Ford Motor Company (F) Q4 2012 earnings summary

Executive summary

• 2012 revenue was $134.3B and net income attributable to shareholders was $5.7B; earnings fell sharply YoY as the prior-year deferred-tax valuation allowance release did not recur.

• Adjusted for special items, pre-tax profit was $8.0B, down from $8.8B; strong North American automotive results were offset by weaker finance earnings and a substantial European loss.

Financial highlights

• Revenue was $134.3B vs. $136.3B in 2011; net income attributable to shareholders was $5.665B vs. $20.213B, with 2011 including a $12.4B tax benefit from releasing most of the deferred-tax valuation allowance.

• Diluted EPS was $1.42 vs. $4.94; reported net income was $5.664B, while pre-tax results excluding special items were $7.966B vs. $8.763B.

• Automotive revenue was $126.6B vs. $128.2B; automotive pre-tax profit excluding special items and Other Automotive was $6.3B, with a 5.3% operating margin vs. 5.4%.

Outlook and guidance

• 2013 total pre-tax profit was expected to be about equal to 2012; automotive operating margin about equal to or lower than 5.3%, with operating-related cash flow higher despite planned capital spending of about $7B.

• North America automotive pre-tax profit was expected to exceed 2012, with ~10% operating margin; South America and Asia Pacific Africa were expected to be about breakeven.

• Europe automotive was forecast to lose about $2B in 2013, worse than prior guidance, on weaker industry volume, higher pension costs, a stronger euro, and restructuring spending; mid-decade margin target was 6%-8%.

• Finance pre-tax profit was expected to be about equal to 2012; year-end managed receivables were projected at $95B-$105B and managed leverage at 8:1-9:1.