, 2006 September 30, 2006 Restated Restated ------------------ -------------------- Net Net Income EPS Income EPS ------- ------- ------- ------- REPORTED -------- Loss from continuing operations $ (277) $ (.49) $(3,278) $ (5.80) Income from discontinued operations 130 .23 350 .62 ---- ---- ------ ---- Net loss $ (147) $ (.26) $(2,928) $ (5.18) ==== ==== ===== ==== ADJUSTMENTS ----------- GMAC commercial finance goodwill impairment (A) $ 695 $ 1.23 $ 695 $ 1.23 Delphi (B) 325 .57 325 .57 Product impairments (C) 112 .20 309 .55 Restructuring (D) 87 .16 428 .76 Special Attrition Program (E) (105) (.19) 3,554 6.28 Tax related items (F) (148) (.26) (148) (.26) GMAC transaction related (G) (322) (.57) 368 .65 Sale of Suzuki investment (H) - - (395) (.70) Sale of Isuzu investment (I) - - (212) (.37) ---- ---- ----- ---- Total adjustments $ 644 $ 1.14 $ 4,924 $ 8.71 ==== ==== ===== ==== ADJUSTED -------- Income from continuing operations $ 367 $ .65 $ 1,646 $ 2.91 Income from discontinued operations 130 .23 350 .62 ---- ---- ----- ----- Adjusted Income - Basic * $ 497 $ .88 $ 1,996 $ 3.53 ==== ==== ===== ==== Adjusted Income - Diluted ** $ .88 $ 3.52 ==== ==== * Adjusted EPS - Basic for the nine months ended September 30, 2006 has been changed from $3.56 per share to $3.53 per share to reflect a revision to the special item related to the gain on sale of our Suzuki investment from $372 million, after-tax, to $395 million, after-tax. ** See average shares outstanding. General Motors Corporation List of Special Items - After-Tax (Unaudited) (A) During the third quarter, GMAC's commercial finance business recognized goodwill and other intangible asset impairment charges of $695 million after-tax ($839 million pre-tax). The charge was the result of a decision made by management to eliminate certain low margin product lines in its commercial finance business. (B) During the third quarter of 2006, GM increased its contingent liability associated with the restructuring of Delphi's operations by $325 million after-tax ($500 million pre-tax), based on data available at that time and ongoing discussions with Delphi and other stakeholders. GM established a contingent liability in the fourth quarter of 2005 and recorded a charge of $3.6 billion after-tax ($5.5 billion pre-tax). (C) GMNA recorded impairment charges related to product specific assets and the write-down of plant assets in connection with the planned stoppage of production at the Doraville, Georgia assembly plant. (D) Charges during the quarter of $87 million were recognized at GME primarily related to the elimination of a shift at the Ellesmere Port plant in the U.K. In addition to the third quarter charges, year-to-date after-tax charges totaling $428 million include: - $182 million recognized at GME, primarily related to the announced closure in December 2006 of the GM assembly plant in Azambuja, Portugal, which includes amounts for the write-down to fair market value of plant assets, employee separation costs, contract cancellation charges, other product-related asset impairments and separation charges. - Estimated charges of $65 million related to separations of salaried employees at GMNA. - Curtailment charges associated with modifications to the U.S. Retirement Program for Salaried Employees announced in the first quarter of 2006. GMNA and Corporate and Other Operations recognized charges of $12 million and $3 million, respectively, associated with these modifications. - A favorable adjustment of $88 million for higher than anticipated headcount reductions associated with previously announced GMNA plant idling activities. - A charge of $52 million for certain components of the hourly attrition program related to retroactive lump-sum payments, recognized at GMNA. - Other restructuring charges of $72 million and $43 million recognized at GME and GMLAAM, respectively. (E) Favorable adjustments of $105 million after-tax during the third quarter and year-to-date to adjust other personnel related accruals as a result of the GMNA hourly attrition plan. In addition to the current quarter charge, year-to-date charges relate to the results of the GM-UAW-Delphi Special Attrition Program, primarily for payments to employees (approximately $1.4 billion) and for the curtailment charges associated with GM's U.S. hourly pension plan as a result of the attrition program (approximately $2.9 billion). The charge also includes a favorable revision of the accrual taken in the fourth quarter of 2005 for the North American plant capacity actions (approximately $.6 billion). (F) Primarily reflects the reversal of a deferred tax asset valuation allowance at GM Daewoo and residual taxes at Suzuki. (G) In the second quarter of 2006, GM recognized impairment losses on GMAC to reflect the net assets held for sale at their net realizable value as required by SFAS 144. In the third quarter, GM recognized a reversal of losses previously recognized due to the fact that an impairment charge was recorded by GMAC's commercial finance business. Year-to-date after-tax charges of $368 million represent the sum of these two adjustments. (H) Relates to the sale of 92.4 million shares of GM's investment in Suzuki for approximately $2 billion in cash, reducing GM's equity stake to approximately 3.7% (16.3 million shares). The after-tax gain of $395 million was recognized at GMAP. (I) Relates to the sale of GM's entire investment in Isuzu Motors, Ltd. for an after-tax gain of $212 million. The gain was recognized at GMAP. General Motors Corporation Summary Corporate Financial Results (Dollars in millions except per share amounts) (Unaudited) Third Quarter Year to Date -------------------- ----------------- 2007 2006 2007 2006 Restated Restated ------- -------- ------- -------- Total net sales and revenue $ 43,834 $ 48,892 $ 134,225 $ 154,871 Adjusted 43,834 48,892 134,225 154,871 Income (loss) from continuing operations $ (42,512) $ (277) $ (41,770) $ (3,278) Adjusted (1,631) 367 (337) 1,646 Income from discontinued operations $ 45 $ 130 $ 256 $ 350 Adjusted 45 130 256 350 Net income (loss) $ (38,963) $ (147) $ (38,010) $ (2,928) Adjusted (1,586) 497 (81) 1,996 Net margin from continuing operations * (96.9)% (.6)% (31.1)% (2.1)% Adjusted (3.7)% .8% (.3)% 1.1% Earnings (loss) per share - basic Continuing operations $ (75.12) $ (.49) $ (73.82) $ (5.80) Income from discontinued operations .08 .23 .45 .62 Gain on sale of discontinued operations 6.19 - 6.19 - Net income (loss) (68.85) (.26) (67.18) (5.18) Earnings (loss) per share - diluted Continuing operations $ (75.12) $ (.49) $ (73.82) $ (5.80) Income from discontinued operations .08 .23 .45 .62 Gain on sale of discontinued operations 6.19 - 6.19 - Net income (loss) (68.85) (.26) (67.18) (5.18) Earnings (loss) per share - adjusted diluted $ (2.80) $ .88 $ (.14) $ 3.52 GM $1-2/3 par value average shares outstanding (Millions) Basic shares 566 566 566 566 Diluted shares ** 566 567 566 567 Cash dividends per share of common stocks $ .25 $ .25 $ .75 $ .75 See reconciliation of adjusted financial results. * Calculated as Income from continuing operations / Total net sales and revenue. ** Due to Loss from continuing operations for all periods presented, there is no difference between basic and diluted average shares outstanding on a reported basis (GAAP). Accordingly, the average number of diluted shares outstanding relates to amounts on an adjusted basis (non-GAAP) only, which has been adjusted to reflect the dilutive impact of stock options and other contracts to issue common stock in periods when adjusted net income is positive. General Motors Corporation Summary Corporate Financial Results (Unaudited) Third Quarter Year to Date -------------------- ----------------- 2007 2006 2007 2006 Restated Restated ------ -------- ------- -------- Automotive total cash & marketable securities at September 30 (Billions) $ 26.4 $ 17.9 Readily-available assets in VEBA 3.6 2.5 Total Automotive cash & marketable securities plus readily-available ----- ---- assets in VEBA $ 30.0 $ 20.4 ===== ==== Automotive Operations (Millions) Depreciation $ 1,237 $ 1,060 $ 3,725 $ 3,220 Amortization of special tools 744 869 2,327 2,712 Amortization of intangible assets 16 17 51 52 ----- ----- ----- ----- Total $ 1,997 $ 1,946 $ 6,103 $ 5,984 ===== ===== ===== ===== GM's share of nonconsolidated affiliates' net income (loss) (Millions) GMAC * $ (809) $ - $ (874) $ - Shanghai GM and SAIC-GM-Wuling 73 76 306 233 Other ** 42 26 134 198 ---- ---- ---- ----- $ (694) $ 102 $ (434) $ 431 ==== ==== ==== ==== * GMAC's reported results includes a charge for the quarter and year-to-date periods related to a goodwill impairment charge of $455 million. GM's share of this charge totaled $223 million and was included in GM's reported share of GMAC's net losses above. ** GM sold most of its investment in Suzuki in the first quarter of 2006, and consequently now accounts for its remaining investment as an equity security, and no longer records income on the equity basis. General Motors Corporation Summary Corporate Financial Results (Dollars in millions) (Unaudited) Third Quarter 2007 and 2006 ---------------------- Reported Special Items Adjusted ------------ --------------- ---------------- 2007 2006 2007 2006 2007 2006 Restated Restated Restated ------- -------- ------- -------- ----- -------- Net sales and revenue GMNA $ 26,607 $ 26,788 $ -$ - $ 26,607 $ 26,788 GME 8,722 7,444 - - 8,722 7,444 GMLAAM 4,944 3,658 - - 4,944 3,658 GMAP 5,446 3,847 - - 5,446 3,847 Auto Eliminations (a) (2,613) (2,085) - - (2,613) (2,085) ------ ------ --- --- ------ ------ Total GMA 43,106 39,652 - - 43,106 39,652 Corporate & Other (a) 28 (40) - - 28 (40) ------ ------ --- --- ------ ------ Total Auto & Other 43,134 39,612 - - 43,134 39,612 ------- ------ --- --- ------ ------ GMAC - 9,282 - - - 9,282 Other Financing (a) 700 (2) - - 700 (2) ------- ------ --- --- ------ ------ Total Financing 700 9,280 - - 700 9,280 -------- ------ --- --- ------ ------ Total net sales and revenue $ 43,834 $ 48,892 $ -$ - $ 43,834 $ 48,892 ====== ====== ==== ==== ====== ====== Income (loss) from continuing operations before income taxes, other equity income and minority interests GMNA $ (1,760) $ (927) $ 1,468 $ 11 $ (292) $ (916) GME (406) (197) 262 123 (144) (74) GMLAAM 375 187 - - 375 187 GMAP 168 (10) - - 168 (10) Auto Eliminations (26) 5 - - (26) 5 ------ ------ ------ ---- ----- ----- Total GMA (1,649) (942) 1,730 134 81 (808) Corporate & Other (999) (678) 601 500 (398) (178) ------ ------ ------ ---- ----- ----- Total Auto & Other (2,648) (1,620) 2,331 634 (317) (986) ------ ------ ------ ---- ----- ----- GMAC (753) 17 - 839 (753) 856 Other Financing 63 398 - (392) 63 6 ----- -------- ------------- ------- -------- Total Financing (690) 415 - 447 (690) 862 ----- -------- ------------- ------- -------- Total income (loss) from continuing operations before income taxes, other equity income and minority interests $ (3,338) $(1,205) $ 2,331 $1,081 $(1,007) $ (124) ===== ===== ===== ===== ===== === See footnotes. General Motors Corporation Summary Corporate Financial Results (Dollars in millions) (Unaudited) Third Quarter 2007 and 2006 ---------------------- Reported Special Items Adjusted ------------ --------------- ---------------- 2007 2006 2007 2006 2007 2006 Restated Restated Restated ------- -------- ------- -------- ----- -------- Income (loss) from continuing operations GMNA $ (38,195) $ (667) $37,948 $ 7 $ (247) $ (660) GME (2,869) (126) 2,779 87 (90) (39) GMLAAM 340 183 - - 340 183 GMAP 138 205 - (148) 138 57 Auto Eliminations (a) (19) 4 - - (19) 4 ------- ------ ------- ----- ----- ---- Total GMA (40,605) (401) 40,727 (54) 122 (455) Corporate & Other (1,136) (25) 31 325 (1,105) 300 ------- ------ ------- ----- ----- ---- Total Auto & Other (41,741) (426) 40,758 271 (983) (155) ------- ------ ------- ----- ----- ---- GMAC (803) (173) 46 695 (757) 522 Other Financing 32 322 77 (322) 109 - ------- ------ ------- ----- ----- ---- Total Financing (771) 149 123 373 (648) 522 ------- ------ ------- ----- ----- ----- Total income (loss) from continuing operations (42,512) (277) 40,881 644 (1,631) 367 Income from discontinued operations 45 130 - - 45 130 Sale of discontinued operations 3,504 - (3,504) - - - ------- ------ ------- ----- ------ ----- Net income (loss) $ (38,963) $ (147) $37,377 $ 644 $ (1,586) $ 497 ====== === ====== === ===== === Income tax expense (benefit) GMNA $ 36,429 $ (261)$(36,480) $ 4 $ (51) $ (257) GME 2,471 (63) (2,517) 36 (46) (27) GMLAAM 34 (5) - - 34 (5) GMAP 48 (260) - 253 48 (7) Auto Eliminations (9) 1 - - (9) 1 ------ ------ ------ ---- ----- ---- Total GMA 38,973 (588) (38,997) 293 (24) (295) Corporate & Other 140 (649) 570 175 710 (474) ------ ------ ----- ---- ----- ---- Total Auto & Other 39,113 (1,237) (38,427) 468 686 (769) ------ ------ ------ ---- ----- ---- GMAC 50 184 (46) 144 4 328 Other Financing 23 76 (77) (70) (54) 6 ----- ------ ------ ---- ----- ---- Total Financing 73 260 (123) 74 (50) 334 ----- ------ ------ ---- ----- ---- Income tax expense (benefit) $ 39,186 $ (977)$(38,550) $ 542 $ 636 $ (435) ====== ==== ====== ==== === === See footnotes. General Motors Corporation Summary Corporate Financial Results (Dollars in millions) (Unaudited) Third Quarter 2007 and 2006 ---------------------- Reported Special Items Adjusted ------------ --------------- ---------------- 2007 2006 2007 2006 2007 2006 Restated Restated Restated ------- -------- ------- -------- ----- -------- Effective tax rate Total GM (1,174)% 81% (1,654)% 50% (63)% 351% GMNA (2,070)% 28% (2,485)% 36% 17% 28% GME (609)% 32% (961)% 29% 32% 37% GMAC (7)% 1,082% n.m. 17% (.5)% 38% Equity income (loss) and minority interests, net of tax GMNA $ (6) $ (1) $ - $ - $ (6) $ (1) GME 8 8 - - 8 8 GMLAAM (1) (9) - - (1) (9) GMAP * 18 (45) - 105 18 60 Auto Eliminations (2) - - - (2) - --- -- --- --- --- -- Total GMA $ 17 $ (47) $ - $ 105 $ 17 $ 58 == === == === == == * We consolidate GM Daewoo, but exclude through minority interest, the profits on the 49% of GM Daewoo that we do not own. On a reported basis, this minority interest was $68 million for the third quarter of 2007 compared to $124 million for the third quarter of 2006. n.m. = not meaningful General Motors Corporation Summary Corporate Financial Results (Dollars in millions) (Unaudited) Third Quarter 2007 and 2006 Reported Special Items Adjusted ------------ --------------- ---------------- 2007 2006 2007 2006 2007 2006 Restated Restated Restated ------- -------- ------- -------- ----- -------- Net sales and revenue GMNA $ 84,327 $ 88,137 $ - $ - $ 84,327 $ 88,137 GME 26,820 24,280 - - 26,820 24,280 GMLAAM 12,854 10,652 - - 12,854 10,652 GMAP 15,469 11,030 - - 15,469 11,030 Auto Eliminations (a) (7,848) (6,303) - - (7,848) (6,303) ------- ------- --- ---- ------- ------- Total GMA 131,622 127,796 - - 131,622 127,796 Corporate & Other (a) 73 (139) - - 73 (139) ------- -------- --- ---- ------- ------- Total Auto & Other 131,695 127,657 - - 131,695 127,657 ------- -------- --- ---- ------- ------- GMAC - 27,143 - - - 27,143 Other Financing (a) 2,530 71 - - 2,530 71 ------- -------- --- ---- ------- ------- Total Financing 2,530 27,214 - - 2,530 27,214 ------- -------- --- ---- ------- ------- Total net sales and revenue $ 134,225 $154,871 $ - $ - $134,225 $154,871 ======= ======= ==== ==== ======= ======= Income (loss) from continuing operations before income taxes, other equity income and minority interests GMNA $ (2,069) $(7,580) $ 1,587 $6,006 $ (482) $(1,574) GME (92) (159) 349 512 257 353 GMLAAM 925 453 - 43 925 496 GMAP 544 1,063 63 (977) 607 86 Auto Eliminations (a) (35) (2) - - (35) (2) ------- ------ ------- ----- ------- ------- Total GMA (727) (6,225) 1,999 5,584 1,272 (641) Corporate & Other (1,787) (1,615) 1,176 504 (611) (1,111) ------- ------ ------- ----- ------- ------- Total Auto & Other (2,514) (7,840) 3,175 6,088 661 (1,752) ------- ------ ------- ----- ------- ------- GMAC (733) 1,875 - 839 (733) 2,714 Other Financing 203 (29) - 41 203 12 ------- ------ ------- ----- ------- ------- Total Financing (530) 1,846 - 880 (530) 2,726 ------- ------ ------- ----- ------- ------- Total income (loss) from continuing operations before income taxes, other equity income and minority interests $ (3,044) $(5,994) $ 3,175 $6,968 $ 131 $ 974 ==== ===== ===== ===== ==== ===== See footnotes. General Motors Corporation Summary Corporate Financial Results (Dollars in millions) (Unaudited) Year to Date 2007 and 2006 ---------------------- Reported Special Items Adjusted ------------ --------------- ---------------- 2007 2006 2007 2006 2007 2006 Restated Restated Restated ------- -------- ------- -------- ----- -------- Income (loss) from continuing operations GMNA $(38,416) $(5,018) $38,026 $3,904 $(390) $(1,114) GME (2,647) (106) 2,835 341 188 235 GMLAAM 754 362 - 43 754 405 GMAP 481 1,073 44 (755) 525 318 Auto Eliminations (a) (23) (1) - - (23) (1) ------ ------ ------ ----- ------ ----- Total GMA (39,851) (3,690) 40,905 3,533 1,054 (157) Corporate & Other (1,258) (333) 405 328 (853) (5) ------ ------ ------ ----- ------ ----- Total Auto & Other (41,109) (4,023) 41,310 3,861 201 (162) ------ ------ ------ ----- ------ ----- GMAC (779) 1,109 46 695 (733) 1,804 Other Financing 118 (364) 77 368 195 4 ------ ------ ------ ----- ------ ----- Total Financing (661) 745 123 1,063 (538) 1,808 ------ ------ ------ ----- ------ ----- Total income (loss) from continuing operations (41,770) (3,278) 41,433 4,924 (337) 1,646 Income from discontinued operations 256 350 - - 256 350 Sale of discontinued operations 3,504 - (3,504) - - - ------ ------ ------ ----- ------ ----- Net income (loss) $ (38,010) $(2,928)$ 37,929 $4,924 $ (81) $ 1,996 ===== ====== ====== ===== ===== ===== Income tax expense (benefit) GMNA $ 36,354 $(2,486)$(36,439)$2,102 $ (85) $ (384) GME 2,568 (37) (2,486) 171 82 134 GMLAAM 170 80 - - 170 80 GMAP 128 96 19 (117) 147 (21) Auto Eliminations (12) (1) - - (12) (1) ------ ------ ------ ----- ------ ----- Total GMA 39,208 (2,348) (38,906) 2,156 302 (192) Corporate & Other (526) (1,277) 771 176 245 (1,101) ------ ------ ------ ----- ------ ----- Total Auto & Other 38,682 (3,625) (38,135) 2,332 547 (1,293) ------ ------ ------ ----- ------ ----- GMAC 46 767 (46) 144 - 911 Other Financing 77 335 (77) (327) - 8 ------ ------ ------ ----- ------ ----- Total Financing 123 1,102 (123) (183) - 919 ------ ------ ------ ----- ------ ----- Income tax expense (benefit) $ 38,805 $ (2,523)$(38,258)$2,149 $ 547 $ (374) ====== ====== ====== ===== ==== ===== See footnotes. General Motors Corporation Summary Corporate Financial Results (Dollars in millions) (Unaudited) Year to Date 2007 and 2006 ---------------------- Reported Special Items Adjusted ------------ --------------- ---------------- 2007 2006 2007 2006 2007 2006 Restated Restated Restated ------- -------- ------- -------- ----- -------- Effective tax rate Total GM (1,275)% 42% (1,205)% 31% 418% (38)% GMNA (1,757)% 33% (2,296)% 35% 18% 24% GME (2,791)% 23% (712)% 33% 32% 38% GMAC (6)% 41% n.m. 17% - 34% Equity income (loss) and minority interests, net of tax GMNA $ 7 $ 76 $ - $ - $ 7 $ 76 GME 13 16 - - 13 16 GMLAAM (1) (11) - - (1) (11) GMAP * 65 106 - 105 65 211 --- ---- --- --- --- --- Total GMA $ 84 $ 187 $ - $ 105 $ 84 $ 292 === ==== === === === ==== * We consolidate GM Daewoo, but exclude, through minority interest, the profits on the 49% of GM Daewoo that we do not own. On a reported basis, this minority interest was $270 million for the nine months year-to-date 2007 compared to $173 million for the nine months year-to-date 2006. n.m. = not meaningful General Motors Corporation Operating Statistics (Unaudited) Third Quarter Year to Date ------------------ ---------------- 2007 2006 2007 2006 (Units in thousands) ----- ------- ------ ------ Worldwide Production Volume: GMNA - Cars 367 417 1,168 1,375 GMNA - Trucks 653 633 2,057 2,167 ----- ----- ------ ----- Total GMNA 1,020 1,050 3,225 3,542 GME 396 374 1,371 1,363 GMLAAM 251 215 706 615 GMAP * 489 433 1,604 1,387 ----- ----- ------ ----- Total Worldwide 2,156 2,072 6,906 6,907 ===== ===== ====== ==== Vehicle Unit Deliveries: Chevrolet - Cars 190 216 595 638 Chevrolet - Trucks 416 430 1,153 1,240 Pontiac 101 118 277 322 GMC 140 129 381 363 Buick 54 66 144 191 Saturn 62 65 188 168 Cadillac 57 59 155 170 Other 27 34 77 92 ----- ----- ------ ----- Total United States 1,047 1,117 2,970 3,184 Canada, Mexico, and Other 159 168 492 514 ----- ----- ------ ----- Total GMNA 1,206 1,285 3,462 3,698 GME 524 457 1,652 1,529 GMLAAM 329 270 894 746 GMAP * 328 283 1,054 920 ----- ----- ------ ----- Total Worldwide ** 2,387 2,295 7,061 6,893 ===== ===== ===== ===== Market Share: United States - Cars 20.4% 21.8% 19.6% 20.8% United States - Trucks 29.1% 27.9% 27.0% 27.4% Total United States 25.1% 25.1% 23.6% 24.3% Total GMNA 24.3% 24.5% 23.2% 24.0% Total GME 9.5% 9.0% 9.5% 9.2% Total GMLAAM 17.5% 17.1% 17.1% 16.6% Total GMAP 6.5% 6.2% 6.8% 6.4% Total Worldwide 13.7% 13.9% 13.3% 13.6% U.S. Retail/Fleet Mix % Fleet Sales - Cars 38.1% 33.9% 36.0% 36.1% % Fleet Sales - Trucks 21.6% 17.3% 20.8% 21.3% Total Vehicles 27.8% 24.0% 26.7% 27.2% GMNA Capacity Utilization *** 84.1% 84.1% 89.0% 94.3% * GMAP production and sales volume includes SAIC-GM Wuling Automobile Co. Ltd. joint venture vehicles. ** Total Worldwide may include rounding differences. *** Two shift rated, annualized. General Motors Corporation Operating Statistics (Unaudited) Third Quarter Year to Date ------------------- -------------------- 2007 2006 2007 2006 ------ ------- ------ ------- GMAC's Worldwide Cost of Borrowing (b) 6.51% 6.31% 6.30% 5.84% GMAC Period End Debt Spreads Over U. S. Treasuries 2 Year 278 bp 200 bp 278 bp 200 bp 5 Year 421 bp 250 bp 421 bp 250 bp 10 Year 478 bp 290 bp 478 bp 290 bp GMAC Automotive Finance Operations Consumer Credit (North America) Net charge-offs as a % of managed receivables 1.20% 1.19% 1.17% 1.15% Retail contracts 30 days delinquent - % of average number of contracts outstanding (c) 2.54% 2.42% 2.33% 2.21% Share of GM retail sales (U.S. only) Total consumer volume (retail and lease) as % of retail 27% 45% 27% 33% SmartLease as % of retail 18% 17% 19% 19% Worldwide Employment at September 30 (Thousands) United States Hourly (d) 78 92 United States Salary (d) 32 33 ----- ----- Total United States 110 125 Canada, Mexico, and Other 29 31 ----- ----- GMNA 139 156 GME 58 62 GMLAAM 34 32 GMAP 34 34 GMAC - 31 Other 2 3 ----- ----- Total United States 267 318 ===== ===== Worldwide Payrolls (Billions) $ 4.5 $ 5.9 $ 13.3 $ 16.5 Footnotes: (a)Auto Eliminations, Corporate & Other and Other Financing include intercompany eliminations. (b)Calculated by dividing total interest expense (excluding mark to market adjustments) by total debt. (c)Excludes accounts in bankruptcy. (d)Approximately 2,400 hourly and 1,100 salary employees are excluded from 2007 data due to the sale of Allison Transmission. GENERAL MOTORS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in millions, except per share amounts) (Unaudited) Three Months Ended Nine Months Ended ------------------ ----------------- September 30, September 30, ------------------ ----------------- 2007 2006 2007 2006 ------ ------- ------ ------- (As (As restated) restated) Net sales and revenue Automotive sales $43,134 $39,612 $131,695 $127,657 Financial services and insurance revenue 700 9,280 2,530 27,214 ------- ------- -------- -------- Total net sales and revenue 43,834 48,892 134,225 154,871 ------- ------- -------- -------- Costs and expenses Automotive cost of sales 41,540 37,184 122,210 124,598 Selling, general and administrative expense 3,601 3,155 10,205 9,740 Financial services and insurance expense 640 7,596 2,334 23,608 Other expenses 350 1,943 925 3,151 ------- ------- -------- -------- Total costs and expenses 46,131 49,878 135,674 161,097 ------- ------- -------- -------- Operating loss (2,297) (986) (1,449) (6,226) Equity in loss of GMAC LLC (809) -- (874) -- Automotive and other interest expense (776) (529) (2,256) (1,861) Automotive interest income and other non-operating income 544 310 1,535 2,093 ------- ------- -------- -------- Loss from continuing operations before income taxes, other equity income and minority interests (3,338) (1,205) (3,044) (5,994) Income tax expense (benefit) 39,186 (977) 38,805 (2,523) Equity income (loss) and minority interests, net of tax 12 (49) 79 193 ------- ------- -------- -------- Loss from continuing operations (42,512) (277) (41,770) (3,278) Discontinued Operations Income from discontinued operations, net of tax 45 130 256 350 Gain on sale of discontinued operations, net of tax 3,504 -- 3,504 -- ------- ------- -------- -------- Income from discontinued operations 3,549 130 3,760 350 ------- ------- -------- -------- Net loss $(38,963) $(147) $(38,010) $(2,928) ======= ======= ======== ======== Basic earnings (loss) per share: Continuing operations $(75.12) $(.49) $(73.82) $(5.80) Discontinued operations 6.27 .23 6.64 .62 ------- ------- -------- -------- Total $(68.85) $(.26) $(67.18) $(5.18) ======= ======= ======== ======== Weighted average common shares outstanding, basic (millions) 566 566 566 566 ======= ======= ======== ======== Diluted earnings (loss) per share: Continuing operations $(75.12) $(.49) $(73.82) $(5.80) Discontinued operations 6.27 .23 6.64 .62 ------- ------- --------- ---------- Total $(68.85) $(.26) $(67.18) $(5.18) ======= ======= ======== ======== Weighted average common shares outstanding, diluted (millions) 566 566 566 566 ======= ======= ======== ======== Cash dividends per share $.25 $.25 $.75 $.75 ======= ======= ======== ======== GENERAL MOTORS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in millions) (Unaudited) September 30, December 31, September 30, 2007 2006 2006 ------------ ------------ ------------- (As (As restated restated) ASSETS Current Assets Cash and cash equivalents $24,402 $23,774 $17,802 Marketable securities 1,978 138 107 --------- -------- -------- Total cash and marketable securities 26,380 23,912 17,909 Accounts and notes receivable, net 10,728 8,216 6,855 Inventories 15,530 13,921 14,822 Equipment on operating leases, net 5,572 6,125 6,569 Deferred income taxes and other current assets 2,204 11,957 10,813 --------- ---------- ---------- Total current assets 60,414 64,131 56,968 Financing and Insurance Operations Assets Cash and cash equivalents 328 349 3,089 Assets held for sale -- -- 282,847 Equipment on operating leases, net 7,856 11,794 13,325 Investment in GMAC LLC 6,852 7,523 -- Other assets 4,119 2,457 1,827 --------- -------- -------- Total Financing and Insurance Operations Assets 19,155 22,123 301,088 Non-Current Assets Property, net 42,264 41,934 38,959 Deferred income taxes 975 33,079 24,972 Prepaid pension 18,920 17,366 37,691 Other assets 7,772 7,671 8,357 --------- -------- -------- Total non-current assets 69,931 100,050 109,979 --------- -------- -------- Total Assets $149,500 $186,304 $468,035 ========= ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities Accounts payable (principally trade) $30,514 $26,931 $27,318 Short-term borrowings and current portion of long-term debt 5,263 5,666 1,436 Accrued expenses 34,619 35,225 40,235 --------- --------- --------- Total current liabilities 70,396 67,822 68,989 Financing and Insurance Operations Liabilities Liabilities related to assets held for sale -- -- 272,869 Debt 5,962 9,438 10,073 Other liabilities and deferred income taxes 1,666 2,139 2,243 --------- -------- -------- Total Financing and Insurance Operations Liabilities 7,628 11,577 285,185 Non-Current Liabilities Long-term debt 34,670 33,067 33,118 Postretirement benefits other than pensions 48,336 50,409 34,534 Pensions 12,214 11,934 15,937 Other liabilities and deferred income taxes 16,327 15,957 17,714 --------- -------- -------- Total non-current liabilities 111,547 111,367 101,303 --------- -------- -------- Total liabilities 189,571 190,766 455,477 Minority interests 1,700 1,190 1,210 Stockholders' Equity (Deficit) Preferred stock, no par value, 6,000,000 shares authorized, no shares issued and outstanding -- -- -- Common stock, $1 2/3 par value (2,000,000,000 shares authorized, 756,637,541 and 565,877,391 shares issued and outstanding at September 30, 2007, respectively, 756,637,541 and 565,670,254 shares issued and outstanding at December 31, 2006, respectively, and 756,637,541 and 565,611,157 shares issued and outstanding at September 30, 2006, respectively) 943 943 943 Capital surplus (principally additional paid-in capital) 15,264 15,336 15,316 Retained earnings (deficit) (38,528) 195 (616) Accumulated other comprehensive loss (19,450) (22,126) (4,295) ------- ------- ------- Total stockholders' equity (deficit) (41,771) (5,652) 11,348 ------- ------- ------- Total Liabilities, Minority Interests and Stockholders' Equity (Deficit) $149,500 $186,304 $468,035 ======= ======= =======