GM Financial Reports June Quarter 2015 Operating Results

  • June quarter net income of $186 million
  • Consumer loan and lease originations of $9.9 billion
  • Annualized net credit losses of 1.6% on average consumer finance receivables
  • End of period earning assets of $48.0 billion

FORT WORTH, Texas--()--GENERAL MOTORS FINANCIAL COMPANY, INC. (“GM Financial” or the “Company”) announced net income of $186 million for the quarter ended June 30, 2015, compared to $175 million for the quarter ended June 30, 2014. Earnings for the six months ended June 30, 2015 were $336 million, compared to $320 million for the six months ended June 30, 2014.

Consumer loan originations were $4.3 billion for the quarter ended June 30, 2015, compared to $4.1 billion for the quarter ended March 31, 2015, and $3.6 billion for the quarter ended June 30, 2014. Consumer loan originations for the six months ended June 30, 2015 were $8.4 billion, compared to $7.0 billion for the six months ended June 30, 2014. The outstanding balance of consumer finance receivables was $27.3 billion at June 30, 2015.

Operating lease originations of General Motors Company (“GM”) vehicles were $5.6 billion for the quarter ended June 30, 2015, compared to $3.0 billion for the quarter ended March 31, 2015, and $1.5 billion for the quarter ended June 30, 2014. Operating lease originations for the six months ended June 30, 2015 were $8.6 billion, compared to $2.3 billion for the six months ended June 30, 2014. Leased vehicles, net was $12.9 billion at June 30, 2015.

The outstanding balance of commercial finance receivables was $7.8 billion at June 30, 2015 compared to $7.6 billion at March 31, 2015 and $7.1 billion at June 30, 2014.

Consumer finance receivables 31-to-60 days delinquent were 3.6% of the portfolio at June 30, 2015, compared to 3.5% at June 30, 2014. Accounts more than 60 days delinquent were 1.6% of the portfolio at June 30, 2015 and June 30, 2014.

Annualized net credit losses were 1.6% of average consumer finance receivables for the quarter ended June 30, 2015 and 1.4% for the quarter ended June 30, 2014. For the six months ended June 30, 2015, annualized consumer net credit losses were 1.7%, compared to 1.6% for the six months ended June 30, 2014.

The Company had total available liquidity of $12.9 billion at June 30, 2015, consisting of $2.1 billion of unrestricted cash, $9.2 billion of borrowing capacity on unpledged eligible assets, $0.6 billion of borrowing capacity on unsecured lines of credit and $1.0 billion of borrowing capacity on a Junior Subordinated Revolving Credit Facility from GM.

On January 2, 2015, the Company completed the acquisition of Ally Financial Inc.’s 40% equity interest in SAIC-GMAC Automotive Finance Company Limited (“SAIC-GMAC”). Also on January 2, 2015, the Company sold a 5% equity interest in SAIC-GMAC to Shanghai Automotive Group Finance Company Ltd. As a result of these transactions, the Company owns a 35% equity interest in SAIC-GMAC. Income from our equity investment in SAIC-GMAC is included in our results beginning January 2, 2015.

About GM Financial

General Motors Financial Company, Inc. is the captive finance company for and a wholly-owned subsidiary of General Motors Company and is headquartered in Fort Worth, Texas. For more information, visit www.gmfinancial.com.

Forward-Looking Statements

Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements which are our current views with respect to future events and financial performance. These forward-looking statements are subject to many assumptions, risks and uncertainties that could cause actual results to differ significantly from historical results or from those anticipated. The most significant risks are detailed from time to time in our filings and reports with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended December 31, 2014. Such risks include – but are not limited to – changes in general economic and business conditions; GM’s ability to sell new vehicles that we finance in the markets we serve in North America, Europe, Latin America and China; interest rate and currency fluctuations; our financial condition and liquidity, as well as future cash flows and earnings; competition; the effect, interpretation or application of new or existing laws, regulations, court decisions and accounting pronouncements; the availability of sources of financing; the level of net charge-offs, delinquencies and prepayments on the loans and leases we originate; vehicle return rates and the residual value performance on vehicles we lease; the viability of GM-franchised dealers that are commercial loan customers; the prices at which used cars are sold in the wholesale markets; and changes in business strategy, including expansion of product lines and credit risk appetite, and acquisitions. If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, actual events or results may differ materially. It is advisable not to place undue reliance on any forward-looking statements. We undertake no obligation to, and do not, publicly update or revise any forward-looking statements, except as required by federal securities laws, whether as a result of new information, future events or otherwise.

   
 

General Motors Financial Company, Inc.

Consolidated Statements of Income

(Unaudited, in millions)

 
 
Three Months Ended Six Months Ended
June 30, June 30,
2015

 

2014 2015   2014
Revenue
Finance charge income $ 848 $ 882 $ 1,702 $ 1,712
Leasing income 599 238 1,030 438
Other income 68   71   137   138
1,515   1,191   2,869   2,288
Costs and expenses
Operating expenses 319 280 625 549
Leased vehicles expenses 467 179 794 335
Provision for loan losses 141 113 296 248
Interest expense 391   354   771   669
1,318 926 2,486 1,801
Equity income 28     56  

Income before income taxes 225 265 439 487
Income tax provision 39   90   103   167
Net income $ 186   $ 175   $ 336   $ 320
 
         

 

Consolidated Balance Sheets

(Unaudited, in millions)

 
 
June 30, 2015 December 31, 2014
Assets
Cash and cash equivalents $ 2,070 $ 2,974
Finance receivables, net 34,385 33,000
Leased vehicles, net 12,904 7,060
Restricted cash 1,856 2,071
Goodwill 1,243 1,244
Equity in net assets of non-consolidated affiliates 978
Property and equipment, net of accumulated depreciation 202 172
Deferred income taxes 283 341
Related party receivables 588 384
Other assets 821   478
Total assets $ 55,330   $ 47,724
Liabilities and Shareholder's Equity
Liabilities
Secured debt $ 26,617 $ 25,214
Unsecured debt 17,713 12,217
Accounts payable and accrued expenses 1,138 1,002
Deferred income 844 392
Deferred income taxes 70 20
Related party taxes payable 636 636
Related party payables 429 433
Other liabilities 380   418
Total liabilities 47,827 40,332
Shareholder's equity 7,503 7,392
 
Total liabilities and shareholder's equity $ 55,330   $ 47,724
 
 
 

Operational and Financial Data

(Unaudited, in millions)

 
 
Three Months Ended
June 30,
2015   2014
North     North    
America International Total America International Total
Consumer finance receivables originations $ 2,642 $ 1,646 $ 4,288 $ 1,553

 

$ 2,080

 

$ 3,633
GM lease originations $ 5,587 $ 20 $ 5,607 $ 1,549 $ $ 1,549

GM new vehicle loans and leases as a

percent of total loan and lease originations

83.5% 84.2% 83.6% 66.3% 87.1% 74.6%
 
 
 
Six Months Ended
June 30,
2015   2014
North     North    
America International Total America International Total
Consumer finance receivables originations $ 4,915 $ 3,451 $ 8,366 $ 2,917 $ 4,128 $ 7,045
GM lease originations $ 8,594 $ 37 $ 8,631 $ 2,322 $

$ 2,322

GM new vehicle loans and leases as a

percent of total loan and lease originations

79.7% 84.9% 80.8% 60.8% 87.6% 72.6%
 
       
 
Three Months Ended
June 30,
2015

 

2014
North     North    
America International Total America International Total
Average consumer finance receivables $ 14,927 $ 11,666 $ 26,593 $ 11,847 $ 12,827 $ 24,674
Average commercial finance receivables 3,359 4,301 7,660 2,287 4,755 7,042
Average finance receivables 18,286 15,967 34,253 14,134 17,582 31,716
Average leased vehicles, net 10,826 50 10,876 4,169 1 4,170
Average earning assets $ 29,112 $ 16,017 $ 45,129 $ 18,303 $ 17,583 $ 35,886
         
       
 
Six Months Ended
June 30,
2015   2014
North     North    
America International Total America International Total
Average consumer finance receivables $ 14,396 $ 11,822 $ 26,218 $ 11,691 $ 12,406 $ 24,097
Average commercial finance receivables 3,248 4,406 7,654 2,158 4,715 6,873
Average finance receivables 17,644 16,228 33,872 13,849 17,121 30,970
Average leased vehicles, net 9,387 43 9,430 3,867 2 3,869
Average earning assets $ 27,031 $ 16,271 $ 43,302 $ 17,716 $ 17,123 $ 34,839
         
                 
 
June 30, 2015

 

June 30, 2014
North     North    
America International Total America International Total
Consumer finance receivables $ 15,490 $ 11,840 $ 27,330 $ 11,978 $ 13,152 $ 25,130
Commercial finance receivables 3,515 4,300 7,815 2,373 4,741 7,114
Leased vehicles 12,846 58 12,904 4,747 1 4,748
Ending earning assets $ 31,851 $ 16,198 $ 48,049 $ 19,098 $ 17,894 $ 36,992
         
   
 
June 30, 2015 December 31, 2014
North     North    
America International Total America International Total

Consumer

 

Consumer finance receivables,

net of fees(a)

$ 15,490 $ 11,840 $ 27,330 $ 13,361 $ 12,262 $ 25,623
Less: allowance for loan losses (627 ) (94 ) (721 ) (577 ) (78 ) (655 )

Total consumer finance receivables, net

14,863   11,746   26,609   12,784   12,184   24,968  

Commercial

Commercial finance receivables,

3,515 4,300 7,815 3,180 4,892 8,072

net of fees

Less: allowance for loan losses (22 ) (17 ) (39 ) (21 ) (19 ) (40 )
Total commercial finance receivables, net 3,493   4,283   7,776   3,159   4,873   8,032  
Total finance receivables, net $ 18,356   $ 16,029   $ 34,385   $ 15,943   $ 17,057   $ 33,000  
 
 
(a) Amounts reported for International include $1.1 billion and $1.0 billion of direct-financing leases at June 30, 2015 and December 31, 2014.
 

   
 
June 30, 2015 December 31, 2014
North     North    
America International Total America International Total

Allowance for loan losses as a percentage

           
of consumer finance receivables,
net of fees 4.0% 0.8% 2.6% 4.4% 0.6% 2.6%

Allowance for loan losses as a percentage

of commercial finance receivables,

net of fees

0.6%

0.4%

0.5%

0.7%

0.4%

0.5%

 

 

 

 

 

 

 

 

 

 

 

 

     
 
June 30, 2015 June 30, 2014
North     North    
America International Total

America

International Total
Loan delinquency as a percent of ending

consumer finance receivables:

31 - 60 days 5.9% 1.1% 3.6% 6.3% 1.0% 3.5%
Greater than 60 days 2.1%

1.0%

1.6% 2.1% 1.0% 1.6%

Total

8.0%

2.1%

5.2%

8.4%

2.0%

5.1%

 

 

 

 

 

 

 

 

 

 

 

 

           
 
Three Months Ended
June 30,
2015 2014
North North
America

International(a)

Total America

International(a)

Total
Charge-offs $ 188 $ 32 $ 220 $ 157 $ 34 $ 191

Adjustments to reflect write-offs of the

contractual amounts on the

pre-acquisition portfolio

 

4

 

 

 

 

4

 

 

15

 

 

2

 

 

17

 
Credit Losses $ 192 $ 32 $ 224 $ 172 $ 36 $ 208
Less: recoveries

 

(106

)

 

(11

)

 

(117

)

 

(105

)

 

(16

)

 

(121

)
Net credit losses $ 86   $ 21   $ 107   $ 67   $ 20   $ 87  

Net annualized credit losses as a percent of

average consumer finance receivables:

 

2.3

%

 

0.7

%

 

1.6

%

 

2.3

%

 

0.6

%

 

1.4

%

Recoveries as a percentage of gross

 

repossession credit losses:

 

58.8

%

 

61.5

%
 
 
(a) Credit losses for the International Segment represent the write-down of defaulted receivables to net realizable value.
 

  Six Months Ended
June 30,    

2015

  2014
North America   International(a)   Total North America   International(a)   Total
Charge-offs $ 388 $ 66 $ 454 $ 349 $ 66 $ 415
Adjustments to reflect write-offs of the

contractual amounts on the

pre-acquisition portfolio

 

11

 

 

1

 

 

12

 

 

39

 

 

5

 

 

44

 
Credit Losses $ 399 $

67

$ 466 $ 388

$

71 $ 459
Less: recoveries

 

(225

)

 

(23

)

 

(248

)

 

(233

)

 

(33

)

 

(266

)
Net credit losses $ 174   $ 44   $ 218  

 

155

  $ 38   $ 193  
Net annualized credit losses as a percent of

average consumer finance receivables:

 

2.5

%

 

0.8

%

 

1.7

%

 

2.7

%

 

0.6

%

 

1.6

%
Recoveries as a percentage of gross

repossession credit losses:

 

58.2

%

 

60.1

%
 
(a) Credit losses for the International Segment represent the write-down of defaulted receivables to net realizable value.
 

 
 

 

Three Months Ended
June 30,
2015   2014
North     North    
America International Total America International Total

Annualized operating expenses as a

percent of average earning assets(a)

2.5 % 3.4 % 2.8 % 2.9 % 3.4 % 3.1 %
 
 
 
Six Months Ended
June 30,
2015   2014
North     North    
America International Total America International Total

Annualized operating expenses as a

percent of average earning assets(a)

2.6 % 3.5 % 2.9 % 2.9 % 3.5 % 3.2 %
 
 
(a) Excluding leased vehicle expenses.
 

Contacts

General Motors Financial Company, Inc.
Stephen Jones, 817-302-7119

Contacts

General Motors Financial Company, Inc.
Stephen Jones, 817-302-7119