DETROIT (Reuters) - Ford Motor Co (F.N) on Wednesday posted a lower-than-expected quarterly net profit, hurt by rising commodity costs and unfavorable currency exchange rates, and said it expects more pain to come from higher raw material prices in 2018.
Ford has been alone among the major automakers in warning that higher prices for metals like aluminum and steel will take a bite out of earnings, and last week its shares took a dive after executives said they could cost the company $1.6 billion in 2018.
Speaking to reporters at Ford’s suburban Detroit headquarters, Chief Financial Officer Bob Shanks spoke of a lack of fitness at the No. 2 U.S. automaker, which meant that higher commodity costs stood out more than at rival companies that are hitting their numbers.
“We have to be far fitter than we are, regardless of what the future is,” Shanks said.
Ford’s fourth-quarter results were driven almost entirely by North America, which accounted for $1.6 billion out of $1.7 billion of pre-tax profits.
The company sold more expensive and profitable vehicles, mainly pickup trucks and SUVs, in North America than in other markets.
CFO Shanks said that around two thirds of the $400 million currency exchange hit the company took in the quarter was related to Brexit in Europe.
Ford reported quarterly net income of $2.41 billion or 60 cents per share, versus a loss of $781 million or 20 cents per share a year earlier. Adjusted for one-time items, Ford reported earnings per share of 39 cents. On that basis, analysts had on average expected earnings per share of 42 cents.
Reporting By Nick Carey, additional reporting by Paul Lienert; Editing by Tom Brown
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.