FOX Translator
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Just like you never want to hear a doctor say "oops" in the operating room, you never want to see a going-concern statement
in a financial report about a company you own. Accountants throw these in when they've been over the books, talked to customers,
and checked the horoscopes and have concluded there is "substantial doubt" about a company's ability to remain in business.
In short, don't blame the accountants if the company files for bankruptcy protection.
You¿d reckon that a going-concern
statement would be enough to send investors running to the exits, but it's not. True, many large institutions automatically
bail when an existing company gets slapped with one of these, but many individuals (often wrongly) take a chance they know
more than the bean counters.
During the tech boom of the late 1990s, many companies actually went public even though they had been hit with going-concern statements. Many of those companies subsequently disappeared. Enough said.
Home / Markets
Thursday, July 24, 2008
Ford Posts $8.67B Loss in the Second Quarter
Associated Press
Ford Motor Co. (F) said Thursday it lost $8.67 billion in the second quarter largely because of a reduction in the value of assets.
The company also announced that it will bring six European small car models to North America by the end of 2012 as it deals with a market shift from trucks to cars brought on by high gasoline prices. The company also will retool two more U.S. truck and sport utility vehicle plants to build small, fuel-efficient vehicles.
The second-quarter loss was $3.88 per share, compared with net profit of $750 million, or 31 cents per share, in the same quarter a year ago.
The loss includes $8 billion worth of write-offs because of a decline in value of North American assets and Ford Motor Credit Co.'s lease portfolio.
Ford's second-quarter revenue was $38.6 billion, down $5.6 billion from the year-ago period.
Ford said it will retool the Michigan Truck plant in suburban Detroit, shifting its products from large SUVs to make global vehicles off the European Focus platform by 2010.
The SUVs made at Michigan Truck -- the Lincoln Navigator and Ford Expedition -- will be shifted to the Kentucky Truck plant in Louisville.
The company also will retool the Louisville Assembly Plant, which now builds the Ford Explorer midsize SUV, to produce vehicles on the European Focus frame, starting in 2011.
Ford also said its Twin Cities Assembly Plant in St. Paul, Minn., will continue producing the Ranger small pickup through 2011. The plant was scheduled to close next year.
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