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Ford's earnings up in fourth quarter

CHRISTINE TIERNEY / The Detroit News

Ford Motor Co. reported a rise in fourth-quarter profit Monday, as gains from the sale of its Hertz Corp. rental car unit helped to offset continued losses in its automotive operations.

Its profit for all of 2005, however, dropped to $2 billion from $3.5 billion, reflecting a $1.6 billion pre-tax loss in the North American auto operations.

Ford reported its quarter and full-year results shortly before it was expected to outline a restructuring plan for its North American auto business.

Ford attributed its losses in North America to a drop in its U.S. market share for a 10th consecutive year, lower revenue in the region and “unfavorable cost performance”.

In the fourth quarter, Ford’s income rose 19 percent to $124 million. However, excluding special items — such as the proceeds from the Hertz sale and charges for staff reductions and writedowns of Jaguar and Land Rover assets — the after-tax income from continuing operations slipped to $511 million from $554 a year earlier.

Ford’s results were slightly above market expectations.

Among the bright spots in the automaker’s performance, Ford’s European auto operations returned to profit in 2005 as the automaker stemmed the losses of its luxury brands, notably Jaguar. The combined operations of Ford of Europe and the Premier Automotive Group — which also includes the Land Rover, Volvo and Aston Martin nameplates — reported a $112 million profit in the fourth quarter, compared with a $626 million loss a year earlier. For the full year, the European operations recorded a $36 million pre-tax profit, compared with a $324 million loss in 2004.

Ford’s total revenue increased to $47.6 billion in the fourth quarter from $44.9 billion a year ago.

Ford said special items reduced its earnings by 6 cents per share in the fourth quarter. Those included a pretax charge of $1.3 billion for ongoing restructuring at its Jaguar and Land Rover divisions, a $962 million charge for personnel reductions and a profit of $1.4 billion for the sale of its Hertz Corp. rental car division.
 
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