FORD CREDIT EARNS $897 MILLION IN SECOND QUARTER
DEARBORN, Mich., July 20, 2004 – Ford Motor Credit Company reported record net income of
$897 million in the second quarter of 2004, up $496 million from $401 million a year earlier. On a
pre-tax basis from continuing operations, Ford Credit earned $1.4 billion in the second quarter,
compared with $661 million in the previous year. The increase in earnings primarily reflected
continued improved credit loss performance, higher used vehicle prices and the favorable impact of the
low interest rate environment.
"Results were very strong for the quarter, with significant improvements in credit losses," said Mike
Bannister, Chairman and CEO. "Improvement in the U.S. economy helped, but much of the success is
due to our dedicated Ford Credit team and the support we receive from Ford Motor Company sales and
marketing groups and from our dealers."
On June 30, 2004, receivables on Ford Credit's balance sheet totaled $129 billion, compared with
$132 billion on December 31, 2003. Managed receivables were $175 billion on June 30, down
$7 billion from $182 billion on December 31, primarily reflecting lower retail and lease placement
volumes.
Ford Credit paid a dividend of $1 billion during the quarter. On June 30, managed leverage was
12.7 to 1.
Ford Credit is an indirect, wholly owned subsidiary of Ford Motor Company. Now in its 45th year,
Ford Credit provides vehicle financing in 36 countries to more than 10 million customers and 12,500
automotive dealers. More information can be found at www.fordcredit.com and at Ford Credit's
investor center, www.fordcredit.com/investorcenter/.
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
For the Periods Ended June 30, 2004 and 2003
(in millions)
Second Quarter
2004
2003
(Unaudited)
Financing revenue
Operating leases
Retail
Interest supplements and other support costs earned
from affiliated companies
Wholesale
Other
Total financing revenue
Depreciation on 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 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
Loss from discontinued/held-for-sale operations
Net income
$
$
1,463 $
1,117
1,876
1,126
First Half
2004
2003
(Unaudited)
$
3,023 $
2,241
3,938
2,205
866
223
60
3,729
(1,242)
(1,295)
1,192
855
227
72
4,156
(1,822)
(1,479)
855
1,672
462
109
7,507
(2,549)
(2,624)
2,334
1,739
423
161
8,466
(3,950)
(2,998)
1,518
581
61
290
2,124
672
61
249
1,837
1,130
121
515
4,100
1,563
125
506
3,712
552
76
74
702
1,422
520
902
1
901
(4)
897 $
539
542
95
1,176
661
258
403
2
401
401
1,103
377
111
1,591
2,509
918
1,591
1
1,590
(5)
1,585 $
1,123
1,063
138
2,324
1,388
542
846
3
843
843
$
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(in millions)
June 30,
2004
(Unaudited)
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/held-for-sale operations
Other assets
Total assets
LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities
Accounts payable
Trade, customer deposits, and dealer reserves
Affiliated companies
Total accounts payable
Debt
Deferred income taxes, net
Derivative financial instruments
Liabilities of discontinued/held-for-sale 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
$
8,832
641
107,607
21,638
16,396
1,438
5,782
385
4,401
167,120
1,531
1,456
2,987
138,270
7,073
636
92
5,905
154,963
December 31,
2003
$
$
$
15,688
611
108,912
23,164
13,017
1,653
9,866
388
5,530
178,829
1,535
1,258
2,793
149,652
6,334
987
37
6,533
166,336
11
19
25
5,117
407
6,597
12,146
167,120
25
5,117
420
6,912
12,474
178,829
$
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
2004
2003
First Half
2004
2003
39%
78
34%
83
38%
79
35%
83
28%
97
32%
96
28%
97
31%
97
Contract Volume – New and used retail/lease (in thousands)
North America Segment
United States
Canada
Total North America Segment
472
52
524
491
60
551
900
88
988
963
101
1,064
International Segment
Europe
Other international
Total International Segment
Total financing volume
209
65
274
798
223
65
288
839
422
139
561
1,549
444
144
588
1,652
Borrowing Cost Rate*
3.7%
4.3%
3.7%
4.4%
Credit Losses (in millions)
On-Balance sheet
Retail installment & lease
Wholesale
Other
Total on-balance sheet credit losses
Total Loss-to-receivables Ratios**
$ 326
6
0
$ 332
1.07%
$ 421
16
14
$ 451
1.50%
$ 659
9
(1)
$ 667
1.09%
$ 915
17
13
$ 945
1.56%
Managed***
Retail installment & lease
Wholesale
Other
Total managed credit losses
Total Loss-to-receivables Ratios
$ 440
6
0
$ 446
$ 590
19
14
$ 623
$ 931
9
(1)
$ 939
$ 1,276
20
13
$ 1,309
1.02%
1.32%
1.06%
1.37%
1.03%
1.44%
1.03%
1.53%
—————
* Includes the effect of interest rate swap agreements
** Includes credit losses on reacquired receivables
Total excluding credit losses on reacquired receivables
*** See appendix for additional information
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
APPENDIX
In evaluating Ford Credit's financial performance, Ford 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 Credit's balance sheet and receivables Ford Credit sold in offbalance sheet securitizations and continues to service.
•
Managed credit losses: credit losses associated with receivables reported on Ford Credit's balance sheet plus credit
losses associated with receivables that Ford Credit sold in off-balance sheet securitizations and continues to service.
IMPACT OF ON-BALANCE SHEET SECURITIZATION: retail installment receivables reported on Ford Credit's balance
sheet include receivables sold in securitizations. These receivables have been legally sold to Ford Credit sponsored
special purpose entities and are available only to pay securitization investors and other participants and are not available to
pay the obligations of Ford Credit or the claims of Ford Credit's creditors. Debt reported on Ford Credit's balance sheet
includes debt issued to securitization investors which is payable solely out of collections on the receivables supporting the
securitization and is not the legal obligation of Ford Credit.
RECONCILIATION OF MEASURES:
June 30,
2004
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,
2003
(in billions)
$ 138.3
$ 149.7
45.8
49.4
(16.4)
(13.0)
(8.8)
(15.7)
(3.2)
(4.7)
$ 155.7
$ 165.7
Total stockholder's equity (including minority interest)
Adjustments for SFAS No. 133
Total adjusted equity
$ 12.1
0.1
$ 12.2
$ 12.5
0.2
$ 12.7
12.7
11.4
13.0
12.0
Managed Leverage Calculation
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
On-Balance
Sheet
June 30, 2004
Retail installment
Wholesale
Other finance receivables
Net investment in operating leases
Total net finance receivables and operating leases
$ 77.7
22.2
7.7
21.6
$ 129.2
December 31, 2003
Retail installment
Wholesale
Other finance receivables
Net investment in operating leases
Total net finance receivables and operating leases
$ 77.8
22.5
8.6
23.2
$ 132.1
Managed Receivables
Off-Balance
Sheet
Total
(in billions)
$ 23.9
$ 101.6
21.9
44.1
0.0
7.7
0.0
21.6
$ 45.8
$ 175.0
$ 29.1
20.3
0.0
0.0
$ 49.4
$ 106.9
42.8
8.6
23.2
$ 181.5