WSJ: Net income more than doubles amid continued sales growth in the U.S. light-vehicle market
Ford Motor Co. delivered record results in the first-quarter amid strong truck sales, with net income more than doubling in the period and an operating margin in the core North American unit rivaling those returned by high-end luxury brands.
Ford reported net income of $2.5 billion, or 61 cents a share, up from $1.2 billion, or 29 cents a share in the first quarter of 2015, a period negatively affected by short supplies of its biggest money maker, the F-150 truck. On an operating basis, the company earned 68 cents per share.
The results beat analyst expectations of 48 cents a share. The company’s closely watched North American operating margin equaled 12.9%, an all-time record during the three-month span, and far higher than the 8.7% at rival General Motors Co.This is a bigger story than the Facebook story on so many levels.
RBN Energy: US gulf coast propane exports back down.
The prospects for an ever-expanding boom in propane exports from the U.S. Gulf Coast are dimming, even as export volumes stand at near-record levels and as new export capacity continues to come online. Why? It comes down to supply and demand. With oil and NGL prices at today’s levels, propane production is leveling off, not rising, and U.S. Gulf Coast domestic demand for propane will be increasing—from new propane dehydrogenation (PDH) plants and propane’s use in ethylene steam crackers—at the same time that export volumes out of the East Coast are quadrupling. In today’s blog we consider the possibility that what goes up must come down.
There’s a Woody Allen quote that’s relevant here: “If you want to make God laugh, tell him about your plans.”
Not so long ago, the general expectation was that through the latter half of the 2010s, the U.S. would be awash in ethane, propane and other natural gas liquids (NGLs). To take advantage of these plentiful (and presumably inexpensive) supplies, petrochemical companies planned ethane-only ethylene steam crackers and PDH units, and midstream companies planned NGL pipelines and export terminals to expedite the delivery of NGLs to international markets, including increasing amounts of liquefied petroleum gas (LPG, mostly propane with some butane) and previously unheard of waterborne ethane exports.
The thinking behind all this planning–and building—was that the new, domestic NGL consumers (the ethane-based steam crackers and the PDH units) and the export market would absorb all those “surplus” NGLs and keep NGL markets in near-perfect balance—the sweet spot of moderate prices and healthy demand. Well, it is now looking like things might not work out as planned.