Ford's Earns $2.1 Billion in First Quarter
17 April 2000
Ford's Earns $2.1 Billion in First Quarter; New Records for Operating Earnings, Revenues
DEARBORN, Mich., April 17 Ford Motor Company (NYSE: F)
earned a record $2.1 billion in the first quarter, or $1.70 per diluted share
of common and Class B stock, and posted the 16th consecutive quarter of
improved year-over-year operating results. The results compare with first-
quarter earnings in 1999 of $2 billion, or $1.60 per diluted share, which
included a one-time gain of $165 million, or 14 cents a share, from the
dissolution of AutoEuropa. Excluding AutoEuropa, first-quarter earnings rose
$265 million or 15 percent.
"Our earnings momentum is as strong as ever," said Jacques A. Nasser,
president and chief executive officer. "We are transforming our car and truck
business, and we have positioned the company for profitable growth in
financial services, automotive consumer services, Hertz, and e-business. We
have a strong product line-up, and as the year unfolds, important new products
will continue to be introduced in North America and Europe. In addition, the
independence of Visteon will only accelerate our transformation."
On April 14, Ford announced that the goal to make Visteon Corporation an
independent company would be realized through a 100 percent distribution of
stock to Ford shareholders, expected to be completed by this summer.
Visteon's earnings are now reported separately and are treated as a
discontinued operation in Ford Motor Company's financial statements.
"An independent Visteon will be a stronger competitor in a growing
industry segment," Nasser said, "and at the same time it will allow us at Ford
to focus even more strongly on our car and truck business."
Excluding Visteon, first-quarter revenues were a record $43 billion, up
$5 billion or 14 percent over the first quarter of 1999. Unit sales were a
record 1.9 million, compared with 1.8 million a year ago. Luxury vehicle
sales, also a record, were 190,000, an increase of 50 percent from a year ago.
AUTOMOTIVE OPERATIONS: Excluding Visteon, Ford's earnings from worldwide
automotive operations were $1.6 billion, up $271 million or 21 percent from
the same period a year ago, excluding the sale of AutoEuropa. Worldwide
automotive revenues in the first quarter were a record $36 billion, up
14 percent compared with a year ago. After-tax return on sales was
4.3 percent, up two-tenths of a point from last year's first quarter,
excluding AutoEuropa.
Automotive cash was $23 billion at the end of the quarter, virtually
unchanged from the same period last year. Net cash was $12 billion, up
$450 million from a year ago.
New products coming later this year include the Ford Escape sport utility,
the Volvo S60, a new Ford Explorer and Mercury Mountaineer and a new Mondeo in
Europe.
North America: Automotive operations in North America, excluding Visteon,
earned a record $1.7 billion in the first quarter of 2000, up $288 million
from the same period a year ago. After-tax return on sales was 6.2 percent,
up four-tenths of a point. "The real driver behind our North American results
is the strong demand for hit products," Nasser said. "And more will be
coming," he added. "At the same time, our automotive business structure
continues to transform. Total costs are down $6 billion in three years, and
the acquisitions of Volvo, Kwik-Fit, and the planned acquisition of Land Rover
have strengthened and broadened our consumer focus," Nasser said.
Total vehicle sales in the United States set a new first-quarter record of
1.2 million cars and trucks. Strong sales were aided by the new Ford Focus,
Ford Taurus, Ford F150 SuperCrew, the Ford Explorer Sport Trac and Sport,
Jaguar S-Type and the Volvo 70.
Other Markets: In Europe, South America and other overseas markets, Ford
lost $115 million, about even with last year's first quarter.
FORD CREDIT: Ford Credit earned $353 million in the first quarter, up
$53 million or 18 percent in the first quarter of 1999. Return on equity was
12.7 percent, up 1.4 points from a year ago. Ford Credit is on track to meet
its full-year financial milestones to increase earnings by 10 percent and
improve returns.
HERTZ: The Hertz Corporation (NYSE: HRZ) earned a record $56 million in
the first quarter, up $7 million or 14 percent. Ford Motor Company's share of
Hertz' first-quarter earnings was $46 million.
DELIVERING SHAREHOLDER VALUE: On April 14, Ford Motor Company also
announced a Shareholder Value Enhancement Plan that offers Ford shareholders
new Ford shares and a choice of accepting $20 per share in cash or additional
new Ford shares equivalent to the cash value. "This plan reflects our
transformational thinking," Nasser said, "as well as our strong earnings and
cash flow. It also underscores management's confidence and our commitment to
delivering superior shareholder value over time."
Ford Motor Company and Subsidiaries
HIGHLIGHTS a/
First Quarter
2000 1999
(unaudited)
Worldwide vehicle unit sales of cars and trucks
(in thousands)
- North America 1,309 1,220
- Outside North America 602 554
Total 1,911 1,774
Sales and revenues (in millions)
- Automotive $ 36,175 $ 31,597
- Financial Services 6,719 5,952
Total $ 42,894 $ 37,549
Net income (in millions)
- Automotive $ 1,552 $ 1,446
- Financial Services 380 328
Total continuing operations 1,932 1,774
- Discontinued operation - Visteon 147 205
Total $ 2,079 $ 1,979
Capital expenditures (in millions)
- Automotive $ 1,500 $ 1,142
- Financial Services 306 144
Total $ 1,806 $ 1,286
Automotive capital expenditures as a
percentage of sales 4.1% 3.6%
Stockholders' equity at March 31
- Total (in millions) $ 28,419 $ 24,814
- After-tax return on Common and
Class B stockholders' equity 25.3% 29.6%
Automotive net cash at March 31
(in millions)
- Cash and marketable securities $ 22,848 $ 22,899
- Debt 10,753 11,254
Automotive net cash $ 12,095 $ 11,645
After-tax return on sales
- North American Automotive 6.2% 5.8%
- Total Automotive 4.3% 4.6%
Shares of Common and Class B Stock
(in millions)
- Average number outstanding 1,206 1,211
- Number outstanding at March 31 1,205 1,211
Common Stock price (per share)
- High $ 54-5/8 $ 66-1/2
- Low 41 55-1/4
AMOUNTS PER SHARE OF COMMON AND CLASS B
STOCK AFTER PREFERRED STOCK DIVIDENDS
Income assuming dilution
- Automotive $ 1.27 $ 1.16
- Financial Services 0.31 0.27
Total continuing operations 1.58 1.43
- Discontinued operation - Visteon 0.12 0.17
Total $ 1.70 $ 1.60
Cash dividends $ 0.50 $ 0.46
- - - - -
a/ Visteon is reflected as a discontinued operation. Visteon's results
and financial condition have been excluded from all amounts except
total net income and total earnings per share.