Ford Motor Company (F) Q4 2010 earnings summary

Executive summary

• 2010 net income attributable to shareholders was $6.561B, versus $2.717B in 2009; Automotive returned to operating income of $5.789B from a $3.352B loss.

• The turnaround reflected stronger volumes and pricing, lower Ford Credit credit losses, disciplined costs, and continued execution of the One Ford plan.

• Automotive debt fell $14.5B to $19.1B; year-end Automotive gross cash of $20.5B exceeded debt by $1.4B.

Financial highlights

• Total sales and revenues were $128.954B in 2010, compared with $116.283B in 2009; income before taxes was $7.149B versus $2.599B.

• Net income attributable to shareholders was $6.561B; diluted EPS was $1.66, compared with $2.717B and $0.86 in 2009.

• Automotive sales were $119.280B; operating income was $5.789B, versus a $3.352B operating loss in 2009.

• Q4 pre-tax income was $280M and net income was $190M; Q4 diluted EPS was $0.05, including a $962M pre-tax loss on convertible-note exchanges.

Outlook and guidance

• 2011 outlook called for improved total pre-tax operating profit and Automotive operating-related cash flow; each operating segment was expected to be profitable for FY 2011.

• FY 2011 Automotive and North America operating margins were expected to be equal to or above 2010; 2010 Automotive operating margin was 6.1%.

• 2011 planned capital spending was $5B-$5.5B, versus $3.9B in 2010; commodity costs and structural costs were expected to be higher.

• Ford Credit was expected to remain solidly profitable, but below 2010, with a ~$1.2B pre-tax earnings headwind from lower lease gains and smaller credit-loss allowance releases.

• 2011 U.S. and Europe industry-volume planning ranges were 13.0M-13.5M and 14.5M-15.5M units, respectively.