Ford Reports Revenues, Sales, Operating Earnings Per Share in 2000
18 January 2001
Ford Reports Record Revenues, Unit Sales, Operating Earnings Per Share in 2000
DEARBORN, Mich., Jan. 18 Ford Motor Company
earned $5.4 billion from continuing operations in 2000 on record revenues and
volume as it made significant progress moving toward a consumer-focused
organization.
Excluding unusual items, 2000 operating earnings were $6.7 billion, or a
record $3.26 per fully diluted share, up 4 percent from 1999 on a comparable
basis. Revenues for 2000 were a record at $170 billion, up 6 percent.
Vehicle unit sales rose 3 percent to a record 7.4 million. Full-year results
for both periods exclude Visteon Corp. , spun off June 28.
"Customers are the foundation of our strategy," said Jacques Nasser,
president and CEO. "At the beginning of the year we reorganized the company
around consumer business groups. We launched consumer-driven 6-Sigma and
adopted new E-commerce initiatives across the organization that together have
transformed how we do business on a day-to-day basis."
Ford Credit and The Hertz Corporation both had excellent
results. Ford Credit's earnings were up 22 percent to $1.54 billion. Hertz
had record income of $358 million, its ninth consecutive year of increased
earnings.
FOURTH QUARTER
Fourth quarter 2000 results were below a year ago, primarily because of
weaker vehicle industry conditions in the United States. Earnings from
continuing operations (excluding Visteon) were $1.1 billion or 57 cents per
fully diluted share of common and Class B stock. Quarterly results include a
one-time charge of $133 million, or 7 cents a share, for the write-down of
assets associated with the Nemak joint venture on castings. A year ago,
earnings from continuing operations were $1.7 billion or $1.39 per diluted
share.
Fourth quarter 2000 operating earnings (excluding Visteon and one-time
items) were $1.2 billion, or 64 cents per fully diluted share of common and
Class B stock. Operating earnings for the 1999 fourth quarter, were
$1.8 billion or 83 cents per diluted share, adjusted for the Value Enhancement
Plan.
Highlights from 2000 included:
-- Shareholder value: Ford returned $5.7 billion in cash to shareholders
through the Value Enhancement Plan, spun off Visteon and purchased
$1 billion of stock under our $5 billion stock repurchase plan.
-- Products and brands: Volvo was successfully integrated, the acquisition
of Land Rover was completed and several new products were introduced,
such as the Escape sport utility vehicle, Explorer Sport Trac, Volvo
S60 and Mondeo and Transit in Europe; Ford Focus was the world's
best-selling car, and Ford F-Series the top-selling truck.
-- Transformation: Internet and E-business initiatives were implemented,
including an employee personal computer program, alliances with Yahoo
and Trilogy Software, and the Wingcast telematics joint venture with
Qualcomm Inc.
AUTOMOTIVE OPERATIONS
Ford Motor Company earned $3.62 billion from continuing automotive
operations in 2000 on revenues of $141 billion. That compares to
$4.99 billion on revenues of $135 billion a year ago.
Worldwide factory unit sales for the year were 7.4 million units, topping
the previous record of 7.2 million set in 1999. Total costs were down
$500 million at constant volume and mix. Cost improvements were below the
$1 billion goal, primarily reflecting the Firestone tire recall and the
3.8 liter engine warranty extension. Automotive gross cash at year-end was
$16.5 billion.
Income from continuing operations in the fourth quarter was $629 million,
down from $1.35 billion a year ago. Revenue from automotive operations was
$35.1 billion, versus $37.3 billion. Worldwide vehicle unit sales in the
fourth quarter were 1.8 million units, down from 1.9 million a year ago.
North America: Full-year 2000 earnings were $4.89 billion on revenues of
$103.9 billion, down from $5.42 billion on revenues of $99.2 billion in 1999.
Fourth-quarter 2000 earnings were $607 million on revenues of
$25.6 billion. That compares to $1.47 billion on revenues of $27.1 billion.
The reduction primarily reflects lower industry sales and market share, and
higher marketing costs.
"We've got the strongest product lineup we've ever had and look for
another solid year in North America," said Nasser. "We have already taken
aggressive action to adjust our first quarter production schedules to meet
softening market demand. We'll continue to closely monitor economic
conditions, and will not hesitate to take further actions if warranted."
Europe: Full-year 2000 loss were $1.13 billion on revenues of
$28.7 billion after several one-time items, including a $1 billion charge for
asset impairments and restructuring. On an operating basis, Europe had a loss
of $35 million. A year ago, Europe had a profit of $50 million, or
$10 million on an operating basis, on revenues of $29.3 billion.
Fourth-quarter results were a profit of $33 million on revenues of
$7.3 billion reflecting continued cost reductions. The 1999 fourth quarter
was a loss of $30 million on revenues of $8.5 billion.
South America: Full-year results improved to a loss of $240 million on
revenues of $2.5 billion. Last year, Ford lost $444 million on revenues of
$2.3 billion.
Fourth-quarter losses were $31 million on revenues of $642 million. The
year-earlier period was a $100 million loss on revenues of $537 million. The
improvement over a year ago reflects continued cost reductions and better
revenue and product mix.
Asia-Pacific and other markets: Full-year profits were $108 million on
sharply higher revenues of $6.2 billion. That compares to a $38 million loss
on revenues of $4.2 billion.
Fourth-quarter 2000 results were a $20 million profit on revenues of
$1.5 billion. That compares to a profit of $10 million on revenues of
$1.1 billion.
"Our results outside North America, while improving, remained unacceptable
in 2000. Our European operations are in the middle of a strategic
restructuring and we expect a solid return to profitability this year. Our
South American operations met their full-year 2000 milestone and will continue
to improve this year," Nasser said.
FORD CREDIT
Ford Credit earned $1.54 billion in 2000, up 22 percent from 1999. In the
fourth quarter, Ford Credit earned $410 million, an increase of $101 million,
primarily because of higher volume and an improved net financing margin,
offset partially by higher credit losses associated with the restructuring of
North American operations.
HERTZ
Hertz reported full-year 2000 earnings of $358 million, up from
$336 million in 1999. It was the ninth consecutive year of improved earnings
for Hertz. In the fourth quarter Hertz earned $56 million, down $5 million
from the year-earlier period.
MILESTONES
For 2000, Ford reached its milestones for revenue growth, South America,
Asia-Pacific, capital spending, Ford Credit, Hertz and Visteon. Ford missed
its milestones for total shareholder returns, total cost reductions and North
America and Europe.
Ford last week set its financial milestones for 2001 and reaffirmed its
customer-focused strategy. Ford has a goal of growing total company revenues
by $5 billion from record levels in 2000. In North America, Ford has targeted
a 4 percent-plus return on sales despite softening market conditions. In
Europe, we have a goal of improving results to a 1-percent plus return on
sales. Ford also has goals of improving results in South America and
achieving profitability in Asia-Pacific.
Total costs, assuming constant volume and mix, are targeted to be reduced
by $1 billion, and capital spending will be contained at $8 billion or less.
Ford Credit has a milestone of improving returns and growing its earnings by
10 percent.
OUTLOOK
"We will face softening U.S. market conditions in 2001," Nasser said.
"However, our excellent portfolio of brands, customer focus and commitment to
executing our strategies set us apart from our competitors. We are focused on
improving our cost structure, bringing production in line with demand,
generating positive cash flow and delivering another year of strong financial
results."
Ford Motor Company and Subsidiaries
HIGHLIGHTS
Fourth Quarter Full Year
2000 1999 2000 1999
Worldwide vehicle unit sales of
cars and trucks (in thousands)
- North America 1,209 1,280 4,933 4,787
- Outside North America 631 639 2,491 2,433
Total 1,840 1,919 7,424 7,220
Sales and revenues (in millions)
- Automotive $35,107 $37,285 $141,230 $135,073
- Financial Services 7,480 6,637 28,834 25,585
Total $42,587 $43,922 $170,064 $160,658
Net income (in millions)
- Automotive $629 $1,354 $3,624 $4,986
- Financial Services 448 357 1,786 1,516
Income from continuing
operations 1,077 1,711 5,410 6,502
- Discontinued operation
(Visteon) - 95 309 735
- Loss on spin-off of Visteon - - (2,252) -
Total $1,077 $1,806 $3,467 $7,237
Capital expenditures (in millions)
- Automotive $2,510 $2,548 $7,393 $7,069
- Financial Services 390 155 955 590
Total $2,900 $2,703 $8,348 $7,659
Automotive capital expenditures as a
percentage of sales 8.2% 6.8% 5.2% 5.2%
Stockholders' equity at December 31
- Total (in millions) $18,610 $27,604 $18,610 $27,604
- Annualized after-tax return
on Common and Class B
stockholders' equity 25.5% 26.6% 14.9% 28.2%
Automotive net cash at December 31
(in millions)
- Cash and marketable
securities $16,490 $21,736 $16,490 $21,736
- Debt 12,046 11,736 12,046 11,736
Automotive net cash $4,444 $10,000 $4,444 $10,000
After-tax return on sales
- North American Automotive 2.4% 5.5% 4.8% 5.5%
- Total Automotive 1.8% 3.7% 2.6% 3.7%
Shares of Common and Class B Stock
(in millions)
- Average number outstanding 1,873 1,207 1,483 1,210
- Number outstanding at
December 31 1,854 1,207 1,854 1,207
Common Stock price (per share)
(adjusted to reflect Visteon spin-off
and Value Enhancement Plan)
- High $27 $30-1/8 $30-1/8 $37-1/4
- Low 21-5/8 26-5/8 21-5/8 25-3/8
AMOUNTS PER SHARE OF COMMON AND CLASS B
STOCK AFTER PREFERRED STOCK DIVIDENDS
Income assuming dilution
- Automotive $0.33 $1.10 $2.40 $4.03
- Financial Services 0.24 0.29 1.19 1.23
Subtotal 0.57 1.39 3.59 5.26
- Discontinued operation
(Visteon) - 0.08 0.21 0.60
- Loss on spin-off of Visteon - - (1.50) -
Total $0.57 $1.47 $2.30 $5.86
Cash dividends (2000 adjusted for
Value Enhancement Plan) $0.30 $0.50 $1.16 $1.88