Ford Mtr Co Del · NYSE:F
Ford Mtr Co Del — Ford Motor Company — Q4 2022 Earnings Presentation
43 slides from Ford Mtr Co Del's earnings presentation, Feb 15, 2023
Slide 1: Ford Q4 2022 Earnings (updated February 15, 2023)
Updated on February 15, 2023 to include slide 23 • • • • • • * See Next Slide For Vehicle Information
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements. Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially fr
Slide 3: Disruptive Technology Allows Us to Leverage Foundational Strengths
Disruptive Technology Allows Us to Leverage Foundational Strengths to Build New Capabilities – Enriching Customer Experiences and Deepening Loyalty CUSTOMER EXPERIENCE FOUNDATIONAL ENHANCED EXPANDED TAM STRENGTHS CAPABILITIES & VALUE CREATION Ford Blue Iconic Integrated Hardware Nameplates and Softw
Slide 4: Foundational Strengths + Enhanced Capabilities = Expanded TAM
FOUNDATIONAL STRENGTHS + ENHANCED CAPABILITIES = EXPANDED TAM & VALUE CREATION Iconic Nameplates Integrated Hardware & Software Electrification Launching seventh-generation Mustang and Demonstrating real progress with BlueCruise; Launching the all-new one tonne E-Transit all-new Super Duty in 2023 4
Slide 5: Disruptive Technology Allows Us to Leverage Foundational Strengths
Disruptive Technology Allows Us to Leverage Foundational Strengths to Build New Capabilities – Enriching Customer Experiences and Deepening Loyalty CUSTOMER EXPERIENCE • ICE / Hybrid: Delivering the freshest and most-appealing lineup in the industry with Broncos, Mavericks, Rangers etc., along with
Slide 6: Q4 and Full Year 2022 Financial Highlights
Revenue Adj. EBIT Adj. EBIT Margin Adj. FCF Adj. EPS $44.0B $2.6B 5.8% $2.4B $0.51 Up $6.3B Up $0.5B Up 0.4 ppts Up $0.1B Up $0.25 2022 Mustang Mach-E F u l l Ye a r $158.1B $10.4B 6.6% $9.1B $1.88 Up $21.7B Up $0.4B Down 0.7 ppts Up $4.5B Up $0.29 SECRET 6
Slide 7: Full Year Company Adjusted EBIT
$9.7 $10.4 • Company Adjusted EBIT driven by strong Automotive $2.7 $1.0 and Ford Credit results $(0.9) $(1.0) • Special Items include Rivian $(1.3) $(2.0) mark-to-market net loss of $7.4B and a $2.7B impairment on Argo $(12.2) investment Taxes / Automotive Mobility Ford Credit Corporate Company Int
Slide 8: FY 2021 YoY Change: Volume / Mix
North South Total Total Europe China IMG America America Auto Company FY 2021 $ 7.4 $ (0.1) $ (0.2) $ (0.3) $ 0.6 $ 7.4 $ 10.0 YoY Change: Volume / Mix $ 4.0 $ (0.1) $ 0.5 $ (0.3) $ 0.2 $ 4.3 $ 4.3 Net Pricing 6.6 0.9 2.8 (0.0) 0.6 10.9 10.9 Commodities $(4.5) Material / Freight (4.5) Cost (8.3) (0.
Slide 9: Q4 Company Revenue and Adjusted EBIT
Wholesale Units (000) Adjusted EBIT ($B) & Revenue ($B) & EBIT Margin (%) • Q4 wholesales up 4%, driven Wholesale Units by improvement in supply $44.0 chain constraints and EV $40.2 $39.4 $37.7 scaling $35.7 $34.5 • Revenue up 17%, driven by increased volume and higher net pricing, offset partially
Slide 10: Q4 Adjusted FCF of $2.4B, driven by Automotive EBIT
Adjusted Cash Balance Free Cash Flow & Liquidity Liquidity • Q4 Adjusted FCF of $2.4B, $7.8 $52.4 driven by automotive EBIT $47.4 $49.2 $44.6 $45.1 $48.0 • Strong cash and liquidity $3.6 $3.6 available to invest in growth $2.3 $2.4 $36.5 $31.5 $32.0 $32.3 Rivian $28.8 $10.6* $28.7 Rivian $0.8 Rivian
Slide 11: Q4 Company Adjusted EBIT driven by Automotive results
$2.8 $2.6 • Company Adjusted EBIT driven by Automotive results $1.3 • Special Items driven by pensions and joint venture $0.2 $0.1 asset impairments in China $(0.2) $(0.2) $(0.3) $(1.1) Taxes / Automotive Mobility Ford Credit Corporate Company Interest Special Non-Controlling Net Income / Other Adj.
Slide 12: Q4 2021 YoY Change: Volume / Mix
North South Total Total Europe China IMG America America Auto Company Q4 2021 $ 1.8 $ 0.0 $ (0.2) $ (0.2) $ 0.1 $ 1.6 $ 2.0 YoY Change: Volume / Mix $ 0.9 $ (0.0) $ 0.3 $ (0.1) $ 0.2 $ 1.4 $ 1.4 Material / Freight $(1.8) Net Pricing 2.2 0.2 0.8 (0.0) 0.2 3.4 3.4 Structural (0.5) Cost (1.6) (0.2) (1.
Slide 13: North America: FY EBIT of $9.2B, up $1.8B
Wholesale Units (000) Revenue ($B) $29.1 $31.0 $25.8 $26.3 635 $24.0 • FY EBIT of $9.2B, up $1.8B 546 599 618 568 $22.3 514 • America’s best-selling commercial van lineup for the 44th consecutive year Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 • Q
Slide 14: South America: FY EBIT of $0.4B, up $0.5B
Wholesale Units (000) Revenue ($B) • FY EBIT of $0.4B, up $0.5B $0.9 $0.9 $0.8 26 26 $0.6 $0.7 $0.6 • First FY profit in 10 years; region 20 15 18 23 de-risked and expected to be sustainably profitable Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 •
Slide 15: Europe: FY EBIT of $47M, up $201M
Wholesale Units (000)* Revenue ($B) $6.9 $6.8 $6.1 $5.8 $6.1 273 266 $5.7 254 • FY EBIT of $47M, up $201M 218 213 222 • #1 European commercial vehicle brand for 8 straight years, a first for any OEM Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 • Q4
Slide 16: China: FY EBIT of $(0.6)B, down $0.2B
Wholesale Units (000)* Revenue ($B) JV Volume • FY EBIT of $(0.6)B, down 186 162 $0.2B, as investments in EVs 184 128 137 $0.6 $0.6 160 114 117 $0.6 continue to increase 125 134 $0.4 $0.4 111 114 $0.3 • Lincoln - profit pillar for the region Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4
Slide 17: International Markets Group: FY EBIT of $0.6B unchanged
Wholesale Units (000)* Revenue ($B) 103 $3.3 86 $2.8 • FY EBIT of $0.6B unchanged 80 $2.4 66 $1.9 $2.0 55 59 $1.7 • FY profit driven by the launch of all-new Ranger and the exit of India Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 • Record Ranger s
Slide 18: Mobility: FY EBIT of $(0.9)B, improved $0.1B
• FY EBIT of $(0.9)B, improved $0.1B • Winding down Argo EBIT ($B) Q4 EBIT YoY ($B) $0.1 $0.0 $(0.2) $(0.3) $(0.2) $(0.2) $(0.2) $(0.2) $(0.3) $(0.3) Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q4 Autonomous Other Q4 2021 Vehicles Mobility 2022 SECRET 18
Slide 19: Ford Credit: FY EBT of $2.7B, down $2.1B
Auction Values (Per Unit)* U.S. Retail Loss-to-Receivables (“LTR”) Ratio (%) $34,315 $34,170 $34,780 0.63% $31,740 • FY EBT of $2.7B, down $2.1B, $29,905 reflecting lower credit loss and 0.37% $24,690 lease residual reserve releases, $22,230 0.25% 0.18% lower financing margin, and 0.07% 0.08% 0.05%
Slide 20: Q4 Adjusted FCF of $2.4B, Driven By Automotive EBIT
Balance Sheet Fourth Quarter Full Year 2021 2022 2021 2022 2021 2022 Dec. 31 Dec. 31 Company Adj. EBIT excl. Ford Credit $ 1.0 $ 2.4 $ 5.3 $ 7.8 Capital spending $ (1.8) $ (2.0) $ (6.2) $ (6.5) Depreciation and tooling amortization 1.3 1.3 5.1 5.2 Company Excl. Ford Credit Net Spending $ (0.5) $ (0.
Slide 21: Q4 EBIT Special Items Of $(1.1)B
Fourth Quarter Full Year Global Redesign 2021 2022 2021 2022 2022 Actions and Cash Effects Recorded 2018 - 2021 Global Redesign China $ (0.0) $ (0.3) $ 0.2 $ (0.4) India (0.1) (0.0) (0.5) (0.3) South America (0.1) 0.1 (0.8) 0.1 Separations and Other (not included above) (0.2) (0.1) (0.6) (0.3) $9.8
Slide 22: 2023 Outlook: Headwinds and Tailwinds
Headwinds 2023 Outlook 2022 Actual • Expected mild U.S. recession, moderate Europe recession Adjusted EBIT $9B to $11B $10.4 • Higher incentives across the industry as supply and Adjusted FCF ~$6B $9.1 demand come back into balance Capital Spending $8B to $9B $6.5 • Ford Credit EBT of ~$1.3B, down $
Slide 23: 2023 Adjusted EBIT Tailwinds and Headwinds
Tailwinds Headwinds + Volume: Industry, supply chain ~ Pricing: + All-new Super Duty – Lower ATPs $1.0 - $3.0 + Material: Commodities + Production stability $9.0 - $11.0 + Commodities – Ford Credit: – More normalized credit losses and auction values, non-reoccurrence of derivative gains and higher b
Slide 24: Upcoming Events: Teach In, Q1 Earnings, Capital Markets Day
March 23: May 2: May 22: Teach In Event Q1 2023 Earnings Capital Markets Day Operating and financial reporting of First quarter reported with three new Full day immersive event in Dearborn, new business segments: Ford Blue, Ford business segments Michigan, including operating Model e and Ford Pro ta
Slide 25: Cautionary Note on Forward-Looking Statements
Statements included or incorporated by reference herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve a number of r
Slide 26: Constructing BlueOval SK Battery Park In KY
SECRET Constructing BlueOval SK Battery Park In KY: 197 Football Fields Of Concrete 1’ Thick 26
Slide 27: Ford Builds 150,000th Mustang Mach-E
SECRET Ford Builds 150,000th Mustang Mach-E 27
Slide 28: F-150 Lightning Wins MotorTrend Truck of the Year for 2023
SECRET F-150 Lightning Wins MotorTrend Truck of the Year for 2023 28
Slide 29: Launch Of Next-Gen Ford Ranger In South Africa
SECRET Launch Of Next-Gen Ford Ranger In South Africa 29
Slide 30: 2023 Transit Trail Van
2023 Transit Trail Van SECRET
Slide 31: Wholesale Units, Market Share and Revenue by Region
Wholesale Units (000) Market Share (%) Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 North America 546 599 514 618 568 635 11.2 % 14.3 % 12.0 % 12.9 % 12.8 % 12.4 % South America 20 26 15 18 23 26 2.4 2.4 2.2 2.0 2.0 2.0 Europe 218 213 254 222 273 26
Slide 32: EBIT and EBIT Margin by Region
EBIT ($B) EBIT Change (%) Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 North America $ 2.4 $ 1.8 $ 1.6 $ 3.3 $ 1.3 $ 3.0 (24) % 68 % (46) % N/M % (46) % 65 % South America 0.0 0.0 0.1 0.1 0.1 0.1 102 134 169 N/M N/M N/M Europe (0.1) (0.2) 0.2 0.0 0.
Slide 33: Market Share, Wholesale Units, Revenue and EBIT Margin
Wholesale Units (000) Market Share (%) 2022 B / (W) 2022 B / (W) 2022 B / (W) 2022 B / (W) Q4 2021 Q4 2022 2021 FY 2022 FY Q4 2021 Q4 2022 2021 FY 2022 FY 2021 2021 2021 2021 North America 599 635 36 2,006 2,335 328 14.3 % 12.4 % (1.9) ppts 12.0 % 12.5 % 0.5 ppts South America 26 26 1 81 83 2 2.4 2.
Slide 34: Fourth Quarter and Full Year EBIT by Segment
Fourth Quarter Full Year 2021 2022 2022 B / (W) 2021 2021 2022 2022 B / (W) 2021 North America $ 1,822 $ 3,007 $ 1,185 $ 7,377 $ 9,176 $ 1,799 South America 36 110 74 (121) 413 534 Europe (159) (374) (215) (154) 47 201 China (150) (205) (55) (327) (572) (245) International Markets Group 92 243 151 6
Slide 35: Quarterly EBIT by Segment 2021-2022
2021 2022 Q1 Q2 Q3 Q4 Full Year Q1 Q2 Q3 Q4 Full Year North America $ 2,943 $ 192 $ 2,420 $ 1,822 $ 7,377 $ 1,591 $ 3,269 $ 1,309 $ 3,007 $ 9,176 South America (73) (86) 2 36 (121) 50 104 149 110 413 Europe 341 (284) (52) (159) (154) 207 10 204 (374) 47 China (15) (123) (39) (150) (327) (53) (121) (
Slide 36: Net Income to Adjusted EBIT Reconciliation
Fourth Quarter Full Year 2021 2022 2021 2022 Net income / (loss) attributable to Ford (GAAP) $ 12,282 $ 1,289 $ 17,937 $ (1,981) Income / (Loss) attributable to non-controlling interests (9) (30) (27) (171) Net income / (loss) $ 12,273 $ 1,259 $ 17,910 $ (2,152) Less: (Provision for) / Benefit from
Slide 37: Operating Cash Flow to Adjusted Free Cash Flow
Full Year Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 2021 2022 Net cash provided by / (used in) operating activities (GAAP) $ 3,531 $ (1,084) $ 2,947 $ 3,812 $ 1,178 $ 15,787 $ 6,853 Less: Items Not Included in Company Adjusted Free Cash Flows Ford Credit operating cash flows 998 (419) (1,340) (439) (3
Slide 38: Diluted After-Tax Results and Adjusted EPS
Fourth Quarter Full Year 2021 2022 2021 2022 Diluted After-Tax Results ($M) Diluted after-tax results (GAAP) $ 12,282 $ 1,289 $ 17,937 $ (1,981) Less: Impact of pre-tax and tax special items 11,220 (780) 11,507 (9,599) Adjusted net income – diluted (Non-GAAP) $ 1,062 $ 2,069 $ 6,430 $ 7,618 Basic an
Slide 39: Pre-Tax Results, Taxes and Tax Rate
2022 Memo: Q4 Full Year Full Year 2021 Pre-Tax Results ($M) Income / (Loss) before income taxes (GAAP) $ 1,166 $ (3,016) $ 17,780 Less: Impact of special items (1,080) (12,172) 9,583 Adjusted earnings before taxes (Non-GAAP) $ 2,246 $ 9,156 $ 8,197 Taxes ($M) (Provision for) / Benefit from income ta
Slide 40: Adjusted Net Operating Profit After Cash Tax and ROIC
Four Quarters Four Quarters Adjusted Net Operating Profit / (Loss) After Cash Tax Ending Q4 2021 Ending Q4 2022 Net income / (loss) attributable to Ford $ 17.9 $ (2.0) Add: Non-controlling interest (0.0) (0.2) Less: Income tax 0.1 0.9 Add: Cash tax (0.6) (0.8) Less: Interest on debt (1.8) (1.3) Less
Slide 41: We use both GAAP and non-GAAP financial measures
We use both GAAP and non-GAAP financial measures for operational and financial decision making, and to assess Company and segment business performance. The non-GAAP measures listed below are intended to be considered by users as supplemental information to their equivalent GAAP measures, to aid inve
Slide 42: Company Adjusted Free Cash Flow (FCF)
• Company Adjusted Free Cash Flow (FCF) (Most Comparable GAAP Measure: Net Cash Provided By / (Used In) Operating Activities) – Measure of Company’s operating cash flow excluding Ford Credit’s operating cash flows. The measure contains elements management considers operating activities, including Co
Slide 43: Wholesale Units and Revenue
Wholesale Units 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 or others, units manufactured by Ford that are sold to other manufacturers, units distributed by Ford for other man