FORD MOTOR CREDIT EARNS $740 MILLION IN THE
SECOND QUARTER
DEARBORN, Mich., July 19, 2005 – Ford Motor Credit Company reported net income of
$740 million in the second quarter of 2005, down $157 million from earnings of $897 million a year
earlier. On a pre-tax basis from continuing operations, Ford Motor Credit earned $1.2 billion in the
second quarter, compared with $1.4 billion in the previous year. The decrease in earnings primarily
reflected higher borrowing costs and the impact of lower receivable levels, offset partially by improved
credit loss performance.
"This quarter's solid results reflect our ongoing efforts to strengthen our operations," said Mike
Bannister, chairman and CEO. "Despite the challenging business environment, Ford Motor Credit
continues to generate strong profits."
On June 30, 2005, Ford Motor Credit's on-balance sheet net receivables totaled $121 billion, compared
with $133 billion on December 31, 2004. Managed receivables were $160 billion on June 30, down
from $168 billion on December 31. The lower managed receivables primarily reflected lower retail
placement volumes.
Ford Motor Credit paid dividends of $1 billion during the quarter. On June 30, managed leverage was
12.8 to 1.
Ford Motor Credit Company is one of the world's largest automotive finance companies and
has supported the sale of Ford products since 1959. Ford Motor Credit is an indirect, wholly
owned subsidiary of Ford Motor Company. It provides automotive financing for Ford, Lincoln,
Mercury, Aston Martin, Jaguar, Land Rover, Mazda and Volvo dealers and customers. More
information can be found at http://www.fordcredit.com and at Ford Motor Credit's investor
center, http://www.fordcredit.com/investorcenter/.
###
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
For the Periods Ended June 30, 2005 and 2004
(in millions)
Second Quarter
2005
2004
(Unaudited)
Financing revenue
Operating leases
Retail
Interest supplements and other support costs earned
from affiliated companies
Wholesale
Other
Total financing revenue
Depreciation on vehicles subject to operating leases
Interest expense
Net financing margin
Other revenue
Investment and other income related to sales
of receivables
Insurance premiums earned, net
Other income
Total financing margin and other revenue
Expenses
Operating expenses
Provision for credit losses
Insurance expenses
Total expenses
Income from continuing operations before income taxes
Provision for income taxes
Income from continuing operations before minority interests
Minority interests in net income of subsidiaries
Income from continuing operations
Income from discontinued operations
Gain on disposal of discontinued operations
Net income
$ 1,339
1,012
$ 1,477
1,081
First Half
2005
2004
(Unaudited)
$ 2,697
2,082
$ 3,051
2,152
795
276
55
3,477
(1,095)
(1,386)
996
881
193
60
3,692
(1,242)
(1,295)
1,155
1,638
527
111
7,055
(2,172)
(2,812)
2,071
1,737
382
109
7,431
(2,549)
(2,624)
2,258
443
52
143
1,634
542
61
291
2,049
888
104
313
3,376
1,034
121
519
3,932
522
(111)
61
472
1,162
426
736
736
4
$ 740
516
68
74
658
1,391
508
883
1
882
15
$ 897
1,050
6
97
1,153
2,223
813
1,410
1
1,409
37
4
$ 1,450
1,033
350
111
1,494
2,438
891
1,547
1
1,546
39
$ 1,585
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(in millions)
ASSETS
Cash and cash equivalents
Investments in securities
Finance receivables, net
Net investment in operating leases
Retained interest in securitized assets
Notes and accounts receivable from affiliated companies
Derivative financial instruments
Assets of discontinued operations
Other assets
Total assets
LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities
Accounts payable
Customer deposits, dealer reserves and other
Affiliated companies
Total accounts payable
Debt
Deferred income taxes, net
Derivative financial instruments
Liabilities of discontinued operations
Other liabilities and deferred income
Total liabilities
Minority interests in net assets of subsidiaries
Stockholder's equity
Capital stock, par value $100 a share, 250,000 shares
authorized, issued and outstanding
Paid-in surplus (contributions by stockholder)
Accumulated other comprehensive income
Retained earnings
Total stockholder's equity
Total liabilities and stockholder's equity
June 30,
2005
(Unaudited)
December 31,
2004
$ 18,518
706
98,599
21,932
5,287
1,478
4,060
6,087
$ 156,667
$ 12,668
653
110,851
21,866
9,166
1,780
6,930
2,186
6,521
$ 172,621
$
$
1,604
1,070
2,674
128,935
8,315
711
4,908
145,543
1,645
819
2,464
144,274
7,593
911
93
5,802
161,137
14
13
25
5,117
502
5,466
11,110
$ 156,667
25
5,117
855
5,474
11,471
$ 172,621
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
OPERATING HIGHLIGHTS*
Financing Shares
United States
Financing share – Ford, Lincoln and Mercury
Retail installment and lease
Wholesale
Europe
Financing share – Ford
Retail installment and lease
Wholesale
Second Quarter
2005
2004
2005
First Half
2004
40%
81
39%
84
41%
81
38%
84
29%
97
29%
97
28%
97
28%
97
Contract Volume – New and used retail/lease (in thousands)
North America segment
United States
Canada
Total North America segment
424
51
475
440
52
492
834
82
916
838
88
926
International segment
Europe
Other international
Total International segment
Total contract volume
206
65
271
746
208
62
270
762
392
138
530
1,446
410
136
546
1,472
Borrowing Cost Rate**
Charge-offs (in millions)
On-Balance Sheet
Retail installment & lease
Wholesale
Other
Total on-balance sheet charge-offs
Total loss-to-receivables ratio
Managed***
Retail installment & lease
Wholesale
Other
Total managed charge-offs
Total loss-to-receivables ratio
—————
*
Continuing operations
** Includes the effect of interest rate swap agreements
*** See appendix for additional information
4.4%
$ 140
(1)
(2)
$ 137
0.44%
$ 172
(1)
(2)
$ 169
0.41%
3.7%
$ 285
6
0
$ 291
0.91%
$ 362
6
0
$ 368
0.85%
4.2%
$ 307
16
(5)
$ 318
0.50%
$ 387
16
(5)
$ 398
0.48%
3.7%
$ 598
9
(1)
$ 606
0.94%
$ 789
9
(1)
$ 797
0.91%
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
APPENDIX
In evaluating Ford Motor Credit's financial performance, Ford Motor Credit management uses financial statements and other
financial measures in accordance with Generally Accepted Accounting Principles (GAAP). Included below are brief
definitions of key terms, information about the impact of on-balance sheet securitization and a reconciliation of other
measures.
KEY TERMS:
•
Managed receivables: receivables reported on Ford Motor Credit's balance sheet and receivables Ford Motor Credit
sold in off-balance sheet securitizations and continues to service.
•
Charge-offs on managed receivables: charge-offs associated with receivables reported on Ford Motor Credit's
balance sheet and charge-offs associated with receivables that Ford Motor Credit sold in off-balance sheet
securitizations and continues to service.
IMPACT OF ON-BALANCE SHEET SECURITIZATION: finance receivables (retail and wholesale) and investments in
operating leases reported on Ford Motor Credit's balance sheet include assets transferred in securitizations that do not
qualify for accounting sale treatment. These assets have been legally transferred to Ford Motor Credit sponsored special
purpose entities and are available only to pay the obligations of the special purpose entities and are not available to pay the
other obligations of Ford Motor Credit or the claims of Ford Motor Credit's other creditors. Debt reported on Ford Motor
Credit's balance sheet includes debt issued by these special purpose entities to securitization investors which is payable out
of collections on the assets supporting the securitizations and is not the legal obligation of Ford Motor Credit or its other
subsidiaries.
RECONCILIATION OF MEASURES:
Managed Leverage Calculation
June 30,
2005
Total debt
Securitized off-balance sheet receivables outstanding
Retained interest in securitized off-balance sheet receivables
Adjustments for cash and cash equivalents
Adjustments for SFAS No. 133
Total adjusted debt
December 31,
2004
(in billions)
$ 128.9
$ 144.3
39.2
37.7*
(5.3)
(9.5)**
(18.5)
(12.7)
(2.6)
(3.2)
$ 141.7
$ 156.6
Total stockholder's equity (including minority interest)
Adjustments for SFAS No. 133
Total adjusted equity
$ 11.1
(0.0)
$ 11.1
Managed leverage (to 1) = adjusted debt / adjusted equity
Memo: Financial statement leverage (to 1) = total debt / stockholder's equity
Net Finance Receivables and Operating Leases
June 30, 2005
Retail installment
Wholesale
Other finance receivables
Net investment in operating leases
Total net finance receivables and operating leases
On-Balance
Sheet
December 31, 2004
Retail installment
Wholesale
Other finance receivables
Net investment in operating leases
Total net finance receivables and operating leases
—————
* Includes securitized funding from discontinued operations
** Includes retained interest in securitized receivables from discontinued operations
$ 69.9
23.5
5.2
21.9
$ 120.5
$ 81.7
23.8
5.3
21.9
$ 132.7
12.8
11.6
Managed Receivables
Off-Balance
Sheet
(in billions)
$ 20.4
18.8
0.0
0.0
$ 39.2
$ 16.7
18.9
0.0
0.0
$ 35.6
$ 11.5
(0.1)
$ 11.4
13.7
12.6
Total
$ 90.3
42.3
5.2
21.9
$ 159.7
$ 98.4
42.7
5.3
21.9
$ 168.3