Ford’s record 2015 profits will reward shareholders with extra dividends this year. Ford Motor Company shareholders will receive a first-quarter dividend of 15 cents per share — the same payout as in last year — but the automaker will provide an additional 25 cents per share as part of a $1-billion supplemental cash dividend, according to Automotive News
News of the record profits came from Wall Street in after-hours trading. The supplemental cash represents a 40 percent increase for shareholders because of Ford’s strong financial performance in 2015 and its cash and liquidity levels. The first-quarter and supplemental dividends will be paid to stockholders on March 1.
The accounting change removes $1.4 billion in amortization costs, and the company has said pretax operating profit will be in the range of $10 billion to $11 billion — $1.5 billion higher than expected — as a result. Wall Street may be unimpressed because the automaker has already telegraphed higher profits.
Ford’s record 2015 profits are before special items and include the automaker’s recent change to a new accounting system to report accumulated costs related to pension and other post-retirement benefits. Last week, Ford said it is making more money than expected because of the change and the company is restating earnings back to 2011.
Ford said it will continue its momentum this year with results equal to or higher than 2015. Ford will release fourth-quarter and full-year 2015 results Jan. 28.
“As we close out 2015, we are benefiting from six consecutive years of consistently strong results, and our performance is allowing us to reward our shareholders,” said Ford President and CEO Mark Fields in a statement. “This pattern of strong returns gives us a great platform to build on.”
Ford is telling analysts it expects 2016 automotive revenue, operating margin and cash flow will all be equal to or higher than in 2015 and pretax profit will be higher. Operating earnings per share could also be higher this year.
By region, North America will have an operating margin of 9.5 percent or higher, which is below the double digits that the company enjoyed a few years ago and is a threshold automakers strive to reach. It is a figure to which analysts pay close attention.
Europe, Middle East and Africa will be profitable in 2016, a longtime goal for a region that has struggled for years to stem the sales drop and stop losing money. Asia Pacific will also be profitable in 2016 as the company continues to expand in China.
Ford’s record 2015 profits are expected to be equal to or higher than 2015 as well. Wall Street was not initially impressed. Ford Motor Company stock closed up slightly for the day but was down in after-hours trading after the news was released.