Ford Reports $2.6b Q2 Profit
Ford Motor Company has announced its second-quarter results for 2010, and the company says it earned $2.6b over the last three months on $2.9b in operating profit before special items. In a departure from the typical model for domestic automakers, Ford’s growth was largely driven by improvement in North American results: Ford earned $1.9b in pre-tax operating profits in North America after boosting its Ford brand to the top spot in the American market over the first six months of 2010. Ford earned $31.3b in Q2 revenue, a $4.5b improvement over Q2 2009 (a $7.4b improvement excluding Volvo). Ford’s operating cash flow improved by $2.6b despite ending the quarter with $21.9b in cash, a $3.4b drop since the end of Q1. However, that drop in cash-on-hand was the result of a $3.8b debt reduction, and Ford figures its total automotive liquidity (including all credit facilities) is $25.4b. Automotive debt was reduced by about $7b, to $27.3b, the result of both the UAW Retiree Medical Benefit trust buydown and a $3b repayment of a revolving credit line. The shutdown of Mercury has reportedly cost Ford about $229m so far, and Ford expects that amount to equal slightly under half of the total cost of eliminating the brand.
Ford’s results aren’t very surprising given the fact that it Ford brand outsold all other brands over the first half of 2010, but the healthy profit shows that a rumored dependence on fleet sales wasn’t enough of a factor to weaken Ford’s financial results. Though debt levels remain high and its overseas performance remains weak, Ford has proven once again that it’s the healthiest American automaker… if only in terms of its North American market performance.
Full financial release in PDF format here, Q2 results presentation slides in PDF format here, Ford Credit results in PDF format here
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I assume he means a book value loss from purchase, but as someone else noted, they probably wrote that down a while ago.
To give some creds to Silvy: 1) Ford doesnt play any major role in China or India. And that are the growing markets. 2) Yes, Ford is strong in USA, but just there. They are even loosing grounds in Europe. 3) Ford uglified the front of the US Fiesta (why do they do that? same thing happened with Mazda6). According to mjz and TrailerTrash (let me remind you, TrailerTrash owns a MKS and loves Fords) Fiesta isnt anything special (they both testdrove it). Whatever Nullomondo says shouldnt be taken seriously as he is a Ford salesmen (and they inherently lie!) 4) the upcoming Focus doesnt do it for me. The back design is stolen from the Kia pro_ceed, the front is just ugly. The interior is way too busy. 5) The facelifted Mondeo is blant, already demode. 6) The Kuga wont sell as it will have competition from the new Kia Sportage, VW Tiguans, Audi Q5 etc. It will have the same fate as the Infiniti EX (wont sell, too small/no utilisation for americans). 7) if the US lineup becomes more europeanized, Ford will tarnish its stance in the states. and with the falling sales in Europe, falling sales in the US might worsen things. 8) Yes, all these Focuses and Fiestas might sell in *SoCal*, but at the end, people will realize they are just paying big bucks for a Ford. What an awakening that will be.