Ford Motor Co. yesterday reported record worldwide sales of $10 billion for the first three months of 1978 and near-record profits of $466 million ($3.93 a share) compared with sales of $9.2 billion and profits of $483 million ($4.10) for the same quarter last year.
A statement released by Henry Ford II, chairman of the board, said the reason for the earnings decline was due primarily to a less profitable mixture of new cars sold, large and continuing capital expenditures for coming models, and the higher costs of materials and labor. His statement said those were partially offset by the change in exchange rates for foreign operations.
In the first three months, Ford sold 1.625 million vehicles worldwide compared with $1.64 million in the same quarter a year earlier.
The Ford report included a striking increase in profits from foreign operations. U.S. and Canadian operations produced a scant $232 million of the company's total $466 million profits.
Edward Blanch, vice president of finance, answered a query about that by saying the company has participated in international operations almost since it was founded in 1903 and considers those international profits "sustainable," management cost controls were a strong international plus, and booming new product success internationally - presumably the European-made subcompact Fiesta - would continue.
Asked whether the first quarter's bad weather had hurt Ford, Blanch attributed the loss of roughly 3 cents a share in profits, or 52,000 units of production to the cold and snow. He added that roughly two-thirds were scheduled to be made up during coming months.
The statement from Henry Ford II said the company still expects to devote $2.5 billion to capital expenditures during 1978.
The bulk of the rise in international profits came from Britain and Germany, according to Blanch.
The Ford report was in stark contrast to Chrysler Corp's record loss of $119.8 million announced a day earlier. General Motors Corp, earlier reported profits of $870 million on sales of $14.9 billion for the three-month period.
News services also reported the following corporate earnings:
Armco Steel Corp. yesterday said first-quarter earnings rebounded sharply from results a year ago that were depressed by poor weather, and stockholders voted overwhelmingly to change the name of the company to Armco Inc.
The name change is the second in the company's history and takes effect July 1. It is being made to reflect the company's ongoing diversification, which now provides a major part of Armco's income, William Verity, Armco chairman, noted.
Armco, the nation's sixth-largest steel maker, reported earnings of $30.23 million (96 cents a share) on record revenues of $946.22 million. In the comparable period last year, earnings were $6.12 million (15 cents) on revenues of $788.13 million.
"This year's figures, in the face of the second consecutive year of very bad winter weather which affected steel operations, is a positive indication of Armco's ability to offset the cyclical results from its steel businesses," Verity said during the the company's annual stockholders meeting yesterday in Middletown, Ohio.
"At its heart, the year boils down to a question of how much of America's demand for steel will be filled by foreign imports and how much by a hungry steel industry," Verity and Armco President Harry Holliday said.
If imports are limited to the administration's stated goals of 12 million to 14 million tons, domestic shipments should rise about 10 percent, Armco executives predicted!
"If that happens and we crank improved steel results into the rest of a healthy, thriving Armco, we think you will be pleased next year when we tell you how Armco did in 1978," Verity said. "The results won't match the heavy and profitable demand of 1974, but we believe 1978 will be Armco's second best year in history."
UAL Inc. yesterday reported the best first-quarter results in its history as the parent company of United Airlines turned the 1977 first quarter's $23.97 million loss into an unaudited profit of $17.1 million (65 cents a share fully diluted) in the latest period.
This marked the second time since 1968 that UAL has been profitable in the seasonally weak first quarter.
Revenues were $830.6 million, a 15.2 percent increase from 1977 first-quarter revenues of $720.799 million.
United Airlines earned $13.5 million compared with a restated loss of $27.3 million a year earlier, Western International Hotels Co. earnings increased by 149 percent to $2.66 million, and GAB Business Services showed a gain in net earnings to $381,000 from $55,000.