DEARBORN (AP) After tucking away $4.1 billion in restructuring costs into last year”s books, Ford Motor Co.”s chief financial officer says the automaker expects to break even in 2002 as a result of a major cost-cutting plan.
“In 2002 we will realize $2 billion in pretax profit improvement from the revitalization plan,” Ford CFO Martin Inglis said during a conference call yesterday with financial analysts and reporters.
After an expected loss in the first quarter of this year, Inglis said he expected the automaker would either break even or return to profitability by year”s end.
Ford posted a $5.07 billion loss in the fourth quarter of 2001, or $2.81 a share, mostly due to the $4.1 billion in costs related to its restructuring plan and an additional $102 million in accounting charges, the automaker reported yesterday.
Excluding those costs, the automaker would have lost $860 million or 48 cents a share, beating Wall Street expectations. A consensus of analysts polled by Thomson/First Call estimated Ford would lose 50 cents a share excluding special costs.
“It was the expected disaster. Ford is hemorrhaging red ink all over the place,” said David Healy, an analyst with Burnham Securities Inc.
The loss means there will be no profit-sharing checks for hourly workers. On Wednesday, hourly workers at General Motors Corp. were told they would not receive profit sharing checks this year because even though the automaker reported a profit for 2001, it did not meet financial goals.
Inglis called 2001 a challenging year for the automaker, citing “unexpected” economic factors and the Firestone tire replacement program.
During the October-December period in 2000, Ford earned $1.08 billion, or 57 cents a share, including special items, but not including earnings from its parts subsidiary, Visteon Corp., which it spun-off.
For all of 2001 Ford lost $5.45 billion or $3.02 per share including the special charges, compared with earnings of $3.47 billion, or $2.30 a share in 2000. This was Ford”s first losing year since 1992 when the world”s second-largest automaker lost $7.4 billion.
Excluding the charges, in 2001 Ford lost $782 million or 44 cents a share.
Revenues for 2001 were $162.4 billion, down 5 percent from $170.1 billion a year ago.
Inglis said while Ford gained .3 percent market share in the United States during the fourth quarter, the automaker”s market share dropped almost 1 percent to 22.8 percent for the year.
The automaker”s worldwide automotive operations lost $803 million in the fourth quarter compared to a $762 million profit in the same period in 2000.
In North America, Ford”s automotive operations lost $916 million in the fourth quarter of 2001 compared to a profit of $740 million in 2000.