Ford CEO Jim Hackett said the company’s global redesign resulted in a stronger company but they have “more work to do.”

Ford Motor Co. reported its net income was cut by more than half in the third quarter, dropping to $425 million from $1 billion in the same three-month period in 2018.

The company’s margins also declined to 1.1% from 2.6% in the third quarter a year ago. A decline in per-share earnings to 11 cents was primarily attributable to charges for special items associated with the company’s strategic Global Redesign, the company said in its quarterly financial report.

“Our Global Redesign is about making choices to transform our organization, to become the world’s most trusted company and a clear leader in an era of rapid change,” said Jim Hackett, Ford president and chief executive officer.

“We are getting stronger today and we have more work to do,” said Hackett.

Hackett noted Ford opened a new customer-contact center in Houston to develop even closer relationships with U.S. owners of Ford vehicles.

”Business-unit highlights during the quarter included an ongoing product renewal in North America, where all-new Ford Explorer and Escape and Lincoln Aviator and Corsair models will soon be followed by a new F-Series Super Duty with best-in-class diesel towing, diesel and gas power and torque, and payload; a new F-150; an innovative, Mustang-inspired battery-electric vehicle; and the return of the Bronco,” he said.

Reported revenue for the third quarter was $37 billion, down 2% from the prior year, largely as a result of currency exchange issues. Special items in the quarter included charges related to the proposed creation of a joint venture in India with Mahindra & Mahindra.

Cash flow from operating activities was $4.7 billion, down 9% compared with the same period last year. Adjusted free cash flow for the quarter was $207 million.

Adjusted EBIT in the quarter increased 8% to $1.8 billion. The higher operating results were attributable to mark-to-market investment gains; improvement in the company’s businesses in North America, Europe and China; and another strong performance by Ford Credit.

Adjusted per-share earnings for the third quarter were 34 cents. For the year to date, adjusted free cash flow was up 80%. EBIT from Ford’s Automotive business for the first nine months of the year increased 10%.

However, despite touting improved performance in Europe and China, the company sees a tough time in the fourth quarter. The company is now expecting higher warranty costs, higher than planned incentives in North America, and lower volumes in China.

As a result, Ford lowered its guidance for full-year company adjusted EBIT to between $6.5 billion and $7 billion, compared with $7 billion in 2018. Full-year adjusted EPS is now expected to fall between $1.20 and $1.32, versus $1.30 in 2018, with an adjusted effective tax rate of around 12 to 13%.