- Ford reshaping company to lead the
future of transportation and mobility
- Company strategy centers on high-growth
product segments, electrified propulsion, autonomous vehicles,
mobility services, operational fitness and high-performance
culture
- Global wave of new products in fastest
growing and most profitable segments, with more than 20 new Ford
and Lincoln products in North America over the next 24 months
- Announces preliminary results for
full-year 2018 earnings-per-share (EPS) of $0.92 and adjusted EPS
of $1.30
- Declares first quarter regular dividend
of $0.15 per share
Ford Motor Company (NYSE: F) today highlighted its commitment to
reinvent the future of mobility by transforming the company through
operational fitness and allocating capital to high-growth and
high-margin product segments and smart vehicles and services.
Presenting at the Deutsche Bank Global Auto Industry Conference
in Detroit, the company also provided preliminary results for
full-year 2018, provided high-level guidance for 2019 and
highlighted areas of strategic momentum throughout the company.
“Over the last 19 months, we have worked to reshape and
transform our company – sharpening our competitiveness, taking
actions to improve our profitability and returns, and investing in
our future. These actions support our drive to satisfy today’s
customers – and those of tomorrow,” said Jim Hackett, president and
CEO.
Jim Farley, president, Global Markets, shared details of the
company’s major global product wave, which focuses on trucks,
commercial vehicles and SUVs.
“We are now beginning to see the results of our capital shift
away from traditional sedans to trucks and SUVs with new utility
nameplates globally, including Territory in China, Bronco, and a
slightly smaller, yet-to-be named off-roader in North America,”
Farley said. “2018 was a growth year for F-Series, especially Super
Duty in North America. Transit and Ranger are now in all global
markets in high volume with great potential.”
Farley also outlined actions the company is taking to reshape
its regional businesses, including:
North America
- In the next 24 months, Ford is
refreshing 75 percent of its lineup, fortifying the company’s
successful truck franchise and renewing and expanding the range of
SUVs
- Expedition and Navigator posting
increases in share; conquesting from competition
- Increasing mix of SUVs, more in line
with overall market
Europe
- #1 selling commercial vehicle brand in
Europe
- Redesign to strengthen competitive
position, improve profitability and returns
- More targeted vehicle lineup within
three customer-focused business groups: Commercial vehicles,
passenger vehicles and imports
China
- Creating a solid foundation for
turnaround with right leadership and right products – including new
Territory and Focus
- Intense focus to improve cost structure
and improve relationships with partners, including dealer
network
- Introducing more than 10 new Ford and
Lincoln products in China this year and more than 30 by 2021
South America
- Remain committed to the region with an
optimized footprint, targeted to Ford’s strengths
- Focused on reducing structural costs
and improving efficiency; administrative headcount reduced by 20
percent in 2018
“We are bolstering our portfolio to capture a healthy share of
higher growth and higher profit segments and partnering where
appropriate to improve profitability and returns,” Farley said.
“I’m very confident in our plan and our ability to execute.”
Bob Shanks, chief financial officer, reported positive company
operating results despite external challenges, including commodity
costs, unfavorable exchange effects and policy changes. He also
cited other factors, including a decline of business in China and
higher warranty costs in North America.
“For 2019, we see the potential for year-over-year improvement
in company revenue, EBIT and adjusted operating cash flow,” Shanks
said. “Our imperative to sustain an investment grade rating and a
strong balance sheet remains the foundation of our business. For
2019, we expect to be able to fully fund our business needs, while
maintaining cash and liquidity levels at or above our target
levels.”
For 2019, Shanks gave other high-level guidance, emphasizing the
dynamic and challenging nature of the global external
environment:
- Continued GDP growth globally and in
major markets, with a deceleration in the rate of growth in the
U.S., Europe and China
- Global industry sales volume expected
to remain flat compared to 2018
- Commodity costs to remain at the
present level through 2019
- Adjusted effective tax rate for 2019 to
be in the low 20s – a full 10 percentage points higher than in
2018
2018 Preliminary
Results*
For full-year 2018, the company is announcing preliminary EPS
results of $0.92, and adjusted EPS of $1.30 – in line with the
company’s most recent guidance. The company ended the year with a
strong balance sheet, with cash of $23.1 billion and liquidity of
$34.2 billion.
2018 results also will include the impact of a non-cash pre-tax
remeasurement loss of $877 million related to the year-end
revaluation of global pension and other postretirement employee
benefits (OPEB) plans, also known as pension mark-to-market
adjustment. The loss was almost exclusively related to lower asset
returns as a result of the deterioration in the financial markets
at the end of the year. While the remeasurement generated a
mark-to-market loss for accounting purposes, the company’s funded
pension plans remain fully funded as a result of the company’s
de-risking strategy.
2019 First Quarter
Dividend
Ford’s Board of Directors declared a first quarter regular
dividend of $0.15 per share on the company’s outstanding Class B
and common stock. The first quarter regular dividend maintains the
same level as the regular dividends paid in 2018. The first quarter
regular dividend is payable on March 1 to shareholders of record at
the close of business on Jan. 31. In 2018, we distributed $3.1
billion to shareholders and by year-end 2018, cumulative
distributions to shareholders totaled $18.4 billion since the
company’s regular dividend was restored in 2012.
To access the presentation materials and a listen-only audio
webcast, visit www.shareholder.ford.com.
*This release includes Ford’s preliminary view of 2018 results.
Ford’s actual results could differ materially from the preliminary
results included in this release. Ford will provide additional
detail on 2018 results in its earnings presentation on January 23,
2019. Ford’s Annual Report on Form 10-K, which will be filed in
February, will include Ford’s audited financial results.
Note: See table later in this release for reconciliation of the
non-GAAP financial measure designated as “adjusted earnings per
share” to “earnings per share,” the most comparable financial
measure calculated in accordance with U.S. generally accepted
accounting principles (“GAAP”). Adjusted earnings per share is a
non-GAAP financial measure because it excludes special items. The
measure provides investors with useful information to evaluate the
performance of Ford’s business excluding items not indicative of
the underlying run rate.
About Ford Motor Company
Ford Motor Company is a global company based in Dearborn,
Michigan. The company designs, manufactures, markets and services a
full line of Ford cars, trucks, SUVs, electrified vehicles and
Lincoln luxury vehicles, provides financial services through Ford
Motor Credit Company and is pursuing leadership positions in
electrification, autonomous vehicles and mobility solutions. Ford
employs approximately 200,000 people worldwide. For more
information regarding Ford, its products and Ford Motor Credit
Company, please visit www.corporate.ford.com.
Cautionary Note on Forward-Looking
Statements
Statements included or incorporated by reference herein may
constitute “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are based on expectations, forecasts, and assumptions by
our management and involve a number of risks, uncertainties, and
other factors that could cause actual results to differ materially
from those stated, including, without limitation:
- Ford’s long-term competitiveness
depends on the successful execution of fitness actions;
- Industry sales volume, particularly in
the United States, Europe, or China, could decline if there is a
financial crisis, recession, or significant geopolitical
event;
- Ford’s new and existing products and
mobility services are subject to market acceptance;
- Ford’s results are dependent on sales
of larger, more profitable vehicles, particularly in the United
States;
- Ford may face increased price
competition resulting from industry excess capacity, currency
fluctuations, or other factors;
- Fluctuations in commodity prices,
foreign currency exchange rates, and interest rates can have a
significant effect on results;
- With a global footprint, Ford’s results
could be adversely affected by economic, geopolitical,
protectionist trade policies, or other events;
- Ford’s production, as well as Ford’s
suppliers’ production, could be disrupted by labor disputes,
natural or man-made disasters, financial distress, production
difficulties, or other factors;
- Ford’s ability to maintain a
competitive cost structure could be affected by labor or other
constraints;
- Pension and other postretirement
liabilities could adversely affect Ford’s liquidity and financial
condition;
- Economic and demographic experience for
pension and other postretirement benefit plans (e.g., discount
rates or investment returns) could be worse than Ford has
assumed;
- Ford’s vehicles could be affected by
defects that result in delays in new model launches, recall
campaigns, or increased warranty costs;
- Safety, emissions, fuel economy, and
other regulations affecting Ford may become more stringent;
- Ford could experience unusual or
significant litigation, governmental investigations, or adverse
publicity arising out of alleged defects in products, perceived
environmental impacts, or otherwise;
- Ford’s receipt of government incentives
could be subject to reduction, termination, or clawback;
- Operational systems, security systems,
and vehicles could be affected by cyber incidents;
- Ford Credit’s access to debt,
securitization, or derivative markets around the world at
competitive rates or in sufficient amounts could be affected by
credit rating downgrades, market volatility, market disruption,
regulatory requirements, or other factors;
- Ford Credit could experience
higher-than-expected credit losses, lower-than-anticipated residual
values, or higher-than-expected return volumes for leased
vehicles;
- Ford Credit could face increased
competition from banks, financial institutions, or other third
parties seeking to increase their share of financing Ford vehicles;
and
- Ford Credit could be subject to new or
increased credit regulations, consumer or data protection
regulations, or other regulations.
We cannot be certain that any expectation, forecast, or
assumption made in preparing forward-looking statements will prove
accurate, or that any projection will be realized. It is to be
expected that there may be differences between projected and actual
results. Our forward-looking statements speak only as of the date
of their initial issuance, and we do not undertake any obligation
to update or revise publicly any forward-looking statement, whether
as a result of new information, future events, or otherwise. For
additional discussion, see “Item 1A. Risk Factors” in our Annual
Report on Form 10-K for the year ended December 31, 2017, as
updated by our subsequent Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K.
Preliminary Company Earnings Per Share
Reconciliation to Adjusted Earnings Per Share
4Q FY 2017
2018 2017 2018
Diluted After-Tax
Results (Mils)
Diluted after-tax results (GAAP) $ 2,520
$ (116 ) $ 7,731 $
3,677 Less: Impact of pre-tax and tax special items
971 (1,320 ) 608
(1,517 ) Adjusted net income – diluted
(Non-GAAP) $ 1,549 $ 1,204
$ 7,123 $ 5,194
Basic and Diluted
Shares (Mils)
Basic shares (average shares outstanding) 3,973
3,970 3,975 3,974 Net dilutive options,
unvested restricted stock units and restricted stock
27 27 23 24
Diluted shares 4,000
3,997 3,998 3,998
Earnings per share – diluted (GAAP)* $
0.63 $ (0.03 ) $ 1.93
$ 0.92 Less: Net impact of adjustments
0.24 (0.33 ) 0.15
(0.38 ) Adjusted earnings per share – diluted
(Non-GAAP) $ 0.39 $ 0.30
$ 1.78 $ 1.30 * The
fourth quarter calculation of Earnings Per Share - Diluted (GAAP)
excludes the 27 million shares of net dilutive options, unvested
restricted stock units and restricted stock due to their
antidilutive effect
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190116005336/en/
Media:Karen
Hampton313.390.9080khampto2@ford.com
Equity Investment Community:Lynn
Antipas Tyson914.485.1150fordir@ford.com
Fixed Income Investment
Community:Karen Rocoff313.621.0965fixedinc@ford.com
Shareholder
Inquiries:1.800.555.5259 or313.845.8540stockinf@ford.com
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