3 Min Read
DETROIT (Reuters) - Ford Motor Co (F.N) on Thursday said it would keep relying on North America for its profit this year as the No. 2 U.S. automaker signaled that losses in Europe would be more than previously forecast.
Ford had previously estimated losses from Europe at about $250 million in 2015. On Thursday, however, it backed away from that forecast, saying the loss would narrow from $1 billion in 2014 but would be wider than previously thought.
"We're seeing a much bigger impact from Russia," Chief Financial Officer Bob Shanks said.
The company's earnings beat Wall Street's expectations but fell from the prior year, mainly due to charges for a previously announced accounting change for its Venezuela operations. Ford also maintained its 2015 profit forecast.
Shanks said the introduction of the latest version of Ford's F-150 pickup truck was going "extremely well" in North America, where 2014 pretax earnings of $6.9 billion were greater than the overall profit of $6.3 billion. The truck is the major force behind Ford's earnings.
The profit margin in North America was 8.4 percent last year. Ford had said last fall that figure would finish at the low end of a range of 8 percent to 9 percent.
In the fourth quarter, Ford's pretax profit fell in North America and Asia.
Ford's loss in Europe was $443 million, compared with $529 million a year earlier.
Net income was $52 million, or 1 cent per share, a decline from $3.07 billion a year earlier, when results were boosted by a one-time $2.1 billion special tax item. This year, Ford took a one-time charge of $800 million in the fourth quarter for an accounting change in Venezuela that also shields its future earnings from the volatile currency and operations there.
Excluding special items, earnings were 26 cents per share, 3 cents higher than the expectations of analysts polled by Thomson Reuters I/B/E/S.
Revenue of $35.9 billion topped analysts' estimates of $34.54 billion.
In North America, Ford made a pretax profit of $6.9 billion in 2014, which will yield an annual bonus for about 50,000 union-represented workers of $6,900 per person, down from $8,800 in 2013.
Ford maintained its forecast for 2015 pretax profit of between $8.5 billion and $9.5 billion.
Ford's shares were up 2 percent in premarket trading at $14.75.
Reporting by Bernie Woodall and Ben Klayman; Editing by Lisa Von Ahn