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Ford Profit Misses Expectations, 2015 Profit Outlook Affirmed

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Ford Motor Co (F.N) on Tuesday reported a 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 maintained its full-year forecast of pre-tax profit of 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, but highlighted worsening business conditions 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 said to reporters.

Net income in the first quarter fell 7 percent to $924 million, or 23 cents a share, compared with $989 million or 24 cents a share a year earlier. Analysts had 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 analyst expectations.

Ford said that two cents of the three-cent profit shortfall was because the tax rate was higher than analysts had expected.

Shanks said that the company’s 6.7-percent operating profit margin in North America would have been over 10 percent if two highly profitable models now being relaunched with new designs, the F-150 and Edge, had matched year-ago sales levels. That also would have increased Ford’s North American profit more than $1 billion from its reported $1.34 billion operating profit, he said.