Ford Motor Company (NYSE:F) released its third-quarter earnings for fiscal year 15 (3QFY15) on Tuesday during pre-market hours.
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Analysts polled by Thomson Reuters were expecting quarterly earnings of 46 cents a share on sales of $35.07 billion.
While the margins at Ford are rich, CFO Bob Shanks told the press on Tuesday that profitability for the fourth quarter would be affected negatively by seasonal costs that are higher and possible payouts in relation to a new deal with labor unions.
Earnings easily outpaced the $835 million reported in the same quarter a year ago, when sales and profits in North America felt the short-term impact of an aggressive year of product launches.
Shanks added that Ford Credit had its best quarter since 2011, that outside the USA, operations improved year-over year, and that cash flow at $2.8 billion was a big boost of $3.5 billion over the third quarter in 2014. Ford’s average transaction price (ATP) has increased significantly over the years.
Its revenue rose $3.2 billion to $38.1 billion.
Ford’s results echoed those at its rival, General Motors.
MANAGEMENT DISCUSSION SECTIONOperator: Good day, ladies and gentlemen, and welcome to the Ford third-quarter earnings conference call. And the Ford brand is the commercial vehicle leader in Europe and we recorded our best sales in 12 years there, led by the Transit family.
The automaker’s overall sales rose 7 percent to 1.6 million.
In fact, re-engineering the F-150 to shed weight has, according to Shanks, enabled Ford to have flexibility with other products in its portfolio.
Still, North America is the foundation for the company’s optimism. What seems to have been lost in the midst of the news of the shortcoming, however, is that Ford was still wildly profitable in the third quarter in spite of uncertainty in each of the overseas markets where it operates.
Despite the loss in Europe – a trouble spot for years – Ford posted its best quarter there since 2009. As far as operating results, the company was right on target, but they were subjected to a 33% tax rate. Pre-tax loss amounted to $163 million, lower than a pre-tax loss of $170 million in the prior-year quarter. It earned $20 million in the third quarter, down $24 million from a year ago.
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In the company’s other regions, revenues were mixed year-over-year across the board, with sales down in South America and the Middle East/Africa regions, flat in Asia/Pacific, and up $100 million in Europe. In China, Ford’s market share remained flat at 4.7%. Analysts projected revenue of $35.07 billion. Now along with those results, we also delivered strong top-line growth.
