General Motors Co (GM.N) on Wednesday posted fourth-quarter earnings far above analysts' expectations as strong sales of high-margin SUVs and trucks in North America helped offset record recall costs there, and its shares rose more than 4 percent.

Chief Financial Officer Chuck Stevens told reporters that profitability would improve in all geographic markets in 2015 and that the company was "very much on the path to 10 percent margins (in North America) in 2016."

North American profit margins for 2014 were 6.5 percent. Excluding the additional costs for a record vehicle recall, they would have been 8.9 percent, GM said.

GM said it planned to raise its dividend by 20 percent, a move many shareholders have been pushing the company to do.

Stevens told Reuters that further return of capital to investors could happen later this year, as soon as the company resolves legal issues involving the recall of a defective ignition switch linked to at least 51 deaths.

Excluding special items, the largest U.S. automaker earned $1.19 per share in the quarter, compared with the analysts' average estimate of 83 cents, according to Thomson Reuters I/B/E/S.

Net income rose to $1.1 billion, or 66 cents a share, from $900 million, or 57 cents a share, a year earlier.

Without the recall costs, 2014 operating profit of $6.5 billion would have been $2.8 billion higher and net income per share of $1.65 would have been $1.07 higher, GM said.

Once again, North America accounted for almost all of quarterly earnings, which Stevens credited to increased sales of full-sized SUVs and pickup trucks. Profit on these larger vehicles dwarf those of smaller cars.

Operating profit was $2.2 billion for North America, compared with $2.4 billion companywide.

GM will pay annual bonuses of up to $9,000 to each of its U.S.-based United Auto Workers union employees, up from $7,500 a year ago. The 2014 bonus is the highest ever given by the company.

Fourth-quarter revenue fell to $39.6 billion from $40.5 billion and missed analysts' estimates of $40.12 billion.

GM posted a quarterly operating loss of $400 million in Europe, unchanged from a year earlier. Its annual loss in Europe widened to $1.4 billion from $900 million in 2013.

Stevens affirmed GM's expectations of posting a profit in Europe in 2016.

Shares of GM were up 4.2 percent at $35.40 in premarket trading.