Ford Post 274 million dollar loss for 08

[vztrt]

While not the best result there was a big write off but they have reduced their operating loss.


http://www.goauto.com.au/mellor/mell...2575DA0020325A

Ford Oz posts record $274m loss for 2008

Third consecutive operating loss announced by Ford Australia

By MARTON PETTENDY 19 June 2009

FORD Australia today announced a net after-tax operating loss of $274.4 million for 2008 – its worst financial result and more than triple the $87.1 million loss it posted in 2007.

The result is the third consecutive annual operating loss recorded by Ford Australia since 2005, when it posted a $148 million profit ahead of a $40 million loss in 2006.

GM Holden is yet to announce its financial results for 2008 but reported a $6 million loss in 2007 – a vast improvement on its $146 million and $145 million losses in 2006 and 2005 respectively.

Toyota Australia is also yet to reveal its financial performance during its previous fiscal year (ending on March 31), but posted $242 million and $184 million profits in 2007/08 and 2006/07 respectively.

Ford said its net sales revenue for 2008 was $3.29 billion – down about 7.5 per cent or $168 million from a year ago – from total sales of 108,564 vehicles including exports (down 5319 on 2007 figures).

However, it pointed out that the launch of the last year’s new FG Falcon range and continued cost-cutting helped offset the decline in automotive sales in Australia last year, when it improved its underlying financial result on a pre-tax operating basis.

Excluding financing costs of $74 million and special charges totalling $313 million on an after-tax basis, Ford Australia posted an underlying operating loss of $14 million, compared to a $99 million loss in 2007 – up $85 million.

Ford said special items included $151 million in accounting adjustments for the company's defined benefit superannuation fund, $110 million in restructuring costs including voluntary redundancies during 2008 and $52 million in the reduced value of certain long-lived assets.

Ford Australia president and CEO Marin Burela said today Ford had endured a challenging year as the Australian market was affected by the global economic slowdown.

“But Ford Australia’s underlying business continued to improve with strong new vehicle launches and our continued progress in lowering costs and gaining efficiencies,” he said.

“We are continuing to improve our business fundamentals and implement our strategic plan as we move through 2009.

“We’ll continue with a laser focus delivering positive results, which included an increase in market share in May to 11.2 per cent. Ford is the only local manufacturer to have increased market share during 2009.

“Launches of exciting new products such as the all-new Fiesta, the updated Territory and Ranger and the Mondeo wagon, will continue to drive customers back to the Ford brand and increase our sales revenue.”

[vztrt]

Age Article

http://business.theage.com.au/busine...0619-cnm4.html

Ford's Australian losses triple
June 19, 2009 - 4:52PM

Ford's Australian operations lost a record $274.4 million in 2008, triple the previous year's deficit, as sales slumped and the car maker topped up employees' superannuation funds.

The company's sales shrank 7.4 per cent in 2008 to $3.06 billion, the company said in its annual report. Net sales fell about 5 per cent, to $3.29 billion, with vehicle sales dropping 5319 units to 108,564 last year.

The result reflects slowing demand for large cars and the impact of the global financial crisis in the second half of last year.

Ford president Marin Burela recently admitted the launch of its all-new Falcon sedan last April had got off to a slow start.

A new model usually enjoys a honeymoon period of higher sales, but Falcon sales finished last year 6 per cent down on 2007.

A perennial top-two seller for decades, the Falcon slipped behind the Toyota Corolla and Mazda3 small cars last year for the first time.

Gap widens

The new Falcon also failed to close the sales gap on its main large car rival, the Holden Commodore.

At the same time, Ford's other locally-produced vehicle, the Territory off-roader, fell out of favour with buyers, recording a 25 per cent drop in sales.

Overall Ford sales finished the year down 3 per cent in 2008.

Sales have deteriorated further this year, falling 18 per cent in line with the overall market. Falcon sales have proved more resilient, though, falling just 2 per cent, which has allowed Ford to increase its market share slightly.

Burela said the company had trimmed costs and improved efficiency throughout its business.

''We are continuing to improve our business fundamentals and implement our strategic plan as we move through 2009,'' he said.

'Challenging year'

Ford will build a new small car, the Focus, in Australia from 2011 as it attempts to re-shape its business to suit shifting buyer preferences.

"This was a challenging year as the Australian market was affected by the global economic slowdown, but Ford Australia's underlying business continued to improve with strong new vehicle launches and our continued progress in lowering costs and gaining efficiencies," said Mr Burela in a statement.

Ford now lags a distant third in local vehicle sales, behind Toyota and General Motors' Holden. The company has been hurt by its reliance on larger vehicles, such as its six-cylinder sedans and Territory four-wheel drives, as higher fuel prices prompt buyers to switch to smaller cars.

The losses included a one-time restructuring cost of $162.18 million, compared with no such deduction in 2007.

The declining stock exchange also meant the company had to set aside a further $151.12 million for employees' defined benefit retirement fund, the company said. In the previous year, Ford needed just $369,000 to top up local super funds.

Ford and the other two car makers are recipients of government aid to help them produce more efficient vehicles in Australia. Ford's accounts show a net tax benefit of $127.5 million for 2008, almost triple the previous year's $45.3 million benefit.

The car maker, with plants in Geelong and Melbourne's northern suburb of Broadmeadows, spent $250.7 million on research and development last year, slight more than the $243.3 million spent in the previous year.

Excluding financing charges and special items, Ford's an underlying operating loss was $14 million, compared with a $99 million loss in 2007, an improvement of $85 million, the company said.

Special items included $110 million ''to reflect the cost of restructuring actions during 2008; and $52 million to reflect the reduced value of certain long-lived assets,'' the company said.

BusinessDay, with Richard Blackburn

[vztrt]

Car advice report

http://www.caradvice.com.au/33165/fo...sts-274m-loss/

Ford Australia has posted a substantial $274.4 million loss for last year but says much of that involves restructuring costs that will place it in a better position to move forward.

Restructuring charges cost it $162.2 million and came as sales revenue fell 7.4 per cent, lead by a declining interest in the Ford Falcon large car, which has been the company’s mainstay in the past.

In addition the collapse of the stock market meant the company had to contribute $151 million to prop up its employee superannuation scheme.

The losses reported by Ford Motor Company of Australia, which is wholly owned by Ford in the United States, have more than tripled from the $87.2 million reported in 2007.

However, the company said it had “proactively restructured its operations” in the past year and is in a strong position to deal with the future.

“This was a challenging year as the Australian market was affected by the global economic slowdown, but Ford Australia’s underlying business continued to improve with strong new vehicle launches and our continued progress in lowering costs and gaining efficiencies,” said Ford Australia President and CEO Marin Burela.

Net sales revenue for 2008 was $3.29 billion, down $168 million from one year ago. The results were based on total volumes of 108,564 units, including exports, down 5319 units from a year ago.

“We are continuing to improve our business fundamentals and implement our strategic plan as we move through 2009,” said Mr Burela.

Ford said the one-off $162.2m restructuring charge included write-downs on the value of some assets.

Ford said it had the continued support of its US parent company, which provides the Australian arm with a revolving $900 million loan.

“Our current cash flow forecasts indicate a return to positive operating cash flows in 2009,” the Australian company said.

“Furthermore, if required, we could receive additional support from Ford US to continue our operations.”

A $52.2 million impairment loss was largely attributable to “the downturn in the global economy and the deteriorated outlook for the automotive industry both in Australia and overseas markets”, Ford said in its annual report.

[GT69]

'The age' loves to lay the boot in doesn't it? :

[Road_Warrior]

Ford said it had the continued support of its US parent company, which provides the Australian arm with a revolving $900 million loan.

O rly.

[csv8]

Ford's Australian operations lost a record $274.4 million in 2008, triple the previous year's deficit, as sales slumped and the car maker topped up employees' superannuation funds.

The company's sales shrank 7.4 per cent in 2008 to $3.06 billion, the company said in its annual report. Net sales fell about 5 per cent, to $3.29 billion, with vehicle sales dropping 5319 units to 108,564 last year.

The result reflects slowing demand for large cars and the impact of the global financial crisis in the second half of last year.

Ford president Marin Burela recently admitted the launch of its all-new Falcon sedan last April had got off to a slow start.

A new model usually enjoys a honeymoon period of higher sales, but Falcon sales finished last year 6 per cent down on 2007.

A perennial top-two seller for decades, the Falcon slipped behind the Toyota Corolla and Mazda3 small cars last year for the first time.



The new Falcon also failed to close the sales gap on its main large car rival, the Holden Commodore.

At the same time, Ford's other locally-produced vehicle, the Territory off-roader, fell out of favour with buyers, recording a 25 per cent drop in sales.

Overall Ford sales finished the year down 3 per cent in 2008.

Sales have deteriorated further this year, falling 18 per cent in line with the overall market. Falcon sales have proved more resilient, though, falling just 2 per cent, which has allowed Ford to increase its market share slightly.

Burela said the company had trimmed costs and improved efficiency throughout its business.

''We are continuing to improve our business fundamentals and implement our strategic plan as we move through 2009,'' he said.

'Challenging year'

Ford will build a new small car, the Focus, in Australia from 2011 as it attempts to re-shape its business to suit shifting buyer preferences.

"This was a challenging year as the Australian market was affected by the global economic slowdown, but Ford Australia's underlying business continued to improve with strong new vehicle launches and our continued progress in lowering costs and gaining efficiencies," said Mr Burela in a statement.

Ford now lags a distant third in local vehicle sales, behind Toyota and General Motors' Holden. The company has been hurt by its reliance on larger vehicles, such as its six-cylinder sedans and Territory four-wheel drives, as higher fuel prices prompt buyers to switch to smaller cars.

The losses included a one-time restructuring cost of $162.18 million, compared with no such deduction in 2007.

The declining stock exchange also meant the company had to set aside a further $151.12 million for employees' defined benefit retirement fund, the company said. In the previous year, Ford needed just $369,000 to top up local super funds.

Ford and the other two car makers are recipients of government aid to help them produce more efficient vehicles in Australia. Ford's accounts show a net tax benefit of $127.5 million for 2008, almost triple the previous year's $45.3 million benefit.

The car maker, with plants in Geelong and Melbourne's northern suburb of Broadmeadows, spent $250.7 million on research and development last year, slight more than the $243.3 million spent in the previous year.

Excluding financing charges and special items, Ford's an underlying operating loss was $14 million, compared with a $99 million loss in 2007, an improvement of $85 million, the company said.

Special items included $110 million ''to reflect the cost of restructuring actions during 2008; and $52 million to reflect the reduced value of certain long-lived assets,'' the company said.

BusinessDay, with Richard Blackburn
© 2007 The Sydney Morning Herald
Popular Stories

[Wally]

That's disappointing. I was hoping both companies (the two that count) would turn a nominal profit.

[Falc'man]

Originally Posted by Wally

That's disappointing. I was hoping both companies (the two that count) would turn a nominal profit.

Who are the two that count?


Poorly written article. Tries to link "losses" to "sales" in the first bit...

Ford's Australian operations lost a record $274.4 million in 2008, triple the previous year's deficit, as sales slumped

Then the explanation for this loss right down the bottom. Nothing to do with lack of sales. Doomsdayer's article, typical rubbish sorry to say.

The losses included a one-time restructuring cost of $162.18 million, compared with no such deduction in 2007.

The declining stock exchange also meant the company had to set aside a further $151.12 million for employees' defined benefit retirement fund, the company said. In the previous year, Ford needed just $369,000 to top up local super funds.

If you add up the numbers it's more of a positive result than the author would want you to think.

How about a link?

[Dr Smith]

Different writer, different view, same numbers:
http://www.businessspectator.com.au/...Q?OpenDocument

[Joe5619]

Accountants can be very creative!! Read the 2nd last paragraph to is where the "true" business perfromance is heading long time..

[vztrt]

http://www.fordforums.com.au/showthread.php?t=11263866

[phillyc]

http://www.businessspectator.com.au/...Q?OpenDocument
A much better, balanced article.

2nd last paragraph

Car people tend to be very product focused – the better mousetrap syndrome! But Ford’s product range looks fairly comprehensive and competitive at present while pricing is competitive, which leaves the image and marketing as the real problems.

[Donut King]

merged threads

[phillyc]

I think the real key is this

Ford's an underlying operating loss was $14 million which is a dramatic closing of the loss made the previous year.

The other big factor was the stock market losses requiring the defined benefit super/pension scheme needing big bucks, ie $150m plus!

Ford Australia, also had the decency to retrench workers, unlike Holden who are starving off their workers with real pay reduced by over 30%. The redundancy cost was $110m...

The final thing i noticed is what Marin Burela said.

“We’ll continue with a laser focus delivering positive results, which included an increase in market share in May to 11.2 per cent. Ford is the only local manufacturer to have increased market share during 2009.

Which sounds exactly like the speak that Ford CEO Alan Mullaly says.

[Wally]

Originally Posted by Falc'man

Who are the two that count?


...

Holden Australia and Ford Australia

[Falc'man]

Originally Posted by Wally

Holden Australia and Ford Australia

They're just as Australian as Toyota, or whoever else manufactures here.

[Wally]

Tell that to the guys who go to Bathurst and the plethora of members here who have preoccupation with red versus blue. Toyota only gets mentioned in passing in these forums, while Holden dominates.

[Falc'man]

Originally Posted by Wally

Tell that to the guys who go to Bathurst and the plethora of members here who have preoccupation with red versus blue. Toyota only gets mentioned in passing in these forums, while Holden dominates.

I'm not interested in what people think. Fact is, Holden, Toyota, Ford, are not Australian owned.

Going back to your answer, and then your explanation, I think you're a closet Holden lover that doesn't accept any criticism of the un-Australian bogan car company. Live with it. Holden doesn't "count" any more or less than Toyota does. Toyota employs people locally, and that's what counts the most!

[Dave R]

Originally Posted by Falc'man

They're just as Australian as Toyota, or whoever else manufactures here.

No, they actually design their highest selling cars here.

[Road_Warrior]

Here's a more balanced article from Carpoint:

http://www.carpoint.com.au/news/2009...s-for-08-15550

Ford Australia has announced an after-tax loss of $274 million for the 2008 accounting period. This figure, three times the $87 million loss posted the previous year (more here), includes financing costs of $74 million and "special charges" of $313 million.

Among other items (including some amortisation of the FG Falcon development), the special charges comprise one-off items such as $110 million for staff redundancies near the end of last year and $151 million worth of "accounting adjustments for the company's defined benefit superannuation fund". The remaining $52 million charge covers depreciation on "certain long-lived assets" -- plant and equipment, in other words.

Despite the size of the after-tax loss, Ford is confident that the company's fortunes are turning around and points to the improvement in operating loss from $99 million in 2007 to $14 million in 2008 -- a difference of $85 million. With a more lucrative mix of Falcon sales for the year to date, 2009, plus Fiesta gaining ground, Ford anticipates a stronger showing for 2009.

In a press release issued today, the company highlighted the weaker market for new cars during 2008 by drawing comparison between the sales revenue for last year and the year before. In 2008, the company earned $3.29 billion in net sales revenue, a $168 million shortfall against the sales revenue for 2007.

"This was a challenging year as the Australian market was affected by the global economic slowdown, but Ford Australia's underlying business continued to improve with strong new vehicle launches and our continued progress in lowering costs and gaining efficiencies," Ford President Marin Burela was quoted as saying in the press release.

Earlier today, the Carsales Network spoke to Ford's Communications Manager, Sinead McAlary for some further background.

"The key thing is that our underlying business improved in 2008," she said, alluding to the reduction in the operating loss for the year. "It's the special items that take [the loss] up quite significantly."

McAlary explained that there were a range of actions Ford is taking to ameliorate the company's financial position for this year.

"We're continuing to launch new product," she said. "Obviously Fiesta is a significant one for us in this year. We're continuing to increase our market share, and we've actually... put a couple of production days back in, in the month of June. We were meant to have three non-production days and we've actually added those back in, because our sales are moving in the right direction."

Ford has gained market share in 2009, the only local manufacturer to do so, according to the press release.

"We've increased the mix of our local product..." McAlary continued. "We've got a richer mix, if you like, in the private segment -- of our vehicles. Obviously that directly contributes to the health of the business."

On that point, figures provided by Marin Burela at last week's sales briefing to the press indicated that just 4½ per cent of Falcon sales are currently contributed by the entry-level XT variants. Ford is thus earning decent margins from the FG Falcon, relative to the sales volumes. Over 40 per cent of Falcon sales are the 'G6' luxury models and the circa 50 per cent of sales remaining are the lucrative sports-focused 'XR' models.

Burela also said at the time that he could have sold another 300 units of the Territory SUV last month and buyers planning to order a G6E Turbo (pictured) won't be see it delivered until around the end of July. So on the product front, things are looking up for the local manufacturer.

"We are moving our business in the right direction," McAlary concluded.

[Wally]

Originally Posted by Falc'man

I'm not interested in what people think. Fact is, Holden, Toyota, Ford, are not Australian owned.

Going back to your answer, and then your explanation, I think you're a closet Holden lover that doesn't accept any criticism of the un-Australian bogan car company. Live with it. Holden doesn't "count" any more or less than Toyota does. Toyota employs people locally, and that's what counts the most!

I did wrirte a response, but then I figured it would be wasted on someone of your calibre.

[Wally]

Originally Posted by Adrenaline

No, they actually design their highest selling cars here.

And they posted a profit year end March 31 2009 of ~$124M.
95,000 exported vehicles is a good haul too.

They are using the lull to increase employee training in readiness for the upturn.... really good business acumen IMO.

[Wally]

Originally Posted by Road_Warrior

Here's a more balanced article from Carpoint:

http://www.carpoint.com.au/news/2009...s-for-08-15550

Unfortunately the figures speak for themselves. Without the Fedral grants the loss would have been:

122.4 + 274.4 = $396.8m.

consider also the deficit equity position of having twice the liabilities as assets on the balance sheet.

[Fordman1]

Originally Posted by Wally

Unfortunately the figures speak for themselves. Without the Fedral grants the loss would have been:

122.4 + 274.4 = $396.8m.

consider also the deficit equity position of having twice the liabilities as assets on the balance sheet.

Where did you get that info from Wally ?

[Wally]

Financial sites.

[Fordman1]

Originally Posted by Wally

Financial sites.

I don't believe FoA have released that info.

[Wally]

I can't comment on that, but they are the figures quoted. I might have to spend a few bob on a broker to get a copy.

[Fordman1]

Originally Posted by Wally

I can't comment on that, but they are the figures quoted. I might have to spend a few bob on a broker to get a copy.

I don't believe you'll get a copy......

Like I said it's not published info here.

[Wally]

I thought they had filed with ASIC?

[Dave_au]

Originally Posted by Wally

I thought they had filed with ASIC?

Yeah it's on there. 67 pages, filed under a 388a financial report of a public or disclosing entity.

Anyone can download it for a price from one of the various information brokers.