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Business

Ford surprises with third quarter net profits of 997 million dollars

Text by News Wires

Latest update : 2009-11-02

Ford posted net profits of 997 million dollars for the third quarter of 2009. It's the automakers’ first quarterly profit since 2008 and is largely due to a drastic cost-cutting policy. The US firm said it was on track to become "solidly profitable."

AFP - Ford Motor Co. on Monday posted a surprise third-quarter profit of 997 million dollars on improvement in its North American business, and said it was on track to become "solidly profitable."
  
The number two US automaker swung to the black from a loss of 129 million dollars the same period in 2008, as Ford continued to restructure to cope with an ailing market amid the worst global downturn in decades.
  
Overall pre-tax operating profit totaled 1.1 billion dollars, an improvement of 3.9 billion dollars from the 2008 July-September period and the first quarterly profit since the first quarter of 2008, the company said.
  
The swing into profit of earnings per share of 26 cents, excluding special items, surprised most analysts who had expected a 12 cent loss.
  
For the key North America market, the company posted a pre-tax operating profit of 357 million dollars, its first profitable quarter since the first quarter of 2005.
  
Ford is the only Detroit Big Three automaker that did not get government aid to cope with the auto sales slump and, unlike rivals General Motors and Chrysler, did not go bankrupt this year.
  
"Strong new products, structural cost reductions and improved results at Ford Credit lifted the company's results despite continued weak global economic conditions," the company said in a statement.
  
"Ford now expects to be solidly profitable in 2011, excluding special items, with positive operating-related cash flow."
  
Ford also reported operating profits in its South America, Europe and Asia Pacific Africa businesses.
  
"Our third-quarter results clearly show that Ford is making tremendous progress despite the prolonged slump in the global economy," said Ford president and chief executive Alan Mulally.
  
"Our solid product lineup is leading the way in all markets. While we still face a challenging road ahead, our One Ford transformation plan is working and our underlying business continues to grow stronger."
  
Ford said third-quarter revenue was 30.9 billion dollars, down 800 million dollars from the same period a year ago.
  
A rise in automotive sales of 100 million dollars from a year ago was offset by a decline in Ford Credit revenues, largely due to loan losses, the company said.
  
Ford said it slashed 1.0 billion dollars from structural costs in its automotive sector during the quarter, resulting in part from job cuts pimarily in North America and Europe.
  
Through the first nine months of the year, Ford said it had reduced automotive structural costs by 4.6 billion dollars, topping its full-year 2009 target of 4.0 billion dollars.

Date created : 2009-11-02

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