GM FINANCIAL REPORTS SEPTEMBER QUARTER 2016
OPERATING RESULTS
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| • | September quarter net income of $147 million |
| |
| • | Consumer loan and lease originations of $11.2 billion for the September quarter |
| |
| • | End of period earning assets of $73.8 billion |
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| • | Available liquidity of $15.4 billion at quarter end |
FORT WORTH, TEXAS October 25, 2016 – GENERAL MOTORS FINANCIAL COMPANY, INC.
(“GM Financial” or the “Company”) announced net income of $147 million for the quarter ended September 30, 2016, compared to $179 million for the quarter ended September 30, 2015. Net income for the nine months ended September 30, 2016 was $500 million, compared to $515 million for the nine months ended September 30, 2015.
Retail loan originations were $5.1 billion for the quarter ended September 30, 2016, compared to $4.2 billion for the quarter ended June 30, 2016, and $4.7 billion for the quarter ended September 30, 2015. Retail loan originations for the nine months ended September 30, 2016 were $13.4 billion, compared to $13.1 billion for the nine months ended September 30, 2015. The outstanding balance of retail finance receivables was $32.2 billion at September 30, 2016.
Operating lease originations were $6.2 billion for the quarter ended September 30, 2016, compared to $6.5 billion for the quarter ended June 30, 2016, and $6.2 billion for the quarter ended September 30, 2015. Operating lease originations for the nine months ended September 30, 2016 were $19.4 billion, compared to $14.8 billion for the nine months ended September 30, 2015. Leased vehicles, net was $31.8 billion at September 30, 2016.
The outstanding balance of commercial finance receivables was $9.8 billion at September 30, 2016 compared to $9.4 billion at June 30, 2016 and $7.8 billion at September 30, 2015.
Retail finance receivables 31-60 days delinquent were 3.5% of the portfolio at September 30, 2016 and 4.0% at September 30, 2015. Accounts more than 60 days delinquent were 1.5% of the portfolio at September 30, 2016 and 1.6% at September 30, 2015.
Annualized net charge-offs were 2.0% of average retail finance receivables for the quarter ended September 30, 2016 and 1.9% for the quarter ended September 30, 2015. For the nine months ended September 30, 2016, annualized retail net charge-offs were 1.9%, compared to 1.8% for the nine months ended September 30, 2015.
The Company had total available liquidity of $15.4 billion at September 30, 2016, consisting of $2.6 billion of cash and cash equivalents, $11.6 billion of borrowing capacity on unpledged eligible assets, $0.6 billion of borrowing capacity on committed unsecured lines of credit and $0.6 billion of borrowing capacity on a Junior Subordinated Revolving Credit Facility from GM.
Earnings resulting from the Company's equity investment in SAIC-GMAC, a joint venture that conducts auto finance operations in China, were $36 million for the three months ended September 30, 2016 compared to $37 million for the three months ended June 30, 2016, and $29 million for the three months ended September 30, 2015. Earnings for the nine months ended September 30, 2016 were $109 million, compared to $85 million for the nine months ended September 30, 2015.
About GM Financial
General Motors Financial Company, Inc. is the wholly-owned captive finance 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, 2015. 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, Latin America, China and Europe, particularly the United Kingdom where automobile sales may be negatively impacted due to the passage of the referendum to discontinue its membership in the European Union; 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 and cost 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, Dollars in millions)
|
| | | | | | | | | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | 2016 | | 2015 | | 2016 | | 2015 |
| Revenue | | | | | | | |
| Finance charge income | $ | 837 |
| | $ | 842 |
| | $ | 2,481 |
| | $ | 2,544 |
|
| Leased vehicle income | 1,590 |
| | 797 |
| | 4,164 |
| | 1,827 |
|
| Other income | 72 |
| | 68 |
| | 221 |
| | 205 |
|
| Total revenue | 2,499 |
| | 1,707 |
| | 6,866 |
| | 4,576 |
|
| Costs and expenses | | | | | | | |
| Operating expenses | 392 |
| | 320 |
| | 1,069 |
| | 945 |
|
| Leased vehicle expenses | 1,202 |
| | 629 |
| | 3,163 |
| | 1,423 |
|
| Provision for loan losses | 172 |
| | 144 |
| | 519 |
| | 440 |
|
| Interest expense | 541 |
| | 412 |
| | 1,505 |
| | 1,183 |
|
| Total costs and expenses | 2,307 |
| | 1,505 |
| | 6,256 |
| | 3,991 |
|
| Equity income | 36 |
| | 29 |
| | 109 |
| | 85 |
|
| Income before income taxes | 228 |
| | 231 |
| | 719 |
| | 670 |
|
| Income tax provision | 81 |
| | 52 |
| | 219 |
| | 155 |
|
| Net income | $ | 147 |
| | $ | 179 |
| | $ | 500 |
| | $ | 515 |
|
Consolidated Balance Sheets
(Unaudited, Dollars in millions)
|
| | | | | | | |
| | September 30, 2016 | | December 31, 2015 |
| ASSETS | | | |
| Cash and cash equivalents | $ | 2,588 |
| | $ | 3,061 |
|
| Finance receivables, net | 41,132 |
| | 36,781 |
|
| Leased vehicles, net | 31,775 |
| | 20,172 |
|
| Restricted cash | 2,055 |
| | 1,941 |
|
| Goodwill | 1,198 |
| | 1,189 |
|
| Equity in net assets of non-consolidated affiliates | 940 |
| | 986 |
|
| Property and equipment, net of accumulated depreciation | 253 |
| | 219 |
|
| Deferred income taxes | 310 |
| | 231 |
|
| Related party receivables | 850 |
| | 573 |
|
| Other assets | 1,010 |
| | 751 |
|
| Total assets | $ | 82,111 |
| | $ | 65,904 |
|
| LIABILITIES AND SHAREHOLDER'S EQUITY | | | |
| Liabilities | | | |
| Secured debt | $ | 35,237 |
| | $ | 30,689 |
|
| Unsecured debt | 33,526 |
| | 23,657 |
|
| Accounts payable and accrued expenses | 1,419 |
| | 1,218 |
|
| Deferred income | 2,226 |
| | 1,454 |
|
| Deferred income taxes | 299 |
| | 129 |
|
| Related party payables | 407 |
| | 362 |
|
| Other liabilities | 379 |
| | 343 |
|
| Total liabilities | 73,493 |
| | 57,852 |
|
| Shareholder's equity | 8,618 |
| | 8,052 |
|
| Total liabilities and shareholder's equity | $ | 82,111 |
| | $ | 65,904 |
|
Operational and Financial Data
(Unaudited, Dollars in millions)
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended September 30, |
| Originations | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Retail finance receivables originations | $ | 3,360 |
| | $ | 1,698 |
| | $ | 5,058 |
| | $ | 3,155 |
| | $ | 1,586 |
| | $ | 4,741 |
|
| GM lease originations | $ | 6,113 |
| | $ | 57 |
| | $ | 6,170 |
| | $ | 6,161 |
| | $ | 19 |
| | $ | 6,180 |
|
| GM new vehicle loans and leases as a percent of total loan and lease originations | 87.4 | % | | 87.8 | % | | 87.5 | % | | 87.8 | % | | 84.5 | % | | 87.3 | % |
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended September 30, |
| | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Retail finance receivables originations | $ | 8,485 |
| | $ | 4,912 |
| | $ | 13,397 |
| | $ | 8,070 |
| | $ | 5,037 |
| | $ | 13,107 |
|
| GM lease originations | $ | 19,280 |
| | $ | 158 |
| | $ | 19,438 |
| | $ | 14,755 |
| | $ | 56 |
| | $ | 14,811 |
|
| GM new vehicle loans and leases as a percent of total loan and lease originations | 88.0 | % | | 87.1 | % | | 87.9 | % | | 83.0 | % | | 84.8 | % | | 83.3 | % |
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended September 30, |
| Average Earning Assets | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Average retail finance receivables | $ | 20,088 |
| | $ | 11,425 |
| | $ | 31,513 |
| | $ | 16,435 |
| | $ | 11,396 |
| | $ | 27,831 |
|
| Average commercial finance receivables | 5,005 |
| | 4,424 |
| | 9,429 |
| | 3,475 |
| | 4,258 |
| | 7,733 |
|
| Average finance receivables | 25,093 |
| | 15,849 |
| | 40,942 |
| | 19,910 |
| | 15,654 |
| | 35,564 |
|
| Average leased vehicles, net | 29,934 |
| | 186 |
| | 30,120 |
| | 14,875 |
| | 66 |
| | 14,941 |
|
| Average earning assets | $ | 55,027 |
| | $ | 16,035 |
| | $ | 71,062 |
| | $ | 34,785 |
| | $ | 15,720 |
| | $ | 50,505 |
|
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended September 30, |
| | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Average retail finance receivables | $ | 19,266 |
| | $ | 11,262 |
| | $ | 30,528 |
| | $ | 15,084 |
| | $ | 11,650 |
| | $ | 26,734 |
|
| Average commercial finance receivables | 4,565 |
| | 4,502 |
| | 9,067 |
| | 3,312 |
| | 4,358 |
| | 7,670 |
|
| Average finance receivables | 23,831 |
| | 15,764 |
| | 39,595 |
| | 18,396 |
| | 16,008 |
| | 34,404 |
|
| Average leased vehicles, net | 26,104 |
| | 142 |
| | 26,246 |
| | 11,236 |
| | 50 |
| | 11,286 |
|
| Average earning assets | $ | 49,935 |
| | $ | 15,906 |
| | $ | 65,841 |
| | $ | 29,632 |
| | $ | 16,058 |
| | $ | 45,690 |
|
|
| | | | | | | | | | | | | | | | | | | | | | | |
| Ending Earning Assets | September 30, 2016 | | September 30, 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Retail finance receivables | $ | 20,766 |
| | $ | 11,480 |
| | $ | 32,246 |
| | $ | 16,994 |
| | $ | 10,993 |
| | $ | 27,987 |
|
| Commercial finance receivables | 5,328 |
| | 4,432 |
| | 9,760 |
| | 3,503 |
| | 4,342 |
| | 7,845 |
|
| Leased vehicles | 31,570 |
| | 205 |
| | 31,775 |
| | 16,843 |
| | 72 |
| | 16,915 |
|
| Ending earning assets | $ | 57,664 |
| | $ | 16,117 |
| | $ | 73,781 |
| | $ | 37,340 |
| | $ | 15,407 |
| | $ | 52,747 |
|
|
| | | | | | | | | | | | | | | | | | | | | | | |
| Total Finance Receivables | September 30, 2016 | | December 31, 2015 |
| | North America | | International |
| Total | | North America | | International | | Total |
| Retail | | | | | | | | | | | |
Retail finance receivables, net of fees(a,b) | $ | 20,766 |
| | $ | 11,480 |
| | $ | 32,246 |
| | $ | 18,148 |
| | $ | 10,976 |
| | $ | 29,124 |
|
| Less: allowance for loan losses | (695 | ) | | (127 | ) | | (822 | ) | | (618 | ) | | (117 | ) | | (735 | ) |
| Total retail finance receivables, net | 20,071 |
| | 11,353 |
| | 31,424 |
| | 17,530 |
| | 10,859 |
| | 28,389 |
|
| Commercial | | | | | | | | | | | |
| Commercial finance receivables, net of fees | 5,328 |
| | 4,432 |
| | 9,760 |
| | 4,051 |
| | 4,388 |
| | 8,439 |
|
| Less: allowance for loan losses | (33 | ) | | (19 | ) | | (52 | ) | | (23 | ) | | (24 | ) | | (47 | ) |
| Total commercial finance receivables, net | 5,295 |
| | 4,413 |
| | 9,708 |
| | 4,028 |
| | 4,364 |
| | 8,392 |
|
| Total finance receivables, net | $ | 25,366 |
| | $ | 15,766 |
| | $ | 41,132 |
| | $ | 21,558 |
| | $ | 15,223 |
| | $ | 36,781 |
|
(a) Includes $1.3 billion and $1.1 billion of direct-financing leases at September 30, 2016 and December 31, 2015.
(b) Net of unearned income, unamortized premiums and discounts, and deferred fees and costs of $200 million and $179 million at September 30, 2016 and December 31, 2015.
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| | | | | | | | | | | | | | | | | |
| Allowance for Loan Losses | September 30, 2016 | | December 31, 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Allowance for loan losses as a percentage of retail finance receivables, net of fees | 3.3 | % | | 1.1 | % | | 2.5 | % | | 3.4 | % | | 1.1 | % | | 2.5 | % |
| Allowance for loan losses as a percentage of commercial finance receivables, net of fees | 0.6 | % | | 0.4 | % | | 0.5 | % | | 0.6 | % | | 0.5 | % | | 0.6 | % |
|
| | | | | | | | | | | | | | | | | |
| Delinquencies | September 30, 2016 | | September 30, 2015 |
| | North America | | International | | Total | North America | | International | | Total |
| Loan delinquency as a percent of ending retail finance receivables: | | | | | | | | | | | |
| 31 - 60 days | 4.9 | % | | 0.9 | % | | 3.5 | % | | 6.1 | % | | 0.9 | % | | 4.0 | % |
| Greater than 60 days | 1.9 | % | | 0.9 | % | | 1.5 | % | | 2.1 | % | | 0.8 | % | | 1.6 | % |
| Total | 6.8 | % | | 1.8 | % | | 5.0 | % | | 8.2 | % | | 1.7 | % | | 5.6 | % |
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended September 30, |
| Charge-offs and Recoveries | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Charge-offs | $ | 253 |
| | $ | 41 |
| | $ | 294 |
| | $ | 221 |
| | $ | 35 |
| | $ | 256 |
|
| Less: recoveries | (118 | ) | | (16 | ) | | (134 | ) | | (111 | ) | | (13 | ) | | (124 | ) |
| Net charge-offs | $ | 135 |
| | $ | 25 |
| | $ | 160 |
| | $ | 110 |
| | $ | 22 |
| | $ | 132 |
|
| Net annualized charge-offs as a percent of average retail finance receivables | 2.7 | % | | 0.9 | % | | 2.0 | % | | 2.7 | % | | 0.8 | % | | 1.9 | % |
Recoveries as a percentage of gross repossession charge-offs(a) | 52.3 | % | | | | | | 56.2 | % | | | | |
| |
| (a) | Charge-offs for the International Segment primarily include the write-down of receivables to net realizable value. As a result, a calculation of recoveries as a percentage of gross charge-offs is not meaningful. |
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended September 30, |
| | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Charge-offs | $ | 740 |
| | $ | 113 |
| | $ | 853 |
| | $ | 609 |
| | $ | 101 |
| | $ | 710 |
|
| Less: recoveries | (378 | ) | | (39 | ) | | (417 | ) | | (321 | ) | | (36 | ) | | (357 | ) |
| Net charge-offs | $ | 362 |
| | $ | 74 |
| | $ | 436 |
| | $ | 288 |
| | $ | 65 |
| | $ | 353 |
|
| Net annualized charge-offs as a percent of average retail finance receivables | 2.5 | % | | 0.9 | % | | 1.9 | % | | 2.6 | % | | 0.7 | % | | 1.8 | % |
Recoveries as a percentage of gross repossession charge-offs(a) | 53.8 | % | | | | | | 57.5 | % | | | | |
| |
| (a) | Charge-offs for the International Segment primarily include the write-down of receivables to net realizable value. As a result, a calculation of recoveries as a percentage of gross charge-offs is not meaningful. |
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| | | | | | | | | | | | | | | | | |
| | Three Months Ended September 30, |
| Operating Expenses | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Annualized operating expenses as a percent of average earning assets | 1.7 | % | | 3.8 | % | | 2.2 | % | | 2.1 | % | | 3.4 | % | | 2.5 | % |
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| | | | | | | | | | | | | | | | | |
| | Nine Months Ended September 30, |
| | 2016 | | 2015 |
| | North America | | International | | Total | | North America | | International | | Total |
| Annualized operating expenses as a percent of average earning assets | 1.8 | % | | 3.5 | % | | 2.2 | % | | 2.4 | % | | 3.5 | % | | 2.8 | % |
Investor Relations contact:
Stephen Jones
Vice President, Investor Relations
(817) 302-7119
Investors@gmfinancial.com
