Benzinga - by Shanthi Rexaline, Benzinga Editor.
Shares of legacy automaker General Motors Corp. (NYSE:GM) rose sharply in premarket trading on Wednesday.
The strong gains came after the Detroit-based automaker reinstated its full-year 2023 earnings guidance. The company had withdrawn the previously issued guidance in the third quarter, citing labor disruptions stemming from the United Auto Workers union strike. The strike has since then been resolved.
The company said the reinstated guidance included an estimated $1.1 billion EBIT-adjusted impact from the UAW strike, primarily from lost production.
The company also announced a $10 billion accelerated share repurchase program with an eye on increasing its common stock dividend by 33%, beginning with the January 2024 declaration. It added that 3 cents per share will increase the quarterly common stock dividend to 12 cents beginning in 2024.
“GM will deliver very strong profits in 2023 thanks to an exceptional portfolio of vehicles that customers love and our operating discipline,” said GM CEO Mary Barra.
“We are finalizing a 2024 budget that will fully offset the incremental costs of our new labor agreements and the long-term plan we are executing includes reducing the capital intensity of the business, developing products even more efficiently, and further reducing our fixed and variable costs,” she added.
The company said it now anticipates full-year 2023 capital spending to be $11.0 billion-$11.5 billion, which is at the low end of its prior guidance range of $11 billion-$12 billion, driven by the previously announced retiming of certain product programs and more capital-efficient investment.
In premarket trading, GM shares rose 5.23% to $30.40, according to Benzinga Pro data.
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