General Motors 2012 Annual Report Download - page 30

GENERAL MOTORS COMPANY AND SUBSIDIARIES
The tables which summarize production volume and sales of new motor vehicles and competitive position are presented in “Item 1.
Business.”
Reconciliation of Consolidated, Automotive and GM Financial Segment Results
Management believes EBIT-adjusted provides meaningful supplemental information regarding our automotive segments’ operating
results because it excludes interest income, expense and income taxes as well as certain additional amounts. Management does not
consider these excluded items when assessing and measuring the operational and financial performance of the organization, its
management teams and when making decisions to allocate resources, such as capital investment, among business units and for internal
reporting and as part of its forecasting and budgeting processes. Such adjustments include impairment charges related to goodwill and
certain investments, gains or losses on the settlement/extinguishment of obligations and gains or losses on the sale of non-core
investments. Management believes this measure allows it to readily view operating trends, perform analytical comparisons and
benchmark performance between periods and among geographic regions. We believe EBIT-adjusted is useful in allowing for greater
transparency of our core operations and is therefore used by management in its financial and operational decision-making.
While management believes that EBIT-adjusted provides useful information, it is not an operating measure under U.S. GAAP and
there are limitations associated with its use. Our calculation of EBIT-adjusted may not be completely comparable to similarly titled
measures of other companies due to potential differences between companies in the method of calculation. As a result, the use of
EBIT-adjusted has limitations and should not be considered in isolation from, or as a substitute for, other measures such as Net
income or Net income attributable to stockholders. Due to these limitations, EBIT-adjusted is used as a supplement to U.S. GAAP
measures.
Management believes income before income taxes provides meaningful supplemental information regarding GM Financial’s
operating results. GM Financial uses a separate measure from our automotive operations because management believes interest
income and interest expense are part of operating results when assessing and measuring the operational and financial performance of
the segment.
In 2012 we recorded losses on extinguishment of debt within Corporate for segment reporting purposes, and they are excluded from
EBIT-adjusted. Previously gains and losses on extinguishment of debt were recorded within the applicable automotive segments. This
change is consistent with how management currently views the results of our operations.
General Motors Company 2012 ANNUAL REPORT 27