Ford earns $2.7 billion in 2009
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Ford earns $2.7 billion in 2009
DEARBORN, Mich. (AP) -- Ford Motor Co. made $2.7 billion in 2009, its first annual profit in four years.
The automaker on Thursday also forecast a full-year profit in 2010. Earlier it had only promised to be "solidly profitable" in 2011.
Ford benefited from cost-cutting, a $696 million profit in its credit arm and popular cars and trucks like the Ford Fusion midsize sedan and Ford Escape small sport utility vehicle. It gained market share in North and South America and Europe, despite the worst U.S. sales climate in 30 years.
"While we still face significant business environment challenges ahead, 2009 was a pivotal year for Ford," Ford CEO Alan Mulally said in a statement.
Ford's 2009 net income of 86 cents per share showed a significant improvement from the year before, when it lost a record $14.6 billion. Excluding one-time items of $711 million, Ford made 43 cents per share. Those items included severance payments and retiree health-care charges.
The profit surprised Wall Street, where analysts surveyed by Thomson Reuters expected an annual loss of 31 cents.
In the fourth quarter, Ford earned $868 million, or 25 cents per share, compared with a loss of $5.9 billion a year earlier. Ford earned money in three of the four quarters last year.
Ford said it will make profit-sharing payments to its U.S. hourly workers in March. They will be the first profit-sharing checks since 2004.
The Dearborn-based automaker's debt load increased by $7.4 billion to $34.3 billion, largely because it took a charge of $7 billion to account for debt to a union-run retiree health-care fund. That puts Ford at a disadvantage to GM and Chrysler, who were able to shed debt in bankruptcy court.
The automaker on Thursday also forecast a full-year profit in 2010. Earlier it had only promised to be "solidly profitable" in 2011.
Ford benefited from cost-cutting, a $696 million profit in its credit arm and popular cars and trucks like the Ford Fusion midsize sedan and Ford Escape small sport utility vehicle. It gained market share in North and South America and Europe, despite the worst U.S. sales climate in 30 years.
"While we still face significant business environment challenges ahead, 2009 was a pivotal year for Ford," Ford CEO Alan Mulally said in a statement.
Ford's 2009 net income of 86 cents per share showed a significant improvement from the year before, when it lost a record $14.6 billion. Excluding one-time items of $711 million, Ford made 43 cents per share. Those items included severance payments and retiree health-care charges.
The profit surprised Wall Street, where analysts surveyed by Thomson Reuters expected an annual loss of 31 cents.
In the fourth quarter, Ford earned $868 million, or 25 cents per share, compared with a loss of $5.9 billion a year earlier. Ford earned money in three of the four quarters last year.
Ford said it will make profit-sharing payments to its U.S. hourly workers in March. They will be the first profit-sharing checks since 2004.
The Dearborn-based automaker's debt load increased by $7.4 billion to $34.3 billion, largely because it took a charge of $7 billion to account for debt to a union-run retiree health-care fund. That puts Ford at a disadvantage to GM and Chrysler, who were able to shed debt in bankruptcy court.
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Hasn't most or all of GM and Chryslers debt been washed away with the bankrupcy? Wouldn't Ford now be the most in-debt automaker in America? I love what they're doing, and I love the fact that they didn't use any government assistance. But it's going to be a harder road to full recovery due to them taking the high road. I think they can do it, I was purely in awe of the number. Just the sound of such a thing seems overwhelming 
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Chrylser has no Debt, GM has a few Billion that it plans to payoff this summer. The rest of the government payback will come from them selling stock. Ford added $7.3 Billion of new debt in the fourth quarter alone, mostly to fund the VEBA.
No offense to Ford, but that kind of accounting is why GM went bankrupt. Hopefully with good sales, they won't add anymore to it.
-Geoff
No offense to Ford, but that kind of accounting is why GM went bankrupt. Hopefully with good sales, they won't add anymore to it.
-Geoff
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From: Melbourne, Australia
Hasn't most or all of GM and Chryslers debt been washed away with the bankrupcy? Wouldn't Ford now be the most in-debt automaker in America? I love what they're doing, and I love the fact that they didn't use any government assistance. But it's going to be a harder road to full recovery due to them taking the high road. I think they can do it, I was purely in awe of the number. Just the sound of such a thing seems overwhelming
But I wish GM had made that move... when they were $35B in debt instead of now.
Having said that, I can see Ford wriggle out of its way out of its debt over the next 10 years.
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.......While Ford has added about 7 billion in debt.......
....... the value of the entire company the past year [b]MORE THAN TRIPPLED!!!!!
..... Ford's debt is getting quickly to the point where it's going to be pretty minor next to the value of the company as a whole.
Whitehawk, you really can not begin to compare GM's creative financing which GM purposely did to hide their catastrophic losses as the value of the company had already imploded to negative numbers to Ford's current value growth and actual profitability on income from gross sales.
The accounting doesn't get you in trouble.
It's cooking that accounting to hide losses.
Last edited by guionM; Jan 29, 2010 at 12:17 AM.
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Much of that $2.7 billion profit was from debt-restructuing; in other words not profit from operations.
The market capitalization of Ford may have tripled (due to its share price rising), but the company itself has negative equity (assets minus liabilities) of around $13 billion.
The market capitalization of Ford may have tripled (due to its share price rising), but the company itself has negative equity (assets minus liabilities) of around $13 billion.
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One thing missed.......
.......While Ford has added about 7 billion in debt.......
....... the value of the entire company the past year [b]MORE THAN TRIPPLED!!!!!
..... Ford's debt is getting quickly to the point where it's going to be pretty minor next to the value of the company as a whole.
.......While Ford has added about 7 billion in debt.......
....... the value of the entire company the past year [b]MORE THAN TRIPPLED!!!!!
..... Ford's debt is getting quickly to the point where it's going to be pretty minor next to the value of the company as a whole.
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