General Motors Company (NYSE:GM) easily beat first-quarter Wall Street profit estimates Thursday, but the car maker’s net income sank 60% due to hefty restructuring costs in South Korea.
General Motors shares were down slightly to $37.90 in pre-market trade.
For the quarter ended March 31, General Motors posted earnings excluding one-time factors of US$1.43 per share on revenue of US$36.1bn. The consensus earnings estimate was US$1.24 per share on revenue of US$34.1bn.
However, net income from continuing operations was impacted by a US$0.9bn special charge related to GM's operations in Korea, where the automaker is closing a plant and negotiating for government aid to continue operations in the country. GM's net income tumbled to US$1.05 bn from US$2.61bn from a year ago, hurt by a US$900 mln charge to restructure its business in South Korea.
CFO Chuck Stevens said on a call with reporters that GM had reached a deal with a Korean labor union on Thursday that would allow it to remain in the country and save the car maker US$500 mln per year in costs.