EXHIBIT 99.1
Contact: Daniel Jarvis
313-594-2527
djarvis1@ford.com
FOR IMMEDIATE RELEASE
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/.
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FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
For the Periods Ended June 30, 2004 and 2003
(in millions)
| Second Quarter | First Half | |||||||||||||||
| 2004 | 2003 | 2004 | 2003 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
| Financing revenue | ||||||||||||||||
| Operating leases | $ | 1,463 | $ | 1,876 | $ | 3,023 | $ | 3,938 | ||||||||
| Retail | 1,117 | 1,126 | 2,241 | 2,205 | ||||||||||||
| Interest supplements and other support costs earned from affiliated companies | 866 | 855 | 1,672 | 1,739 | ||||||||||||
| Wholesale | 223 | 227 | 462 | 423 | ||||||||||||
| Other | 60 | 72 | 109 | 161 | ||||||||||||
| Total financing revenue | 3,729 | 4,156 | 7,507 | 8,466 | ||||||||||||
| Depreciation on operating leases | (1,242 | ) | (1,822 | ) | (2,549 | ) | (3,950 | ) | ||||||||
| Interest expense | (1,295 | ) | (1,479 | ) | (2,624 | ) | (2,998 | ) | ||||||||
| Net financing margin | 1,192 | 855 | 2,334 | 1,518 | ||||||||||||
| Other revenue | ||||||||||||||||
| Investment and other income related to sales of receivables | 581 | 672 | 1,130 | 1,563 | ||||||||||||
| Insurance premiums earned, net | 61 | 61 | 121 | 125 | ||||||||||||
| Other income | 290 | 249 | 515 | 506 | ||||||||||||
| Total financing margin and revenue | 2,124 | 1,837 | 4,100 | 3,712 | ||||||||||||
| Expenses | ||||||||||||||||
| Operating expenses | 552 | 539 | 1,103 | 1,123 | ||||||||||||
| Provision for credit losses | 76 | 542 | 377 | 1,063 | ||||||||||||
| Insurance expenses | 74 | 95 | 111 | 138 | ||||||||||||
| Total expenses | 702 | 1,176 | 1,591 | 2,324 | ||||||||||||
| Income from continuing operations before income taxes | 1,422 | 661 | 2,509 | 1,388 | ||||||||||||
| Provision for income taxes | 520 | 258 | 918 | 542 | ||||||||||||
| Income from continuing operations before minority interests | 902 | 403 | 1,591 | 846 | ||||||||||||
| Minority interests in net income of subsidiaries | 1 | 2 | 1 | 3 | ||||||||||||
| Income from continuing operations | 901 | 401 | 1,590 | 843 | ||||||||||||
| Loss from discontinued/held-for-sale operations | (4 | ) | — | (5 | ) | — | ||||||||||
| Net income | $ | 897 | $ | 401 | $ | 1,585 | $ | 843 | ||||||||
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(in millions)
| June 30, | December 31, | |||||||
| 2004 | 2003 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 8,832 | $ | 15,688 | ||||
| Investments in securities | 641 | 611 | ||||||
| Finance receivables, net | 107,607 | 108,912 | ||||||
| Net investment in operating leases | 21,638 | 23,164 | ||||||
| Retained interest in securitized assets | 16,396 | 13,017 | ||||||
| Notes and accounts receivable from affiliated companies | 1,438 | 1,653 | ||||||
| Derivative financial instruments | 5,782 | 9,866 | ||||||
| Assets of discontinued/held-for-sale operations | 385 | 388 | ||||||
| Other assets | 4,401 | 5,530 | ||||||
| Total assets | $ | 167,120 | $ | 178,829 | ||||
| LIABILITIES AND STOCKHOLDER’S EQUITY | ||||||||
| Liabilities | ||||||||
| Accounts payable | ||||||||
| Trade, customer deposits, and dealer reserves | $ | 1,531 | $ | 1,535 | ||||
| Affiliated companies | 1,456 | 1,258 | ||||||
| Total accounts payable | 2,987 | 2,793 | ||||||
| Debt | 138,270 | 149,652 | ||||||
| Deferred income taxes, net | 7,073 | 6,334 | ||||||
| Derivative financial instruments | 636 | 987 | ||||||
| Liabilities of discontinued/held-for-sale operations | 92 | 37 | ||||||
| Other liabilities and deferred income | 5,905 | 6,533 | ||||||
| Total liabilities | 154,963 | 166,336 | ||||||
| Minority interests in net assets of subsidiaries | 11 | 19 | ||||||
| Stockholder’s equity | ||||||||
| Capital stock, par value $100 a share, 250,000 shares authorized, issued and outstanding | 25 | 25 | ||||||
| Paid-in surplus (contributions by stockholder) | 5,117 | 5,117 | ||||||
| Accumulated other comprehensive income | 407 | 420 | ||||||
| Retained earnings | 6,597 | 6,912 | ||||||
| Total stockholder’s equity | 12,146 | 12,474 | ||||||
| Total liabilities and stockholder’s equity | $ | 167,120 | $ | 178,829 | ||||
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
OPERATING HIGHLIGHTS
| Second Quarter | First Half | |||||||||||||||
| Financing Shares | 2004 | 2003 | 2004 | 2003 | ||||||||||||
| United States | ||||||||||||||||
| Financing share — Ford, Lincoln and Mercury | ||||||||||||||||
| Retail installment and lease | 39 | % | 34 | % | 38 | % | 35 | % | ||||||||
| Wholesale | 78 | 83 | 79 | 83 | ||||||||||||
| Europe | ||||||||||||||||
| Financing share — Ford | ||||||||||||||||
| Retail installment and lease | 28 | % | 32 | % | 28 | % | 31 | % | ||||||||
| Wholesale | 97 | 96 | 97 | 97 | ||||||||||||
Contract Volume— New and used retail/lease (in thousands) | ||||||||||||||||
| North America Segment | ||||||||||||||||
| United States | 472 | 491 | 900 | 963 | ||||||||||||
| Canada | 52 | 60 | 88 | 101 | ||||||||||||
| Total North America Segment | 524 | 551 | 988 | 1,064 | ||||||||||||
| International Segment | ||||||||||||||||
| Europe | 209 | 223 | 422 | 444 | ||||||||||||
| Other international | 65 | 65 | 139 | 144 | ||||||||||||
| Total International Segment | 274 | 288 | 561 | 588 | ||||||||||||
| Total financing volume | 798 | 839 | 1,549 | 1,652 | ||||||||||||
Borrowing Cost Rate* | 3.7 | % | 4.3 | % | 3.7 | % | 4.4 | % | ||||||||
Credit Losses(in millions) | ||||||||||||||||
On-Balance sheet | ||||||||||||||||
| Retail installment & lease | $ | 326 | $ | 421 | $ | 659 | $ | 915 | ||||||||
| Wholesale | 6 | 16 | 9 | 17 | ||||||||||||
| Other | 0 | 14 | (1 | ) | 13 | |||||||||||
| Total on-balance sheet credit losses | $ | 332 | $ | 451 | $ | 667 | $ | 945 | ||||||||
| Total Loss-to-receivables Ratios** | 1.07 | % | 1.50 | % | 1.09 | % | 1.56 | % | ||||||||
Managed*** | ||||||||||||||||
| Retail installment & lease | $ | 440 | $ | 590 | $ | 931 | $ | 1,276 | ||||||||
| Wholesale | 6 | 19 | 9 | 20 | ||||||||||||
| Other | 0 | 14 | (1 | ) | 13 | |||||||||||
| Total managed credit losses | $ | 446 | $ | 623 | $ | 939 | $ | 1,309 | ||||||||
| Total Loss-to-receivables Ratios | 1.02 | % | 1.32 | % | 1.06 | % | 1.37 | % | ||||||||
| — — — — — | ||||||||||||||||
| * Includes the effect of interest rate swap agreements | ||||||||||||||||
| ** Includes credit losses on reacquired receivables | ||||||||||||||||
| Total excluding credit losses on reacquired receivables | 1.03 | % | 1.44 | % | 1.03 | % | 1.53 | % | ||||||||
| *** 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 off-balance 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:
| Managed Leverage Calculation | June 30, | December 31, | ||||||
| 2004 | 2003 | |||||||
| (in billions) | ||||||||
| Total debt | $ | 138.3 | $ | 149.7 | ||||
| Securitized off-balance sheet receivables outstanding | 45.8 | 49.4 | ||||||
| Retained interest in securitized off-balance sheet receivables | (16.4 | ) | (13.0 | ) | ||||
| Adjustments for cash and cash equivalents | (8.8 | ) | (15.7 | ) | ||||
| Adjustments for SFAS No. 133 | (3.2 | ) | (4.7 | ) | ||||
| Total adjusted debt | $ | 155.7 | $ | 165.7 | ||||
| Total stockholder’s equity (including minority interest) | $ | 12.1 | $ | 12.5 | ||||
| Adjustments for SFAS No. 133 | 0.1 | 0.2 | ||||||
| Total adjusted equity | $ | 12.2 | $ | 12.7 | ||||
| Managed leverage (to 1) = adjusted debt / adjusted equity | 12.7 | 13.0 | ||||||
| Memo: Financial statement leverage (to 1) = total debt / stockholder’s equity | 11.4 | 12.0 | ||||||
| Net Finance Receivables and Operating Leases | Managed Receivables | |||||||||||
| On-Balance | Off-Balance | |||||||||||
| Sheet | Sheet | Total | ||||||||||
| (in billions) | ||||||||||||
June 30, 2004 | ||||||||||||
| Retail installment | $ | 77.7 | $ | 23.9 | $ | 101.6 | ||||||
| Wholesale | 22.2 | 21.9 | 44.1 | |||||||||
| Other finance receivables | 7.7 | 0.0 | 7.7 | |||||||||
| Net investment in operating leases | 21.6 | 0.0 | 21.6 | |||||||||
| Total net finance receivables and operating leases | $ | 129.2 | $ | 45.8 | $ | 175.0 | ||||||
December 31, 2003 | ||||||||||||
| Retail installment | $ | 77.8 | $ | 29.1 | $ | 106.9 | ||||||
| Wholesale | 22.5 | 20.3 | 42.8 | |||||||||
| Other finance receivables | 8.6 | 0.0 | 8.6 | |||||||||
| Net investment in operating leases | 23.2 | 0.0 | 23.2 | |||||||||
| Total net finance receivables and operating leases | $ | 132.1 | $ | 49.4 | $ | 181.5 | ||||||