Ford

Key Performance Metrics

  • The review of Net Profit Margin witnessed a surging trend. The Net Profit Margin improved from 5% in 2017 to 13% in 2021.
  • The average EBIT Margin for the period under analysis was 0.6%, with 2020 and 2021 performing the worst and best, respectively.
  • In the current year, Ford was able to cover its interest liabilities 2.51 times in the current year- compared to 2017 when it was 0.37 times.
  • The Capital turnover stood at 0.81 times in 2021 from 1.01 in 2017, implying a low performance on Capital of the business in relation to revenue.

Profitability

  • The revenue of Ford has increased year on year. The revenue increased by 2.3%% between 2017 and 2018 and a further 2.8%% decrease was recorded between 2018 and 2019. There also occurred an increase of 7.2% between 2020 and 2021 (the current period). 
  • Ford’s performance in profitability looks good as the return on capital employed also recorded good performance during the period of analysis.

Liquidity

  • The company’s result in liquidity looks strong, as current ratio maintained stability at 1.20:1. Which implies that the company has enough assets to settle its current liabilities.

Capital Structure

  • Ford is both equity and debt financed.
  • The debt-to-equity (D/E) ratio has been falling year on year. The gearing position of the company appears to be high as it stood at 429% in the current year.

Source: Ford Annual Report

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