Americans' continuing love affair with the automobile pushed the earnings of
, the second-largest automaker, up 5% in the first quarter, exceeding Wall Street's expectations Monday, despite a stagnant market overseas.
The Dearborn, Mich.-based company said net income rose to $2.1 billion, or $1.70 a diluted share in the first quarter compared with $2 billion, or $1.60 a share in the first quarter of 1999, which included a one-time gain of $165 million from the dissolution of autocomponent maker
Analysts were looking for $1.58 a share on the average in the latest quarter, according to a survey from
First Call/Thomson Financial
Shares of Ford finished up 4 13/16, or 9.2%, to 57 1/16 in early trading.
Jacques Nasser, Ford president and chief executive, said in a statement the company was poised for profitable growth in financial services, automotive consumer services,
rental cars and e-business.
These results follow Ford's announcement last week it would distribute to shareholders shares of
, its automotive parts subsidiary, in a transaction the company said could be worth $10 billion. Shareholders will have the option of taking $20 a share in cash or getting new shares equivalent to the cash value.
Excluding Visteon, first-quarter revenues rose 14%, to $43 billion, from $37.5 billion in the first quarter last year.
Strong demand for "hit products", according to Nasser increased profits by 20% at Ford's North American automotive operations, excluding Visteon, which earned $1.7 billion, up from $1.4 billion the year-earlier quarter. Nasser said the acquisitions of
and the planned acquisition of
have fortified and broadened Ford's consumer appeal.
Total vehicle sales rose to 1.91 million in the first quarter 2000 from 1.77 million in the year-ago period.
Vehicle sales the United States totaled 1.2 million, lead by the Ford Focus, Ford F150 SuperCrew, Ford Explorer Sport Trac and Sport, Jaguar S-Type and the Volvo 70.
While the company benefited from a strong domestic economy, Ford lost $115 million from foreign auto sales. The company sold 602,000 autos outside the U.S. in the first-quarter 2000 vs. 554,000 in the year-ago period.
, its finance leg, earned $353 million, up 18% in the first-quarter 2000 from $300 million in the same period in 1999.
Earnings at Hertz, Ford's rental car agency, grew 14% to $56 million from $49 million from the year-earlier quarter.
Ford hopes to continue its earnings momentum with a new sport utility, Ford Escape, the Volvo S60, a different version of the Ford Explorer, and Mercury Mountaineer and a new Mondeo sedan in Europe.