Ford just said it expects to lose $600 million in Q1 as the coronavirus pandemic damages sales

Advertisement
Ford just said it expects to lose $600 million in Q1 as the coronavirus pandemic damages sales
ford factory

On Monday, Ford said that it expects to post a loss of around $600 million when it reports first-quarter earnings at the end of April.

Advertisement

The company said in a statement that revenue would also decline, to approximately $34 billion for the quarter. For the fourth quarter of 2019, Ford brought in $39.7 billion. In Q1 of 2019, revenue came in just over $40 billion.

The carmaker, which was in the middle of an $11 billion restructuring prior to the COVID-19 outbreak, didn't estimate it losses on a per-share basis.

In trading on Monday, Ford shares declined over 5%, to $5. Year-to-date, the stock is down 45%.

According to CFO Tim Stone, "Ford's first-quarter vehicle wholesales were down 21 percent from a year ago, largely as a result of lower production and demand related to the coronavirus."

Advertisement

Last month, the company tapped several lines of credit to bolster the cash position on its balance sheet, and also suspended its dividend.

With close to $30 billion on hand, Stone said the company believes it has "sufficient cash today to get us through at least the end of the third quarter with no incremental vehicle production and wholesales or financing actions."

All of Ford's North American and European manufacturing operations are currently shut down, with no firm date set for a restart.

However, Ford said, "The company is considering a scenario for a phased restart of its manufacturing plants, supply network and other dependent functions beginning in the second quarter, with enhanced safety standards in place to protect workers."

It added, "Any decisions on resumptions will be made in cooperation with local unions, suppliers, dealers and other stakeholders."

Advertisement

Stone said that Ford is "opportunistically assess[ing] all funding options to further strengthen our balance sheet and increase liquidity to optimize our financial flexibility" and "identifying additional operating actions to enhance our cash position."

Do you have a personal experience with the coronavirus you'd like to share? Or a tip on how your town or community is handling the pandemic? Please email covidtips@businessinsider.com and tell us your story.

Get the latest coronavirus business & economic impact analysis from Business Insider Intelligence on how COVID-19 is affecting industries.

{{}}