Ford Motor Co. announced that its net income over the second quarter of the current financial year increased by 6% due to record results in North America, strong performance in Asia and a quarterly profit in Europe.
In its statement dated July 24th, Ford Motor Co. said that its second-quarter net income jumped to 1.3 billion dollars, or 32 cents per share, from 1.23 billion dollars, or 30 cents a share, during the same period a year ago. The car maker also announced that its profit excluding one-time expenses in the three months through June amounted to 40 cents per share. This result surpassed the initial analysts forecast of 36 cents per share.
Revenue slid to $35.3 billion from $36.0 billion a year earlier, mismatching analysts projections for a jump to $36.3 billion.
Mr. Adam Jonas, an analyst at Morgan Stanley, commented on the auto makers performance for Bloomberg: “Forty cents in the second quarter is as good as it’s going to get. Despite the volume being down, they had a great cost performance. But ultimately, revenue still drives the day.”
The second-quarter profit, considered surprisingly strong due to effective cost cutting, may be Fords best quarterly performance this year as the company is planning to boost spending in order to launch 23 new models and reorganize its operations based in Europe.
Ford swung back to profit in Europe for the first quarter in three years due to lower costs and favorable exchange rates. A total reduction of $283 million in expenditures for parts and raw materials, coupled with staff cuts and the closure of its Belgium factory, helped Ford turn its European business profitable once again.
Effective cost cutting in the companys major business located in North America also benefited to its overall performance, achieving a pretax profit of $2.44 billion, despite the decline in revenue.
Ford also reiterated its forecast for full-year pre-tax profits, which are expected to be in the range between $7 and $8 billion, slightly below last years $8.6 billion.
Ford Motor Co. rose by 0.34% on Thursday in New York to close the trading session at $17.84 per share, marking a one-year change of +2.71%. The second biggest US car maker is valued at $70.54 billion. According to CNN Money, the 15 analysts offering 12-month price forecasts for Ford Motor Co have a median target of $20.00, with a high estimate of $23.00 and a low estimate of $12.00. The median estimate represents a +12.11% increase from the last price of $17.84.