Shares of Ford Motor Company plummeted as much as 12 percent during after-hours trading Tuesday after the American auto giant failed to hit its profit estimates and reported a Generally Accepted Accounting Principles loss in the fourth quarter.
Ford disclosed it lost around $1.7 billion, or 42 cents per share, compared with a drop of $100 million, or 3 cents per share, in the year-ago period.
The company stated that it earned 12 cents per share, adjusted for one-time units, compared with 30 cents per share a year ago. Total sales were down 5 percent to $39.7 billion from $41.9 billion from the previous period.
Struggling to complete a long running corporate revamp and hounded with continued declines in China, the No. 2 US auto manufacturer said it estimates operating profits in the range of 94 cents to $1.20 per share, below the $1.26 Wall Street observers were anticipating.
The quarter included a $2.2 billion GAAP loss as a result of higher contributions to its workforce's pension plans, something the company reported recently.
The results "were not okay for 2019," according to Ford Chief Financial Officer Tim Stone, in a media briefing at the company's headquarters outside Detroit.
During extended sessions conference call with financial analysts, Chief Executive Jim Hackett was more straightforward about the challenges of balancing the company's drawn-out efforts with its continuing development on future technology, which includes self-driving cars.
Analysts surveyed by FactSet had predicted the car manufacturer to post 17 cents adjusted earnings from a share of $39.6 billion in profits. For the quarter the analysts saw a GAAP profit of 15 cents per share.
Financially, the performance of the company last year was "short of our original goals," Hackett said, adding that Ford accepts and takes responsibility for and have made changes because of this.
Ford said it anticipated adjusted earnings for the full year 2020 from $5.6 billion to $6.6 billion, assuming "nominal growth" for its automotive business cushioned by declining contributions from its credit unit and a "modestly higher" investment in autonomous vehicles.
The company disclosed its operating losses in China totaled $770 million in 2019, including a decline of $207 million in the fourth quarter. Ford lost $1.5 billion the previous year, while its market share in the Chinese mainland in the final quarter dropped 2 percent from 2.2 percent last year.
Ford's China revenues were down around 15 percent in Q4 and 25 percent for the year as the company continues to struggle in its second largest market. It has been having difficulty boosting its profits in China since its business started falling in late 2017.
