Ford has posted second quarter profits that show strong margins in North America, but also the impact of restructuring charges in Europe and South America.
Ford said its second quarter financial results demonstrated progress on the ‘fundamental redesign of the business, while the company continues to bring to market a fresh lineup of compelling products that build on well-established strengths’.
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Ford’s reported Q2 net income was US$148m (US$1.1bn last year), net income margin was 0.4 percent (2.7 percent last year), and earnings per share (EPS) was US$0.04 (US$0.27 last year), all down as a result of ‘ongoing global redesign and restructuring activities, primarily in Europe and South America’. Those initiatives, Ford said, accounted for US$1.2bn of charges for special items.
“Midway through this key year of action, we are pleased with the progress we are making toward creating a more dynamic and profitable business,” said Jim Hackett, Ford president and chief executive officer. “In this time of profound change in our industry, Ford has amazing opportunities to delight customers, innovate and collaborate in new ways, and create value.”
“We are building a compelling product portfolio for our customers, executing against our global redesign and fitness initiatives, and investing in mobility opportunities to enhance our trajectory for growth, free cash flow, profitability and returns on capital,” said Tim Stone, the company’s chief financial officer.
Automotive earnings before interest and taxes (EBIT) in the quarter was US$1.4bn, up 19% year-on-year, driven by improvement in mix and net pricing, especially North America’s franchise strengths in trucks and sport-utility vehicles.
Ford said North America again delivered strong vehicle mix and net pricing, supported by F-Series trucks and a continued shift to SUVs and away from sedans.
