Ford's revenue and market capitalization

  •   DEHOUI Lionel

Founded in 1903 and headquartered in Dearborn, Michigan, Ford is an American company that operates in the automobile manufacturing sector. Today, the group is one of the world leaders in this field. In the year 2020, its business has fallen off due to the coronavirus health crisis. In 2021, the company improved its financial performance, despite the shortage of semiconductors that affected several car manufacturers.

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Ford's revenue and market capitalization
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Q4 and full year 2020 performance

In the fourth quarter of 2020, Ford's reported results came in better than expected. In the last three months of this year, its sales reached 36 billion dollars. It reported a 9% year-on-year decline. However, it exceeded market expectations. The market was expecting sales of $33.89 billion for the quarter.

Between October and December 2020, the company incurred a net loss of $2.8 billion (or 70 cents per share), compared with a loss of $1.7 billion (or 42 cents per share) in the fourth quarter of the previous year. The loss was mainly due to the group's restructuring at that time and new vehicle launches.

Excluding exceptional items, earnings per share for Q4-2020 were 34 cents. The market was targeting a loss per share of -7 cents. In addition, for the full twelve months of fiscal 2020, Ford had annual sales of $127.1 billion.

This was down 18% compared to 2019. In fiscal year 2020, the US carmaker posted a net loss of $1.3 billion.

 

Results for the first quarter of 2021

After ending the 2020 financial year with a loss, Ford returned to profit in the first quarter of 2021. Over this period, the American group made a net profit of 3.2 billion dollars, compared with a shortfall of 2 billion dollars a year earlier at the same time.

This is the best net profit recorded by the company for ten years. The group's adjusted Ebit for the first three months of 2021 was $4.8 billion, compared to a loss of $632 million in Q1-2020. For the quarter under review, adjusted EPS was $0.89.

Between January and March 2021, the carmaker's revenue was $36.2 billion. It reported a 6% year-on-year growth in the same period. It should be noted that during this quarter the group was disrupted by the shortage of semiconductors that affected the entire global automotive sector.

 

Group business update for the second quarter of 2021

As the first quarter of 2021 was marked by semiconductor supply problems, Ford was able to offset these difficulties in the second quarter with price increases. This was due to strong demand for its cars. Thus, for the whole of Q2-2021, the group's turnover reached 26.75 billion dollars.

This is an increase of 38% compared to the same period the year before. Between April and June 2021, the company generated a net profit of $561 million. Excluding exceptional items, earnings per share were 13 cents. This exceeded market expectations of a small loss.

 

Third quarter 2021 balance sheet

After being impacted by the Covid-19 health crisis and the semiconductor shortage, Ford posted better-than-expected results in the third quarter of 2021. For the period as a whole, the American group recorded sales of 35.7 billion dollars.

This was 5% lower than in the third quarter of 2020. However, it came in above market expectations. The market was expecting a turnover of $32.5 billion for Q3-2021. It should be noted that the company has not been spared by the semiconductor shortage that has affected the entire automotive sector.

However, Ford has benefited from strong demand. Between July and September 2021, the car manufacturer made a net profit of 1.8 billion dollars, compared to 2.4 billion dollars a year earlier in the same period. This is a 25% year-on-year drop. Adjusted EPS came in at 51 cents, exceeding the 27 cents that the market had expected.

In addition, the Dearborn-based group says it had about 4.9% of the global auto market in the third quarter of 2021. The company sold a total of 1.01 million vehicles during this period. For the first nine months of 2021 as a whole, car deliveries came to 2.84 million units.

The other highlight of the third quarter financial report was the announcement that the company will return to paying a quarterly dividend from the fourth quarter of 2021.

 

About Ford's dividend and market capitalisation

A dividend is the amount paid by a company to its shareholders at the end of its fiscal year. It represents a percentage of the profits earned in the previous year. It is proposed by the company's Board of Directors.

It is then submitted to the shareholders for approval. The Ford Group is one of the US companies that fall under this dividend policy. However, since March 2020, the American firm had suspended all dividend payments. At the end of the third quarter of 2021, it has announced its intention to resume paying a quarterly dividend of 10 cents per share.

In addition, the Ford group has a remarkable presence on the financial markets. Ford shares are among the most closely watched by traders and investors on stock market platforms. The company is listed on the New York Stock Exchange on the NYSE Euronext market. At the beginning of January 2022, its market capitalisation is estimated to be over 90 billion dollars.

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