Summary
Ford Motor Company's 2021 annual report (10-K) reveals a significant financial turnaround, driven by strong performance in its Automotive segment, particularly in North America. The company reported a substantial net income of $17.9 billion, a significant improvement from a net loss in the previous year. This was largely boosted by "special items," most notably gains from its investment in Rivian, which contributed $9.1 billion to pre-tax results. Excluding these special items, adjusted EBIT was $10 billion, a considerable increase from $2.5 billion in 2020, reflecting improved net pricing, favorable product mix, and lower warranty expenses across its operations. The company's 'Ford+' plan for growth and value creation is underway, focusing on electrification, connected vehicle services, and mobility solutions. Despite facing ongoing supply chain challenges, particularly the semiconductor shortage, Ford demonstrated resilience by leveraging higher net pricing and managing costs effectively. The company's financial health shows improvement, with increased liquidity and a strong outlook for 2022, projecting adjusted EBIT between $11.5 billion and $12.5 billion, though acknowledging continued fluidity in supply constraints and inflationary pressures.
Financial Highlights
55 data points| Revenue | $136.34B |
| Cost of Revenue | $114.65B |
| Gross Profit | $21.69B |
| R&D Expenses | $7.60B |
| SG&A Expenses | $11.91B |
| Operating Expenses | $131.82B |
| Operating Income | $4.52B |
| Interest Expense | $4.59B |
| Net Income | $17.91B |
| EPS (Basic) | $4.49 |
| EPS (Diluted) | $4.45 |
| Shares Outstanding (Basic) | 3.99B |
| Shares Outstanding (Diluted) | 4.03B |
Key Highlights
- 1Ford reported a net income of $17.9 billion in 2021, a significant rebound from a net loss in 2020, partly due to substantial gains from its Rivian investment.
- 2Adjusted EBIT more than tripled year-over-year, reaching $10 billion in 2021, driven by improved pricing, favorable product mix, and cost efficiencies in the Automotive segment.
- 3The Automotive segment's EBIT margin improved to 5.9% in 2021 from 1.5% in 2020, with North America showing particularly strong performance.
- 4The company continued to experience supply chain disruptions, notably the semiconductor shortage, which impacted wholesales but was mitigated by higher net pricing.
- 5Ford Credit saw a significant increase in Earnings Before Taxes (EBT) to $4.7 billion in 2021, up from $2.6 billion in 2020, benefiting from favorable operating lease residual performance and lower credit loss provisions.
- 6The company's liquidity position strengthened, with Company cash increasing to $36.5 billion at year-end 2021.
- 7Ford plans significant investments in electrification and mobility as part of its Ford+ growth strategy, with capital expenditures expected to be between $7.0 billion and $8.0 billion in 2022.