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Ford (F) Q1 Loss Wider Than Estimated, Q2 to be Worse
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Ford (F - Free Report) reported first-quarter 2020 adjusted loss per share of 23 cents, wider than the Consensus Estimate of a loss of 10 cents. Lower-than-anticipated automotive sales in North America and China resulted in the underperformance. In the prior-year quarter, adjusted earnings were 44 cents per share. The weaker year-over-year results can be attributed to lower automotive sales across all markets served. The firm’s first-quarter sales were affected by depressed demand for vehicles, thanks to the coronavirus outbreak.
In first-quarter 2020, the company reported adjusted negative EBIT of $600 million against a profit of $2.4 billion recorded in the corresponding period of 2019. The U.S. auto giant reported net loss of $2 billion.
Among the major U.S. auto biggies, Tesla (TSLA - Free Report) is set to report first-quarter 2020 results tomorrow. General Motors (GM - Free Report) and Fiat Chrysler are slated to unveil quarterly numbers on May 6 and May 5, respectively.
Ford registered revenues of $34,320 million in first-quarter 2020, down from the year-ago quarter’s $40,342 million. During the reported quarter, Ford generated automotive revenues of $31,340 million. The figure lagged the Zacks Consensus Estimate of $31,771 million. In the prior-year quarter, the figure had amounted to $37,239 million. Revenues from Ford Credit declined 4.2% year over year to $2,967 million. Revenues from Ford Mobility came in at $13 million, up from $6 million in the first quarter of 2019.
Ford Automotive
During the first quarter, wholesale volume in the Ford Automotive segment declined 21% from the prior-year period to 1.13 million. The segment recorded negative EBIT of $177 million against the prior-year profit of $2 billion.
In North America, revenues declined 14% year over year to $21.8 billion during the quarter ended March 2020. Wholesale volume edged down 18% from the prior-year quarter to 619,000 units. Further, EBIT was $346 million, marking a decrease of $1,859 million from the year-ago quarter.
In South America, revenues declined 21% year over year to $700 million. Wholesale volume slipped 13% from the year-ago quarter to 59,000 units. The region reported a negative EBIT of $113 million, narrower than the prior-year loss of $158 million.
In Europe, revenues fell 16% from a year ago to $6.2 billion. Wholesale volume decreased 25% from the year-ago period to 288,000 units. The region registered a negative EBIT of $143 million against a profit of $57 million reported in the year-ago quarter.
In China, revenues declined 31% year over year to $600 million. Further, wholesale volume declined 29% from the prior-year figure to 81,000 units. The region reported a negative EBIT of $241 million, wider than the year-ago loss of $128 million.
In the International Markets Group, revenues dropped 25% from the year-ago figure to $2 billion. Wholesale volume dipped 27% from the prior-year level to 78,000 units. Further, the region reported a negative EBIT of $26 million.
Financial Position
The Zacks Rank #3 (Hold) company reported negative first-quarter adjusted free cash flow of $2.2 billion. Ford had cash and cash equivalents of $25.9 billion as of Mar 31, 2020 compared with $17.5 billion on Dec 31, 2019. Automotive long-term debt increased to $28.4 billion from 13.2 billion in the prior quarter. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Road Ahead to Get Rougher
Well, coronavirus-induced damage has been done much and the situation is unlikely to improve anytime soon. Given the rate at which the virus is spreading and the fact that customers are likely to put off spending on big-ticket discretionary items for quite some time, Ford is unlikely to churn big profits for a while. Importantly, the firm expects second-quarter operating loss of more than $5 billion.
Investors already know that coronavirus-induced uncertainty had prompted Ford to scrap annual view. It is pulling every available lever to preserve financial flexibility. The firm has draw down its credit revolvers, and suspended dividends as well as anti-dilutive share buyback programs. After borrowing more than $15 billion from the existing lines of credit in March, it issued $8 billion in unsecured bonds this month to bolster liquidity amid coronavirus-led financial crisis. The company has been evaluating other options like pay cuts, and reducing capex and operating costs to preserve cash in the wake of the pandemic.
Ford intends to postpone the launch of an autonomous vehicle service to 2022, given the challenges in the current business environment due to the COVID-19 pandemic. Ford’s luxury brand, Lincoln aborted plans to build an electric SUV on the Rivian skateboard platform. While Ford and Lincoln will continue to collaborate on other projects, this project is halted due to problems exacerbated by the coronavirus outbreak.
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Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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Ford (F) Q1 Loss Wider Than Estimated, Q2 to be Worse
Ford (F - Free Report) reported first-quarter 2020 adjusted loss per share of 23 cents, wider than the Consensus Estimate of a loss of 10 cents. Lower-than-anticipated automotive sales in North America and China resulted in the underperformance. In the prior-year quarter, adjusted earnings were 44 cents per share. The weaker year-over-year results can be attributed to lower automotive sales across all markets served. The firm’s first-quarter sales were affected by depressed demand for vehicles, thanks to the coronavirus outbreak.
In first-quarter 2020, the company reported adjusted negative EBIT of $600 million against a profit of $2.4 billion recorded in the corresponding period of 2019. The U.S. auto giant reported net loss of $2 billion.
Among the major U.S. auto biggies, Tesla (TSLA - Free Report) is set to report first-quarter 2020 results tomorrow. General Motors (GM - Free Report) and Fiat Chrysler are slated to unveil quarterly numbers on May 6 and May 5, respectively.
Ford registered revenues of $34,320 million in first-quarter 2020, down from the year-ago quarter’s $40,342 million. During the reported quarter, Ford generated automotive revenues of $31,340 million. The figure lagged the Zacks Consensus Estimate of $31,771 million. In the prior-year quarter, the figure had amounted to $37,239 million. Revenues from Ford Credit declined 4.2% year over year to $2,967 million. Revenues from Ford Mobility came in at $13 million, up from $6 million in the first quarter of 2019.
Ford Automotive
During the first quarter, wholesale volume in the Ford Automotive segment declined 21% from the prior-year period to 1.13 million. The segment recorded negative EBIT of $177 million against the prior-year profit of $2 billion.
In North America, revenues declined 14% year over year to $21.8 billion during the quarter ended March 2020. Wholesale volume edged down 18% from the prior-year quarter to 619,000 units. Further, EBIT was $346 million, marking a decrease of $1,859 million from the year-ago quarter.
In South America, revenues declined 21% year over year to $700 million. Wholesale volume slipped 13% from the year-ago quarter to 59,000 units. The region reported a negative EBIT of $113 million, narrower than the prior-year loss of $158 million.
In Europe, revenues fell 16% from a year ago to $6.2 billion. Wholesale volume decreased 25% from the year-ago period to 288,000 units. The region registered a negative EBIT of $143 million against a profit of $57 million reported in the year-ago quarter.
In China, revenues declined 31% year over year to $600 million. Further, wholesale volume declined 29% from the prior-year figure to 81,000 units. The region reported a negative EBIT of $241 million, wider than the year-ago loss of $128 million.
In the International Markets Group, revenues dropped 25% from the year-ago figure to $2 billion. Wholesale volume dipped 27% from the prior-year level to 78,000 units. Further, the region reported a negative EBIT of $26 million.
Financial Position
The Zacks Rank #3 (Hold) company reported negative first-quarter adjusted free cash flow of $2.2 billion. Ford had cash and cash equivalents of $25.9 billion as of Mar 31, 2020 compared with $17.5 billion on Dec 31, 2019. Automotive long-term debt increased to $28.4 billion from 13.2 billion in the prior quarter. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Road Ahead to Get Rougher
Well, coronavirus-induced damage has been done much and the situation is unlikely to improve anytime soon. Given the rate at which the virus is spreading and the fact that customers are likely to put off spending on big-ticket discretionary items for quite some time, Ford is unlikely to churn big profits for a while. Importantly, the firm expects second-quarter operating loss of more than $5 billion.
Investors already know that coronavirus-induced uncertainty had prompted Ford to scrap annual view. It is pulling every available lever to preserve financial flexibility. The firm has draw down its credit revolvers, and suspended dividends as well as anti-dilutive share buyback programs. After borrowing more than $15 billion from the existing lines of credit in March, it issued $8 billion in unsecured bonds this month to bolster liquidity amid coronavirus-led financial crisis. The company has been evaluating other options like pay cuts, and reducing capex and operating costs to preserve cash in the wake of the pandemic.
Ford intends to postpone the launch of an autonomous vehicle service to 2022, given the challenges in the current business environment due to the COVID-19 pandemic. Ford’s luxury brand, Lincoln aborted plans to build an electric SUV on the Rivian skateboard platform. While Ford and Lincoln will continue to collaborate on other projects, this project is halted due to problems exacerbated by the coronavirus outbreak.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>