Second Quarter Performance Shows Good Progress
JUL
23

Ford posted net income of $2.3 billion, or $0.69 per share for the second quarter 2009. These results compare with a net loss of $8.7 billion, or $3.89 per share, in the second quarter of 2008.† The results for the second quarter 2009 include a special items net gain totaling $2.8 billion, or $0.90 per share, which includes a $3.4 billion gain related to Ford and Ford Credit’s recent debt-reduction actions. Second quarter revenue was $27.2 billion, down $11 billion from the same period a year ago. 1

Without the debt-restructuring actions in April, Ford would have posted a pre-tax operating loss of $424 million in the second quarter of 2009, excluding special items – a $609 million improvement compared with the second quarter of last year. Cost reductions, net pricing, Ford Credit results and market share helped offset the continued impact of the severe global economic downturn. On an after-tax basis, excluding special items, Ford posted an operating loss of $638 million in the second quarter, or $0.21 per share, compared with a loss of $1.4 billion, or $0.63 per share, a year ago.  1, 3

  • Reported a net income of $2.3 billion, or $0.69 per share for the second quarter of 2009
  • Special items totaled a net gain of $2.8 billion, including a $3.4 billion gain related to debt-reduction actions Reported a pre-tax operating loss of $424 million, excluding special items, for the second quarter of 2009 1
  • Reduced Automotive structural costs by $1.8 billion, including $1.2 billion in North America 1
  • Strong new products drove market share gains in all regions – North America, South America, Europe and Asia Pacific Africa – while achieving further improvements in transaction prices and margins
  • Ford’s customer satisfaction with vehicle quality reached its highest level in North America and now equals Toyota; Ford, Lincoln and Mercury brand vehicles had the fewest “things gone wrong” among all automakers;
  • Ford leads the U.S. industry in Insurance Institute for Highway Safety “Top Safety Pick” awards
  • Ended the second quarter with Automotive gross cash of $21 billion; operating-related cash outflow was $1 billion, an improvement of $2.7 billion from the first quarter of 2009
  • Raised $1.6 billion by issuing 345 million new shares of common stock; completed actions to reduce Automotive debt by $10.1 billion
  • Ford Credit reported a pre-tax profit of $646 million, compared with a pre-tax loss of $294 million a year ago 1
  • Ford remains on track, based on current planning assumptions, to achieve its key 2011 financial targets

“While the business environment remained extremely challenging around the world, we made significant progress on our transformation plan,” said Ford President and CEO Alan Mulally. “Our underlying business is growing progressively stronger as we introduce great new products that customers want and value, while continuing to aggressively restructure our business and strengthen our balance sheet.”

In the second quarter, Ford completed several actions to strengthen its overall business, including:

  • Completing a series of transactions that reduced Automotive debt obligations by $10.1 billion, which will save the company more than $500 million a year in interest expense
  • Raising $1.6 billion through the issuance of 345 million shares of Ford common stock
  • Reducing Automotive structural costs by $1.8 billion, including $1.2 billion in North America
  • Reducing the U.S. hourly work force by approximately 1,000 through a buyout program

Ford reached agreement with the UAW, subject to court and other approvals, to allow Ford the option to fund up to half of its VEBA obligations with Ford common stock at market prices instead of fixed prices in 2009, 2010 and 2011. Ford finished the second quarter with $21 billion in Automotive gross cash, compared with $21.3 billion at the end of the first quarter of 2009. Automotive operating-related cash flow was $1 billion negative during the second quarter of 2009, an improvement of $2.7 billion from the first quarter of 2009. Automotive operating-related cash flow was $4.7 billion negative during the first half; on track with Ford’s plan.

“Ford delivered a very solid quarter, and our transformation plan remains well on track,” said Lewis Booth, Ford executive vice president and chief financial officer. “We strengthened our balance sheet, reduced cash outflows and improved our year-over-year financial results despite sharply lower industry volumes.”

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0 COMMENTS ON THIS ARTICLE
Cole You can use the calculator at LetFordRecycleYourRide.com. You can also view the article on Cash for Clunkers for more information. Cole Quinnell Editorial Director www.theFordStory.com
4 year(s) ago via
Rob Weatherford strange to me that Ford sends oiut the mailer "cash for clunkers" and state see your qualification calculator. I go to ford.com and do not find qualification calculator. "what's the deal?"
4 year(s) ago via
Rolf D. Sellge Alan, thanks for saving our automobile industry,and bringin my Ford Corporate bond home during last Octobers critical time. Have to wish though that you were at the top spot at The Boeing Company, a spot you deserved. 787 would now be flying and my investment sound. Wishing you even more success, Rolf Sellge (717- Retired but still active in the biz)
4 year(s) ago via
Michael Liu Great news! You are going in the right direction. The new line-up is very refreshing. Hope you keep up the good work and keep delivering great new products and optimize your production!
4 year(s) ago via
russell rodriguez why is so much debt required to be in the automotive business? surely the strategy of operating on a cash basis is smarter than paying fees for borrowing on credit. I'm glad Ford survived the immediate crisis. However, there would be a greater ROI if they just bit the bullet, survived these hard times paying off all debts, and emerged as a debt free corporation. How about those are bragging rights?
4 year(s) ago via
Leland Haydon Thank You, Ford... I always knew you could do it!! Defy the goverment and succeed on your own as an American free enterprize company, not as a govermental puppet as GM has become. I own a fleet of about 50 veihicles, sorry to say 90 percent GM, No more. I've decided to change directions and move forward with you thru atrition. You caught my eye back in the Bill Ford days that coarse of change really helped the direct appeal of your products, a big gamble I was glad to see pay off. In the 70's I was a Ford man, 69 Mach 1, 69 Torino GT, 2 wounderful cars to grow up driving and working on, I loved it. I got derailed working at a Buick, Pontiac, and GMC dealer, then never looked back. The 74' Mustang did it, all hope was lost. Moving forward the Fusion, Transit, Taurus, and Flex have a bright future here at B&C Communications. Leland B. Haydon Pres. B&C Communications
4 year(s) ago via
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