SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported) September 25, 2002
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GENERAL MOTORS CORPORATION
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(Exact name of registrant as specified in its charter)
STATE OF DELAWARE 1-143 38-0572515
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
300 Renaissance Center, Detroit, Michigan 48265-3000
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (313)-556-5000
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ITEM 9. Forward Looking Information Relating to Hughes
On September 25, 2002, General Motors Corporation's (GM) subsidiary Hughes
Electronics Corporation (Hughes), issued a news release announcing that it is
updating guidance for the third quarter of 2002.
HUGHES UPDATES GUIDANCE FOR THIRD QUARTER 2002
El Segundo, Calif., September 25, 2002 -- Hughes Electronics Corporation,
a world-leading provider of digital television entertainment, broadband
services, satellite-based private business networks, and global video and data
broadcasting, announced today that it is updating its third quarter 2002
guidance.
"Today we are confirming HUGHES' consolidated revenues and raising our
EBITDA1 guidance for the third quarter primarily due to particularly strong
results in our DIRECTV U.S. business that more than offset weakness in the
DIRECTV Latin America business. At the same time, we are reducing our third
quarter subscriber estimates for DIRECTV in both the U.S. and Latin America,"
said Jack A. Shaw, HUGHES chief executive officer. No changes were made to the
guidance for PanAmSat, Hughes Network Systems (HNS) and DIRECTV DSL. HUGHES will
hold its regularly scheduled quarterly conference call with analysts at 2 p.m.
ET October 14, 2002, to discuss third quarter results as well as full-year 2002
guidance.
Shaw added, "In the U.S., we are increasing DIRECTV's third quarter EBITDA
guidance by $45 million to approximately $195 million due to continued success
with reducing our cost structure, improved monthly subscriber revenue and lower
marketing costs associated with the reduced subscriber projections. We are
lowering our subscriber guidance for the quarter to a range of 200,000 to
210,000 net additions (versus a prior range of 250,000 to 300,000) primarily due
to higher than expected monthly churn of approximately 1.7%, which we believe
was related to the replacement of DIRECTV's older generation access cards. In
the quarter, about 50,000 active subscribers who were paying for basic services,
but who we believe were receiving other DIRECTV services via illegally-modified
access cards, were disconnected. In addition, gross subscriber activations were
slightly below our expectations mostly due to a decline in consumer confidence
resulting in softer sales at national consumer electronics retail outlets.
"In Latin America, our DIRECTV business is still suffering from the
significant economic and political deterioration experienced throughout the
region, as well as the ongoing devaluation of several local currencies. In
response, we have drastically cut back on our marketing costs, made further
headcount reductions, and are eliminating all non-critical business activities
and capital expenditures. As a result of the substantial reduction in subscriber
acquisition efforts and the spike in churn related to the economic instability
throughout much of the region, we are now projecting that DIRECTV Latin America
will have a net loss of 65,000 subscribers in the third quarter versus our prior
guidance of 15,000 - 25,000 net subscriber additions. In addition, we are
lowering our revenue projections, and expect to be at the high end of our prior
guidance for EBITDA losses," Shaw explained. HUGHES' revised guidance for the
third quarter is shown below.
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Third Quarter 2002
Prior Revised
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HUGHES
Revenues $2.2 - 2.25B No Change
EBITDA $175 - 225M >$225M
Cash Requirements N/A No Change
DIRECTV U.S.
Revenues ~$1.6B ~$1.61B
EBITDA ~$150M ~$195M
Net Subscriber Adds 250 - 300K 200 - 210K
DIRECTV DSL
Revenues N/A No Change
EBITDA $(25) - (30)M No Change
Net Subscriber Adds N/A No Change
DIRECTV Latin America
Revenues $170 -180M ~$145M
EBITDA $(15) - (25)M $(20) - (25)M
Net Subscriber Adds 15 - 20K ~(65)K
Hughes Network Systems
Revenues $275 - 325M No Change
EBITDA $(20) -(35)M No Change
DIRECWAY Net Sub Adds N/A No Change
PanAmSat
Revenues $190 - 200M No Change
New Outright Sales and
Sales-Type Leases None No Change
EBITDA Margin 70% or higher No Change
EBITDA $135 - 150M No Change
Hughes Electronics Corporation is a unit of General Motors Corporation.
The earnings of Hughes Electronics are used to calculate the earnings
attributable to the General Motors Class H common stock (NYSE:GMH).
NOTE: Hughes Electronics Corporation believes that some of the foregoing
statements may constitute forward-looking statements. When used in this report,
the words "estimate," "plan," "project," "anticipate," "expect," "intend,"
"outlook," "believe," and other similar expressions are intended to identify
such forward-looking statements and information. Important factors that may
cause actual results of HUGHES to differ materially from the forward-looking
statements in this report are set forth in the Form 10-Ks and 10-Qs filed with
the SEC by General Motors and HUGHES. HUGHES does not undertake to update any
future guidance as to its financial performance prior to its regularly scheduled
release date.
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1 EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is the
sum of operating profit (loss) and depreciation and amortization. EBITDA is not
presented as an alternative measure of operating results or cash flow from
operations, as determined in accordance with accounting principles generally
accepted in the United States of America. EBITDA does not reflect the funds
available for investment in the business of HUGHES, dividends or other
discretionary uses. EBITDA as presented herein may not be comparable to
similarly titled measures reported by other companies.
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SIGNATURE
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 hereunto duly authorized.
GENERAL MOTORS CORPORATION
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(Registrant)
Date September 25, 2002
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By
/s/Peter R. Bible
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(Peter R. Bible,
Chief Accounting Officer)
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