Ford

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Company

-What to sell: cars and trucks, buses, vans/
-M&A (subsidiaries); engaging in other businesses: including manufacturing
automotive components and systems and financing and renting vehicles and
equipment/ the company in divided up into the following four operating segments:
Automotive, Visteon Automotive systems, Ford Motor Credit company, and the Hertz
corporation.

-where to sell: North America, South America, Europe, Asia pacific
Financial
data

Substantial debt:
Ford continued to report high debt in 2013. For the fiscal year ended December 31, 2013,
the company reported total debt of US$114.7 billion, as compared to US$105 billion in
FY2012. The company’s debt to equity ratio stood at 434.7%, as compared to 658.8% in
FY2012. Highly levered balance sheet could impair its ability to obtain financing for working
capital, capital expenditure or general corporate purposes, especially if the ratings assigned
to its debt securities by rating organizations were revised downward. It could restrict the
flexibility of the company in responding to changing market conditions and make it more
vulnerable during times of slowdown. Another major consequence of the debt is that the
company would need to allocate a substantial portion of the cash flow from operations to pay
the principal and interest on debt, thereby reducing funds, which could be used for expansion
through acquisitions, expansion of product offerings and for marketing.
Barclay: Ford released 2015 guidance that fell far short of
our expectations and those of investors – ‘15 pre-tax profit was guided to ~$8.59.5bn
vs. our ingoing estimate of ~$11bn.

Reducing 2014 estimates due to macro, recall charges
We reduce our 2014 estimates, with EPS revised down to $1.15 vs. prior of $1.33,
and
pretax profit revised down to $6.3bn vs. prior of $7.5bn. Our lower estimates are
driven by
the following:
- North America reduced primarily to reflect $500mn of recall charges (related to
the
850k unit recall of 2013-14 C-MAX, Fusion, Escape, and MKZ over airbag issues);
our
2014 margin estimate is now at 8.0%, down from 8.5%, and consistent with
guidance
for margins to be at the low end of the 8-9% range.
- Europe reduced by ~$600mn, in part reflecting a $300mn hit from Russia
headwinds.
- South America reduced by $125mn, reflecting further deterioration of macro.

Reducing 2015 estimates due to North America headwinds,
weak macro,
launch costs
We reduce our 2015 estimates, with EPS revised down to $1.65 vs. prior of $1.95,
and
pretax profit revised down to $9.4bn vs. prior of $11.1bn and at the upper end of
guidance
of $8.5-9.5bn. Our lower estimates are driven by the following:
- North America reduced by ~$540mn due to increased content costs (i.e.
aluminum for
the new F-150), downtime in 1H’15 related to the F-150 changeover, and pricing
headwinds in the competitive small car segment. We now estimate 2015 NA
margin of
8.6%, well below our prior estimate of 9.4%, and near the mid-point of guidance
of 89%.
- Europe reduced by ~$420mn, reflecting headwinds from Russia, a slow

recovery in
Western Europe, and increased pension expense.
- South America reduced by $525mn, reflecting continued weak macro.
- Asia Pacific reduced by $241mn, reflecting facility ramp-up costs in China.
MORNINGSTAR:

-Safety: Weakness - Product Recalls
In January 2014, the company announced to recall 13,493 imported Edge SUVs in China on
a possible fuel system leak that could lead to a fire. In November 2013, the company
recalled its 161,334 SUV, Escape, for the seventh time to address potential leaks that could
cause a fire. In September 2013, Ford India announced to recall 1,66,021 units of Figo and
Classic sedan to rectify problems related to steering and rear suspension. In July 2013, Ford
Motor Co in India announced to recall 972 diesel-engine EcoSport compact sport-utility
vehicles. As part of routine checks the company discovered a potential concern with EcoSport
diesel variants. In June 2013, the company announced to recall 465,000 2013 models to
check for fuel tank leaks that could result in a fire. Models include the 2013 Ford Fusion,
Flex, Explorer, Taurus, Interceptor Sedan and Interceptor Utility, as well as the 2013 Lincoln
MKZ, MKS and MKT. In March 2013, the company announced to recall 3,500 Taurus,
Explorer and Lincoln MKS vehicles around the world to repair fuel tanks equipped with an
improperly molded seam. The company is also recalling 7,150 vehicles built Due to such
frequent recalls, the company incurred higher product costs and reported about 39% decline
in its net profitability in the first quarter of FY2014.
R&D

-research and development of fuel-efficient engines and
commercial vehicles with lower emissions, and upgrades to an engine
manufacturing plant in the United Kingdom

- Our sustainability strategy and the pursuit of our related goals have
enhanced our reputation and contributed to the competitiveness of
our products, operations and workforce, and are helping us build
social, environmental and financial value.
Ford Motor Company cut CO2 emissions from its global facilities by
37 percent per vehicle produced between 2000 and 2012 and plans
for a 30 percent reduction from 2010 to 2025.
To facilitate continued reduction of CO2 emissions from our products,
we are implementing a wide range of fuel efficiency technologies,
advanced powertrains, and alternative fuel capabilities across our
global product portfolio. For example, we now offer six electrified
vehicle choices: Fusion Hybrid, C-MAX Hybrid and Lincoln MKZ
Hybrid; Fusion Energi and C-MAX Energi plug-in hybrids; and Focus
Electric.
Ford’s efforts to tackle a myriad of sustainability challenges in a
rapidly changing world are not limited to CO2 reduction. We are also
focused on global water challenges, safety achievements and other
sustainability-related issues including Ford’s Code of Human Rights,
Basic Working Conditions and Corporate Responsibility, and the
reduction of waste-to-landfill per vehicle
Risks: according to the annual data, quite well prepared for the remedies of
exchange risk/
Fairly doing well,, considering all the risky factors

Doubtful.. Although their decent work, why the share price does not reflect well
enough?

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