Ford Mtr Co Del · NYSE:F
Ford Mtr Co Del — Ford Motor Company — Q3 2015 Earnings Presentation
38 slides from Ford Mtr Co Del's earnings presentation, Oct 27, 2015
Slide 1: 3Q 2015 Earnings Review
Go Further 3Q 2015 EARNINGS REVIEW OCTOBER 27, 2015
Slide 2: One Ford Plan: Profitable Growth for All
OUR FOCUS One Ford THE PLAN Acceleration Product Excellence Delivered with Passion Innovation Asia Americas Large Medium Profits PROFITABLE GROWTH FOR ALL Pacific Europe, + Small + = In Every Part of Our Middle East & Cash & Africa Business SLIDE 2
Slide 3: 3Q 2015 Summary
3Q 2015 SUMMARY* Outstanding quarter for Ford; on track for breakthrough year Net income of $1.9 billion -- more than doubled from year ago; record Third Quarter Company pre-tax profit of $2.7 billion; Automotive operating margin of 6.5% and operating-related cash flow a Third Quarter record of $2.8
Slide 4: 2015 Key Financial Summary
2015 KEY FINANCIAL SUMMARY 3Q YTD B / (W) B / (W) 2015 2014 2015 2014 Wholesales (000) 1,596 103 4,860 117 Revenue (Bils) $ 38.1 $ 3.2 $ 109.3 $ 1.1 Operating results* Automotive $ 2,167 $ 1,481 $ 5,480 $ 1,705 Financial Services 526 31 1,486 100 Pre-tax results (Mils) $ 2,693 $ 1,512 $ 6,966 $ 1,80
Slide 5: 3Q 2015 Key Metrics Compared with 2014
AUTOMOTIVE SECTOR 3Q 2015 KEY METRICS COMPARED WITH 2014* Wholesales Revenue Operating Margin Pre-Tax Results (000) (Bils) (Pct) (Mils) $35.8 6.5% $2,167 1,493 1,596 $32.8 2.5% $686 2014 2015 2014 2015 2014 2015 2014 2015 YTD: 4,743 4,860 $102.0 $102.7 4.2% 5.9% $3,775 $5,480 3Q 2014 2015 Global Ind
Slide 6: 3Q 2015 Pre-Tax Results Compared with 2014
AUTOMOTIVE SECTOR 3Q 2015 PRE-TAX RESULTS COMPARED WITH 2014* (MILS) Industry $379 $1,481 Share 243 Stocks 421 Material Excl. Commodities $(1,194) Mix / Other 629 Commodities 355 $2,167 Warranty / Freight / Other 418 $1,672 Mfg. / Engineering $(407) Advert. & Sales Promo. (104) Other 58 $686 $791 $(
Slide 7: 3Q 2015 Pre-Tax Results by Segment
AUTOMOTIVE SECTOR 3Q 2015 PRE-TAX RESULTS BY SEGMENT* (MILS) $2,670 $2,167 $20 $(15) $(163) $(182) $(163) North South Middle East Asia Other Total America America Europe & Africa Pacific Automotive B / (W) 3Q 2014 $ 1,481 $1,260 $ 7 $ 257 $ - $ (24) $(19) B / (W) 2Q 2015 (210) 73 22 (168) 31 (172) 4
Slide 8: 3Q 2015 Key Metrics – North America
AUTOMOTIVE SECTOR – NORTH AMERICA 3Q 2015 KEY METRICS COMPARED WITH 2014 Wholesales Revenue Operating Margin Pre-Tax Results (000) (Bils) (Pct) (Mils) $23.7 11.3% $2,670 771 665 $19.9 7.1% $1,410 2014 2015 2014 2015 2014 2015 2014 2015 YTD: 2,142 2,265 $61.5 $67.0 8.7% 9.9% $5,350 $6,607 F-650 / F-7
Slide 9: 3Q 2015 Pre-Tax Results – North America
AUTOMOTIVE SECTOR – NORTH AMERICA 3Q 2015 PRE-TAX RESULTS COMPARED WITH 2014 (MILS) $1,260 Industry $407 Share 217 $2,670 Stocks 398 Mix / Other 547 $1,569 $1,410 $405 $101 $(70) $(427) $(318) Volume / Net Contribution Structural 3Q 2014 3Q 2015 Mix Pricing Cost Cost Exchange Other B / (W) 2Q 2015 $
Slide 10: 3Q 2015 Key Metrics – South America
AUTOMOTIVE SECTOR – SOUTH AMERICA 3Q 2015 KEY METRICS COMPARED WITH 2014 Wholesales Revenue Operating Margin Pre-Tax Results (000) (Bils) (Pct) (Mils) 113 $2.3 102 $1.6 (7.3)% $(170) $(163) (10.3)% 2014 2015 2014 2015 2014 2015 2014 2015 Focus YTD: 331 301 $6.3 $4.6 (15.4)% (11.7)% $(975) $(537) 3Q
Slide 11: 3Q 2015 Pre-Tax Results – South America
AUTOMOTIVE SECTOR – SOUTH AMERICA 3Q 2015 PRE-TAX RESULTS COMPARED WITH 2014 (MILS) Industry $(146) Share 64 Stocks 11 $134 Mix / Other 6 $7 $22 $19 $(17) $(65) $(86) $(170) $(163) Volume / Net Contribution Structural 3Q 2014 3Q 2015 Mix Pricing Cost Cost Exchange Other B / (W) 2Q 2015 $22 $16 $28 $
Slide 12: 3Q 2015 Key Metrics – Europe
AUTOMOTIVE SECTOR – EUROPE 3Q 2015 KEY METRICS COMPARED WITH 2014 Wholesales* Revenue Operating Margin Pre-Tax Results (000) (Bils) (Pct) (Mils) 375 $6.9 $7.0 321 (2.6)% $(182) $(439) (6.4)% 2014 2015 2014 2015 2014 2015 2014 2015 YTD: 1,064 1,140 $22.7 $20.9 (2.7)% (1.8)% $(619) $(381) Mondeo 3Q 20
Slide 13: 3Q 2015 Pre-Tax Results – Europe
AUTOMOTIVE SECTOR – EUROPE 3Q 2015 PRE-TAX RESULTS COMPARED WITH 2014 (MILS) Industry $141 Share (38) Stocks 123 Mix / Other (21) $262 $257 $205 $12 $(72) $(35) $(115) $(182) $(439) Volume / Net Contribution Structural 3Q 2014 3Q 2015 Mix Pricing Cost Cost Exchange Other B / (W) 2Q 2015 $(168) $(52)
Slide 14: 3Q 2015 Key Metrics – Middle East & Africa
AUTOMOTIVE SECTOR – MIDDLE EAST & AFRICA 3Q 2015 KEY METRICS COMPARED WITH 2014 Wholesales Revenue Operating Margin Pre-Tax Results (000) (Bils) (Pct) (Mils) 48 $1.1 42 $0.9 (1.4)% (1.6)% $(15) $(15) 2014 2015 2014 2015 2014 2015 2014 2015 YTD: 148 133 $3.4 $2.9 1.8% 0.6% $62 $18 Ecosport 3Q 2014 20
Slide 15: 3Q 2015 Key Metrics – Asia Pacific
AUTOMOTIVE SECTOR – ASIA PACIFIC 3Q 2015 KEY METRICS COMPARED WITH 2014 Wholesales* Revenue Operating Margin Pre-Tax Results (000) (Bils) (Pct) (Mils) 1.7% $44 346 $2.6 $2.6 306 0.8% $20 Figo $298** $253** 2014 2015 2014 2015 2014 2015 2014 2015 YTD: 1,058 1,021 $8.1 $7.3 6.1% 4.3% $494 $315 3Q 2014
Slide 16: 3Q 2015 Pre-Tax Results – Asia Pacific
AUTOMOTIVE SECTOR – ASIA PACIFIC 3Q 2015 PRE-TAX RESULTS COMPARED WITH 2014 (MILS) Industry $ (6) Share 16 Stocks (128) Mix / Other 117 $74 $44 $20 $22 $5 $(1) $(24) $(39) $(85) Volume / Net Contribution Structural 3Q 2014 3Q 2015 Mix Pricing Cost Cost Exchange Other B / (W) 2Q 2015 $(172) $(27) $32
Slide 17: Ford Credit 3Q 2015 Pre-Tax Results
FORD CREDIT 3Q 2015 PRE-TAX RESULTS COMPARED WITH 2014 (MILS) $43 $541 $498 $115 $11 $11 $(13) $(34) $(47) Volume / Financing Credit Lease 3Q 2014 3Q 2015 Mix Margin Loss Residual Exchange Other B / (W) 2Q 2015 $35 $34 $36 $(28) $(41) $(3) $37 Receivables (Bils) Net* $106 $117 Managed** 110 122 * Ne
Slide 18: 2015 Cash
AUTOMOTIVE SECTOR 2015 CASH* 3Q 2015 YTD 2015 (Bils) (Bils) Gross cash at end of period $ 22.2 $ 22.2 Gross cash at beginning of period 20.7 21.7 Change in gross cash $ 1.5 $ 0.5 Automotive pre-tax profits $ 2.2 $ 5.5 Capital spending (1.8) (5.3) Depreciation and tooling amortization 1.1 3.2 Changes
Slide 19: 2015 Planning Assumptions and Key Metrics
2015 PLANNING ASSUMPTIONS AND KEY METRICS Memo: 2014 FY 2015 FY 2015 YTD Results Plan Outlook Results GDP Growth Outlook Planning Assumptions (Mils) Industry Volume -- U.S. 16.8 17.0 - 17.5 About 17.7 17.7 About 2.5% -- Europe 20 14.6 14.8 - 15.3 About 16.0 15.9 Improving to about 1.8% -- China 24.0
Slide 20: SLIDE 20
Large Americas Asia Pacific Medium Europe, Middle East & Africa + Small F-150 SLIDE 20
Slide 21: Risk Factors
RISK FACTORS Statements included or incorporated by reference herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve
Slide 22: Q&A
Q&A
Slide 23: Appendix
APPENDIX
Slide 24: 3Q 2015 Earnings – Appendix Index
3Q 2015 EARNINGS – APPENDIX INDEX Appendix No. • Calculation of Earnings Per Share 1 • Income from Continuing Operations 2 • Special Items 3 • Sector Income Statement 4 Automotive Sector • Production Volumes 5 • Dealer Stocks 6 • Market Share 7 • Automotive Debt 8 Reconciliation to GAAP (Automotive
Slide 25: 2015 Calculation of Earnings per Share
2015 CALCULATION OF EARNINGS PER SHARE 3Q YTD After-Tax After-Tax Operating Operating Results Results Net Income Excluding Net Income Excluding Attributable Special Attributable Special to Ford Items* to Ford Items* Diluted After-Tax Results (Mils) $ 1,909 $ 1,801 $ 4,718 $ 4,610 Basic and Diluted S
Slide 26: Income from Continuing Operations
INCOME FROM CONTINUING OPERATIONS Memo: 3Q YTD FY 2014 2015 2014 2015 2014 (Mils) (Mils) (Mils) (Mils) (Mils) Automotive North America $ 1,410 $ 2,670 $ 5,350 $ 6,607 $ 6,898 South America (170) (163) (975) (537) (1,162) Europe (439) (182) (619) (381) (1,062) Middle East & Africa (15) (15) 62 18 (20
Slide 27: Special Items
SPECIAL ITEMS Memo: 3Q YTD FY 2014 2015 2014 2015 2014 (Mils) (Mils) (Mils) (Mils) (Mils) Personnel-Related Items Separation-related actions* $ (160) $ - $ (434) $ - $ (685) Other Items Nemak IPO $ - $ 166 $ - $ 166 $ - Venezuela - - - - (800) Ford Sollers equity impairment - - (329) - (329) 2016 Co
Slide 28: Sector Income Statement
SECTOR INCOME STATEMENT 3Q YTD For the periods ended September 30 2014 2015 2014 2015 (unaudited) (Mils) (Mils) (Mils) (Mils) AUTOMOTIVE Revenues $ 32,779 $ 35,818 $ 102,020 $ 102,723 Costs and Expenses Cost of sales 30,197 31,493 92,465 90,797 Selling, administrative, and other expenses 2,489 2,538
Slide 29: Production Volumes
AUTOMOTIVE SECTOR PRODUCTION VOLUMES 2015 3Q Actual 4Q Forecast O / (U) O / (U) Units 2014 Units 2014 (000) (000) (000) (000) North America 792 97 780 82 South America 85 (12) 70 (35) Europe 377 51 390 62 Middle East & Africa 22 2 20 1 Asia Pacific 341 (11) 430 54 Total 1,617 127 1,690 164 APPENDIX
Slide 30: Dealer Stocks
SELECTED MARKETS DEALER STOCKS Memo: Total U.S. Brazil Europe 20 MEA China Company (000) (000) (000) (000) (000) (000) 2015 September 30 605 29 197 64 139 1,170 June 30 611 29 182 68 163 1,195 Stock Change H / (L) (6) - 15 (4) (24) (25) 2014 September 30 599 34 182 79 115 1,145 June 30 643 34 192 84
Slide 31: Market Share
AUTOMOTIVE SECTOR MARKET SHARE 3Q YTD 2014 2015 B / (W) 2014 2015 B / (W) (Pct) (Pct) (Pts) (Pct) (Pct) (Pts) Total Share of Total Industry North America Total 13.8 14.1 0.3 14.4 14.2 (0.2) U.S. 14.1 14.7 0.6 14.9 14.8 (0.1) South America Total 8.8 10.2 1.4 8.7 10.0 1.3 Brazil 9.1 11.0 1.9 9.1 10.8
Slide 32: Automotive Debt
AUTOMOTIVE SECTOR AUTOMOTIVE DEBT Dec. 31, 2015 2014 June 30 Sept. 30 (Bils) (Bils) (Bils) Public unsecured debt $ 6.6 $ 6.5 $ 6.5 U.S. Department of Energy 4.4 4.1 4.0 Other debt (including International) 2.8 3.1 2.3 Total Automotive debt $ 13.8 $ 13.7 $ 12.8 Memo: Automotive debt payable within on
Slide 33: Net Interest Reconciliation to GAAP
AUTOMOTIVE SECTOR NET INTEREST RECONCILIATION TO GAAP Memo: 3Q YTD FY 2014 2015 2014 2015 2014 (Mils) (Mils) (Mils) (Mils) (Mils) Interest expense (GAAP) $ (204) $ (206) $ (619) $ (561) $ (797) Investment-related interest income (GAAP) 65 60 145 161 193 Interest income / (expense) on income taxes (G
Slide 34: Gross Cash Reconciliation to GAAP
AUTOMOTIVE SECTOR GROSS CASH RECONCILIATION TO GAAP 2014 2015 Sept. 30 Dec. 31 June 30 Sept. 30 (Bils) (Bils) (Bils) (Bils) Cash and cash equivalents $ 6.0 $ 4.6 $ 6.1 $ 7.8 Marketable securities 16.9 17.1 14.6 14.4 Total cash and marketable securities (GAAP) $ 22.9 $ 21.7 $ 20.7 $ 22.2 Securities i
Slide 35: Operating-Related Cash Flows Reconciliation to GAAP
AUTOMOTIVE SECTOR OPERATING-RELATED CASH FLOWS RECONCILIATION TO GAAP Memo: 3Q YTD FY 2014 2015 2014 2015 2014 (Bils) (Bils) (Bils) (Bils) (Bils) Net cash provided by / (used in) operating activities (GAAP) $ 0.6 $ 4.2 $ 6.7 $ 8.7 $ 8.8 Items included in operating-related cash flows Capital spending
Slide 36: 2015 Business Unit Key Metrics
2015 BUSINESS UNIT KEY METRICS Memo: 2014 FY 2015 FY 2015 YTD Results Plan Outlook Results Automotive (Mils) North America $ 6,898 Higher* On Track $6,607 - Operating Margin 8.4% 8% - 9% 8.5% - 9.5% 9.9% South America $ (1,162) Substantially Improved* Improved* $ (537) Europe (1,062) Improved* On Tr
Slide 37: China Unconsolidated Affiliates – Asia Pacific
AUTOMOTIVE SECTOR – ASIA PACIFIC CHINA UNCONSOLIDATED AFFILIATES Memo: 3Q YTD FY 2014 2015 2014 2015 2014 China Unconsolidated Affiliates Wholesales (000) 255 221 786 783 1,077 Ford Equity Income (Mils)* $ 298 $ 253 $ 957 $1,024 $ 1,280 * Ford equity share of China joint ventures net income APPENDIX
Slide 38: Definitions and Calculations
DEFINITIONS AND CALCULATIONS Wholesales and Revenue • Wholesale unit volumes include all Ford and Lincoln badged units (whether produced by Ford or by an unconsolidated affiliate) that are sold to dealerships, units manufactured by Ford that are sold to other manufacturers, units distributed by Ford