Monday, December 22nd4.7°C
24563
24390

Ford's second quarter net profit up 6 per cent to $1.3 billion as Europe makes money again

DEARBORN, Mich. - Ford Motor Co. beat Wall Street's expectations in the second quarter as it chalked up a record profit in North America and made money in Europe for the first time in three years.

But things will get leaner in the second half as Ford closes one of its U.S. pickup truck plants to prepare for the launch of its new aluminum-sided F-150. Marketing expenses for new products, like the truck and the Ford Edge in the U.S. and the Mondeo and Focus sedans in Europe, will also take a bite out of earnings.

Ford, which earned $3.9 billion before taxes in the first half of this year, confirmed it expects full-year earnings of $7 billion to $8 billion. That's down from $8.6 billion in 2013.

"It's really a set-up year for a step up in the business in 2015 and beyond,"Chief Financial Officer Bob Shanks told media Thursday morning at Ford's Dearborn headquarters.

For the April-June period, Ford's net income rose 6 per cent to $1.3 billion. The profit, of 32 cents per share, was up from 30 cents per share in the same period a year ago.

Excluding separation costs in Europe and a $329 million impairment charge for its money-losing joint venture in Russia, Ford earned 40 cents per share. That beat analysts' forecast of 36 cents, according to FactSet.

Ford's revenue fell 1 per cent to $37.4 billion, but topped analysts' expectation of $36.2 billion.

Ford shares crossed $18 for the first time since early 2011 in morning trading, and were up 20 cents to $17.98 at midday.

Mark Fields, a company veteran who became Ford's CEO on July 1, told analysts and media on a conference call that he intends to continue the strategy he helped develop with former CEO Alan Mulally. That means focusing on profitable growth, working closely between regions and speeding up vehicle development time.

"My message to our team internally, and now externally, is one of continuity but also acceleration of the plan," Fields said.

The results were less rosy at Ford's crosstown rival, General Motors Co., which posted a net profit of $190 million after absorbing $1.5 billion in recall-related costs. GM's shares fell nearly 4 per cent to $35.96 in midday trading.

Ford's worldwide sales fell 1 per cent to nearly 1.7 million. Sales were down in every region except Asia Pacific, where they jumped 21 per cent thanks to strong demand for new vehicles like the Kuga SUV in China. Ford made up for that by limiting production and commanding higher prices.

Ford reported its highest-ever pretax profit of $2.4 billion in North America. The company's U.S. sales fell, but Shanks said that was offset by lower costs for materials such as steel and increases in sales of parts and accessories.

Ford plans to close its Dearborn truck plant for eight weeks beginning in August. The new F-150, with aluminum sides that shave 700 pounds off the truck's weight, is scheduled to go on sale in the fourth quarter.

In Europe, Ford made $14 million, its first quarterly profit since 2011. Ford expects Europe to be profitable for the full year in 2015.

In Asia, Ford's profit jumped 22 per cent to $159 million. Ford said its market share in the Asia Pacific region hit a record 3.7 per cent.

Ford lost $295 million in South America, where its sales were down 23 per cent.

The Canadian Press


Read more Business News

24605


Recent Trending




Today's Market
S&P TSX14468.26+121.51
S&P CDNX676.54+11.04
DJIA17804.8026.65
Nasdaq4765.38+16.983
S&P 5002070.65+9.42
CDN Dollar0.8633+0.0016
Gold1197.90+2.00
Oil56.50+2.39
Lumber338.00-0.70
Natural Gas3.324-0.14

 
Okanagan Companies
Pacific Safety0.12-0.01
Knighthawk0.01-0.005
QHR Technologies Inc1.25-0.03
Cantex0.03-0.005
Anavex Life Sciences0.1726+0.0026
Metalex Ventures0.05-0.005
Russel Metals25.58-0.42
Copper Mountain Mining1.55-0.02
Colorado Resources0.120.00
ReliaBrand Inc0.011-0.0089
Sunrise Resources Ltd0.05-0.005
Mission Ready Services0.215-0.01

 
23744


23015

FEATURED Property
21065671962 Covington Crescent
5 bedrooms 3 baths
$629,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


My final thoughts on real estate

This will be the last column I write on real estate. Largely because at the end of the year I will be handing in my license. After 20+ years of working in land development, resort development and rea...


Reflecting on the end of the year

The importance of the end of the year and the Christmas holidays is profound. It is a time to reconnect with family and traditions that have made us who we are. But the year-end has always been a time...


Parenthood: Estates, insurance & taxes

It is now even more important to ensure your loved ones are well looked if anything should happen to you. Here are a few topics to consider helping you prepare for some of the unexpected events that c...

_



24386

24476


Member of BC Press Council


24333