10-QPeriod: Q2 FY2013

FORD MOTOR CO Quarterly Report for Q2 Ended Jun 30, 2013

Filed July 31, 2013For Securities:FF-PCF-PDF-PB

Summary

Ford Motor Company reported solid financial results for the second quarter and first half of 2013, showcasing significant improvements in profitability driven primarily by its Automotive segment. Total revenues saw a healthy increase compared to the prior year, reflecting strong volume growth across most regions and improved net pricing. The company's strategic transformation initiatives, particularly in Europe, are progressing as planned, contributing to operational efficiencies despite ongoing restructuring costs. Ford's financial services arm also demonstrated resilience, supporting overall company performance. Investors can take comfort in the company's strengthened financial position, evidenced by improved pre-tax results and a more robust balance sheet. The company's focus on product innovation, cost management, and deleveraging its balance sheet continues to be a priority, positioning Ford for sustained performance in a dynamic global automotive market. The outlook for the full year remains positive, with expectations for continued profitability and growth, albeit with awareness of regional economic uncertainties.

Financial Highlights

33 data points
Beta

Revenue

$37.92B

14.2% Gross Margin

Net Income

$1.23B

3.3% Net Margin

EPS (Diluted)

$0.30

Total Assets

$195.00B

Cash & Equivalents

$13.36B

Free Cash Flow

$6.08B

Financial Statements
Beta
Revenue$37.92B
Cost of Revenue$32.52B
Gross Profit$5.40B
SG&A Expenses$3.20B
Operating Expenses$36.48B
Net Income$1.23B
EPS (Basic)$0.31
EPS (Diluted)$0.30
Shares Outstanding (Basic)3.93B
Shares Outstanding (Diluted)4.08B

Key Highlights

  • 1Total revenues increased to $38.1 billion in Q2 2013 and $73.9 billion in the first half of 2013, up from $33.2 billion and $65.7 billion in the respective prior-year periods.
  • 2Net income attributable to Ford Motor Company rose to $1.23 billion ($0.30/share diluted) in Q2 2013 and $2.84 billion ($0.70/share diluted) in the first half of 2013, showing significant year-over-year improvements.
  • 3The Automotive segment demonstrated strong performance, with income before taxes increasing to $1.37 billion in Q2 2013 and $2.99 billion in the first half of 2013, driven by higher volumes and improved net pricing across most regions.
  • 4Ford North America continued its strong performance, delivering over $2 billion in pre-tax profit for the second quarter with an operating margin of 10% or more.
  • 5The Financial Services sector contributed positively, with income before taxes of $451 million in Q2 2013 and $954 million in the first half of 2013.
  • 6Total Automotive debt levels are expected to be reduced to approximately $10 billion by mid-decade, demonstrating a commitment to balance sheet improvement.
  • 7The company repurchased 5.18 million shares of Common Stock during the second quarter of 2013 as part of its anti-dilutive share repurchase program.

Frequently Asked Questions

Ford reported increased revenues and net income in both the second quarter and the first half of 2013. Specifically, total revenues grew to $38.1 billion in Q2 2013 and $73.9 billion for the first half, up from $33.2 billion and $65.7 billion in the respective prior-year periods. Net income attributable to Ford Motor Company increased to $1.23 billion ($0.30 per diluted share) in Q2 2013 and $2.84 billion ($0.70 per diluted share) for the first half of 2013.

The primary driver of Ford's improved performance was the strong showing of its Automotive segment, which benefited from higher wholesale volumes across most regions and improved net pricing. Ford North America, in particular, delivered robust results with consistent profitability. The Financial Services segment also contributed positively to the company's overall financial health.

Ford's outlook for the remainder of 2013 is positive, with expectations for continued profitability and growth. The company projects total Company pre-tax profit to be about equal to or higher than 2012 and expects Automotive operating-related cash flow to be substantially higher. Key challenges and risks include potential declines in industry sales volumes (especially in the U.S. and Europe), market share fluctuations, the impact of fuel prices, increased competition, currency and commodity price volatility, supplier economic distress, and substantial pension liabilities. Specific regional uncertainties, such as those in South America (Brazil, Argentina, Venezuela) and Europe, are also noted.

Ford is focused on improving its balance sheet by reducing Automotive debt levels. The company plans to reduce its Automotive debt to approximately $10 billion by mid-decade through the use of operating cash flow for debt repayments, including the ATVM loan and EIB/Ex-Im loans. Additionally, Ford is actively managing its pension liabilities, with significant contributions and a strategic shift in asset allocation towards fixed income.