UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
ENDED JUNE 30, 1994, OR
_____ TRANSITION REPORT PURSUANT TO SECTION 13 OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION
PERIOD FROM __________ TO __________
Commission file number 1-3754
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GENERAL MOTORS ACCEPTANCE CORPORATION
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(Exact name of registrant as specified in its charter)
New York 38-0572512
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
767 Fifth Avenue, New York, New York 10153
3044 West Grand Boulevard, Detroit, Michigan 48202
- -------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code 313-556-1211
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The registrant meets the conditions set forth in General
Instruction H(1) (a) and (b) of Form 10-Q and is therefore
filing this Form with the reduced disclosure format.
Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 of the
Securities Exchange Act of 1934 during the preceding 12
months, and (2) has been subject to such filing requirements
for the past 90 days. Yes X . No .
--- ---
As of June 30, 1994, there were outstanding 21,650,000
shares of the issuer's common stock.
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<PAGE>2
This quarterly report, filed pursuant to Rule 13a-13 of
the General Rules and Regulations under the Securities
Exchange Act of 1934, consists of the following information as
specified in Form 10-Q:
PART I. FINANCIAL INFORMATION
The required information is given as to the registrant,
General Motors Acceptance Corporation and subsidiaries (the
"Company" or "GMAC").
ITEM 1. FINANCIAL STATEMENTS.
1. Consolidated Balance Sheet, June 30, 1994,
December 31, 1993 and June 30, 1993.
2. Consolidated Statement of Income and Net Income
Retained for Use in the Business for the Second
Quarter and Six Months Ended June 30, 1994 and
1993.
3. Consolidated Statement of Cash Flows for the
Six Months Ended June 30, 1994 and 1993.
4. Notes to Financial Statements.
5. Summary of Financing and Insurance Operations.
The above described Financial Statements are submitted
herein as Exhibit 20.
In the opinion of management, the interim financial
statements reflect all adjustments, consisting of only normal
recurring items (with the exception of the accounting changes
in 1994 to adopt Statement of Financial Accounting Standards
(SFAS) No. 112, Employers' Accounting for Postemployment
Benefits, SFAS No. 114, Accounting by Creditors for Impairment
of a Loan, and SFAS No. 115, Accounting for Certain
Investments in Debt and Equity Securities, as described in
Management's Discussion and Analysis of Financial Condition
and Results of Operations), which are necessary for a fair
presentation of the results for the interim periods presented.
The results for interim periods are not necessarily indicative
of results which may be expected for any other interim period
or for the full year. These financial statements should be
read in conjunction with the consolidated financial
statements, the significant accounting policies, and the other
notes to the consolidated financial statements included in the
Company's 1993 Annual Report to the SEC on Form 10-K.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
Consolidated net income from General Motors Acceptance
Corporation (GMAC) financing and Motors Insurance Corporation
(MIC) insurance operations totaled $216.1 million for the
second quarter of 1994, compared with $285.4 million earned in
the second quarter of 1993. For the first six months of 1994,
net income totaled $433.6 million, a decrease of $135.9
million from the same period last year. Earnings for the
first six months of 1994 reflect an unfavorable first quarter
after-tax charge of $7.4 million related to the cumulative
effect on income resulting from the implementation of
Statement of Financial Accounting Standards (SFAS) No. 112,
Employers' Accounting for Postemployment Benefits.
Net income from financing operations, including GMAC
Mortgage Corporation (GMACM) results, totaled $184.6 million
for the 1994 second quarter. The $29.0 million decrease from
the same period last year can be primarily attributed to
GMAC's mortgage operations, reflecting both the industry-wide
decline in mortgage originations, specifically refinancings,
brought about by rising interest rates, and competitive
pricing pressures. For the first six months of 1994, net
financing income (excluding the cumulative impact of SFAS No.
112) totaled $377.4 million in comparison to $463.9 million
during the same period in 1993. In addition to the lower
GMACM income noted above, lower earnings were also experienced
due to lower average levels of retail and wholesale assets.
Net income from insurance operations was $31.5 million
for the second quarter of 1994, a $40.3 million decrease as
compared to the second quarter of 1993. For the first six
months of 1994, net income from insurance operations
(excluding the cumulative impact of SFAS No. 112) was $63.6
million, compared with $105.6 million for the same period in
1993. The decline in net income reflects non-recurring
capital gains in the first half of 1993 which more than offset
improved underwriting results.
FINANCING VOLUME
Deliveries of new General Motors (GM) cars and trucks in
the United States were 1,385,000 during the second quarter of
1994, relatively unchanged from the same period last year.
Deliveries during the first six months of 1994 totaled
2,616,000, an 8% increase over deliveries of 2,418,000 for the
first half of 1993. During the second quarter of 1994, GMAC
financed or leased worldwide 510,000 new passenger cars and
trucks, a decrease of 6% from the comparable 1993 period. In
the United States, GMAC financed or leased 333,000 new
vehicles during the second quarter of 1994 and 732,000 new
vehicles for the first six months of 1994 compared with
398,000 and 675,000 new vehicles in the second quarter and
first six months of 1993, respectively.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
During the second quarter of 1994, GMAC financed 23% of
new General Motors products delivered in the U.S., a 5
percentage point decrease from the same period last year,
while penetration for the first six months of 1994 decreased
to 26% of new GM deliveries, one percentage point lower than
the comparable 1993 period. The decrease in retail and lease
unit financing and penetration reflects continued intense
competitive pressures within a robust sales environment.
Outside the United States, GMAC financed or leased
177,000 new vehicles in the second quarter of 1994 and 320,000
new vehicles for the first six months of 1994 compared with
143,000 and 268,000 new vehicles in the second quarter and
first six months of 1993, respectively.
Leasing volume worldwide, primarily acquired under GMAC's
SmartLease program, totaled 175,000 units in the second
quarter of 1994, a 92% increase from a year ago. Leasing
volume totaled 303,000 vehicles leased during the first six
months of 1994 compared with 165,000 units for the same period
a year ago. In the U.S., GMAC also financed 29,000 units
during the second quarter of 1994 under its SmartBuy program
and 56,000 units during the first six months of 1994, compared
with 31,000 units and 48,000 units in the second quarter and
first six months of 1993, respectively. This product offers
consumers many of the advantages of leasing, namely lower
monthly payments, while providing them with ownership of the
vehicles.
GMAC also provides wholesale financing for GM and other
dealers' new and used vehicle inventories. In the United
States, inventory financing was provided on 996,000 and
1,965,000 new GM vehicles in the second quarter and first six
months of 1994, compared with 982,000 and 1,893,000 new GM
vehicles during the same periods in 1993. GMAC's financing
represented 74% of all GM sales to dealers during the first
six months of 1994, a slight decrease from 76% for the
comparable period a year ago.
GMAC Mortgage Corporation loan origination, purchased
mortgage servicing and correspondent loan volume totaled $6.8
billion for the second quarter of 1994, $500 million above a
year ago. The mortgage origination portion of this total was
$3.2 billion, a 43% decline from a year ago, reflecting lower
mortgage refinancings. At June 30, 1994, the combined
mortgage servicing portfolio, including $23.2 billion of loans
master serviced by GMAC's Residential Funding Corporation,
amounted to $57.7 billion, up $200 million from June 30, 1993.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
ASSETS
GMAC's consolidated assets totaled $83.4 billion at June
30, 1994, compared to $80.8 billion and $84.8 billion at
December 31, 1993 and June 30, 1993, respectively.
Consolidated earning assets totaled $79.1 billion at June 30,
1994, virtually unchanged from $79.2 billion at June 30, 1993
and up $4.3 billion from the December 31, 1993 level of $74.8
billion. The increase from year-end can be largely attributed
to an increase in operating lease assets due to the continued
acceptance and popularity of the SmartLease program.
Cash and Cash Equivalents, which primarily include short
term borrowed funds in excess of requirements invested in
short-term marketable securities, totaled $2,345.7 million at
June 30, 1994. This compared to $4,028.1 million at December
31, 1993 and $3,498.8 million at June 30, 1993. The decrease
is due to a strategy that has been undertaken to reduce the
liquidity portfolio as a direct result of the Company's
continued good access to the capital markets.
At June 30, 1994, consolidated worldwide retail finance
receivables, net of unearned income, totaled $28.8 billion,
virtually unchanged from $28.7 billion at June 30, 1993 but up
$2.8 billion from year-end 1993. The Company continues to
utilize an asset securitization program as an alternative
funding source and as a result sold retail receivables with
principal in the United States aggregating $8.0 billion and
$1.2 billion, respectively, during the twelve and six month
periods ended June 30, 1994.
With respect to sold receivables, GMAC continues to
service these receivables for a fee. The Company's retail
instalment obligation servicing portfolio at June 30, 1994,
totaled $13.4 billion, compared with $14.9 billion and $13.1
billion at December 31, 1993 and June 30, 1993, respectively.
Consolidated worldwide leasing and lease financing
receivables, net of unearned income, at June 30, 1994 were
$3,309.9 million, down $469.0 million and $1,884.9 million
from December 31, 1993 and June 30, 1993, respectively. These
reductions are primarily reflective of General Motors
reduction in fleet sales to daily rental companies and the
resultant GMAC fleet financing reduction.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
Wholesale receivables financed by GMAC, primarily dealer
vehicle inventories, were $18.8 billion at June 30, 1994,
compared to $20.7 billion at December 31, 1993 and $13.3
billion at June 30, 1993. Wholesale receivables at the end of
the second quarter of 1994, as compared to the asset levels at
June 30, 1993, reflects the resumption by GMAC of dealer
wholesale inventory previously financed by General Motors,
partially offset by lower levels of dealer inventory and sales
of wholesale finance receivables. The following table
summarizes wholesale assets on a comparable year-to-year
basis:
Wholesale
Inventory June 30 December 31 June 30
Financing 1994 1993 1993
- ---------- ----------- ----------- -----------
(in billions of dollars)
GMAC $ 18.8 $ 20.7 $ 13.3
General
Motors* 0.0 0.0 8.7
----------- ----------- -----------
Total $ 18.8 $ 20.7 $ 22.0
=========== =========== ===========
* Included in Receivables General Motors Corporation. (See
Note 6).
Furthermore, the Company sold wholesale receivables,
which it also continues to service, totaling $1.4 billion to
outside investors during the first quarter of 1994, through a
special purpose subsidiary. (See Note 5).
Operating lease assets, net of depreciation, offered
principally under the GMAC SmartLease program, increased to
$14.7 billion at June 30, 1994 from $11.4 billion and $10.4
billion at December 31, 1993 and June 30, 1993, respectively.
The increase primarily reflects growth in the U.S. and
Canadian markets, driven by continued consumer acceptance of
leasing and enhanced manufacturer's subvented programs.
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<PAGE>7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
Real estate mortgage inventory held for sale, including
warehouse advances, amounted to $2,219.4 million at June 30,
1994, essentially unchanged from June 30, 1993, but up $391.9
million from December 31, 1993. The increase resulted from
the fact that in December 1993, GMACM took advantage of
investor accelerated delivery programs for which pricing
reflected a lower cost of capital than internal capital costs.
In contrast, in June 1994, internal capital costs were more
favorable than the investor accelerated programs and loans
remained on the balance sheet for longer periods. The
Company's due and deferred from receivable sales (net) was
$2,587.3 million at June 30, 1994, as compared to $1,857.6
million at December 31, 1993 and $1,413.2 million at June 30,
1993, with the increase primarily attributable to the
Company's investment in the wholesale revolving note of $875.7
million in connection with the Company's first wholesale
receivable sale. Other earning assets totaled $465.5 million
at June 30, 1994, down from $795.2 million and $760.3 million
at December 31, 1993 and June 30, 1993, respectively, with the
decrease primarily attributable to lower levels of vehicles
repurchased from rental car companies prior to sale at auction
reflective of General Motors reduction in such fleet sales.
Intangible assets included in other assets totaled $361.5
million at June 30, 1994, compared with $360.9 million at 1993
year-end and $427.5 million at the end of the second quarter
of 1993. Other nonearning assets, comprised primarily of
repossessed vehicles, foreclosed loans or loans otherwise
classified as nonearning, and insurance premium receivables,
totaled $1,641.8 million at the end of the second quarter of
1994, as compared to $1,578.0 million and $1,660.5 million at
December 31, 1993 and June 30, 1993, respectively.
LIQUIDITY
The Company's liquidity, as well as its ability to
profitably effect ongoing core business acquisition activity,
is in large part dependent upon its timely access to and the
costs associated with raising funds in different segments of
the capital markets. In this regard, GMAC regularly accesses
the short-, medium- and long-term debt markets, principally
through commercial paper, medium-term notes and underwritten
transactions.
GMAC's total borrowings were $64.4 billion at June 30,
1994, compared with $65.9 billion at June 30, 1993 and $62.8
billion at December 31, 1993. Approximately 81% represented
funding for operations in the United States, with the
remaining 19% of borrowings being split equally between
Canada, Germany, and other countries. Total short-term debt
worldwide at June 30, 1994, amounted to $20.2 billion, up from
$17.7 billion at December 31, 1993 and $16.6 billion at June
30, 1993.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
The Company has committed bank credit facilities of $10
billion, as well as an $8.5 billion asset backed commercial
paper liquidity and receivables credit facility to a non-
consolidated special purpose entity established to issue asset
backed commercial paper. The total facilities were increased
from $15.0 billion at December 31, 1993, as the size of the
asset backed commercial paper liquidity and receivables credit
facility was increased by $3.5 billion to total $8.5 billion
as of May 1, 1994. In addition, GMAC has $4.5 billion in
committed bank credit facilities to support the funding needs
of the Company's international subsidiaries.
The $10 billion bank credit facilities include a covenant
such that, so long as the commitments remain in effect or any
amount is owing to any lender under such commitments, the
ratio of consolidated debt to total stockholder's equity at
the last day of any fiscal quarter shall not exceed 11.0 to
1.0. With regard to such covenant, GMAC's ratio of total
borrowings to equity capital at June 30, 1994 was 8.2:1
compared with 8.0:1 at June 30, 1993.
For the second quarter of 1994, GMAC paid dividends to
General Motors Corporation amounting to $250 million and
thereby totaling $500 million for the 1994 calendar year,
matching the amounts paid during the comparable periods in
1993.
The scope of GMAC's capability to tap the capital markets
for unsecured debt is linked to both its term debt and
commercial paper ratings. This is particularly true with
respect to the Company's commercial paper ratings. Lower
ratings generally result in higher borrowing costs as well as
reduced access to the capital markets. A security rating is
not a recommendation to buy, sell, or hold securities and may
be subject to revision or withdrawal at any time by the
assigned rating organization. Each rating should be evaluated
independently of any other rating. As of August 12, 1994,
such agencies had assigned the following ratings to GMAC:
Medium- &
Long-Term Commercial
Debt Paper
--------- ----------
Duff & Phelps Credit Rating Co. A- D-1
Fitch Investors Service, Inc. A- F-1
Moody's Investors Service, Inc. Baa1 P-2
Standard & Poor's Corporation BBB+ A-2
At this date, GMAC is not under review by any of the
above agencies; however, in July 1994, Standard & Poor's
Corporation affirmed its rating of GM and GMAC debt and its
positive rating outlook.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
The Company utilizes a variety of interest rate contracts
including interest rate swaps and caps in the normal course of
managing its interest rate exposures. The Company also uses
currency swaps to hedge its foreign currency denominated debt.
The total notional amount of off-balance sheet instruments
outstanding was $10.1 billion at June 30, 1994, compared with
$8.6 billion at December 31, 1993 and $5.8 billion at June 30,
1993. Of the amount outstanding at June 30, 1994, $6.1
billion represented currency and interest rate swaps and $4.0
billion represented interest rate caps as compared to $3.8
billion and $2.0 billion at June 30, 1993, respectively. In
addition, the Company has commitments to sell mortgages or
mortgage-backed securities comprised of mandatory delivery
contracts with investors totaling $1.7 billion at June 30,
1994, versus $2.7 billion at June 30, 1993. Also outstanding
at June 30, 1994 and 1993, were commitments to purchase/fund
first mortgage loans at fixed prices totaling $900 million and
$2.0 billion, respectively.
CASH FLOWS
For the six month period ending June 30, 1994, cash
provided by operating and financing activities totaled $2.5
billion and $1.3 billion, respectively. Such cash was used in
net investing activities totaling $5.1 billion as well as to
pay dividends of $500 million, with a resultant decrease in
cash and cash equivalents amounting to $1.7 billion. In
comparison, cash provided by operating and investing
activities during the first six months of 1993 totaled $2.5
billion and $6.0 billion, respectively, with such cash
utilized to reduce debt by $8.4 billion and pay dividends of
$500 million, with a net decrease in cash and cash equivalents
of $0.4 billion. The difference reflects a planned reduction
in the cash and cash equivalents portfolio due to continued
favorable access to the capital markets and the Company's
improved liquidity position as well as lower proceeds from
sales of finance receivables.
FINANCIAL REVIEW
Financing revenue totaled $2.3 billion and $4.5 billion
for the second quarter and first six months of 1994,
respectively, $84.9 million greater than the amount reported
for the comparable 1993 quarter and $19.9 million below the
amount recorded for the 1993 six month period. The decrease
from the respective 1993 six month period is primarily
attributable to lower earning rates, partially offset by an
increase in leasing revenues resulting from continued growth
in operating lease activity.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
Interest and discount expense totaled $2.1 billion for
the first six months of 1994, a decrease of 18.5% from the
comparable period in 1993. The average cost of funds
worldwide for the second quarter of 1994 declined to 6.53%, a
decrease of 42 basis points from a year earlier. The
worldwide cost of funds averaged 6.53% for the first six
months of 1994, down 47 basis points from a year ago. Total
borrowing costs for United States operations averaged 6.31%
for the second quarter and 6.28% for the first six months of
1994, compared with 6.48% and 6.51%, respectively, for the
same 1993 periods.
Depreciation expense on operating leases, primarily
GMAC's SmartLease program, amounted to $765.4 million for the
second quarter of 1994, compared with $660.5 million for the
same period in 1993. For the first six months of 1994,
depreciation expense on operating leases totaled $1.5 billion
compared to $1.3 billion for the first six months of 1993,
with the increase attributable to continued successful
marketing of the SmartLease program in the United States and
Canada.
Other income, including gains on receivable sales, as
well as servicing fees and other income related to sold
finance receivables, amounted to $378.0 million and $789.5
million for the second quarter and first six months of 1994,
compared with $758.0 million and $1,411.0 million,
respectively, for the same periods of 1993. The decreases are
primarily attributable to a quarter-to-quarter decrease of
$160.3 million and a six months decrease of $314.3 million due
to lower interest and service fees from General Motors as a
result of the termination of the financing agreement whereby
GM had previously assumed some dealer wholesale inventory
financing. This reduction is offset by increased financing
revenues on wholesale receivables. Furthermore, capital gains
at MIC decreased $57.0 million and $129.3 million for the
quarter and six month periods ended June 30, 1994, primarily
reflecting non-recurring capital gains recorded during the
first six months of 1993.
Other operating expenses, including salaries and benefits
and insurance losses and loss adjustment expenses, totaled
$745.2 million for the second quarter and $1.5 billion for the
first six months of 1994, $19.7 million and $38.2 million
lower than the respective comparable 1993 periods. The
decrease is primarily attributable to lower losses incurred on
commercial lines and lower commission expenses for originated
mortgages.
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<PAGE>11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (continued).
The provision for losses on finance receivables,
including both retained and sold receivables, totaled $54.8
million for the second quarter of 1994, compared to $118.9
million in the same period of 1993. For the first six months
of 1994, provision for losses on finance receivables totaled
$118.9 million as compared to $175.9 million for the first six
months of 1993. Total net chargeoffs for the second quarter
and first six months of 1994 were $54.6 million and $104.7
million, respectively, as compared to $71.2 million and $178.1
million in the second quarter and first six months of 1993.
As a result of this continued favorable loss experience, net
retail losses were 0.42% and 0.48% of total serviced assets
during the second quarter and first six months of 1994, as
compared to 0.56% and 0.64% for the same periods last year.
United States, foreign and other income taxes amounted to
$128.0 million for the second quarter of 1994, $47.0 million
less than the comparable 1993 period. For the first six
months of 1994, U.S., foreign and other income taxes amounted
to $263.5 million, $80.1 million below the same period of
1993. The decrease was primarily due to reduced pre-tax
income, partially offset by increased U.S. Federal statutory
income tax rates.
On a consolidated basis, GMAC's return on average equity
capital was 11.5% for the second quarter and 11.2% for the
first six months of 1994, compared with 13.7% for the same
1993 periods.
ACCOUNTING STANDARDS
In November 1992, the Financial Accounting Standards
Board (FASB) issued SFAS No. 112, Employers' Accounting for
Postemployment Benefits, which established a new accounting
principle for the cost of benefits provided to former or
inactive employees after employment but before retirement.
The Statement is effective for the fiscal years beginning
after December 15, 1993. The Company adopted this standard
effective January 1, 1994; as stated earlier, the after-tax
unfavorable cumulative effect of this change at January 1 was
$7.4 million. The ongoing effect in subsequent periods is not
expected to be material.
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<PAGE>12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (concluded).
In May 1993, the FASB issued SFAS No. 114, Accounting by
Creditors for Impairment of a Loan, which amends FASB
Statement No. 5, Accounting for Contingencies, to clarify that
a creditor should evaluate the collectibility of both
contractual interest and principal of all receivables when
assessing the need for a loss accrual. SFAS No. 114 also
amends FASB Statement No. 15, Accounting by Debtors and
Creditors for Troubled Debt Restructurings, to require
creditors to measure all loans that are restructured in a
troubled debt restructuring involving modification of terms to
reflect the time value of money. SFAS No. 114 applies to
financial statements for fiscal years beginning after December
15, 1994. The Company adopted this standard effective January
1, 1994. The Company's loans primarily consist of large
groups of smaller-balance homogeneous loans which are
collectively evaluated for impairment and to which this
standard does not apply. However, certain loans of the
Company affected by this Statement are currently carried at
the lower of book value or the fair value of the collateral.
The net book value of such loans at June 30, 1994, was $209.5
million, net of $172.2 million valuation reserve. There was
no material impact on the consolidated financial position or
results of operations as a result of adoption.
In May 1993, the FASB also issued SFAS No. 115,
Accounting for Certain Investments in Debt and Equity
Securities, which addresses the accounting and reporting for
investments in debt and equity securities that have readily
determinable fair values. These investments are categorized
as either "Held-to-Maturity Securities", reported at amortized
cost, "Trading Securities", reported at fair value with
unrealized gains or losses reported in earnings or "Available-
for-Sale" also reported at fair value with unrealized gains or
losses reported separately in stockholder's equity.
Investments are categorized based upon the intent of the
Company for which the securities were purchased.
This Statement is effective for fiscal years beginning
after December 15, 1993. The Company adopted this standard
effective January 1, 1994. The cumulative favorable effect to
stockholder's equity at January 1, 1994, was $127.5 million,
net of tax.
--------------------------
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<PAGE>13
RATIO OF EARNINGS TO FIXED CHARGES
Six Months Ended
June 30
-----------------
1994 1993
---- ----
1.34 1.35
The ratio of earnings to fixed charges has been computed
by dividing earnings before income taxes and fixed charges by
the fixed charges. This ratio includes the earnings and fixed
charges of the Company and its consolidated subsidiaries;
fixed charges consist of interest, debt discount and expense
and the portion of rentals for real and personal properties in
an amount deemed to be representative of the interest factor.
PART II. OTHER INFORMATION
ITEM 5. SUBSEQUENT EVENT
On June 10, 1994, the Company increased the amount of
authorized capital stock from $2,165,000,000, consisting of
21,650,000 shares of common stock of the par value $100, to
$2,500,000,000, consisting of 25,000,000 shares of common
stock of the par value $100.
In July, the State of New York approved this increase in
authorized capital stock. On July 29, 1994, General Motors
Corporation, the Company's sole stockholder, purchased an
additional 350,000 shares of common stock at the par value of
$100 each. This transaction increased the Company's shares
outstanding to 22,000,000.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) EXHIBITS:
20. General Motors Acceptance Corporation and
Subsidiaries Consolidated Financial Statements
for the Second Quarter and Six Months Ended
June 30, 1994.
(b) REPORTS ON FORM 8-K:
No Current Report on Form 8-K was filed during the
second quarter ended June 30, 1994.
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<PAGE>14
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
GENERAL MOTORS ACCEPTANCE CORPORATION
-------------------------------------
(Registrant)
s\ John D. Finnegan
---------------------------------
Dated: August 12, 1994 John D. Finnegan, Executive Vice
--------------- President and Principal
Financial Officer
s\ Gerald E. Gross
---------------------------------
Dated: August 12, 1994 Gerald E. Gross, Comptroller
--------------- and Principal Accounting Officer
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<PAGE>15
EXHIBIT 20
Page 1 of 17
CONSOLIDATED BALANCE SHEET
ASSETS
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- -------------------------------------- --------- --------- ---------
Cash and Cash Equivalents . . . . . . $ 2,345.7 $ 4,028.1 $ 3,498.8
--------- --------- ---------
EARNING ASSETS
INVESTMENTS IN SECURITIES (Note 1)
Bonds, notes and other securities . . 2,981.9 2,928.7 2,923.5
Equity securities . . . . . . . . . . 513.4 521.0 515.5
--------- --------- ---------
Total investments in securities . . . 3,495.3 3,449.7 3,439.0
--------- --------- ---------
FINANCE RECEIVABLES (Note 2)
Finance receivables . . . . . . . . . 55,046.6 54,882.8 51,611.4
Allowance for financing losses . . . . (764.5) (748.0) (752.6)
--------- --------- ---------
Finance receivables (net) . . . . . . 54,282.1 54,134.8 50,858.8
--------- --------- ---------
OTHER EARNING ASSETS
Receivables General Motors
Corporation (Note 6) . . . . . . . . 1,390.1 1,355.5 9,929.1
Net equipment on operating leases . . 14,658.9 11,363.5 10,422.7
Real estate mortgages held for sale,
at lower of cost or market . . . . . 2,219.4 1,827.5 2,376.8
Due and deferred from receivable
sales (net) (Note 5) . . . . . . . . 2,587.3 1,857.6 1,413.2
Other (Note 6) . . . . . . . . . . . . 465.5 795.2 760.3
--------- --------- ---------
Total earning assets . . . . . . . . 79,098.6 74,783.8 79,199.9
--------- --------- ---------
OTHER ASSETS
Intangible assets, at cost
less amortization . . . . . . . . . . 361.5 360.9 427.5
Other nonearning assets . . . . . . . 1,641.8 1,578.0 1,660.5
--------- --------- ---------
Total other assets . . . . . . . . . . 2,003.3 1,938.9 2,088.0
--------- --------- ---------
TOTAL ASSETS . . . . . . . . . . . . . $83,447.6 $80,750.8 $84,786.7
========= ========= =========
Certain amounts for 1993 have been reclassified
to conform with 1994 classifications.
Reference should be made to the Notes to
Financial Statements.
(continued)
<PAGE>16
EXHIBIT 20
Page 2 of 17
CONSOLIDATED BALANCE SHEET (continued)
LIABILITIES AND STOCKHOLDER'S EQUITY
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- -------------------------------------- --------- --------- ---------
NOTES, LOANS AND DEBENTURES
PAYABLE WITHIN ONE YEAR
(Note 3) . . . . . . . . . . . . . . $33,758.5 $35,084.4 $36,671.0
--------- --------- ---------
ACCOUNTS PAYABLE AND OTHER LIABILITIES
General Motors Corporation and
affiliated companies (Note 6) . . . . 2,902.0 2,487.5 2,829.2
Interest . . . . . . . . . . . . . . . 1,117.7 1,006.6 1,308.6
Unpaid insurance losses and loss
adjustment expenses . . . . . . . . . 1,555.6 1,569.4 1,561.6
Unearned insurance premiums . . . . . 1,401.3 1,337.4 1,293.7
Deferred income taxes . . . . . . . . 1,262.8 1,193.2 870.7
United States and foreign income and
other taxes payable . . . . . . . . . 267.2 35.5 164.5
Other postretirement benefits . . . . 550.4 524.9 502.7
Other . . . . . . . . . . . . . . . . 2,178.0 1,970.8 2,126.5
--------- --------- ---------
Total accounts payable and other
liabilities . . . . . . . . . . . . . 11,235.0 10,125.3 10,657.5
--------- --------- ---------
NOTES, LOANS AND DEBENTURES
PAYABLE AFTER ONE YEAR (Note 4) . . . 30,652.5 27,688.8 29,256.5
--------- --------- ---------
STOCKHOLDER'S EQUITY
Common stock, $100 par value
(authorized and outstanding,
21,650,000 shares) . . . . . . . . . 2,165.0 2,165.0 2,165.0
Net income retained for use
in the business . . . . . . . . . . . 5,542.6 5,609.0 5,947.4
Net unrealized gains on securities . . 127.4 164.3 177.2
Unrealized accumulated foreign
currency translation adjustments . . (33.4) (86.0) (87.9)
--------- --------- ---------
Total stockholder's equity . . . . . . 7,801.6 7,852.3 8,201.7
--------- --------- ---------
TOTAL LIABILITIES AND
STOCKHOLDER'S EQUITY . . . . . . . . $83,447.6 $80,750.8 $84,786.7
========= ========= =========
Certain amounts for 1993 have been reclassified
to conform with 1994 classifications.
Reference should be made to the Notes to
Financial Statements.
<PAGE>17
EXHIBIT 20
Page 3 of 17
CONSOLIDATED STATEMENT OF INCOME AND
NET INCOME RETAINED FOR USE IN THE BUSINESS
Period Ended June 30
Second Quarter Six Months
-------------------- --------------------
(in millions of dollars) 1994 1993 1994 1993
- ----------------------------- --------- --------- --------- ---------
FINANCING REVENUE
Retail and lease financing . $ 769.2 $ 962.9 $ 1,506.5 $ 1,951.4
Leasing . . . . . . . . . . . 1,133.3 948.1 2,185.6 1,888.8
Wholesale and term loans . . 402.2 308.8 775.6 647.4
--------- --------- --------- ---------
Total financing revenue . . . 2,304.7 2,219.8 4,467.7 4,487.6
Interest and discount . . . . (1,045.3) (1,221.5) (2,055.3) (2,521.5)
Depreciation on operating
leases . . . . . . . . . . . (765.4) (660.5) (1,454.1) (1,287.9)
--------- --------- --------- ---------
Net financing revenue . . . . 494.0 337.8 958.3 678.2
Insurance premiums earned . . 286.2 283.1 565.6 556.7
Other income . . . . . . . . 378.0 758.0 789.5 1,411.0
--------- --------- --------- ---------
NET FINANCING REVENUE AND
OTHER . . . . . . . . . . . 1,158.2 1,378.9 2,313.4 2,645.9
--------- --------- --------- ---------
EXPENSES
Salaries and benefits . . . . 191.5 211.1 404.8 406.5
Other operating expenses . . 294.1 300.5 553.8 526.4
Insurance losses and loss
adjustment expenses . . . . 259.6 253.3 498.6 562.5
Provision for financing
losses . . . . . . . . . . . 54.8 118.9 118.9 175.9
Amortization of intangible
assets . . . . . . . . . . . 14.1 34.7 32.8 61.5
--------- --------- --------- ---------
Total expenses . . . . . . . 814.1 918.5 1,608.9 1,732.8
--------- --------- --------- ---------
Income before income taxes . 344.1 460.4 704.5 913.1
United States, foreign and
other income taxes . . . . . 128.0 175.0 263.5 343.6
--------- --------- --------- ---------
Income before cumulative
effect of accounting
changes . . . . . . . . . . 216.1 285.4 441.0 569.5
Cumulative effect of
accounting change . . . . . -- -- (7.4) --
--------- --------- --------- ---------
NET INCOME . . . . . . . . . 216.1 285.4 433.6 569.5
Net income retained for use
in the business at beginning
of the period . . . . . . . 5,576.5 5,912.0 5,609.0 5,877.9
--------- --------- --------- ---------
Total . . . . . . . . . . . . 5,792.6 6,197.4 6,042.6 6,447.4
Cash dividends . . . . . . . 250.0 250.0 500.0 500.0
--------- --------- --------- ---------
NET INCOME RETAINED FOR USE
IN THE BUSINESS AT END OF
THE PERIOD . . . . . . . . . $ 5,542.6 $ 5,947.4 $ 5,542.6 $ 5,947.4
========= ========= ========= =========
Certain amounts for 1993 have been reclassified
to conform with 1994 classifications.
Reference should be made to the Notes to
Financial Statements.
<PAGE>18
EXHIBIT 20
Page 4 of 17
CONSOLIDATED STATEMENT OF CASH FLOWS
Six Months Ended
June 30
---------------------
(in millions of dollars) 1994 1993
- --------------------------------------------- --------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Income before cumulative effect of
accounting changes . . . . . . . . . . . . . $ 441.0 $ 569.5
Depreciation . . . . . . . . . . . . . . . . 1,467.6 1,308.7
Taxes payable and deferred . . . . . . . . . 309.0 (79.4)
Provision for financing losses . . . . . . . 118.9 175.9
General Motors Corporation and affiliated
companies . . . . . . . . . . . . . . . . . 401.9 4.6
Origination/purchase of mortgage loans . . . (6,829.7) (8,939.6)
Proceeds on sale of mortgage loans . . . . . 6,437.8 9,101.4
Interest payable . . . . . . . . . . . . . . 107.2 119.5
Other assets . . . . . . . . . . . . . . . . (80.9) (243.8)
Other liabilities . . . . . . . . . . . . . . 198.2 242.6
Other . . . . . . . . . . . . . . . . . . . . 40.7 228.5
--------- ---------
Net cash provided by operating activities . . 2,611.7 2,487.9
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Finance receivables-acquisitions . . . . . . (80,015.6) (55,528.1)
-liquidations . . . . . . 77,624.9 55,129.9
Notes receivable General Motors Corporation . (34.6) 1,634.1
Operating leases-acquisitions . . . . . . . . (6,252.2) (3,300.1)
-liquidations . . . . . . . . 1,633.6 1,335.9
Investments in securities-acquisitions . . . (5,633.6) (6,115.4)
-liquidations . . . 5,542.4 5,856.8
Proceeds from sales of receivables . . . . . 2,453.4 6,548.9
Due and deferred from receivable sales . . . (730.5) (95.8)
Other . . . . . . . . . . . . . . . . . . . . 322.8 565.7
--------- ---------
Net cash (used in) provided by investing
activities . . . . . . . . . . . . . . . . . (5,089.4) 6,031.9
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Debt with original maturities 90 days and over
-proceeds . . . . . . . . . . . . . . . . . 26,744.2 18,120.9
-liquidations . . . . . . . . . . . . . . . (27,024.3) (24,691.7)
Debt with original maturities less than 90
days-net change . . . . . . . . . . . . . . 1,579.3 (1,817.1)
Dividends paid . . . . . . . . . . . . . . . (500.0) (500.0)
--------- ---------
Net cash provided by (used in) financing
activities . . . . . . . . . . . . . . . . . 799.2 (8,887.9)
--------- ---------
Effect of exchange rate changes on cash and
cash equivalents . . . . . . . . . . . . . . (3.9) (4.2)
--------- ---------
Net decrease in cash and cash equivalents . . (1,682.4) (372.3)
Cash and cash equivalents at the beginning of
the period . . . . . . . . . . . . . . . . . 4,028.1 3,871.1
--------- ---------
Cash and cash equivalents at the end of the
period . . . . . . . . . . . . . . . . . . . $ 2,345.7 $ 3,498.8
========= =========
Certain amounts for 1993 have been reclassified
to conform with 1994 classifications.
Reference should be made to the Notes to
Financial Statements.
<PAGE>19
EXHIBIT 20
Page 5 of 17
NOTES TO FINANCIAL STATEMENTS
NOTE 1. INVESTMENTS IN SECURITIES
As of January 1, 1994, GMAC adopted SFAS 115. As a
result, GMAC's bonds, notes, certificates of deposit, other
investments and preferred stocks with mandatory redemption
terms are carried at market value. In prior years, these
investments were carried at amortized cost. Other stocks are
carried at market (fair) value for both years. The aggregate
excess of market value over cost, net of related income taxes,
is included as a separate component of stockholder's equity.
The fair value of the other financial instruments presented
herein is based on quoted market prices.
- --------------------------------------------------------------
(in millions of dollars) June 30, 1994
Fair Unrealized Unrealized
Type of Security Cost Value Gains Losses
- ---------------- --------- --------- ---------- ----------
Bonds, notes and
other securities
United States
government and
governmental
agencies and
authorities . . $ 202.9 $ 198.1 $ 1.6 $ (6.4)
States,
municipalities
and political
subdivisions . 2,034.9 2,032.8 60.1 (62.2)
Other . . . . . 759.3 748.6 14.4 (25.1)
Preferred stocks
with mandatory
redemption
terms . . . . . 2.4 2.4 0.0 0.0
--------- --------- --------- ---------
Total bonds, notes
and other
securities . . . $ 2,999.5 $ 2,981.9 $ 76.1 $ (93.7)
========= ========= ========= =========
<PAGE>20
EXHIBIT 20
Page 6 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 1. INVESTMENTS IN SECURITIES (continued)
The distribution of maturities of debt securities
outstanding at June 30, 1994, December 31, 1993 and June 30,
1993 is summarized as follows:
- ------------------------------------------------------------
(in millions of
dollars) June 30, 1994 December 31, 1993
Fair Fair
Maturity Cost Value Cost Value
- --------------- --------- --------- --------- ---------
Due in one year
or less . . . $ 237.6 $ 239.4 $ 168.0 $ 173.5
Due after one
year through
five years . . 592.3 601.6 621.6 663.7
Due after five
years through
ten years . . 896.3 892.0 876.6 931.8
Due after ten
years . . . . 1,126.1 1,102.4 1,075.2 1,157.4
Mortgage-backed
securities . . 144.8 144.1 182.5 193.7
Preferred
stock-mandatory
redemption
terms . . . . 2.4 2.4 4.8 4.8
--------- --------- --------- ---------
Total debt
securities . . $ 2,999.5 $ 2,981.9 $ 2,928.7 $ 3,124.9
========= ========= ========= =========
- -------------------------------------------------------------
(in millions of
dollars) June 30, 1993
Fair
Maturity Cost Value
- --------------- --------- ---------
Due in one year
or less . . . $ 133.9 $ 134.9
Due after one
year through
five years . . 618.1 650.0
Due after five
years through
ten years . . 747.2 797.3
Due after ten
years . . . . 1,095.0 1,173.5
Mortgage-backed
securities . . 324.5 338.6
Preferred
stock-mandatory
redemption
terms . . . . 4.8 4.8
--------- ---------
Total debt
securities . . $ 2,923.5 $ 3,099.1
========= =========
<PAGE>21
EXHIBIT 20
Page 7 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 1. INVESTMENTS IN SECURITIES (continued)
Proceeds from the sale of debt securities amounted to
$481.6 million, $2,093.4 million and $1,181.3 million at June
30, 1994, December 31, 1993 and June 30, 1993, respectively.
Gross realized gains amounted to $8.4 million, $58.6 million
and $33.4 million at June 30, 1994, December 31, 1993 and June
30, 1993, respectively. Gross realized losses amounted to
$5.2 million, $13.3 million and $1.4 million at June 30, 1994,
December 31, 1993 and June 30, 1993, respectively.
- --------------------------------------------------------------
(in millions of
dollars)
June 30, 1994 December 31, 1993
Type of Fair Fair
Security Cost Value Cost Value
- ---------------- --------- --------- --------- ---------
Equity
securities-
common stocks
Public
utilities . . . $ 18.9 $ 40.4 $ 19.8 $ 46.1
Banks, trust and
insurance
companies . . . 18.6 26.8 10.4 22.1
Industrial and
miscellaneous 260.4 446.2 236.0 452.8
--------- --------- --------- ---------
Total equity
securities . . . $ 297.9 $ 513.4 $ 266.2 $ 521.0
========= ========= ========= =========
- --------------------------------------------------------------
(in millions of
dollars)
June 30, 1993
Type of Fair
Security Cost Value
- ---------------- --------- ---------
Equity
securities-
common stocks
Public
utilities . . . $ 20.9 $ 50.6
Banks, trust and
insurance
companies . . . 7.4 23.6
Industrial and
miscellaneous 218.8 441.3
--------- ---------
Total equity
securities . . . $ 247.1 $ 515.5
========= =========
<PAGE>22
EXHIBIT 20
Page 8 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 1. INVESTMENTS IN SECURITIES (concluded)
The difference between fair (market) value and cost of
equity securities at June 30, 1994, December 31, 1993 and June
30, 1993, consisted of gross unrealized gains (excess of
market value over cost) of $233.7 million, $270.9 million and
$336.4 million and gross unrealized losses (excess of cost
over market value) of $18.2 million, $16.1 million and $68.0
million, respectively.
Net realized gains from the sale of equity securities
amounted to $14.9 million, $158.2 million and $115.4 million
at June 30, 1994, December 31, 1993 and June 30, 1993,
respectively.
NOTE 2. FINANCE RECEIVABLES
The composition of finance receivables outstanding at
June 30, 1994, December 31, 1993 and June 30, 1993 is
summarized as follows:
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- --------------------------- --------- --------- ---------
United States
Retail . . . . . . . . . . $24,797.2 $22,322.2 $24,955.4
Wholesale . . . . . . . . 14,170.2 16,290.3 8,495.9
Leasing and lease
financing . . . . . . . . 1,815.1 2,372.1 3,583.2
Term loans to dealers and
others . . . . . . . . . 3,680.7 3,984.4 4,101.6
--------- --------- ---------
Total United States . . . . 44,463.2 44,969.0 41,136.1
Canada and International
Retail . . . . . . . . . . 7,377.7 6,846.4 7,141.4
Wholesale . . . . . . . . 4,595.7 4,383.3 4,828.4
Leasing and lease
financing . . . . . . . . 1,574.9 1,491.3 1,706.1
Term loans to dealers and
others . . . . . . . . . 473.9 387.9 334.4
--------- --------- ---------
Total Canada and
International . . . . . . 14,022.2 13,108.9 14,010.3
--------- --------- ---------
Total finance receivables . 58,485.4 58,077.9 55,146.4
Deductions
Unearned income . . . . . 3,438.8 3,195.1 3,535.0
Allowance for financing
losses . . . . . . . . . 764.5 748.0 752.6
--------- --------- ---------
Total deductions . . . . . 4,203.3 3,943.1 4,287.6
--------- --------- ---------
Finance receivables (net) . $54,282.1 $54,134.8 $50,858.8
========= ========= =========
<PAGE>23
EXHIBIT 20
Page 9 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 3. NOTES, LOANS AND DEBENTURES
PAYABLE WITHIN ONE YEAR
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- --------------------------- --------- --------- ---------
Short-term notes
Commercial paper . . . . . $16,855.6 $14,521.1 $13,428.0
Master notes . . . . . . . 563.3 467.8 642.2
Demand notes . . . . . . . 2,327.0 2,161.0 2,116.1
Other . . . . . . . . . . 588.4 645.5 491.0
--------- --------- ---------
Total principal amount . . 20,334.3 17,795.4 16,677.3
Unamortized discount . . . (119.1) (61.6) (60.2)
--------- --------- ---------
Total . . . . . . . . . . . 20,215.2 17,733.8 16,617.1
--------- --------- ---------
Bank loans and overdrafts . 5,131.1 5,716.6 5,542.7
--------- --------- ---------
Other notes, loans and
debentures payable
within one year
Medium-term notes . . . . 6,466.0 8,569.0 9,340.7
Other . . . . . . . . . . 1,946.2 3,065.0 5,170.5
--------- --------- ---------
Total . . . . . . . . . . . 8,412.2 11,634.0 14,511.2
--------- --------- ---------
Total payable within one
year . . . . . . . . . . . $33,758.5 $35,084.4 $36,671.0
========= ========= =========
Commercial paper is offered in the United States and
Europe in varying terms ranging up to 270 days. Master notes
represent borrowings on a demand basis arranged generally
under agreements with trust departments of certain banks.
GMAC's Variable Rate Demand Note Program is made available to
employees and retirees of General Motors Corporation and their
participating subsidiaries and affiliates, and their immediate
family members, GM dealers and their employees and affiliates,
and stockholders of General Motors Corporation. Bank loans
are generally made on a demand basis. Medium-term notes are
offered in the United States, Canada, Europe and Asia in
varying terms ranging from more than nine months to thirty
years.
<PAGE>24
EXHIBIT 20
Page 10 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 4. NOTES, LOANS, AND DEBENTURES
PAYABLE AFTER ONE YEAR
(in millions
of dollars) Weighted
Average Interest
Rates at June 30 Dec. 31 June 30
Maturity June 30, 1994 1994 1993 1993
- -------------- ------------- --------- --------- ---------
NOTES, LOANS
AND DEBENTURES
United States
currency
1994 . . . . -- $ -- $ -- $ 3,908.6
1995 . . . . 6.5% 2,529.2 6,040.1 5,336.5
1996 . . . . 6.7% 7,364.8 5,173.1 3,901.2
1997 . . . . 7.1% 5,639.3 4,391.6 4,140.7
1998 . . . . 6.6% 1,852.1 1,455.7 664.0
1999 . . . . 7.0% 3,080.0 1,600.0 1,600.0
2000 - 2004 . 8.3% 3,869.5 3,249.1 3,400.0
2005 - 2009 . 8.8% 200.0 200.0 650.0
2010 - 2014 . 10.2% 1,203.5 1,203.5 1,203.5
2015 - 2049 . 8.9% 748.7 748.7 748.7
--------- --------- ---------
Total United
States currency 26,487.1 24,061.8 25,553.2
Other currencies
1994 - 1998 . . 7.3% 4,969.0 4,442.4 4,531.1
--------- --------- ---------
Total notes,
loans and
debentures . . 31,456.1 28,504.2 30,084.3
Unamortized
discount . . . (803.6) (815.4) (827.8)
--------- --------- ---------
Total notes,
loans and
debentures
payable after
one year . . . $30,652.5 $27,688.8 $29,256.5
========= ========= =========
The Company has issued warrants to subscribe for up to
$75 million aggregate principal amount of 7.00% Notes due
August 15, 2001. The warrants are exercisable up to and
including August 15, 2000.
The Company has issued warrants to subscribe for up to
$300 million aggregate principal amount of 6.50% Notes due
October 15, 2009. The warrants are exercisable up to and
including October 15, 2007.
<PAGE>25
EXHIBIT 20
Page 11 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 5. SALE OF FINANCE RECEIVABLES
During the second quarter of 1994, the Company sold
retail receivables with principal aggregating $1,151.9
million, compared with $2,009.3 million for the second quarter
of 1993. Pre-tax gains relating to such sales recorded in
"Other Income" (excluding limited recourse loss provisions)
amounted to $19.8 million, compared with $76.9 million for the
second quarter of 1993. For the first six months of 1994 and
1993, pre-tax gains on such sales amounted to $19.8 million
and $250.8 million, respectively.
The Company sells retail receivables through special
purpose subsidiaries which absorb all losses related to sold
receivables to the extent of their subordinated investments,
as well as certain segregated restricted cash flows.
Appropriate limited recourse loss provisions associated with
sold receivables are included in the Company's provision for
financing losses.
During the first quarter of 1994, the Company completed
its first wholesale receivable sale which included $1,250.0
million floating rate term notes sold to the public and
floating rate subordinated certificates of $132.0 million
privately placed. The certificates, when taken together with
the reserve fund, provides credit support for the notes. As
part of the transaction, a floating rate revolving note
initially totaling $850.3 million, which has a varying balance
up to a maximum of $1,250.0 million, was also issued and is
currently being held by GMAC. Consequently, the balance of
this note is being shown in the following table as "Investment
in wholesale revolving note". On July 1, 1994 the wholesale
revolving note was sold in a private transaction to New Center
Asset Trust, a non-consolidated special purpose entity.
The Company's interest in excess servicing cash flows,
subordinated interest in trusts, cash deposits and other
related amounts are generally restricted assets and subject to
limited recourse provisions. The following is a summary of
amounts included in "Due and deferred from receivable sales
(net)".
<PAGE>26
EXHIBIT 20
Page 12 of 17
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 5. SALE OF FINANCE RECEIVABLES (concluded)
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- --------------------------- --------- --------- ---------
Excess servicing . . . . . $ 506.4 $ 745.5 $ 638.6
Other restricted amounts:
Subordinated interest in
trusts . . . . . . . . . 553.2 726.8 666.8
Cash deposits held by trusts 776.4 557.5 409.9
Investment in wholesale
revolving note . . . . . 875.7 -- --
Deferred servicing and
other .. . . . . . . . . (41.1) (64.9) (72.9)
Allowance for estimated
credit losses on sold
receivables . . . . . . . (83.3) (107.3) (229.2)
--------- --------- ---------
Total . . . . . . . . . . . $ 2,587.3 $ 1,857.6 $ 1,413.2
========= ========= =========
Outstanding principal balances of sold retail receivables
(including subordinated interests) at June 30, 1994, December
31, 1993 and June 30, 1993 totaled $13.4 billion, $14.9
billion and $13.1 billion, respectively.
NOTE 6. TRANSACTIONS WITH AFFILIATES
The amounts due General Motors Corporation and affiliated
companies at the balance sheet dates relate principally to
current wholesale financing of sales of General Motors
products.
Receivables from General Motors Corporation decreased to
$1.4 billion at June 30, 1994, compared with $9.9 billion at
June 30, 1993. This reduction reflects the resumption by GMAC
of dealer wholesale inventory financing which had previously
been provided by General Motors. Such General Motors
financing had been supported by a financing agreement under
which GMAC extended loans to General Motors. This financing
agreement was terminated in the first quarter of 1994.
The Company has purchased certain vehicles which General
Motors acquired from its fleet and rental customers. The cost
of these vehicles held for resale, which is included in other
earning assets, at June 30, 1994 and 1993 was $285.0 million
and $491.2 million, respectively.
From time to time, the Company and one of its
subsidiaries have made interest-bearing loans to National Car
Rental Systems, Inc. (NCRS), a consolidated subsidiary of
General Motors Corporation and certain other affiliates of
General Motors Corporation. At June 30, 1994 and 1993,
$1,390.1 million and $1,539.7 million, respectively, of such
loans (including NCRS) were outstanding.
<PAGE>27
EXHIBIT 20
Page 13 of 17
NOTES TO FINANCIAL STATEMENTS (concluded)
NOTE 7. FINANCIAL INSTRUMENTS
GMAC utilizes a variety of interest rate contracts
including interest rate swaps, caps and currency swaps in the
normal course of managing its interest rate exposures. The
total notional amount of off-balance sheet instruments
outstanding was $10,060.7 million at June 30, 1994, $8,623.9
million at December 31, 1993 and $5,827.3 million at June 30,
1993.
The Company has commitments to sell mortgages or
mortgage-backed securities at June 30, 1994 and 1993,
comprised of mandatory delivery contracts with investors
totaling $1,695.8 million and $2,724.7 million, respectively.
Also outstanding at June 30, 1994 and 1993, were commitments
to purchase/fund first mortgage loans at fixed prices totaling
$881.7 million and $1,955.5 million, respectively.
_______________________________
<PAGE>28
EXHIBIT 20
Page 14 of 17
SUPPLEMENTARY FINANCIAL DATA
SUMMARY OF FINANCING OPERATIONS*
Period Ended June 30
Second Quarter Six Months
-------------------- --------------------
in millions of dollars) 1994 1993 1994 1993
- --------------------------- --------- --------- --------- ---------
INCOME
Financing revenue . . . . $ 2,305.3 $ 2,220.5 $ 4,468.9 $ 4,489.0
Interest and discount . . 1,045.3 1,221.5 2,055.3 2,521.5
Depreciation on operating
leases . . . . . . . . . 765.4 660.5 1,454.1 1,287.9
--------- --------- --------- ---------
Net financing revenue . . . 494.6 338.5 959.5 679.6
Other income . . . . . . . 291.6 593.6 620.5 1,116.3
--------- --------- --------- ---------
Net financing revenue and
other . . . . . . . . . . 786.2 932.1 1,580.0 1,795.9
--------- --------- --------- ---------
Expenses
Salaries and benefits . . 159.9 179.6 339.5 344.9
Other operating
expenses . . . . . . . . 254.6 241.8 467.1 448.5
Provision for financing
losses . . . . . . . . . 54.8 118.9 118.9 175.9
Amortization of intangible
assets . . . . . . . . . 11.6 32.2 27.8 56.5
--------- --------- --------- ---------
Total expenses . . . . . . . 480.9 572.5 953.3 1,025.8
--------- --------- --------- ---------
Income before income taxes . 305.3 359.6 626.7 770.1
United States, foreign and
other income taxes . . . . 120.7 146.0 249.3 306.2
--------- --------- --------- ---------
Income before cumulative
effect of accounting
changes . . . . . . . . . 184.6 213.6 377.4 463.9
Cumulative effect of
accounting change . . . . -- -- (6.8) --
--------- --------- --------- ---------
Income from financing
operations . . . . . . . . $ 184.6 $ 213.6 $ 370.6 $ 463.9
========= ========= ========= =========
*Before elimination of intercompany amounts.
(continued)
<PAGE>29
EXHIBIT 20
Page 15 of 17
SUPPLEMENTARY FINANCIAL DATA (continued)
SUMMARY OF FINANCING OPERATIONS* (concluded)
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- --------------------------- --------- --------- ---------
NET ASSETS
ASSETS
Cash and cash equivalents . $ 2,315.0 $ 3,980.6 $ 3,453.0
--------- --------- ---------
Earning Assets
Investments in securities 20.2 18.4 37.7
--------- --------- ---------
Finance receivables . . . 55,046.6 54,882.8 51,611.4
Less-Allowance for
financing losses . . . . (764.5) (748.0) (752.6)
--------- --------- ---------
Finance receivables (net) 54,282.1 54,134.8 50,858.8
Receivable General Motors
Corporation . . . . . . 1,390.1 1,355.5 9,929.1
Other earning assets . . . 19,931.1 15,843.8 14,973.0
--------- --------- ---------
Total earning assets . . . 75,623.5 71,352.5 75,798.6
--------- --------- ---------
Other assets . . . . . . . 1,070.8 1,061.5 1,150.7
--------- --------- ---------
Total assets . . . . . . . $79,009.3 $76,394.6 $80,402.3
--------- --------- ---------
LIABILITIES
Notes, loans and debentures
payable within one year . $33,758.5 $35,084.4 $36,671.0
--------- --------- ---------
Accounts payable and other
liabilities
General Motors Corporation
and affiliated
companies . . . . . . . . 2,922.1 2,514.0 2,857.3
Other postretirement
benefits . . . . . . . . 457.1 436.9 419.4
Other . . . . . . . . . . 4,584.9 3,991.9 4,100.6
--------- --------- ---------
Total accounts payable and
other liabilities . . . . 7,964.1 6,942.8 7,377.3
--------- --------- ---------
Notes, loans and debentures
payable after one year . . 30,652.5 27,688.8 29,256.5
--------- --------- ---------
Total liabilities . . . . $72,375.1 $69,716.0 $73,304.8
--------- --------- ---------
Net assets of financing
operations . . . . . . . . $ 6,634.2 $ 6,678.6 $ 7,097.5
========= ========= =========
*Before elimination of intercompany amounts.
<PAGE>30
EXHIBIT 20
Page 16 of 17
SUPPLEMENTARY FINANCIAL DATA (continued)
SUMMARY OF INSURANCE OPERATIONS*
Period Ended June 30
Second Quarter Six Months
-------------------- --------------------
in millions of dollars) 1994 1993 1994 1993
- --------------------------- --------- --------- --------- ---------
INCOME
Net premiums written
Personal lines . . . . . . $ 130.5 $ 119.0 $ 246.7 $ 236.7
Mechanical . . . . . . . . 85.6 80.6 162.0 159.4
Life and disability . . . 23.0 23.0 44.8 41.1
Commercial lines,
reinsurance and
miscellaneous . . . . . . 83.9 78.5 176.5 163.6
--------- --------- --------- ---------
Net premiums written . . . 323.0 301.1 630.0 600.8
Changes in unearned
premiums . . . . . . . . . (29.3) (14.9) (49.9) (26.5)
--------- --------- --------- ---------
Premiums earned . . . . . 293.7 286.2 580.1 574.3
Investments and other
income . . . . . . . . . . 86.3 164.4 169.0 294.7
--------- --------- --------- ---------
Total . . . . . . . . . . . 380.0 450.6 749.1 869.0
Expenses
Salaries and benefits . . 31.6 31.5 65.3 61.6
Other operating
expenses . . . . . . . . 66.7 66.8 130.9 101.2
Losses and loss adjustment
expenses . . . . . . . . 240.4 249.0 470.1 558.2
Amortization of intangible
assets . . . . . . . . . 2.5 2.5 5.0 5.0
--------- --------- --------- ---------
Total expenses . . . . . . 341.2 349.8 671.3 726.0
--------- --------- --------- ---------
Income before income
taxes . . . . . . . . . . 38.8 100.8 77.8 143.0
Income taxes . . . . . . . 7.3 29.0 14.2 37.4
--------- --------- --------- ---------
Income before cumulative
effect of accounting
changes . . . . . . . . . 31.5 71.8 63.6 105.6
Cumulative effect of
accounting change . . . . -- -- (0.6) --
--------- --------- --------- ---------
Income from insurance
operations . . . . . . . . $ 31.5 $ 71.8 $ 63.0 $ 105.6
========= ========= ========= =========
*Before elimination of intercompany amounts.
(continued)
<PAGE>31
EXHIBIT 20
Page 17 of 17
SUPPLEMENTARY FINANCIAL DATA (concluded)
SUMMARY OF INSURANCE OPERATIONS* (concluded)
June 30 Dec. 31 June 30
(in millions of dollars) 1994 1993 1993
- --------------------------- --------- --------- ---------
NET ASSETS
ASSETS
Cash . . . . . . . . . . . $ 30.7 $ 47.5 $ 45.8
Investments in securities . 3,475.1 3,431.3 3,401.3
Premiums and other
receivables . . . . . . . 281.2 262.5 281.9
Deferred policy acquisition
cost . . . . . . . . . . . 86.1 77.0 75.8
Prepaid reinsurance
premiums . . . . . . . . . 119.5 105.5 96.7
Reinsurance recoverable on
unpaid insurance losses
and loss adjustment
expense . . . . . . . . . 216.2 220.3 207.4
Other assets . . . . . . . 281.8 270.9 337.8
--------- --------- ---------
Total assets . . . . . . . $ 4,490.6 $ 4,415.0 $ 4,446.7
--------- --------- ---------
LIABILITIES
Unpaid insurance losses and
loss adjustment expenses . $ 1,555.6 $ 1,569.4 $ 1,561.6
Unearned insurance
premiums . . . . . . . . . 1,401.3 1,337.4 1,293.7
Deferred federal income
taxes . . . . . . . . . . (34.2) (11.3) (4.9)
Other postretirement
benefits . . . . . . . . . 93.3 88.0 83.3
Other . . . . . . . . . . . 307.3 257.8 408.8
--------- --------- ---------
Total liabilities . . . . . $ 3,323.3 $ 3,241.3 $ 3,342.5
--------- --------- ---------
Net assets of insurance
operations . . . . . . . $ 1,167.3 $ 1,173.7 $ 1,104.2
========= ========= =========
*Before elimination of intercompany amounts.
