Ford Motor Co., which has struggled overseas and saw U.S. sales fall last year, reported its first quarterly net loss in two years Wednesday
Tom Krisher of the Associated Press had the news:
The Dearborn, Michigan, company said it lost $116 million, or 3 cents a share, in the fourth quarter, compared with a $2.52 billion profit a year earlier. It last posted a quarterly loss in the fourth quarter of 2016.
The loss included an $877 million one-time charge to revalue global pension assets due to a late-year market slide.
Ford made $3.68 billion for the full year, but that was only about half of what its net profit was in 2017. North America was its only profitable region.
“It’s not a year that we were happy with,” Chief Financial Officer Bob Shanks told reporters. “I think the fourth quarter kind of continued in that theme.”
Aparna Narayanan of Investor’s Business Daily reported the company gave vague projections for 2019:
Last week, Ford said it expects EPS of 30 cents in Q4, below estimates at that time, and gave a cloudy 2019 outlook, citing tariff costs and Brexit uncertainty.
Tariffs could dent 2019 Ford earnings by roughly $700 million, executives warned. But the No. 2 U.S. automaker did not give detailed financial guidance for this year. Management said there’s a chance revenue, earnings before interest and taxes, and adjusted operating cash flow will improve in 2019 as it shifts away from sedans to more profitable trucks and sport utility vehicles.
Still, Ford remained vague Wednesday about earnings this year. In a statement, CFO Bob Shanks said Ford expects to be able to fully fund its business needs and capital plans in 2019, while maintaining cash and liquidity levels at or above its target levels.
He added that Ford sees the “potential” for year-over-year improvement in the company’s key financial metrics.
Robert Ferris of CNBC.com reported that pension and layoff costs also hurt the company:
Ford took a $1.18 billion charge for “special items” that were excluded from its adjusted earnings. The charges stem mostly from pension and layoff costs. On an unadjusted basis, Ford lost $116 million, or 3 cents a share, during the fourth quarter. It generated a profit of $2.52 billion, or 63 cents per share, a year earlier.
The company’s total revenue was $41.8 billion during the quarter, slightly higher than its $41.3 billion in revenue during the same quarter last year.
“While 2018 was a challenging year, we put in place key building blocks to build a more resilient and competitive business model that can thrive no matter the economic environment,” Shanks said in a statement.
Despite the losses, Ford expects to be able to fully fund its business and capital needs in 2019, while keeping cash and liquidity at or above target levels, Shanks said.
