Ford Motor Co (F.N) surprised Wall Street with a quarterly profit on Monday and raised its 2011 outlook to "solidly profitable," sending its shares up 5.7 percent in premarket trading.
Ford, the only large U.S. automaker to avoid bankruptcy in 2009, said the third-quarter results were supported by cost cuts, improved credit results and increased market share in North America and other key areas.
Ford burned through $4.7 billion of cash in the first half of 2009 but reported $1.3 billion of positive cash flow in the third quarter. It said it expects positive cash flow in the fourth quarter as well.
The positive cash flow was Ford's first since the second quarter of 2007. The company also reported its first quarterly operating profit in its key home market of North America since the first quarter of 2005.
"Our third-quarter results clearly show that Ford is making tremendous progress despite the prolonged slump in the global economy," Chief Executive Alan Mulally said in a statement.
Ford, which raised its 2011 outlook from a previous forecast for at least break-even, said it was confident the global economy would be improving by 2011, but the near-term growth outlook "remains rather uncertain."
Ford reported a net profit of $997 million, or 29 cents per share, for the third quarter, compared with a net loss of $161 million, or a 7 cents per share, a year earlier.
Operating profit was 26 cents per share excluding one-time items. On that basis, analysts on average expected a loss of 12 cents per share, according to Thomson Reuters I/B/E/S.
Revenue fell by $800 million to $30.9 billion.
From its automotive business, Ford reported a $446 million pre-tax operating profit worldwide, including positive results in all four of its regions — North America, South America, Europe and Asia Pacific.
It was Ford's first quarterly operating profit in its key home market of North America since the first quarter of 2005.
Ford posted losses totaling $30 billion from 2006 through 2008. The company remains saddled with a much heavier debt load than General Motors (GM.UL)or Chrysler following their bankruptcy reorganizations.
Still, Ford has been seen as in much better shape than its U.S. rivals in its finances and product lineup. Ford has cut thousands of salaried and hourly workers in restructuring over the past four years, but has maintained its product cycle.
Its shares rose 40 cents to $7.40 in premarket trading.
