AFF Technical Resources - Ford Australia Reports 2005 Profit

September 2006

Ford Motor Company of Australia Limited* today reported a net profit after tax of $148.2 million for calendar year 2005.

Calculated according to the new Australian International Financial Reporting Standards (AIFRS) introduced in 2005, the profit is a 23 per cent decline versus the prior year. The company's previously reported 2004 calendar year profit of $185.6 million was also recalculated under AIFRS and is now recorded at $192.3 million.

Net sales revenue for 2005 was $3.9 billion and resulted from sales of 129,140 vehicles.

"Our financial position in Australia for the 2005 calendar year remained strong," said Ford Australia President, Mr Tom Gorman.

"However, the reduction in our profit and sales revenue versus the prior year is a reflection of the market forces that became prevalent in the Australian automotive sector during the second half of 2005.

"Rising petrol prices have had a significant impact on sales of large cars and SUVs in Australia. Although this has had a flow-on effect on overall sales of our Falcon and Territory model lines, we maintained strong market share of each category during 2005."

Ford sold 53,080 Falcon vehicles during 2005, for a 33 per cent share of the large car market. Territory remained Australia's top-selling SUV, with 23,454 vehicles sold during the year, which also gave the company a 33 per cent share of the medium SUV segment.

Overall market share was 12.7 per cent, down from 14.2 per cent in 2004.

"We sold more locally manufactured vehicles in Australia during 2005 than any of our competitors, placing us in a unique position to build on this strong market presence," said Mr Gorman.

"The introduction of the BF Falcon and SY Territory in October 2005 allowed us to maintain our competitiveness and introduced a number of class-leading technologies, including the first six-speed automatic transmission on an Australian vehicle, to our locally produced range.

"Actions underway in 2006 will further improve the attractiveness of these model lines and introduce new customers to the Ford brand."

Other vehicles launched during 2005 included the all-new Ford Focus, which went on sale as small cars began to dominate the Australian automotive landscape.

"Initial availability concerns with Focus were resolved early in 2006 and we are continuing to build momentum with sales of our imported small and light vehicles," said Mr Gorman.

"The first half of 2006 has been challenging, with external market forces continuing to have an adverse impact on vehicle sales. However, Ford Australia has been very proactive in determining future product development and investment strategies which will position us well for the future.

"The announcement of the company's involvement in the development of a new global light commercial vehicle architecture program is proof of the engineering and design capability we have here at Ford Australia and we look forward to building on those and other export opportunities in the years to come."

* These financial results relate to Ford Motor Company of Australia Limited, Ford Sales Company of Australia Limited and Foral Service Proprietary Limited, and have been prepared in accordance with Australian Accounting Standards.