ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Tuesday, April 15, 1997 TAG: 9704150068
SECTION: BUSINESS PAGE: B-5 EDITION: METRO
DATELINE: DETROIT
SOURCE: ASSOCIATED PRESS
The company benefited from reduced costs and improved productivity.
General Motors Corp., boosted by its biggest profits in North America in 13 years, reported a somewhat surprising 76 percent increase in first-quarter earnings Monday.
Though GM's worldwide sales were down slightly in the January-March period, the world's largest automaker benefited from reduced material costs and improved productivity from retooled U.S. assembly plants.
``This was just a good, solid quarter,'' analyst Joe Phillippi of Lehman Brothers said. ``It looks like they're on track to have a pretty good year.''
GM said it earned nearly $1.8 billion, or $2.30 a share, compared with $1.02 billion, or 94 cents a share, in the same period of 1996. Revenues totaled $42.3 billion, up 8 percent from $39.2 billion.
Earnings from continuing operations more than doubled from a year ago after adjusting first-quarter 1996 earnings to exclude the $219 million earned from GM's former Electronic Data Systems Corp. unit. The automaker split off EDS in June.
Wall Street initially responded favorably to the figures, pushing GM's stock price up 371/2 cents a share on the New York Stock Exchange, closing at $53.371/2.
The comparison benefited from a weak first quarter last year, when a strike virtually shut down its North American production.
But the strength of its North American unit was noteworthy this year. It earned $764 million, compared with a $279 million loss in the same period of 1996.
U.S. sales were down 1 percent in the quarter. Sales over the next several months will be a better indicator of how competitive GM's new model lineup is likely to be, as many models reach full production.
LENGTH: Short : 44 linesby CNB