Ford beats earnings forecasts

Second-quarter comes in at $2 a share, up 4.3%

July 15, 1999|By BLOOMBERG NEWS

DEARBORN, Mich. -- Ford Motor Co., the world's No. 2 automaker, said yesterday that its second-quarter earnings rose 4.3 percent, beating forecasts, as truck demand led to its strongest first-half U.S. sales in 21 years.

Profit from operations climbed to $2.48 billion, or $2 a share, from $2.38 billion, or $1.91, in the year-earlier quarter. Revenue rose 13 percent, to $42.3 billion.

Ford, like larger rival General Motors Corp., is generating most of its profit in the United States, where consumers bought a record 8.54 million new cars and trucks in the first six months of this year. Sixty percent of Ford's first-half sales came from pickup trucks, sport utility vehicles and minivans. Profit fell in Europe, and the company had a loss in South America.

A $146 million charge to account for inventory acquired this year in Ford's purchase of Volvo AB's car unit led to net income of $2.34 billion, or $1.89 a share.

Profit at Ford's North American automotive business climbed 19 percent to a record $1.97 billion, helped by sales of the Expedition sport utility vehicle and the Ranger pickup.

In Europe, the company's automotive earnings before the Volvo charge fell 31 percent to $214 million. Demand for Ford's new Focus surged, but sales of older models such as the Fiesta and Mondeo declined.

In South America, Ford's automotive operations lost $120 million, compared with a $14 million profit a year earlier.

Ford captured 24.7 percent of U.S. sales during the second quarter, up from 24.0 percent in the year-ago period.

Ford shares fell 56 cents to $52.94 yesterday.

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