Net Income of $1.3 Billion in 2Q for GM

Ready to begin the biggest public-stock offering in American history this year, General Motors announced a $1.3-billion second-quarter profit today.

The numbers, as executives from GM indicated in recent days, exceeded the $865 million in net income the carmaker posted in the first quarter. During the second quarter of 2009, GM posted a $12.9-billion net loss.

Revenue for the second quarter of 2010 was $33.2 billion, an increase of 44 percent over the $23 billion earned in the second quarter of last year. First-quarter revenues this year were $31.5 billion.

Earnings before interest and taxes (EBIT)—a critical metric used to estimate the company’s value—hovered around $2.0 billion for the quarter, an increase of 11 percent from $1.8 billion in the first quarter.

In North America, General Motors reported it made $1.6 billion before interest and taxes, a rise of 33 percent from the first quarter’s $1.2 billion.

Cash flow from operations for GM was $3.9 billion. The automaker reported it concluded the second quarter with $32.5 billion in cash.

Plans to File for IPO on Friday

GM’s strong second-quarter numbers couldn’t come at a better time, as the automaker recently obtained a $5-billion credit facility, which will allow the carmaker to return to the capital markets.

In light of the new acquisition, GM currently plans to file a registration for its initial public offering this Friday. The return to capital markets is an indication of the automaker’s recovery after it emerged from bankruptcy just one year ago. Currently, the government owns 61 percent of GM.

By obtaining bank credit through the new facility, GM has overcome a major obstacle to the IPO of its stock, which is expected to make the government of the United States a minority shareholder. The IPO would be an important political triumph for the Obama administration after its highly unpopular $50 billion bailout of GM.

Predicted to be the biggest in U.S. history and an unparalleled privatization of an industrial juggernaut, the GM IPO will likely occur before Thanksgiving, according to a source with knowledge of the matter.

Ron Bloom, the chief of the White House auto task force, and executives from General Motors have said an offering should occur before the end of the year but have insisted the timing of the IPO would be in any way associated with the November Congressional elections.

Ed Whitacre, GM’s CEO, reported last week that he will go on a roadshow designed to drum up interest in the stock offering among investors in the coming weeks.