Ford Earns Nearly $1 Billion in Third Quarter
November 02, 2009
Ford Motor Co. reported it earned a profit of $997 million in the third quarter, with its North American operations posting its first profit since the first quarter of 2005. 
The automaker said the results put it on track to be "solidly profitable" in 2011.
The results far surpassed forecasts by analysts, most of whom expected a loss. That sent Ford's shares up 6 percent in pre-market trading Monday morning.
Ford said its third-quarter earnings represented a $1.2 billion improvement from the same period a year ago.
"Our third-quarter results clearly show that Ford is making tremendous progress despite the prolonged slump in the global market," Ford President and CEO Alan Mulally said in a statement issued Monday morning. He acknowledged "we still face a challenging road ahead."
Mulally, in a conference call with media and analysts, said it has upped its outlook to "solidly profitable" overall and in North American operations in 2011 with positive cash flow instead of breakeven or marginally profitable as previously expected.
Minus special items, Ford reported a pre-tax operating profit of $1.1 billion, an improvement of $3.9 billion from a year ago and the first operating profit since the first quarter of 2008. On an after-tax basis excluding special items. Ford posted an operating profit of $873 million compared wiht a $3 billion loss a year ago.
Ford's North American operations also made money -- a $357 million profit -- its first quarterly profit since the first quarter of 2005. Ford's North American market share is up for the first time in a decade. Operations in South America, Europe and Asia-Pacific-Africa also posted pre-tax operating profits.
Revenue was $30.9 billion in the quarter, an $800 million decline from the same period a year ago but automotive revenue is up $100 million. Ford Credit's revenue decreased, causing the overall decline.
Ford reported $1.3 billion in positive cash flow in the third quarter -- a first since the second quarter of 2007 -- and said it expects positive cash flow in the fourth quarter. The automaker burned through $4.7 billion of cash in the first six months of this year. Ford closed the third quarter with $23.8 billion in automotive cash, up from $21 billion at the end of the second quarter.
Ford said it reduced its structural costs in the quarter by $1 billion, with lower manufacturing and engineering costs, improved productivity, personnel reductions in North America and Europe and implemention of global platforms and product development processes.
Through the first nine months, Ford has cut automotive structural costs by $4.6 billion, beating its full-year target of $4 billion. -- Michelle Krebs, Senior Analyst and Editor at Large
Posted by Michelle Krebs at 4:10 AM under Featured , Ford | Comments (0) | digg this | Seed Newsvine
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