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DETROIT (Reuters) -Ford Motor Co on Thursday reported fourth-quarter profit fell from a year earlier, and the automaker blamed supply chain issues and production “instabilities” that raised costs, along with lower-than-expected volumes.
Full-year profit was short of expectations and Ford shares dropped more than 6% in after-market trading.
“We should have done much better last year,” Ford CEO Jim Farley said in a statement. “We left about $2 billion in profits on the table that were within our control.”
In a briefing late Thursday, Chief Financial Officer John Lawler said “2023 is a pivotal year for us as we reshape the company.” Some aspects of Ford’s overhaul are “lagging and need more work,” he said.
“In the simplest terms, we need to improve quality and lower costs now,” Lawler reporters.
The CFO said Ford intends to return 40-50% of free cash flow to shareholders this year. But the company expects adjusted free cash flow to fall to about $6 billion in 2023 from $9.1 billion last year.
Ford expects full-year adjusted pretax earnings of $9 billion to $11 billion. The company’s 2022 adjusted profit of $10.4 billion was short of Ford’s forecast at the end of the third quarter for $11.5 billion.
Fourth-quarter net income fell to $1.3 billion, from $12.3 billion in the year-earlier period. Revenue climbed to $44 billion, from $37.7 billion the previous year. Adjusted pretax earnings were $2.6 billion, compared with $2.0 billion last year.
(Additionl reporting by Ben Klayman in Detroit; Editing by David Gregorio)
