Ford loss as Euro job cuts loom
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DEARBORN, Michigan (Reuters) -- Ford Motor Co. on Thursday reported a larger net loss for the fourth quarter, as the cost of job cuts in Europe and a restructuring of its spin-off deal with former parts arm Visteon Corp. offset improved finance and automotive results.
Ford reported a full-year net profit for the first time since 2000, and operating earnings for the year and the quarter topped Ford's own forecasts.
Ford Chairman and Chief Executive Bill Ford Jr. has repeatedly said he prefers the company to "under-promise and over-deliver" on its turnaround plan aimed at producing $7 billion in annual pretax profit by later this decade.
While Ford has set a target of at least maintaining its global market share this year by launching 40 new models, Ford executives say the cost of those launches and weak pricing in
Europe and the United States will pressure its earnings.
"We continue to believe that Ford is in a tough spot between (General Motors) and the Japanese, limiting earnings growth potential, but it is undeniable that the company's execution is improving," said Merrill Lynch analyst John Casesa in a research note.
Ford's shares were down 3 cents at $16.41 on Thursday. The shares have traded near an 18-month high in recent weeks, along with those of General Motors Corp., as investors grew more optimistic about an economic recovery and improved profits at the automakers.
Ford said it lost $793 million, or 43 cents a share, in the quarter, compared with a net loss of $130 million, or 7 cents a share, in the same period a year ago.
Excluding some $2 billion in charges from Europe and Visteon, Ford said it earned 31
cents a share, compared with earnings of 11 cents a share in the fourth quarter of 2002.
For all of 2003, Ford said net earnings totaled $495 million, or 27 cents a share. Excluding special items, Ford said it earned $1.14 per share.
The operating results were higher than Ford's previous forecast to Wall Street of full-year earnings of $1.05 to $1.10 per share.
Ford, which may have been passed by Toyota Motor Corp as the world's second-largest automaker in 2003, said full-year revenue increased 1 percent to $164.2 billion, even as vehicle sales fell about 4 percent to 6.7 million.
Ford's market share in the United States fell by 0.6 percentage point to 20.5 percent in 2003, as competitors launched new vehicles and the company killed off unprofitable models, such as the Ford Escort.
Ford Europe, which plans to cut 6,700 jobs to reduce losses, reported a pretax profit of $60 million, its only profitable quarter of 2003.
Copyright 2004
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
