Ford shares fell after the carmaker missed estimates for quarterly earnings and cautioned it may get off to a slow start to the year due to supply chain issues.
The carmaker posted earnings of 26 cents a share excluding some items for the last three months of 2021, trailing the 45-cent average analyst estimate. Shortages of critical components including semiconductors disrupted production and will weigh on vehicle deliveries to dealers this quarter.
"We have incredible demand for our products," John Lawler, Ford's chief financial officer, told reporters on a call. "It's the supply chains that limited what we could produce and what we could provide. And we see that easing into 2022, and you'll see that flowing through our profits."
Ford shares fell as much as 6.8 per cent to $18.53 before the start trading. The stock was down 4.2 per cent this year through Thursday’s close.
Sales rose 5 per cent to $37.7 billion in the fourth quarter, with automotive revenue accounting for $35.3 billion of that total. Some analysts had anticipated double-digit sales growth, Mr Lawler said. The company is estimating higher commodity costs will be a $1.5 billion to $2 billion headwind this year.
Investors have cheered chief executive Jim Farley’s effort to accelerate Ford’s switch to electric vehicles, sending the shares up 136% last year. Ford’s market capitalisation briefly topped $100 billion.
In recent weeks, the company’s valuation has fallen back to around $80 billion.
“Financial performance is obviously critical,” Mr Farley said in a statement. “We’re also proud that customers see how Ford is taking EVs mainstream.”
For this year, Ford forecast earnings before interest and taxes will rise 15% to 25 per cent to as much as $12.5 billion. That compares with analysts’ estimates of $12.2 billion. Mr Lawler projected a high-single-digit to low-double-digit percentage decline in wholesales for the first quarter due to supplier shortages.
In its home market of North America, Ford increased adjusted profit before interest and taxes by 70 per cent in the fourth quarter to $1.82 billion, mainly due to strong demand for vehicles like the Bronco SUV and Maverick pickup. But that undershot the $2.34 billion profit projected by analysts.
Ford’s loss in China, the world’s largest car market, more than doubled in the quarter to $150 million from $66 million in the year-earlier period.
- Bloomberg
