Ford increases full-year guidance after strong 3Q
Ford Motor boosted its full-year global earnings and margin outlook on Thursday, helped by an improved forecast in Europe and better-than-expected results in the third quarter.
The No. 2 U.S. automaker now expects its pretax profit to top last year's $8 billion and to lose less money in Europe. Previously, Ford predicted its 2013 global profit and Europe losses would be equal to 2012 levels.
Ford saw its vehicle prices stabilize in Europe during the third quarter, Chief Financial Officer Bob Shanks told reporters, adding that the improvement reflected progress in its European restructuring.
Auto industry sales in Europe should begin to see "very, very modest growth" in the near term, Shanks said.
Ford's overhaul of Europe is modeled after Chief Executive Alan Mulally's "One Ford" strategy that helped the company reverse heavy losses in North America, where it still gets the bulk of its profits.
In the third quarter, Ford posted a combined profit in its three overseas regions: Asia Pacific and Africa, Europe and South America—the first time Ford posted a profit in the regions outside North America in more than two years.
Third-quarter net income fell by a little more than one-fifth to $1.27 billion, or 31 cents per share, due to nearly $500 million in special charges, including $250 million spent on restructuring Europe.
Third-quarter revenue rose 12 percent to $36 billion.
But excluding the one-time items, the second largest U.S. automaker reported adjusted earnings of 45 cents per share. This was better than the 38 cents expected, on average, by analysts, according to Thomson Reuters I/B/E/S.
Ford reported a North American pretax profit of $2.3 billion in the quarter, little changed from last year. In South America, the automaker had a pretax profit of $159 million, up sharply from $9 million last year.
The automaker narrowed its losses in Europe to $228 million in the third quarter from nearly $470 million a year ago. In Asia Pacific and Africa, Ford earned $126 million, nearly triple last year's levels.
After the earnings announcement, the company's shares rose in pre-market trading. (Click here to get the latest quotes for Ford.)
—By The Associated Press