Ford reports record full-year pre-tax profit of $10.8 billion

(January 28, 2016) DEARBORN, Mich. — Ford today reported record full-year pretax profit of $10.8 billion and net income of $7.4 billion including $1.9 billion in the fourth quarter. The company earned a fourth-quarter record of $2 billion in North America and its first full-year profit in Europe since 2011.

“We promised a breakthrough year in 2015, and we delivered,” Ford CEO Mark Fields said in a statement. “In 2016, we will continue to build on our strengths and accelerate our pace of progress even further, while transforming Ford into both an auto and a mobility company and creating value for all of our stakeholders.”

Revenue increased 3.8 percent to $149.6 billion. Automotive operating margins grew 2.2 percentage points to 6.8 percent, which it said is the highest since at least 2001. Ford said margins were the highest since at least the 1990s.

“Every single financial metric improved on a year-over-year basis,” Ford CFO Bob Shanks told reporters at Ford’s headquarters this morning.

Ford’s fourth-quarter net income swung from a loss of $2.5 billion a year ago, after a restatement related to pension accounting, to a profit of $1.9 billion. Its operating profit for the quarter, excluding special items, was $2.3 billion, equal to 58 cents a share. That compares with Wall Street expectations of 51 cents.

Much of the increased profit came from sales of high-margin pickups and SUVs.

The full-year North American profit of $9.3 billion means Ford will give its 53,000 hourly workers profit-sharing payouts averaging $9,300, which is $500 more than the previous record. Workers received a $1,500 advance on that bonus last fall as an incentive to approve a new labor contract. The payouts for 2014 averaged $6,900.

In Europe, Ford earned $259 million. It was profitable in all of its global regions except South America.

After North America, Ford’s most profitable region was Asia-Pacific, where it earned a record $765 million. More than half of that — $444 million — came from the fourth quarter, due to strong growth in China, Shanks said.

Sources: Ford, Automotive News