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By Bernie Woodall and Ben Klayman
DEARBORN, Mich., April 28 (Reuters) - Ford Motor Co reported a first-quarter profit that was less than analysts expected, selling fewer vehicles in North America as it worked to increase production of the redesigned F-150 pickup truck, and losing money in South America.
The No. 2 U.S. automaker on Tuesday also maintained its full-year forecast of pretax profit between $8.5 billion and $9.5 billion.
The company raised its forecast for North American operating margin to 8.5 percent to 9.5 percent from 8 percent to 9 percent as the F-150 launch goes better than expected, but Ford said business conditions were worsening in South America.
“The external environment in South America has deteriorated compared to where we were just a few months ago,” Ford Chief Financial Officer Bob Shanks told reporters.
Instead of reporting a “substantial” improvement from last year’s $1.16 billion loss in South America, as it had forecast in January, Ford dropped “substantial” from its outlook.
Ford’s overall first-quarter net income fell 7 percent to $924 million, or 23 cents a share, from $989 million, or 24 cents a share, a year earlier. Analysts expected earnings of 26 cents a share, according to Thomson Reuters I/B/E/S.
Revenue fell 5.6 percent to $33.9 billion, matching expectations.
Ford said 2 cents of the 3-cent profit shortfall was due to a tax rate that was higher than analysts expected.
Shanks said the company’s operating profit margin of 6.7 percent in North America would have topped 10 percent, if two highly profitable models now being relaunched with new designs - the F-150 and Edge - had matched year-ago sales levels.
Ford’s North American profit would have increased more than $1 billion from its reported $1.34 billion operating profit if sales of the relaunched vehicles had been the same as last year, he said.
Ford shipped 40 percent, or about 60,000, fewer F-150 pickup trucks in the quarter than a year ago, and about 15,000, or more than 50 percent, fewer Edge vehicles than a year ago, Shanks said.
North American market share fell by six-tenths of a point to 6.7 percent due to the launches, but Shanks said that will rise through the rest of the year.
(For graphic on Ford earnings, click: here)
The loss in South America narrowed to $189 million from $510 million last year as it pushed through higher prices, but Shanks said the region’s economies were “clearly in recessionary conditions.” Ford will keep cutting costs and matching production with the weaker demand as it rides out the downturns.
The loss in Europe narrowed to $185 million from $194 million, while profits in Asia Pacific dropped to $103 million from $291 million last year due to the cost of product launches.
Its shares fell 0.75 percent to $15.78 shortly after midday.
Editing by Alden Bentley and Jeffrey Benkoe