GM FINANCIAL REPORTS MARCH QUARTER 2018
OPERATING RESULTS
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| • | March quarter net income of $369 million |
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| • | Retail loan and lease originations of $10.8 billion for the March quarter |
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| • | Earning assets of $88.1 billion at March 31, 2018 |
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| • | Available liquidity of $19.4 billion at March 31, 2018 |
FORT WORTH, TEXAS April 26, 2018 – GENERAL MOTORS FINANCIAL COMPANY, INC.
(“GM Financial” or the “Company”) announced net income of $369 million for the quarter ended March 31, 2018, compared to $202 million for the quarter ended March 31, 2017.
Retail loan originations were $5.1 billion for the quarter ended March 31, 2018, compared to $4.4 billion for the quarter ended December 31, 2017, and $5.6 billion for the quarter ended March 31, 2017. The outstanding balance of retail finance receivables was $34.3 billion at March 31, 2018.
Operating lease originations were $5.7 billion for the quarter ended March 31, 2018, compared to $5.8 billion for the quarter ended December 31, 2017, and $6.3 billion for the quarter ended March 31, 2017. Leased vehicles, net was $43.4 billion at March 31, 2018.
The outstanding balance of commercial finance receivables was $10.4 billion at March 31, 2018, compared to $10.3 billion at December 31, 2017 and $8.5 billion at March 31, 2017.
Retail finance receivables 31-60 days delinquent were 3.7% of the portfolio at March 31, 2018 and 3.4% at March 31, 2017. Accounts more than 60 days delinquent were 1.7% of the portfolio at March 31, 2018 and 1.4% at March 31, 2017.
Annualized net charge-offs were 2.1% of average retail finance receivables for the quarter ended March 31, 2018 and 2.3% for the quarter ended March 31, 2017.
The Company had total available liquidity of $19.4 billion at March 31, 2018, consisting of $4.2 billion of cash and cash equivalents, $14.1 billion of borrowing capacity on unpledged eligible assets, $0.1 billion of borrowing capacity on committed unsecured lines of credit and $1.0 billion of borrowing capacity on the 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 $52 million for the quarter ended March 31, 2018 compared to $47 million for the quarter ended March 31, 2017.
Operating Results
On October 31, 2017, we completed the sale of certain of our European subsidiaries and branches (collectively, the "European Operations") to Banque PSA Finance S.A. and BNP Paribas Personal Finance S.A. The European Operations are presented as discontinued operations in our condensed consolidated financial statements for the three months ended March 31, 2017. Unless otherwise indicated, information in this release relates to our continuing operations.
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
This presentation contains several “forward-looking statements.” Forward-looking statements are those that use words such as “believe,” “expect,” “intend,” “plan,” “may,” “likely,” “should,” “estimate,” “continue,” “future” or "anticipate" and other comparable expressions. These words indicate future events and trends. Forward-looking statements 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 by us. 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, 2017. Such risks include - but are not limited to - GM’s ability to sell new vehicles that we finance in the markets we serve; the viability of GM-franchised dealers that are commercial loan customers; the availability and cost of sources of financing; our joint venture in China, which we cannot operate solely for our benefit and over which we have limited control; the level of net charge-offs, delinquencies and prepayments on the loans and leases we originate; the effect, interpretation or application of new or existing laws, regulations, court decisions and accounting pronouncements; the prices at which used cars are sold in the wholesale auction markets; vehicle return rates and the residual value performance on vehicles we lease; interest rate fluctuations and certain related derivatives exposure; foreign currency exchange rate fluctuations; our financial condition and liquidity, as well as future cash flows and earnings; changes in general economic and business conditions; competition; our ability to manage risks related to security breaches and other disruptions to our networks and systems; and changes in business strategy, including expansion of product lines and credit risk appetite, acquisitions and divestitures. If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected. 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.
Condensed Consolidated Statements of Income
(Unaudited, in millions)
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| | | | | | | |
| | Three Months Ended March 31, |
| | 2018 | | 2017 |
| Revenue | | | |
| Finance charge income | $ | 866 |
| | $ | 752 |
|
| Leased vehicle income | 2,447 |
| | 1,931 |
|
| Other income | 98 |
| | 65 |
|
| Total revenue | 3,411 |
| | 2,748 |
|
| Costs and expenses | | | |
| Operating expenses | 365 |
| | 330 |
|
| Leased vehicle expenses | 1,787 |
| | 1,429 |
|
| Provision for loan losses | 136 |
| | 211 |
|
| Interest expense | 732 |
| | 596 |
|
| Total costs and expenses | 3,020 |
| | 2,566 |
|
| Equity income | 52 |
| | 47 |
|
| Income from continuing operations before income taxes | 443 |
| | 229 |
|
| Income tax provision | 74 |
| | 50 |
|
| Income from continuing operations | 369 |
| | 179 |
|
| Income from discontinued operations, net of tax | — |
| | 23 |
|
| Net income | $ | 369 |
| | $ | 202 |
|
| | | | |
| Net income attributable to common shareholder | $ | 355 |
| | $ | 202 |
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Condensed Consolidated Balance Sheets
(Unaudited, in millions)
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| | | | | | | |
| | March 31, 2018 | | December 31, 2017 |
| ASSETS | | | |
| Cash and cash equivalents | $ | 4,178 |
| | $ | 4,265 |
|
| Finance receivables, net | 43,773 |
| | 42,172 |
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| Leased vehicles, net | 43,444 |
| | 42,882 |
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| Goodwill | 1,198 |
| | 1,197 |
|
| Equity in net assets of non-consolidated affiliate | 1,281 |
| | 1,187 |
|
| Related party receivables | 659 |
| | 309 |
|
| Other assets | 6,489 |
| | 5,003 |
|
| Total assets | $ | 101,022 |
| | $ | 97,015 |
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| LIABILITIES AND SHAREHOLDERS' EQUITY | | | |
| Liabilities | | | |
| Secured debt | $ | 39,441 |
| | $ | 39,887 |
|
| Unsecured debt | 44,079 |
| | 40,830 |
|
| Deferred income | 3,336 |
| | 3,221 |
|
| Related party payables | 132 |
| | 92 |
|
| Other liabilities | 3,286 |
| | 2,691 |
|
| Total liabilities | 90,274 |
| | 86,721 |
|
| Shareholders' equity | 10,748 |
| | 10,294 |
|
| Total liabilities and shareholders' equity | $ | 101,022 |
| | $ | 97,015 |
|
Operational and Financial Data
(Unaudited, Dollars in millions)
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| | | | | | | |
| | Three Months Ended March 31, |
| Originations | 2018 | | 2017 |
| Retail finance receivables originations | $ | 5,078 |
| | $ | 5,607 |
|
| GM lease originations | $ | 5,712 |
| | $ | 6,273 |
|
| GM new vehicle loans and leases as a percentage of total loan and lease originations | 89.7 | % | | 87.7 | % |
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| | | | | | | |
| | Three Months Ended March 31, |
| Average Earning Assets | 2018 | | 2017 |
| Average retail finance receivables | $ | 33,471 |
| | $ | 27,484 |
|
| Average commercial finance receivables | 10,068 |
| | 7,963 |
|
| Average finance receivables | 43,539 |
| | 35,447 |
|
| Average leased vehicles, net | 43,177 |
| | 35,751 |
|
| Average earning assets | $ | 86,716 |
| | $ | 71,198 |
|
|
| | | | | | | |
| Ending Earning Assets | March 31, 2018 | | March 31, 2017 |
| Retail finance receivables, net of fees | $ | 34,320 |
| | $ | 29,276 |
|
| Commercial finance receivables, net of fees | 10,365 |
| | 8,504 |
|
| Leased vehicles, net | 43,444 |
| | 37,090 |
|
| Ending earning assets | $ | 88,129 |
| | $ | 74,870 |
|
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| | | | | | | |
| Total Finance Receivables | March 31, 2018 | | December 31, 2017 |
| Retail | | | |
Retail finance receivables, net of fees(a) | $ | 34,320 |
| | $ | 32,802 |
|
| Less: allowance for loan losses | (858 | ) | | (889 | ) |
| Total retail finance receivables, net | 33,462 |
| | 31,913 |
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| Commercial | | | |
| Commercial finance receivables, net of fees | 10,365 |
| | 10,312 |
|
| Less: allowance for loan losses | (54 | ) | | (53 | ) |
| Total commercial finance receivables, net | 10,311 |
| | 10,259 |
|
| Total finance receivables, net | $ | 43,773 |
| | $ | 42,172 |
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(a) Net of unearned income, unamortized premiums and discounts, and deferred fees and costs of $217 million and $228 million at
March 31, 2018 and December 31, 2017.
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| | | | | |
| Allowance for Loan Losses | March 31, 2018 | | December 31, 2017 |
| Allowance for loan losses as a percentage of retail finance receivables, net of fees | 2.5 | % | | 2.7 | % |
| Allowance for loan losses as a percentage of commercial finance receivables, net of fees | 0.5 | % | | 0.5 | % |
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| | | | | |
| Delinquencies | March 31, 2018 | | March 31, 2017 |
| Loan delinquency as a percentage of ending retail finance receivables: | | | |
| 31 - 60 days | 3.7 | % | | 3.4 | % |
| Greater than 60 days | 1.7 |
| | 1.4 |
|
| Total | 5.4 | % | | 4.8 | % |
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| | | | | | | |
| | Three Months Ended March 31, |
| Charge-offs and Recoveries | 2018 | | 2017 |
| Charge-offs | $ | 295 |
| | $ | 298 |
|
| Less: recoveries | (123 | ) | | (143 | ) |
| Net charge-offs | $ | 172 |
| | $ | 155 |
|
| Net charge-offs as an annualized percentage of average retail finance receivables | 2.1 | % | | 2.3 | % |
| Recovery rate as a percentage of gross repossession charge-offs in North America | 53.1 | % | | 51.6 | % |
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| | | | | |
| | Three Months Ended March 31, |
| Operating Expenses | 2018 | | 2017 |
| Operating expenses as an annualized percentage of average earning assets | 1.7 | % | | 1.9 | % |
Investor Relations contact:
Stephen Jones
Vice President, Investor Relations
(817) 302-7119
Investors@gmfinancial.com
