The Ford Motor Company released its first quarter earnings today [Full report here, Slide presentation here (both PDF)], revealing that it gained over $2b in net profit on rising revenue and improved operating margins. Sales receipts rose to over $28b, and with each of Ford’s regional units posted operating profits, Ford’s gross automotive cash rose by $400m to $25.3b (although operating cash flow was $100m in the red). North American operations earned $1.2b in pre-tax operating profit, South America earned $203m, Europe recorded $107m and Asia-Pacific-Africa brought in $23m. Ford Credit racked up $828 in pre-tax profits, as lower depreciation levels improved results. Despite these fine results, Ford finished the quarter with $34.3b in automotive debt, a $700m increase from the beginning of the year. Ford paid $492m in interest on that debt in the first quarter.
Improvements in revenue and profitability are cause for celebration in Dearborn, but negative cash flow and increases in debt are niggling concerns. Especially when Ford’s CFO Lewis Booth is warning that these Q1 results are better than he expects for the rest of this year. Booth tells the Freep:
It would be unwise to think of the $2 billion as a running rate for the year
Ultimately though, Ford’s sales are up, and results are improving across the company’s global operations, meaning Booth still expects profits, albeit smaller ones, this year. And Ford isn’t trying to hide its optimism, increasing production goals by 30k units in the second quarter. Meanwhile, with 45 cents per share in earnings, Ford’s Q1 results beat Wall Street’s expectations, meaning the company’s stock should stay buoyant. Right now, that’s about all an automaker can ask for.