General Motors Co. posted fourth-quarter earnings slightly above expectations and its first full-year profit since 2004. Profit for all of 2010 was $4.7 billion, achieved after the company slashed costs and debt in a 2009 bankruptcy financed by the Obama administration.

The top U.S. automaker reported fourth-quarter net income of $510 million, or 31 cents per share, down from the pace of earnings in the first three quarters of 2010.

Revenue in the quarter was $36.9 billion.

After adjusting for a loss of 21 cents per share on the purchase of preferred shares that had been held by the U.S. Treasury, adjusted earnings per share were 52 cents.

GM’s chief financial officer, Chris Liddell, said 52 cents was in line with analysts’ expectations but earnings before interest and taxes were slightly below estimates.

“We had a big engineering spend, so that might be part of it,” Liddell told reporters.

Analysts polled by Thomson Reuters I/B/E/S on average had forecast adjusted profit of 46 cents per share on revenue of nearly $33 billion.

GM’s European operations posted a loss of $568 million for the fourth quarter and a loss of $1.7 billion for the year. The automaker has said it hopes the unit — known for its Opel brand — will break even this year.

GM shares were down 9 cents at $34.50 in premarket trading.

CASH ON HAND

GM ended 2010 with nearly $28 billion in cash and about $5 billion on an undrawn credit facility.

Its U.S. pension plans were underfunded by about $12 billion, Liddell said.

GM management, led by Chief Executive Dan Akerson, warned in a January meeting with analysts that fourth-quarter earnings would be below the rate of the first three quarters of the year.

The Detroit-based automaker suspended some of its vehicle development efforts as it tried to conserve cash in the run-up to bankruptcy and faces higher costs now to revive those programs, including efforts to broaden its offering of electric cars beyond the just-released Chevrolet Volt.

GM, which had a record-setting $23 billion initial public offering of stock in November, has been seen by investors and analysts as a bet on the continuing recovery in the U.S. auto industry.

The U.S. auto sector is still widely seen as being in the early stages of a recovery from its near-collapse in 2008 and 2009.

But in recent weeks investors have also been concerned about the pressure on profit margins from rising commodity prices, higher costs for launching new vehicles, and the risk of a sustained spike in oil prices.

GM’s closest rival, Ford Motor Co, reported a fourth-quarter profit last month that fell far short of expectations after a $1 billion surge in costs from the third quarter.

GM shares have fallen 11 percent in the four weeks since Ford’s results. Ford shares are down 21 percent in the same period.

For GM to keep the U.S. Treasury from losing on its $52 billion bailout, the remaining 33 percent U.S. government stake in the company would have to be sold at about $53 a share.