Ford profit misses expectations

[DEARBORN, Mich] Ford Motor Co on Tuesday reported a profit that was less than analysts expected, selling fewer vehicles in North America as it worked to increase production of the redesigned F-150 pickup truck and losing money in South America.

The No 2 US automaker maintained its full-year forecast of pre-tax profit of between US$8.5 billion and US$9.5 billion.

The company raised its forecast for North American operating margin to 8.5 per cent to 9.5 per cent from 8 per cent to 9 per cent, but highlighted worsening business conditions in South America. "The external environment in South America has deteriorated compared to where we were just a few months ago," Ford Chief Financial Officer Bob Shanks said to reporters.

Net income in the first quarter fell 7 per cent to US$924 million, or 23 cents a share, compared with US$989 million or 24 cents a share a year earlier. Analysts had expected earnings of 26 cents a share, according to Thomson Reuters I/B/E/S.

Revenue fell 5.6 percent to US$33.9 billion, matching analyst expectations.

Ford said that two cents of the three-cent profit shortfall was because the tax rate was higher than analysts had expected.

Shanks said that the company's 6.7-per cent operating profit margin in North America would have been over 10 per cent if two highly profitable models now being relaunched with new designs, the F-150 and Edge, had matched year-ago sales levels. That also would have increased Ford's North American profit more than US$1 billion from its reported US$1.34 billion operating profit, he said.

REUTERS