Ford Motor Company (NYSE: F) reported an increase in third-quarter earnings, despite a decline in revenues. Earnings came in above Wall Street’s prediction. The stock slipped during Wednesday’s after-hours session as the company trimmed its full-year guidance.
Third-quarter profit, on an adjusted basis, rose to $0.34 per share from $0.29 per share last year and topped the Street view. Unadjusted net income was $425 million or $0.11 per share, down from last year’s profit of $991 million or $0.25 per share.
“Our Global Redesign is about making choices to transform our organization, to become the world’s most trusted company and a clear leader in an era of rapid change. We are getting stronger today and we have more work to do,” said CEO Jim Hackett.
Revenue declined by 2% year-over-year to $37 billion, reflecting the faltering demand and unfavorable exchange rates. The top-line, meanwhile, exceeded expectations.
The company said it continues to expect lower full-year structural costs in the Automotive business and anticipates full-year growth in adjusted free cash flow. Meanwhile, it lowered the full-year adjusted EBIT guidance to between $6.5 billion and $7.0 billion, to reflect the increase in warranty costs, higher than planned incentives in North America, and lower volumes in China.
Full-year adjusted earnings are currently expected to be between $1.20 per share to $1.32 per share, down from the last year’s levels. The estimated adjusted effective tax rate is 12-13%.
Ford’s stock closed Wednesday’s session near the levels seen a year earlier. It is yet to recover from the losses that followed the dismal second-quarter performance. The stock dropped sharply Wednesday evening following the earnings report.
Snap-on Incorporated (NYSE: SNA), the century-old company that makes high-end tools for the automotive industry, is unlikely to have a smooth ride in the current quarter, given the deepening turmoil
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