Ford Motor Co (NYSE:F) CFO Tim Stone remains focused on the strategies he had last year when he took the position of being customer-centric, enhancing free cash flow, and improving the automaker’s performance.
Ford tops Q2 2020 revenue estimates
Despite the impacts of the COVID-19 pandemic that led to halting production for almost two months, the Stone looks determined to attain the goals set last year. He wants to transform Ford into an agile and customer-friendly company that can favorably compete with increasing competition from the likes of Tesla Inc. (NASDAQ:TSLA) and General Motors Co. (NYSE:GM). Stone stated that he is familiar with an and-environment rather than an or-environment, adding that you should do it all at once.
The company reported better expected second-quarter results topping Wall Street estimates and its expectation amid the COVID-19 pandemic induced shutdowns of its factories. In April, the company had indicated that it expected to post a $5 billion loss, but the automaker reported a pretax loss of $1.9 billion adjusted to one-time items. Interestingly the company has already begun repaying credit lines drawn earlier this year to weather the pandemic.
Sales recovery boosted Q2 2020 performance
Ford reported revenue of $17.6 billion against an expectation of $15.95 billion, while loss per share was $0.35 compared against an expectation of $1.17. Ford benefitted from faster than anticipated sales recovery in the second quarter, including better mix, favorable pricing, and operational execution. In Q3, the company expects a pretax profit of around $500 million to $1.5 billion.
During the pandemic, Stone turned to a crisis playbook by focusing on cash and liquidity. The company did away with its dividend, tapped to credit lines of around $15 billion, and issued an unsecured debt of $8 billion. Also, Ford initiated an early payment program to help suppliers with liquidity planning and review on-going projects on areas where it will suspend expenditure. New tech initiatives like the autonomous vehicle service have been pushed forward the same as information tech and real estate initiatives.