Dee-Ann Durbin and Tom Krisher, AP Auto Writers
DEARBORN, Mich. (AP) — Ford Motor Co. surprised Wall Street with a $2.6 billion profit in the second quarter as it continued to grab sales from rivals in a slowly recovering U.S. market.
It was Ford’s fifth straight quarterly profit. The company also expects to be profitable in the second half of the year, although less profitable than in the first half. The automaker sees even stronger results in 2011.
For the second quarter, Ford earned 61 cents per share. That compared with net income of $2.3 billion, or 69 cents per share, in the same quarter a year ago. The year-ago results were mainly driven by debt repayments.
Without special items, Ford earned 68 cents per share, exceeded analysts’ expectations of 40 cents per share. Analysts don’t factor in one-time items, including $229 million in charges related to the discontinuation of the Mercury brand.
Ford’s revenue rose to $31.3 billion from $27.2 billion a year earlier, more than analysts’ forecast of $29.8 billion. U.S. sales rose 28 per cent in the first six months of this year. That’s almost double the industry pace.
Ford paid off $7 billion in debt in the second quarter, including a $3.8 billion cash payment to a United Auto Workers trust fund that pays retiree health care bills. The automaker ended the quarter with $27.3 billion in debt, which will cut its interest payments by $470 million per year.
The debt helped finance a series of highly regarded new products, which has helped Ford grab buyers’ attention. The No. 2 U.S. automaker ended the quarter with 17.2 per cent of the U.S. market, up from 16.9 per cent at the end of the first quarter, according to auto information site Edmunds.com.
Ford said Friday it expects to end 2011 with more cash than debt. It now has $21.9 billion in cash.
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