SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported) January 16, 2002
----------------
GENERAL MOTORS CORPORATION
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(Exact name of registrant as specified in its charter)
STATE OF DELAWARE 1-143 38-0572515
---------------------------- ----------------------- -------------------
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
300 Renaissance Center, Detroit, Michigan 48265-3000
-------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (313)-556-5000
--------------
- 1 -
ITEM 5. OTHER EVENTS
On January 16, 2002, a news release was issued on the subject of fourth
quarter consolidated earnings for General Motors Corporation (GM). The news
release did not include certain financial statements, related footnotes and
certain other financial information that will be filed with the Securities and
Exchange Commission as part of GM's Annual Report on Form 10-K. The following is
the fourth quarter earnings release for GM, and their subsidiary Hughes
Electronics Corporation's (Hughes) earnings release dated January 15, 2002.
GM EARNS $1.5 BILLION, OR $3.23 PER SHARE IN CALENDAR-YEAR 2001
FOURTH QUARTER EARNINGS TOTAL $255 MILLION, OR $0.60 PER SHARE
-- MARKET MOMENTUM, COST REDUCTIONS, STRONG
CASH GENERATION ARE KEY DRIVERS
-- GMAC HAS SEVENTH-STRAIGHT YEAR OF EARNINGS GROWTH
DETROIT -- Market-share gains spurred by strong new product entries coupled
with an intense focus on reducing costs partially offset relentless price
pressures as General Motors Corp. (NYSE: GM, GMH) earned $1.5 billion, or $3.23
diluted earnings per share, in calendar-year 2001 on revenues of $177.3 billion,
excluding special items. That compares with earnings of $5.0 billion, or $8.58
per share, and revenues of $183.3 billion in the prior year, excluding special
items. Including special items, GM had net income of $601 million, or $1.77 per
share, in 2001; this compares with $4.5 billion, or $6.68 per share, in the
prior year.
GM earned $255 million, or $0.60 per share, in the fourth quarter of 2001,
including the approximately $97 million, or $0.14 per share, unfavorable effect
of the currency devaluation in Argentina. This compares with $609 million, or
$1.15 per share, in the fourth quarter of 2000, excluding special items. There
were no special items in the fourth quarter of 2001. GM financial results
described throughout the remainder of this release exclude special items unless
otherwise noted (see Highlights).
"Our performance in 2001 was quite strong considering all of the
challenges we faced, and we intend to continue building momentum throughout the
coming year," said GM Chairman Jack Smith. "Our market-share gains demonstrate
that GM's dedication to developing innovative new products is paying off in the
marketplace. Our focus in the coming year is to build on our market success and
make further improvements in our financial performance."
"We're in good shape to meet the tough competitive challenges in the year
ahead," said GM President and Chief Executive Officer Rick Wagoner. "We gained
momentum in the fourth quarter with our great products and the highly successful
Keep America Rolling marketing campaign, ending the year with low U.S. dealer
inventories. As we continue to introduce more new models this year, and
intensify our focus on efficiencies and cost reductions, we're well-positioned
when the economy rebounds."
Cash, marketable securities, and assets of the Voluntary Employees'
Beneficiary Association (VEBA) trust invested in short-term fixed-income
securities, excluding Hughes, totaled $11.5 billion at Dec. 31, 2001, compared
with $11.0 billion at Sept. 30, 2001.
- 2 -
GM AUTOMOTIVE OPERATIONS
GM's global automotive operations earned $708 million in calendar-year
2001, compared with $3.9 billion in 2000. Fourth-quarter earnings totaled $66
million versus $393 million in the prior-year period. Wholesale volume declined
approximately 8 percent in calendar-year 2001, and approximately 6 percent in
the fourth quarter, compared with the same periods of 2000.
Lower sales volume and strong pricing competition affected results in North
America, where GM's annual wholesale vehicle sales declined 11 percent from
prior-year levels. Similar pricing pressures affected Europe, along with the
shift in consumer preference toward smaller, less-profitable vehicles and
unfavorable country mix. Net price retention in calendar-year 2001 was negative
1.3 percent in both North America and Europe.
Results in the Asia-Pacific region were driven by strong profitability and
market leadership by Australia-based Holden. In the Latin
America/Africa/Mid-East region, market share was the highest for a fourth
quarter in 12 years and sales volume increased. However, pricing pressure from
the supplier community, based partially on the decline in value of the Brazilian
currency, and unfavorable product mix offset these gains.
GM increased its calendar-year market share in the United States for the
first time since 1990, as its strong truck lineup broke the industry record for
truck sales. Sales of full-size pickups were the best since 1978, and GM
shattered the all-time industry sport utility vehicle (SUV) sales record,
becoming the first manufacturer to sell more than one million SUVs in a calendar
year. GM's share of the U.S. truck market increased 2.2 percentage points to
29.2 percent for 2001, while total vehicle share increased 0.3 percentage
points, totaling 28.1 percent for the year. Particularly significant was the
improved mix of retail sales as GM continued to focus its sales efforts on the
more profitable retail side of the business. Retail sales increased 2.8
percentage points to 81.6 percent of all GM U.S. sales.
GM also gained market share in the GM North America (GMNA), Latin
America/Africa/Mid-East (GMLAAM), and Asia-Pacific (GMAP) regions, while holding
share steady in GM Europe (GME). GM's global market share totaled 15.1 percent
in 2001, compared with 15.0 percent in 2000. Combined sales of GM and its
automotive alliance partners - Fiat Auto, Fuji Heavy Industries (Subaru), Isuzu
Motor Corp., and Suzuki Motor Corp. - represented 23.7 percent of the global
automotive market in 2001, compared with 23.3 percent in the prior year.
"To translate our market success into higher profits, our global automotive
operations continue to focus on improving quality and increasing productivity,
and our entire company is concentrating on reducing costs," Wagoner said. "We've
targeted significant reductions in material and structural costs for 2002, in
addition to reducing non-product-related capital expenditures."
In the 2001 Harbour Report, GM's manufacturing operations outpaced all
other multi-plant manufacturers in North America with an overall productivity
improvement of nearly 8.5 percent. In addition, GM scored the biggest
improvement of any automaker in the 2001 J.D. Power & Associates initial quality
survey. GM not only achieved the highest quality gains, but also led all U.S.
automakers and is closing the gap with the best Japanese manufacturers.
- 3 -
General Motors is receiving very positive reaction from the three new
production vehicles and five concept cars that were unveiled to automotive
journalists from around the world last week at the 2002 North American
International Auto Show in Detroit. "The excitement that these vehicles
generated amplifies the overall enthusiasm our products are generating in the
market," Wagoner said. "We intend to build on this momentum by introducing
nearly 40 new products between now and 2003, including six in the crucial
entry-level market. This is continuing evidence that GM's aggressive product
program, focused on great designs, excellent handling and innovation, is paying
off."
GM vehicles have received more than 70 awards since the beginning of 2001,
including the following highly influential citations:
- Motor Trend "SUV of the Year" - GMC Envoy
- Motor Trend "Truck of the Year" - Chevrolet Avalanche
- "North American Truck of the Year" - Chevrolet TrailBlazer
- AutoWeek North American International Auto Show Awards - Cadillac
Cien and Pontiac Solstice concept cars
- "International Van of the Year" - First Place: Opel Vivaro;
Second Place: Opel Combo
- Brazilian Automotive Press Association "Popular Car of the Year"
- Chevrolet Celta; "SUV of the Year" - Chevrolet Tracker (Vitara)
GMAC
For 2001, GMAC achieved income growth for the seventh consecutive year and
posted record earnings for the third-straight year. GMAC's 2001 earnings of $1.8
billion were 9.4 percent higher than during the prior year.
GMAC's fourth-quarter earnings in 2001 of $435 million were up $26 million,
or more than 6 percent, from a year ago. Earnings from Financing Operations
increased as higher asset levels and the positive impact from lower market
interest rates more than offset weaker residual values and higher credit losses.
For the quarter, Insurance Operations posted higher earnings as increases in
underwriting income more than offset lower capital gains. Mortgage Operations
were down slightly year-over-year but still achieved the second highest
quarterly profit as strong new origination volumes kept pace with the high
refinancing activity.
HUGHES
Calendar-year losses at Hughes totaled $525 million for 2001, compared with
$303 million in the prior year. Hughes lost $131 million in the fourth quarter
of 2001, compared with a loss of $74 million in the prior-year period, primarily
because of the cost of adding DIRECTV subscribers.
Hughes revenues were up 4 percent in the fourth quarter of 2001. Total
DIRECTV subscriptions increased to 12.3 million, with approximately 518,000 more
subscribers than in the third quarter of 2001, an increase of 4.4 percent. Total
subscriptions were up 1.5 million from year-end-2000 levels.
PROFIT SHARING, INCENTIVE COMPENSATION
Based on GM's financial results in 2001, there will be no profit-sharing
payments to hourly workers in the United States. In addition, there will be no
annual incentive awards for GM executives, or enhanced variable pay for eligible
U.S. and Canadian salaried employees.
- 4 -
LOOKING AHEAD
GM has forecast total U.S. industry vehicle sales to be in the range of
15.0 million to 15.5 million units, and industry sales in Europe of
approximately 18.5 million units. Sales in the Latin America/Africa/Mid-East and
Asia-Pacific regions are expected to be relatively flat compared with 2001. U.S.
dealer inventories are lean at less than 1 million units, and first-quarter
North American production is expected to increase 7 percent over the first
quarter of 2001. Net price retention in the first quarter is expected to be
consistent with the prior guidance for the calendar year at approximately
negative 1 percent. Based on these factors and considering the high-degree of
economic uncertainty, GM's earnings target for the 2002 calendar year, excluding
Hughes, remains at $3.00 per share, and first-quarter earnings are now expected
to be approximately $1.00 per share. Including Hughes, the targets are
approximately $2.60 per share for the calendar year, and $0.90 per share for the
first quarter.
# # #
In this press release and related comments by General Motors management, our
use of the words "outlook," "expect," "anticipate," "estimate," "forecast,"
"project," "likely," "objective," "plan," "designed," "goal" and similar
expressions is intended to identify forward looking statements. While these
statements represent our current judgment on what the future may hold, and we
believe these judgments are reasonable, actual results may differ materially due
to numerous important factors that are described in GM's most recent report on
SEC Form 10-K (at page II-10,11) which may be revised or supplemented in
subsequent reports on SEC Forms 10-Q and 8-K. Such factors include, among
others, the following: changes in economic conditions, currency exchange rates
or political stability; shortages of fuel, labor strikes or work stoppages;
market acceptance of the corporation's new products; significant changes in the
competitive environment; changes in laws, regulations and tax rates; and the
ability of the corporation to achieve reductions in cost and employment levels
to realize production efficiencies and implement capital expenditures at levels
and times planned by management.
- 5 -
General Motors Corporation
List of Special Items - After Tax
(dollars in millions)
Year to Date 2001
----------------------------------------
Other
GMNA GME GMLAAM GMAP Hughes ACO
---- --- ------ ---- ------ -----
Reported Net Income (Loss) $1,270 $(765) $(81) $(57) $(618) $(916)
Ste. Therese Charge (A) 194 - - - - -
Raytheon Settlement (B) - - - - - 474
Gain on Sale of Thomson (C) - - - - (67) -
SkyPerfecTV! Writedown (D) - - - - 133 -
Severance Charge (E) - - - - 40 -
DirecTV Japan Adjustment (F) - - - - (21) -
Isuzu Restructuring (G) - - - 133 - -
SFAS 133 (H) 14 (2) 1 1 8 -
----- --- --- --- --- ---
Adjusted Net Income (Loss) $1,478 $(767) $(80) $77 $(525) $(442)
===== === == == === ===
Total Other Total Diluted
ACO GMAC FIO GM EPS
----- ------ ----- ----- -------
Reported Net Income (Loss) $(1,167) $1,786 $(18) $601 $1.77
Ste. Therese Charge (A) 194 - - 194 0.35
Raytheon Settlement (B) 474 - - 474 0.85
Gain on Sale of Thomson (C) (67) - - (67) (0.04)
SkyPerfecTV! Writedown (D) 133 - - 133 0.08
Severance Charge (E) 40 - - 40 0.02
DirecTV Japan Adjustment (F) (21) - - (21) (0.01)
Isuzu Restructuring (G) 133 - - 133 0.24
SFAS 133 (H) 22 (34) - (12) (0.03)
--- ----- -- ----- ----
Adjusted Net Income (Loss) $(259) $1,752 $(18) $1,475 $3.23
=== ===== == ===== ====
A) The Ste. Therese Charge relates to the previously announced closing
of the Ste. Therese, Quebec assembly plant.
B) The Raytheon Settlement relates to Hughes' settlement with the Raytheon
Company on a purchase price adjustment related to Raytheon's 1997 merger
with Hughes Defense.
C) The Gain on Sale of Thomson relates to Hughes' sale of 4.1 million shares
of Thomson Multimedia common stock.
- 6 -
General Motors Corporation
List of Special Items - After Tax
D) The SkyPerfecTV! Writedown relates to Hughes' non-cash charge from the
revaluation of its investment.
E) The Severance Charge relates to Hughes' 10% company-wide workforce
reduction in the U.S.
F) The DirecTV Japan Adjustment relates to a favorable adjustment to the
expected costs associated with the shutdown of Hughes' DirecTV Japan
business.
G) The Isuzu Restructuring charges include General Motors' portion of
severance payments and asset impairments that were part of the second
quarter restructuring of its affiliate Isuzu Motors Ltd.
H) The SFAS 133 adjustment represents the net impact during the first quarter
2001 from initially adopting SFAS No. 133, Accounting for Derivatives and
Hedging Activities.
- 7 -
General Motors Corporation
List of Special Items - After Tax
(dollars in millions)
Year to Date 2000
----------------------------------------
Other
GMNA GME GMLAAM GMAP Hughes ACO
---- --- ------ ---- ------ -----
Reported Net Income (Loss) $3,174 $(676) $26 $(233) $829 $(281)
Phase-out of Oldsmobile (I) 939 - - - - -
Postemployment Benefits (J) 294 - - - - -
Capacity Reduction (K) - 419 - - - -
Satellite Businesses Gain (L) - - - - (1,132) -
----- --- -- --- ----- ---
Adjusted Net Income (Loss) $4,407 $(257) $26 $(233) $(303)$(281)
===== === == === ===== ===
Total Other Total Diluted
ACO GMAC FIO GM EPS
----- ------ ----- ----- -------
Reported Net Income (Loss) $2,839 $1,602 $11 $4,452 $6.68
Phase-out of Oldsmobile (I) 939 - - 939 1.59
Postemployment Benefits (J) 294 - - 294 0.50
Capacity Reduction (K) 419 - - 419 0.71
Satellite Businesses Gain (L) (1,132) - - (1,132) (0.90)
----- ----- -- ----- ----
Adjusted Net Income (Loss) $3,359 $1,602 $11 $4,972 $8.58
===== ===== == ===== ====
I) The Phase-out of Oldsmobile relates to the costs associated with GM's
decision in the fourth quarter of 2000 to phase-out the Oldsmobile
division as the current model lineup product lifecycles come to an end, or
when the models are no longer economically viable.
J) The Postemployment Benefits charge relates to postemployment costs for
termination and other postemployment benefits associated with four North
American manufacturing facilities slated for conversion and capacity
reduction (Oklahoma City, Oklahoma; Delta Engine, Lansing, Michigan;
Springhill, Tennessee; and Wilmington, Delaware).
K) The Capacity Reduction adjustment relates to costs associated with the
reduction in production capacity, including the restructuring of Vauxhall
Motors Limited's manufacturing operations in the U.K.
L) The Satellite Businesses Gain relates to the sale of Hughes' satellite
systems manufacturing businesses to The Boeing Company.
- 8 -
General Motors Corporation
List of Special Items - After Tax
(dollars in millions)
Fourth Quarter 2000
----------------------------------------
Other
GMNA GME GMLAAM GMAP Hughes ACO
---- --- ------ ---- ------ -----
Reported Net Income (Loss) $(254) $(882) $(16) $(107) $1,058 $(119)
Phase-out of Oldsmobile (I) 939 - - - - -
Postemployment Benefits (J) 294 - - - - -
Capacity Reduction (K) - 419 - - - -
Satellite Businesses Gain (L) - - - - (1,132) -
--- --- -- --- ----- ---
Adjusted Net Income (Loss) $979 $(463) $(16) $(107) $(74)$(119)
=== === == === ===== ===
Total Other Total Diluted
ACO GMAC FIO GM EPS
----- ------ ----- ----- -------
Reported Net Income (Loss) $(320) $409 $ - $89 $(1.16)
Phase-out of Oldsmobile (I) 939 - - 939 1.68
Postemployment Benefits (J) 294 - - 294 0.53
Capacity Reduction (K) 419 - - 419 0.75
Satellite Businesses Gain (L) (1,132) - - (1,132) (0.65)
----- --- -- ----- ----
Adjusted Net Income (Loss) $200 $409 $ - $609 $1.15
===== === == ===== ====
See page 8 for footnotes (I) - (L).
- 9 -
General Motors Corporation
Adjusted Corporate Financial Results
Fourth Quarter Year to Date
-------------- --------------
2001(1) 2000(1) 2001(1) 2000(1)
---- ---- ---- ----
Total net sales and
revenues ($Mil's) $45,950 $45,001 $177,268 $183,292
Consolidated net
income ($Mil's) $255 $609 $1,475 $4,972
Net margin from
consolidated net income 0.6% 1.4% 0.8% 2.7%
GM $1-2/3 par value
earnings per share
Basic EPS $0.61 $1.16 $3.26 $8.72
Diluted EPS $0.60 $1.15 $3.23 $8.58
GM Class H
earnings per share
Basic EPS $(0.12) $(0.08) $(0.48) $(0.31)
Diluted EPS $(0.12) $(0.08) $(0.48) $(0.31)
Earnings attributable to
GM $1-2/3 par value ($Mil's)
Consolidated net income $255 $609 $1,475 $4,972
Preferred dividends (23) (27) (99) (110)
Losses attributable
to GM Class H 105 66 419 210
--- --- ----- -----
Total earnings attributable
to GM $1-2/3 par value $337 $648 $1,795 $5,072
=== === ===== =====
GM $1-2/3 par value average
shares outstanding (Mil's)
Basic shares 556 559 551 582
Diluted shares 559 564 556 591
Cash dividends per share
of common stocks
GM $1-2/3 par value $0.50 $0.50 $2.00 $2.00
GM Class H - - - -
Book value per share of
common stocks at Dec. 31
GM $1-2/3 par value $24.79 $39.36
GM Class H $4.96 $7.87
Total cash at Dec. 31,
excluding Hughes($Bil's) (2) $11.5 $11.8
Automotive, Communications Services,
and Other Operations ($Mil's)
Depreciation $1,092 $1,127 $4,331 $4,091
Amortization of special
tools 613 576 2,360 2,428
Amortization of intangible
assets 70 99 308 308
----- ----- ----- -----
Total $1,775 $1,802 $6,999 $6,827
===== ===== ===== =====
See footnotes on page 14.
- 10 -
General Motors Corporation
Adjusted Segment Financial Results
Fourth Quarter Year to Date
-------------- --------------
2001(1) 2000(1) 2001(1) 2000(1)
---- ---- ---- ----
(dollars in millions)
Total net sales and revenues
GMNA $27,446 $27,434 $106,938 $113,418
GME 6,084 6,043 23,700 25,358
GMLAAM 1,387 1,431 5,833 5,713
GMAP 1,063 1,001 4,201 3,606
------ ------ ------- -------
Total GMA 35,980 35,909 140,672 148,095
Hughes 2,285 2,188 8,318 8,654
Other 1,034 523 2,501 2,538
------ ------ ------- -------
Total ACO 39,299 38,620 151,491 159,287
GMAC 6,565 6,218 25,480 23,661
Other Financing 86 163 297 344
------ ------ ------- -------
Total FIO 6,651 6,381 25,777 24,005
------ ------ ------- -------
Consolidated net sales
and revenues $45,950 $45,001 $177,268 $183,292
====== ====== ======= =======
Pre-tax income (loss)
GMNA $528 $1,380 $2,051 $6,448
GME (345) (637) (1,092) (275)
GMLAAM (150) (78) (79) (155)
GMAP (17) (47) 27 (21)
--- --- ----- -----
Total GMA 16 618 907 5,997
Hughes (3) (213) (121) (786) (541)
Other (135) (147) (537) (307)
--- --- ----- -----
Total ACO (332) 350 (416) 5,149
GMAC 730 658 2,872 2,579
Other Financing (24) (9) (58) 4
--- --- ----- -----
Total FIO 706 649 2,814 2,583
--- --- ----- -----
Consolidated pre-tax
income $374 $999 $2,398 $7,732
=== === ===== =====
Net income (loss)
GMNA $392 $979 $1,478 $4,407
GME (240) (463) (767) (257)
GMLAAM (111) (16) (80) 26
GMAP 25 (107) 77 (233)
--- --- ----- -----
Total GMA 66 393 708 3,943
Hughes (3)(4) (131) (74) (525) (303)
Other (120) (119) (442) (281)
--- --- ----- -----
Total ACO (185) 200 (259) 3,359
GMAC 435 409 1,752 1,602
Other Financing 5 - (18) 11
--- --- ----- -----
Total FIO 440 409 1,734 1,613
--- --- ----- -----
Consolidated net income $255 $609 $1,475 $4,972
=== === ===== =====
See footnotes on page 14.
- 11 -
General Motors Corporation
Supplementary Adjusted Segment Financial Results
Fourth Quarter Year to Date
-------------- --------------
2001(1) 2000(1) 2001(1) 2000(1)
---- ---- ---- ----
(dollars in millions)
Income tax expense (benefit)
GMNA $150 $365 $537 $1,969
GME (72) (173) (284) (9)
GMLAAM (38) (48) (17) (122)
GMAP 17 (4) 24 17
-- --- --- -----
Total GMA $57 $140 $260 $1,855
== === === =====
Equity income (loss) and
minority interests
GMNA $14 $(36) $(36) $(72)
GME 33 1 41 9
GMLAAM 1 14 (18) 59
GMAP 59 (64) 74 (195)
--- -- -- ---
Total GMA $107 $(85) $61 $(199)
=== == == ===
Effective income tax rate
GMNA 28.4% 26.4% 26.2% 30.5%
GME 20.9% 27.2% 26.0% 3.3%
GMLAAM 25.3% 61.5% 21.5% 78.7%
GMAP (100.0%) 8.5% 88.9% (81.0%)
Total ACO (6) 31.0% 17.0% 31.0% 31.0%
Net margins
GMNA 1.4% 3.6% 1.4% 3.9%
GME (3.9%) (7.7%) (3.2%) (1.0%)
GMLAAM (8.0%) (1.1%) (1.4%) 0.5%
GMAP 2.4% (10.7%) 1.8% (6.5%)
Total GMA 0.2% 1.1% 0.5% 2.7%
Hughes (3)(4) (5.7%) (3.4%) (6.3%) (3.5%)
Total ACO (0.5%) 0.5% (0.2%) 2.1%
GMAC 6.6% 6.6% 6.9% 6.8%
Consolidated net income 0.6% 1.4% 0.8% 2.7%
See footnotes on page 14.
- 12 -
General Motors Corporation
Operating Statistics
Fourth Quarter Year to Date
-------------- --------------
2001 2000 2001 2000
---- ---- ---- ----
(units in thousands)
Worldwide Wholesale Sales
United States - Cars 501 597 2,054 2,514
United States - Trucks 644 611 2,433 2,517
----- ----- ----- -----
Total United States 1,145 1,208 4,487 5,031
Canada, Mexico, and Other 167 174 649 744
----- ----- ----- -----
Total GMNA 1,312 1,382 5,136 5,775
GME 401 445 1,760 1,879
GMLAAM 166 164 666 634
GMAP 100 113 460 458
----- ----- ----- -----
Total Worldwide 1,979 2,104 8,022 8,746
===== ===== ===== =====
Vehicle Unit Deliveries
Chevrolet - Cars 193 185 830 891
Chevrolet - Trucks 539 383 1,860 1,725
Pontiac 115 127 533 613
GMC 163 117 555 529
Buick 105 83 406 405
Oldsmobile 44 65 234 289
Saturn 61 55 261 272
Cadillac 47 41 172 189
Other 14 11 53 40
----- ----- ----- -----
Total United States 1,281 1,067 4,904 4,953
Canada, Mexico, and Other 172 167 686 707
----- ----- ----- -----
Total GMNA 1,453 1,234 5,590 5,660
GME 383 396 1,801 1,856
GMLAAM 166 164 663 605
GMAP 124 128 506 476
----- ----- ----- -----
Total Worldwide 2,126 1,922 8,560 8,597
===== ===== ===== =====
Market Share
United States - Cars 25.8% 27.8% 26.9% 28.6%
United States - Trucks 31.4% 26.9% 29.2% 27.0%
Total United States 28.9% 27.3% 28.1% 27.8%
Total North America 28.1% 26.9% 27.6% 27.5%
Total Europe 8.7% 9.0% 9.2% 9.2%
Latin America (5) 23.4% 20.9% 22.4% 20.5%
Asia and Pacific 4.0% 4.1% 3.9% 3.7%
Total Worldwide 15.7% 14.7% 15.1% 15.0%
U.S. Retail/Fleet Mix
% Fleet Sales - Cars 14.8% 26.5% 25.7% 27.3%
% Fleet Sales - Trucks 7.5% 12.4% 12.1% 14.8%
Total Vehicles 10.4% 19.3% 18.4% 21.2%
Retail Lease as % of Retail Sales
Total Smartlease
and Smartbuy 4.3% 14.0% 11.9% 21.8%
Days Supply of Inventory
at December 31
United States - Cars 93 109
United States - Trucks 75 127
Capacity Utilization
U.S. and Canada
(2 shift rated) 81.7% 86.8% 79.0% 89.4%
GMNA Net Price (1.5%) (1.7%) (1.3%) (0.7%)
See footnotes on page 14.
- 13 -
General Motors Corporation
Operating Statistics
Fourth Quarter Year to Date
-------------- --------------
2001 2000 2001 2000
---- ---- ---- ----
GMAC's U.S. Cost of Borrowing 4.76% 6.81% 5.51% 6.64%
Current Debt Spreads Over
U.S. Treasuries
2 Year 195 bp 125 bp
5 Year 215 bp 200 bp
10 Year 225 bp 235 bp
Worldwide Employment
at Dec. 31, Excluding
Contract (in 000's)
United States Hourly 126 133
United States Salary 42 44
--- ---
Total United States 168 177
Canada, Mexico, and Other 34 35
--- ---
GMNA 202 212
GME 73 89
GMLAAM 23 24
GMAP 11 11
Hughes 12 11
GMAC 28 29
Other 13 12
--- ---
Total 362 388
=== ===
Worldwide Payrolls ($Bil's) $4.8 $5.1 $19.8 $21.6
Footnotes:
---------
(1) Adjusted amounts represent the reported amounts less the effects
of special items. Special items for year to date 2001 and 2000 are
detailed on pages 6-7 and 8, respectively. Special items for fourth
quarter 2000 are detailed on page 9. There are no special items in the
fourth quarter of 2001. The 2001 amounts include the $97 million
pre-tax and after-tax charge ($0.14 EPS) resulting from the
currency devaluation in Argentina (GMLAAM $53 million; Hughes $29
million; GMAC $15 million).
(2) Represents total cash for Automotive, Communications Services, and
Other Operations, excluding Hughes, which includes cash and marketable
securities, as well as approximately $3.0 billion invested in
short-term fixed income securities of the Corporation's Voluntary
Employees' Beneficiary Association Trust.
(3) Excludes the effects of purchase accounting adjustments related to
General Motors' acquisition of Hughes in 1985.
(4) Excludes Hughes Series A Preferred Stock dividends payable to
General Motors.
(5) Latin America excludes the Middle East and Africa.
(6) Excludes the effect of the currency devaluation in Argentina in 2001
and Hughes' disposal of DirecTV Japan in 2000.
- 14 -
CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended December 31,
-------------------------------
2001 2000
---- ----
(dollars in millions except per share amounts)
GENERAL MOTORS CORPORATION AND SUBSIDIARIES
Total net sales and revenues $45,950 $46,341
------ ------
Cost of sales and other expenses 37,293 36,776
Selling, general, and administrative
expenses 6,131 6,648
Interest expense 2,152 2,486
------- -------
Total costs and expenses 45,576 45,910
------ ------
Income before income taxes and
minority interests 374 431
Income tax expense 180 245
Equity income (loss) and minority interests 61 (97)
---- ----
Net income 255 89
Dividends on preference stocks (23) (27)
---- --
Earnings attributable to common stocks $232 $62
=== ==
Basic earnings (losses) per share
attributable to common stocks
Earnings per share attributable
to $1-2/3 par value $0.61 $(1.14)
==== ====
Earnings per share attributable
to Class H $(0.12) $0.80
==== ====
Earnings (losses) per share
attributable to common
stocks assuming dilution
Earnings per share attributable
to $1-2/3 par value $0.60 $(1.16)
==== ====
Earnings per share attributable
to Class H $(0.12) $0.76
==== ====
- 15 -
CONSOLIDATED STATEMENTS OF INCOME - continued
Three Months Ended
December 31,
-------------------
2001 2000
---- ----
(dollars in millions)
AUTOMOTIVE, COMMUNICATIONS SERVICES, AND OTHER OPERATIONS
Total net sales and revenues $39,299 $39,960
------ ------
Cost of sales and other expenses 35,083 34,895
Selling, general, and administrative
expenses 4,206 4,942
------ ------
Total costs and expenses 39,289 39,837
------ ------
Interest expense 222 167
Net expense from transactions with
Financing and Insurance Operations 120 174
--- ---
Loss before income taxes and
minority interests (332) (218)
Income tax expense (benefit) (76) 10
Equity income (loss) and minority interests 71 (92)
---- ----
Net loss - Automotive, Communications
Services, and Other Operations $(185) $(320)
=== ===
FINANCING AND INSURANCE OPERATIONS
Total revenues $6,651 $6,381
----- -----
Interest expense 1,930 2,319
Depreciation and amortization expense 1,428 1,502
Operating and other expenses 1,885 1,658
Provisions for financing and
insurance losses 822 427
----- -----
Total costs and expenses 6,065 5,906
----- -----
Net income from transactions with
Automotive, Communications Services,
and Other Operations (120) (174)
----- -----
Income before income taxes and
minority interests 706 649
Income tax expense 256 235
Equity income (loss) and minority interests (10) (5)
----- -----
Net income - Financing and
Insurance Operations $440 $409
=== ===
- 16 -
CONSOLIDATED STATEMENTS OF INCOME - continued
Years Ended December 31,
--------------------------------
2001 2000 1999
---- ---- ----
(dollars in millions except per share amounts)
GENERAL MOTORS CORPORATION AND SUBSIDIARIES
Total net sales and revenues $177,260 $184,632 $176,558
------- ------- -------
Cost of sales and other expenses 143,850 145,664 140,708
Selling, general, and administrative
expenses 23,302 22,252 19,053
Interest expense 8,590 9,552 7,750
------- ------- -------
Total costs and expenses 175,742 177,468 167,511
------- ------- -------
Income before income taxes and
minority interests 1,518 7,164 9,047
Income tax expense 768 2,393 3,118
Equity income (loss) and minority
interests (149) (319) (353)
----- ------ -----
Income from continuing operations 601 4,452 5,576
Income from discontinued operations - - 426
----- ------ -----
Net income 601 4,452 6,002
Dividends on preference stocks ( 99) (110) (80)
--- ----- -----
Earnings attributable to common stocks $502 $4,342 $5,922
=== ===== =====
Basic earnings (losses) per share
attributable to common stocks
$1-2/3 par value
Continuing operations $1.78 $6.80 $8.70
Discontinued operations - - 0.66
---- ---- ----
Earnings per share attributable
to $1-2/3 par value $1.78 $6.80 $9.36
==== ==== ====
Earnings per share attributable
to Class H $(0.55) $0.56 $(0.26)
==== ==== ====
Earnings (losses) per share
attributable to common
stocks assuming dilution
$1-2/3 par value
Continuing operations $1.77 $6.68 $8.53
Discontinued operations - - 0.65
---- ---- ----
Earnings per share attributable to
$1-2/3 par value $1.77 $6.68 $9.18
==== ==== ====
Earnings per share attributable
to Class H $(0.55) $0.55 $(0.26)
==== ==== ====
- 17 -
CONSOLIDATED STATEMENTS OF INCOME - concluded
Years Ended December 31,
-------------------------------
2001 2000 1999
---- ---- ----
(dollars in millions)
AUTOMOTIVE, COMMUNICATIONS SERVICES, AND OTHER OPERATIONS
Total net sales and revenues $151,491 $160,627 $156,107
------- ------- -------
Cost of sales and other expenses 135,620 138,303 134,111
Selling, general, and administrative
expenses 16,043 16,246 14,324
------- ------- -------
Total costs and expenses 151,663 154,549 148,435
------- ------- -------
Interest expense 751 815 828
Net expense from transactions with
Financing and Insurance Operations 435 682 308
------ ------ ------
Income (loss) from continuing
operations before income
taxes and minority interests (1,358) 4,581 6,536
Income tax (benefit) expense (270) 1,443 2,167
Equity income (loss) and minority
interests (79) (299) (327)
----- ----- -----
Income (loss) from continuing operations (1,167) 2,839 4,042
Income from discontinued operations - - 426
----- ----- -----
Net income (loss) - Automotive,
Communications Services,
and Other Operations $(1,167) $2,839 $4,468
===== ===== =====
Years Ended December 31,
-------------------------------
2001 2000 1999
---- ---- ----
(dollars in millions)
FINANCING AND INSURANCE OPERATIONS
Total revenues $25,769 $24,005 $20,451
------ ------ ------
Interest expense 7,839 8,737 6,922
Depreciation and amortization expense 5,857 5,982 5,445
Operating and other expenses 7,105 5,805 4,595
Provisions for financing and
insurance losses 2,527 1,580 1,286
------ ------ ------
Total costs and expenses 23,328 22,104 18,248
------ ------ ------
Net income from transactions with
Automotive, Communications Services,
and Other Operations (435) (682) (308)
----- ----- -----
Income before income taxes and
minority interests 2,876 2,583 2,511
Income tax expense 1,038 950 951
Equity income (loss) and minority
interests (70) (20) (26)
----- ----- -----
Net income - Financing and
Insurance Operations $1,768 $1,613 $1,534
===== ===== =====
- 18 -
CONSOLIDATED BALANCE SHEETS
December 31,
GENERAL MOTORS CORPORATION AND SUBSIDIARIES 2001 2000
---- ----
ASSETS (dollars in millions)
Automotive, Communications Services, and Other Operations
Cash and cash equivalents $8,432 $9,119
Marketable securities 790 1,161
------ -------
Total cash and marketable securities 9,222 10,280
Accounts and notes receivable (less allowances) 5,406 5,835
Inventories (less allowances) 10,034 10,945
Equipment on operating leases (less
accumulated depreciation) 4,524 5,699
Deferred income taxes and other current assets 7,877 8,388
------- -------
Total current assets 37,063 41,147
Equity in net assets of nonconsolidated associates 4,950 3,497
Property - net 34,908 33,977
Intangible assets - net 13,721 7,622
Deferred income taxes 22,294 14,870
Other assets 17,274 32,243
------- -------
Total Automotive, Communications Services, and
Other Operations assets 130,210 133,356
Financing and Insurance Operations
Cash and cash equivalents 10,123 1,165
Investments in securities 10,669 9,595
Finance receivables - net 99,813 92,415
Investment in leases and other receivables 34,618 36,752
Other assets 36,979 27,846
Net receivable from Automotive, Communications
Services, and Other Operations 1,557 1,971
------- -------
Total Financing and Insurance Operations assets 193,759 169,744
------- -------
Total assets $323,969 $303,100
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Automotive, Communications Services, and Other Operations
Accounts payable (principally trade) $18,297 $18,309
Loans payable 2,402 2,208
Accrued expenses 34,090 33,252
Net payable to Financing and Insurance Operations 1,557 1,971
------- -------
Total current liabilities 56,346 55,740
Long-term debt 10,726 7,410
Postretirement benefits other than pensions 34,515 34,306
Pensions 10,790 3,480
Other liabilities and deferred income taxes 13,794 15,768
------- -------
Total Automotive, Communications Services, and
Other Operations liabilities 126,171 116,704
Financing and Insurance Operations
Accounts payable 7,900 7,416
Debt 153,186 135,037
Other liabilities and deferred income taxes 16,259 12,922
------- -------
Total Financing and Insurance Operations liabilities 177,345 155,375
Minority interests 746 707
General Motors - obligated mandatorily redeemable
preferred securities of subsidiary
trusts holding solely junior subordinated
debentures of General Motors
Series G - 139
Stockholders' equity
$1-2/3 par value common stock (issued,
559,044,427 and 548,181,757 shares) 932 914
Class H common stock (issued, 877,505,382 and
875,286,559 shares) 88 88
Capital surplus (principally additional
paid-in capital) 21,519 21,020
Retained earnings 9,463 10,119
------- -------
Subtotal 32,002 32,141
Accumulated foreign currency translation adjustments (2,919) (2,502)
Net unrealized loss on derivatives (307) -
Net unrealized gains on securities 512 581
Minimum pension liability adjustment (9,581) (45)
------- -------
Accumulated other comprehensive loss (12,295) (1,966)
------- -------
Total stockholders' equity 19,707 30,175
------- -------
Total liabilities and stockholders' equity $323,969 $303,100
======= =======
- 19 -
CONSOLIDATED STATEMENTS OF CASH FLOWS
For The Years Ended December 31,
------------------------------------------------------------------------------------------
2001 2000 1999
------------------------------------------------------------------------------------------
Automotive, Financing Automotive, Financing Automotive, Financing
Comm.Serv., and Comm.Serv., and Comm.Serv., and
and Other Insurance and Other Insurance and Other Insurance
--------- --------- --------- --------- --------- ---------
(dollars in millions)
Cash flows from operating activities
Income (loss) from continuing
operations (1,167) 1,768 $2,839 $1,613 $4,042 $1,534
Adjustments to reconcile income
(loss) from continuing
operations to net cash
provided by operating activities
Depreciation and amortization
expenses 7,051 5,857 7,429 5,982 6,873 5,445
Postretirement benefits other
than pensions, net of payments
and VEBA contributions 1,861 20 772 27 (1,057) 21
Pension expense, net of contributions 148 - 128 - (808) -
Originations and purchases of
mortgage loans - (109,513) - (51,202) - (53,006)
Proceeds on sales of mortgage loans - 105,085 - 51,444 - 55,777
Originations and purchases of
mortgage securities - (3,298) - (1,571) - (1,309)
Proceeds on sales of mortgage securities - 2,875 - 994 - 1,545
Change in other investments and
miscellaneous assets 959 (1,018) 1,154 (1,692) 522 (127)
Change in other operating assets
and liabilities (2,056) 850 724 2,505 7,523 (23)
Other (897) 394 (2,175) 779 (951) 944
----- ----- ------ ----- ------ ------
Net cash provided by operating
activities $5,899 $3,020 $10,871 $8,879 $16,144 $10,801
----- ----- ------ ----- ------ ------
Cash flows from investing activities
Expenditures for property (8,611) (20) (9,200) (522) (7,061) (323)
Investments in marketable securities
- acquisitions (857) (34,198) (2,520) (24,599) (4,149) (21,257)
Investments in marketable securities
- liquidations 1,228 33,124 3,057 24,114 2,886 20,593
Mortgage servicing rights - acquisitions - (1,986) - (1,096) - (1,424)
Mortgage servicing rights - liquidations - 28 - 12 - 35
Finance receivables - acquisitions - (236,723) - (214,666) - (186,379)
Finance receivables - liquidations - 131,447 - 143,242 - 130,293
Proceeds from sales of finance receivables - 96,029 - 58,369 - 48,178
Operating leases - acquisitions (5,214) (12,826) (6,709) (15,174) (6,415) (16,750)
Operating leases - liquidations 5,943 11,780 6,149 9,844 4,243 7,836
Investments in companies, net of
cash acquired (743) (542) (4,302) (2,077) (2,706) (2,402)
Net investing activity with Financing
and Insurance Operations (514) - (1,069) - 75 -
Other 176 (459) 3,281 93 (924) 732
Net cash used in investing activities (8,592) (14,346) (11,313) (22,460) (14,051) (20,868)
----- ------ ------ ------ ------ ------
Cash flows from financing activities
Net increase (decrease) in loans payable 194 (20,238) 142 7,723 140 (2,500)
Long-term debt - borrowings 5,849 58,498 5,279 22,414 9,090 26,471
Long-term debt - repayments (2,602) (18,882) (6,196) (16,196) (8,281) (13,078)
Net financing activity with Automotive,
Communications Services, and
Other Operations - 514 - 1,069 - (75)
Repurchases of common and preference
stocks (264) - (1,613) - (3,870) -
Proceeds from issuing common stocks 100 - 2,792 - 2,090 -
Proceeds from sales of treasury stocks 418 - - - - -
Cash dividends paid to stockholders (1,201) - (1,294) - (1,367) -
----- ------ ----- ------ ----- ------
Net cash provided by (used in)
financing activities 2,494 19,892 (890) 15,010 (2,198) 10,818
----- ------ ---- ------ ----- ------
Effect of exchange rate changes on
cash and cash equivalents (74) (22) (249) (6) (206) -
Net transactions with Automotive/
Financing Operations (414) 414 970 (970) 185 (185)
--- --- --- --- --- ---
Net cash (used in) provided by
continuing operations (687) 8,958 (611) 453 (126) 566
Net cash provided by discontinued
operations - - - - 128 -
--- ----- --- --- --- ---
Net (decrease) increase in cash
and cash equivalents (687) 8,958 (611) 453 2 566
Cash and cash equivalents at
beginning of the year 9,119 1,165 9,730 712 9,728 146
----- ----- ----- --- ----- ---
Cash and cash equivalents at
end of the year $8,432 $10,123 $9,119 $1,165 $9,730 $712
===== ====== ===== ===== ===== ===
- 20 -
Hughes Reports Fourth Quarter 2001 Financial Results
Strong DIRECTV U.S. Subscriber Growth Beats Expectations
El Segundo, Calif., January 15, 2002 -- Hughes Electronics Corporation,
the world's leading provider of digital television entertainment, broadband
services, satellite-based private business networks, and global video and data
broadcasting, today reported fourth quarter 2001 revenues increased 10.8% to
$2,280.6 million, compared with $2,059.0 million in the fourth quarter of 2000.
EBITDA(1) for the quarter was $118.2 million and EBITDA margin(1) was 5.2%,
compared with the fourth quarter of 2000 EBITDA of $153.8 million and EBITDA
margin of 7.5%.
"I am pleased to report that in the fourth quarter we met or exceeded all
of our key financial commitments while making excellent progress toward our goal
of improving operational performance," said Jack A. Shaw, HUGHES' president and
chief executive officer. "Our DIRECTV U.S. business substantially exceeded
expectations by adding 405,000 net new subscribers in the quarter. Additionally,
we had solid revenue growth in the quarter driven by continued strong demand for
DIRECTV(R) services in both the United States and Latin America, as well as
increased sales of DIRECTV receivers and DIRECWAY systems at Hughes Network
Systems."
Shaw continued, "EBITDA increased in each of our key businesses driven by
operational improvements including aggressive cost reductions, a reduced
workforce and lower customer churn at our DIRECTV businesses. These improvements
were partially offset by the losses from our new DIRECTV DSL(TM) service, which
were not included in our 2000 results, and a $29 million charge at DIRECTV Latin
America due to the devaluation of the Argentinean peso." Also impacting the
EBITDA change were one-time favorable adjustments in the fourth quarter of 2000
for corporate expenditures primarily related to pension and other employee
costs.
HUGHES had a fourth quarter 2001 net loss of $132.6 million compared to
net income of $1,057.8 million in the same period of 2000. The change was
primarily due to the gain on the sale of HUGHES' satellite manufacturing
businesses in the fourth quarter of 2000, increased net interest expense, and
the lower EBITDA. These reductions were partially offset by a $42 million tax
benefit resulting from losses previously booked on HUGHES' investment in Motient
Corporation.
FULL-YEAR FINANCIAL REVIEW
For 2001, revenues increased 13.4% to $8,262.0 million, compared to
$7,287.6 million for the same period in 2000. This increase was primarily due to
continued subscriber growth at DIRECTV in the United States and Latin America,
partially offset by fewer sales and sales-type leases at PanAmSat and lower
shipments of DIRECTV receiver systems at Hughes Network Systems.
- 21 -
EBITDA for 2001 was $389.9 million and EBITDA margin was 4.7%, compared to
EBITDA of $594.0 million and EBITDA margin of 8.2% in 2000. The decrease in
EBITDA and EBITDA margin was primarily attributable to the higher outright sales
and sales-type leases of satellite transponders at PanAmSat in 2000, increased
investment in HNS' consumer DIRECWAY business, losses from the new DIRECTV DSL
service, as well as one-time severance charges recorded in the third quarter of
2001. These items were partially offset by improved DIRECTV operating
performance due to the higher gross profit resulting from the larger subscriber
bases in the United States and Latin America, and lower corporate expenses.
For 2001, net losses totaled $621.6 million compared to net income of
$813.0 million in 2000. The change was primarily due to the sale of HUGHES'
satellite manufacturing businesses in 2000, the lower EBITDA and an increase in
depreciation and amortization expense in the Direct-To-Home Broadcast segment
and at PanAmSat.
Segment Financial Review: Fourth Quarter 2001
Direct-To-Home Broadcast
Fourth quarter 2001 revenues for the segment increased 12.7% to $1,714.2
million from $1,520.5 million in the fourth quarter of 2000. The segment had
negative EBITDA of $5.3 million compared with EBITDA of $16.4 million in the
fourth quarter of 2000.
United States: As reported last week, DIRECTV added 910,000 gross
subscribers in the quarter and after accounting for churn, substantially
exceeded expectations by adding 405,000 net subscribers in the quarter. As a
result, DIRECTV had 10.7 million subscribers as of December 31, 2001,
representing a 13% increase over the 9.5 million customers attained as of
December 31, 2000.
DIRECTV reported quarterly revenues of $1,518 million, an increase of 12%
from last year's fourth quarter revenues of $1,351 million. The increase was
primarily due to continued subscriber growth.
EBITDA for the fourth quarter of 2001 was $63 million compared to EBITDA
of $59 million in last year's fourth quarter. This increase was due to the
additional gross profit gained from DIRECTV's larger subscriber base, mostly
offset by increased investments in its customer service and installation
network.
DIRECTV DSL: The DIRECTV DSL service was created following HUGHES' April
2001 acquisition of Telocity. As a result, no comparative financial data for
DIRECTV DSL is included for 2000.
The DIRECTV DSL service had fourth quarter 2001 revenues of $11 million
and negative EBITDA of $32 million. Approximately 17,500 net customers were
added to the DIRECTV DSL service in the quarter. As of December 31, 2001,
DIRECTV DSL had about 91,000 residential broadband customers in the United
States compared to about 48,000 customers as of December 31, 2000.
Latin America: The DIRECTV service in Latin America added 113,000 net
subscribers in the fourth quarter of 2001. The total number of DIRECTV
subscribers in Latin America as of December 31, 2001, was approximately
1,610,000 compared to about 1,305,000 as of December 31, 2000, representing an
increase of approximately 23%.
DIRECTV Latin America generated $186 million in revenues for the quarter
compared with $169 million in the fourth quarter of 2000. This 10% increase was
primarily due to continued subscriber growth and the impact from the financial
consolidation of the Argentinean and Colombian local operating companies
following their acquisition in the first half of 2001.
- 22 -
Excluding a $29 million charge for the recent devaluation of the
Argentinean peso, DIRECTV Latin America had negative EBITDA of $7 million in the
quarter compared to negative EBITDA of $43 million in the same period of 2000.
The improvement was primarily due to the increased gross profit generated from
the larger subscriber base, aggressive costs reductions and reduced marketing
costs. These improvements were partially offset by losses related to the
consolidation of the Argentinean and Colombian local operating companies.
Satellite Services
PanAmSat, which is 81%-owned by HUGHES, generated fourth quarter 2001
revenues of $203.7 million compared with $202.9 million in the prior year's
period. EBITDA for the quarter was $139.3 million and EBITDA margin was 68.4%,
compared with fourth quarter 2000 EBITDA of $136.1 million and EBITDA margin of
67.1%. The increase in EBITDA and EBITDA margin was principally due to recently
implemented cost reduction programs.
As of December 31, 2001, PanAmSat had contracts for satellite services
representing future payments (backlog) of over $5.8 billion compared to
approximately $6.0 billion at the end of the fourth quarter of 2000.
Network Systems
Hughes Network Systems (HNS) generated fourth quarter 2001 revenues of
$435.7 million versus $389.5 million in the fourth quarter of 2000. The 11.9%
increase resulted from increased shipments of DIRECTV receiver systems and
higher sales of DIRECWAY(R) systems to both enterprises and consumers. HNS added
approximately 14,000 net DIRECWAY residential broadband customers in the
quarter, bringing the cumulative total to approximately 101,000 subscribers in
North America. Additionally, HNS shipped 814,000 DIRECTV receiver systems in the
fourth quarter of 2001 compared to 680,000 units in the same period last year.
In the quarter, HNS reported negative EBITDA of $14.1 million compared to
negative EBITDA of $34.3 million in the fourth quarter of 2000. The improvement
in EBITDA is primarily attributable to higher operating margins on the increased
DIRECTV receiver shipments, partially offset by increased investment in the
DIRECWAY and SPACEWAY broadband businesses.
BALANCE SHEET
From December 31, 2000 to December 31, 2001, the company's consolidated
cash balance decreased $808.0 million to $700.1 million and total debt increased
$1,330.7 million to $2,647.3 million. The major uses of cash were for satellite
and capital expenditures, a settlement with the Raytheon Company on a purchase
price adjustment related to Raytheon's 1997 merger with Hughes Defense, and the
purchase of Telocity.
Hughes Electronics Corporation is a unit of General Motors Corporation.
The earnings of Hughes Electronics are used to calculate the earnings
attributable to the General Motors Class H common stock (NYSE:GMH).
A live webcast of HUGHES' fourth quarter 2001 earnings call will be
available on the company's website at www.hughes.com. The call will begin at
2:00 p.m. ET, today. The dial in number for the call is (913) 981-5537. The
webcast will be archived on the Investor Relations portion of the HUGHES website
and a replay will be available (dial in number: 888-203-1112, code: 671802)
beginning on Friday, January 18.
- 23 -
HUGHES FINANCIAL GUIDANCE
------------------------------------------------------------------------------
First Quarter Prior Full Year Revised Full
2002 2002 Year 2002
------------------------------------------------------------------------------
HUGHES
------------------------------------------------------------------------------
Revenues $1,950 - 2,000M* $9.0 - 9.2B No Change*
------------------------------------------------------------------------------
EBITDA $100 - 150M* $750 - 850M No Change*
------------------------------------------------------------------------------
Cash Requirements N/A $1.5 - 1.7B No Change*
------------------------------------------------------------------------------
DIRECTV U.S.
------------------------------------------------------------------------------
Revenue ~$1,425M $6.0 - 6.2B No Change
------------------------------------------------------------------------------
EBITDA $80 - 100M $525 - 575M No Change
------------------------------------------------------------------------------
Net Subscriber Adds 200 - 250K 1.0 - 1.2M No Change
------------------------------------------------------------------------------
DIRECTV DSL
------------------------------------------------------------------------------
Revenue N/A ~$75M No Change
------------------------------------------------------------------------------
EBITDA ~$(30)M ~$(100)M No Change
------------------------------------------------------------------------------
Net Subscriber Adds N/A ~100K No Change
------------------------------------------------------------------------------
DIRECTV Latin America
------------------------------------------------------------------------------
Revenue ~$190M* $925 - 975M No Change*
------------------------------------------------------------------------------
EBITDA ~$(20)M* Break-even No Change*
------------------------------------------------------------------------------
Net Subscriber Adds ~40K* ~250K No Change*
------------------------------------------------------------------------------
Hughes Network Systems
------------------------------------------------------------------------------
Revenue $225 - 250M $1.3 - 1.4B No Change
------------------------------------------------------------------------------
EBITDA $(30) - (40)M $(50) - (75)M No Change
------------------------------------------------------------------------------
DIRECWAY Net Sub Adds N/A 100 - 200K No Change
------------------------------------------------------------------------------
PanAmSat
------------------------------------------------------------------------------
Revenue $200 - 205M $790 - 825M No Change
------------------------------------------------------------------------------
New Outright Sales None None No Change
and Sales-Type Leases
------------------------------------------------------------------------------
EBITDA Margin 70% or higher 70% or higher No Change
------------------------------------------------------------------------------
* Excludes the potential impact from the devaluation of the Argentinean peso.
NOTE: Hughes Electronics Corporation believes that some of the foregoing
statements may constitute forward-looking statements. When used in this report,
the words "estimate," "plan," "project," "anticipate," "expect," "intend,"
"outlook," "believe," and other similar expressions are intended to identify
such forward-looking statements and information. Important factors that may
cause actual results of HUGHES to differ materially from the forward-looking
statements in this report are set forth in the Form 10-Ks filed with the SEC by
General Motors and HUGHES.
----------------------
(1) EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is
the sum of operating profit (loss) and depreciation and amortization. EBITDA
margin is calculated by dividing EBITDA by total revenues.
###
- 24 -
CONSOLIDATED STATEMENTS OF OPERATIONS AND
AVAILABLE SEPARATE CONSOLIDATED NET INCOME (LOSS)
(Dollars in Millions)
(Unaudited)
Three Months Ended Year Ended
December 31, December 31,
------------------ -------------------
2001 2000 2001 2000
------------------------------------------------------------------------ -------------------
Revenues
Direct broadcast, leasing and other services $1,934.6 $1,738.9 $7,202.3 $6,262.2
Product sales 346.0 320.1 1,059.7 1,025.4
---------------------------------------------------------------------------------------------
Total Revenues 2,280.6 2,059.0 8,262.0 7,287.6
---------------------------------------------------------------------------------------------
Operating Costs and Expenses
Broadcast programming and other costs 898.8 776.9 3,254.2 2,812.8
Cost of products sold 309.8 234.5 900.2 815.1
Selling, general and administrative expenses 953.8 893.8 3,717.7 3,065.7
Depreciation and amortization 296.8 275.0 1,147.7 948.1
---------------------------------------------------------------------------------------------
Total Operating Costs and Expenses 2,459.2 2,180.2 9,019.8 7,641.7
---------------------------------------------------------------------------------------------
Operating Loss (178.6) (121.2) (757.8) (354.1)
Interest income 4.5 34.0 56.7 49.3
Interest expense (61.9) (49.0) (195.9) (218.2)
Other, net (2.7) 1.8 (92.7) (292.6)
---------------------------------------------------------------------------------------------
Loss From Continuing Operations
Before Income Taxes, Minority
Interests and Cumulative Effect
of Accounting Change (238.7) (134.4) (989.7) (815.6)
Income tax benefit 107.8 51.7 325.6 406.1
Minority interests in net (earnings)
losses of subsidiaries (1.7) 22.4 49.9 54.1
---------------------------------------------------------------------------------------------
Loss from continuing operations
before cumulative effect of
accounting change (132.6) (60.3) (614.2) (355.4)
Income (Loss) from discontinued
operations, net of taxes - (14.2) - 36.1
Gain on sale of discontinued operations, net of taxes - 1,132.3 - 1,132.3
---------------------------------------------------------------------------------------------
Income (Loss) before cumulative
effect of accounting change (132.6) 1,057.8 (614.2) 813.0
Cumulative effect of accounting change, net of taxes - - (7.4) -
---------------------------------------------------------------------------------------------
Net Income (Loss) (132.6) 1,057.8 (621.6) 813.0
Adjustment to exclude the effect of GM
purchase accounting 0.8 1.0 3.3 16.9
---------------------------------------------------------------------------------------------
Income (Loss) Excluding the Effect of
GM Purchase Accounting Adjustment (131.8) 1,058.8 (618.3) 829.9
Preferred stock dividends (24.1) (24.1) (96.4) (97.0)
---------------------------------------------------------------------------------------------
Earnings (Loss) Used for Computation
of Available Separate Consolidated
Net Income (Loss) $(155.9) $1,034.7 $(714.7) $732.9
=============================================================================================
Available Separate Consolidated Net Income (Loss)
Average number of shares of General Motors Class H
Common Stock outstanding (in millions)
(Numerator) 877.3 874.9 876.3 681.2
Average Class H dividend base (in millions)
(Denominator) 1,300.9 1,298.7 1,300.0 1,297.0
Available Separate Consolidated Net Income (Loss) $(105.1) $697.1 $(481.8) $384.9
=============================================================================================
Certain 2000 amounts have been reclassified to conform to the 2001 presentation.
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SELECTED SEGMENT DATA
(Dollars in Millions)
(Unaudited)
Twelve Months
Fourth Quarter Ended December 31,
------------------- -------------------
2001 2000 2001 2000
--------------------------------------------------------------------------------------
DIRECT-TO-HOME BROADCAST
Total Revenues $1,714.2 $ 1,520.5 $ 6,304.4 $ 5,238.0
EBITDA (1) $ (5.3) $ 16.4 $ (74.8) $ (24.5)
EBITDA Margin (1) N/A 1.1% N/A N/A
Operating Loss $ (176.1) $ (147.0) $ (749.9) $ (557.9)
Depreciation and Amortization $ 170.8 $ 163.4 $ 675.1 $ 533.4
Capital Expenditures $ 211.8 $ 264.4 $ 734.3 $ 913.5
--------------------------------------------------------------------------------------
SATELLITE SERVICES
Total Revenues $ 203.7 $ 202.9 $ 870.1 $ 1,023.6
EBITDA (1) $ 139.3 $ 136.1 $ 580.0 $ 694.0
EBITDA Margin (1) 68.4% 67.1% 66.7% 67.8%
Operating Profit $ 29.3 $ 37.5 $ 165.3 $ 356.6
Operating Profit Margin 14.4% 18.5% 19.0% 34.8%
Depreciation and Amortization $ 110.0 $ 98.6 $ 414.7 $ 337.4
Capital Expenditures $ 96.5 $ 131.9 $ 338.2 $ 449.5
--------------------------------------------------------------------------------------
NETWORK SYSTEMS
Total Revenues $ 435.7 $ 389.5 $ 1,325.8 $ 1,409.8
EBITDA (1) $ (14.1) $ (34.3) $ (111.8) $ 0.1
Operating Loss $ (27.6) $ (48.1) $ (171.8) $ (63.5)
Depreciation and Amortization $ 13.5 $ 13.8 $ 60.0 $ 63.6
Capital Expenditures $ 197.4 $ 128.5 $ 664.6 $ 369.5
--------------------------------------------------------------------------------------
ELIMINATIONS and OTHER
Total Revenues $ (73.0) $ (53.9) $ (238.3) $ (383.8)
EBITDA (1) $ (1.7) $ 35.6 $ (3.5) $ (75.6)
Operating Profit (Loss) $ (4.2) $ 36.4 $ (1.4) $ (89.3)
Depreciation and Amortization $ 2.5 $ (0.8) $ (2.1) $ 13.7
Capital Expenditures $ 10.4 $ (14.1) $ 6.4 $ (16.4)
--------------------------------------------------------------------------------------
TOTAL
Total Revenues $2,280.6 $ 2,059.0 $ 8,262.0 $ 7,287.6
EBITDA (1) $ 118.2 $ 153.8 $ 389.9 $ 594.0
EBITDA Margin (1) 5.2% 7.5% 4.7% 8.2%
Operating Loss $ (178.6) $ (121.2) $ (757.8) $ (354.1)
Depreciation and Amortization $ 296.8 $ 275.0 $ 1,147.7 $ 948.1
Capital Expenditures $ 516.1 $ 510.7 $ 1,743.5 $ 1,716.1
======================================================================================
(1) EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is
the sum of operating profit (loss) and depreciation and amortization.
EBITDA margin is calculated by dividing EBITDA by total revenues.
- 26 -
CONSOLIDATED BALANCE SHEETS
(Dollars in Millions) December 31,
2001 December 31,
ASSETS (Unaudited) 2000
-------------------------------------------------------------------------------
Current Assets
Cash and cash equivalents $700.1 $1,508.1
Accounts and notes receivable 1,090.5 1,253.0
Contracts in process 153.1 186.0
Inventories 360.1 338.0
Deferred income taxes 118.9 89.9
Prepaid expenses and other 918.4 778.7
-------------------------------------------------------------------------------
Total Current Assets 3,341.1 4,153.7
Satellites, net 4,806.6 4,230.0
Property, net 2,197.8 1,707.8
Net Investment in Sales-type Leases 227.0 221.1
Intangible Assets, net 7,156.8 7,151.3
Investments and Other Assets 1,480.8 1,815.4
-------------------------------------------------------------------------------
Total Assets $19,210.1 $19,279.3
===============================================================================
LIABILITIES AND STOCKHOLDER'S EQUITY
-------------------------------------------------------------------------------
Current Liabilities
Accounts payable $1,227.5 $1,224.2
Deferred revenues 178.5 137.6
Short-term borrowings and current portion of
long-term debt 1,658.5 24.6
Accrued liabilities and other 1,342.0 1,304.5
-------------------------------------------------------------------------------
Total Current Liabilities 4,406.5 2,690.9
Long-Term Debt 988.8 1,292.0
Other Liabilities and Deferred Credits 1,465.1 1,647.3
Deferred Income Taxes 746.5 769.3
Commitments and Contingencies
Minority Interests 531.3 553.7
Stockholder's Equity 11,071.9 12,326.1
-------------------------------------------------------------------------------
Total Liabilities and Stockholder's Equity $19,210.1 $19,279.3
===============================================================================
Holders of GM Class H common stock have no direct rights in the equity or assets
of Hughes, but rather have rights in the equity and assets of General Motors
(which includes 100% of the stock of Hughes).
- 27 -
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GENERAL MOTORS CORPORATION
--------------------------
(Registrant)
Date January 16, 2002
-----------------
By
s/Peter R. Bible
-------------------------------
(Peter R. Bible,
Chief Accounting Officer)
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