Ford affirms 2017 to be less profitable than 2016
By Bernie Woodall
DETROIT (Reuters) - Ford Motor Co F.N on Tuesday confirmed that it would be less profitable in 2017 than last year, even as cross town rival General Motors Co GM.N on the same day gave a much more upbeat forecast that surpassed Wall Street expectations.
Ford, the second largest U.S. automaker, affirmed that it was on track to deliver about $10.2 billion in adjusted pretax profit in 2016, matching a forecast it gave previously..
Ford shares initially rose 0.5 percent in extended trading but by early Tuesday evening were flat with their closing value of $12.85. GM shares were also trading near their close of $37.35, up 3.7 percent from the previous day.
Ford said profit would improve in 2018 but in 2017 the company would be pressured as it increased spending on "emerging opportunities" including self-driving cars and a rise in other costs.
The company last week said it was on course to deliver a "high-volume, fully autonomous vehicle for ride sharing in 2021" and a fully electric small SUV with a range of at least 300 miles on a full charge.
GM, the largest U.S. automaker, said it expected 2017 earnings per share in a range of $6 to $6.50. Analysts had, on average, predicted the company would post EPS this year of $5.76, according to Thomson Reuters I/B/E/S.
Ford on Tuesday declared a first-quarter regular dividend of $0.15 per share and a $200 million supplemental cash dividend, or an additional $0.05 per share. The regular dividend matched that of the first quarter of 2016, but the supplemental dividend was below the $0.25 per share payout announced a year ago.
Chief Executive Mark Fields in comments to Wall Street analysts at a meeting webcast from Detroit said the adjusted operating effective tax rate in 2016 was expected to be 32 percent. That was up from an expectation a few months ago for a 2016 tax rate of 28.5 percent, said Ford Chief Financial Officer Bob Shanks. Continued...