Exhibit 99.1
| Contact: | Daniel Jarvis | |||
| 313-594-2527 | ||||
| djarvis1@ford.com |
FOR IMMEDIATE RELEASE
FORD CREDIT EARNS $401 MILLION IN SECOND QUARTER
DEARBORN, Mich., July 16, 2003 — Ford Motor Credit Company reported net income of $401 million in the second quarter of 2003, up $71 million from earnings of $330 million in the same period a year earlier. On a pre-tax basis, Ford Credit earned $661 million in the second quarter of 2003 compared with $519 million in the second quarter of 2002. The increase in earnings primarily reflects higher income related to securitizations and a lower provision for credit losses, offset partially by the impact of lower receivables.
Compared with the first quarter of 2003, earnings were down $41 million, reflecting primarily lower gains on sales of finance receivables, offset partially by higher financing margins.
“In this challenging environment, Ford Credit continues to provide stable performance,” said Greg Smith, Chairman and CEO. “We have made progress on several fronts this quarter, and we continue to focus on the basics of our business by providing support for our dealers and positive results for Ford Motor Company.”
On June 30, 2003, receivables on Ford Credit’s balance sheet totaled $134 billion, down $8 billion from June 30, 2002. The reduction primarily reflects lower retail and lease placement volumes, and higher sales of receivables in whole-loan sale transactions, offset partially by the accounting consolidation of a Ford Credit asset-backed commercial paper program. Managed receivables were $190 billion on June 30, 2003, compared with $207 billion on June 30, 2002, and $193 billion on March 31, 2003.
In June 2003, Ford Credit paid a dividend of $900 million, resulting in managed leverage of 12.9 to 1 on June 30, 2003.
Ford Credit is a wholly owned subsidiary of Ford Motor Company. Now in its 44th year, Ford Credit provides vehicle financing in 36 countries to more than 11 million customers and more than 12,500 automotive dealers. More information can be found atwww.fordcredit.comand at Ford Credit’s investor center,www.fordcredit.com/investorcenter/.
Ford Motor Credit Company and Consolidated Subsidiaries
OPERATING HIGHLIGHTS
| Net Income | Second Quarter | First Half | ||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||
| (in millions) | ||||||||||||||||||
| Income from continuing operations | $ | 401 | $ | 326 | $ | 843 | $ | 575 | ||||||||||
| Income from discontinued operations | 0 | 4 | 0 | 11 | ||||||||||||||
| Net Income | $ | 401 | $ | 330 | $ | 843 | $ | 586 | ||||||||||
| Memo: SFAS No. 133 included above | $ | 68 | $ | (13 | ) | $ | 82 | $ | 1 | |||||||||
| Financial statement return on equity | 12 | % | 10 | % | 13 | % | 9 | % | ||||||||||
| Income before income taxes | $ | 661 | $ | 519 | $ | 1,388 | $ | 916 | ||||||||||
| Balance Sheet Summary | June 30, | |||||||||||||||||||
| March 31, | December 31, | |||||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||||
| (in billions) | ||||||||||||||||||||
Assets | ||||||||||||||||||||
| Finance receivables | ||||||||||||||||||||
| Retail installment | $ | 76.8* | $ | 78.9 | $ | 62.7 | $ | 68.4 | ||||||||||||
| Wholesale | 20.7 | 16.5 | 18.1 | 16.4 | ||||||||||||||||
| Other | 9.4 | 10.7 | 9.6 | 9.8 | ||||||||||||||||
| Total net finance receivables | $ | 106.9 | $ | 106.1 | $ | 90.4 | $ | 94.6 | ||||||||||||
| Net investment in operating leases | 26.9 | 35.5 | 29.0 | 31.6 | ||||||||||||||||
| Total net finance receivables and operating leases | $ | 133.8 | $ | 141.6 | $ | 119.4 | $ | 126.2 | ||||||||||||
| Retained interest in securitized assets | 14.5 | 11.5 | 18.1 | 17.6 | ||||||||||||||||
| All other assets | 26.7 | 19.5 | 28.3 | 26.4 | ||||||||||||||||
| Total assets | $ | 175.0 | $ | 172.6 | $ | 165.8 | $ | 170.2 | ||||||||||||
Liabilities and Stockholder’s Equity | ||||||||||||||||||||
| Debt — short-term | $ | 29.2* | $ | 15.6 | $ | 16.1 | $ | 16.2 | ||||||||||||
| Debt — long-term (includes notes payable within 1 year) | 117.0 | 126.5 | 121.2 | 124.1 | ||||||||||||||||
| Total debt | $ | 146.2 | $ | 142.1 | $ | 137.3 | $ | 140.3 | ||||||||||||
| All other liabilities | 15.9 | 16.8 | 15.3 | 16.3 | ||||||||||||||||
| Total liabilities | $ | 162.1 | $ | 158.9 | $ | 152.6 | $ | 156.6 | ||||||||||||
| Stockholder’s equity | 12.9 | 13.7 | 13.2 | 13.6 | ||||||||||||||||
| Total liabilities and stockholder’s equity | $ | 175.0 | $ | 172.6 | $ | 165.8 | $ | 170.2 | ||||||||||||
| Memo: Financial statement leverage (to 1)* | 11.3 | 10.4 | 10.4 | 10.3 | ||||||||||||||||
Managed Receivables* | ||||||||||||||||||||
| Finance receivables | ||||||||||||||||||||
| Retail installment | $ | 111.0 | $ | 123.5 | $ | 112.2 | $ | 117.3 | ||||||||||||
| Wholesale | 42.5 | 37.6 | 41.9 | 38.9 | ||||||||||||||||
| Other | 9.4 | 10.7 | 9.6 | 9.8 | ||||||||||||||||
| Total net finance receivables | $ | 162.9 | $ | 171.8 | $ | 163.7 | $ | 166.0 | ||||||||||||
| Net investment in operating leases | 26.9 | 35.5 | 29.0 | 31.6 | ||||||||||||||||
| Total managed | $ | 189.8 | $ | 207.3 | $ | 192.7 | $ | 197.6 | ||||||||||||
| Memo: | ||||||||||||||||||||
| Managed leverage (to 1)* | 12.9 | 13.3 | 12.8 | 12.8 | ||||||||||||||||
| Serviced-only receivables (receivables sold in whole-loan sales transactions) | $ | 6.6 | $ | 0.0 | $ | 6.4 | $ | 5.0 | ||||||||||||
| * | See page 4 for additional information |
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Ford Motor Credit Company and Consolidated Subsidiaries
OPERATING HIGHLIGHTS
| Select Operating & Financial Metrics | Second Quarter | First Half | ||||||||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||||||||
Financing Shares | ||||||||||||||||||||||||
| Ford & Lincoln/Mercury retail installment & lease | United States | 34 | % | 37 | % | 35 | % | 40 | % | |||||||||||||||
| Europe | 32 | 35 | 31 | 34 | ||||||||||||||||||||
| Ford & Lincoln/Mercury wholesale | United States | 83 | 85 | 83 | 85 | |||||||||||||||||||
| Europe | 96 | 96 | 97 | 96 | ||||||||||||||||||||
Contract volume- New and used retail/lease (in thousands) | ||||||||||||||||||||||||
| United States | 491 | 631 | 963 | 1,294 | ||||||||||||||||||||
| Europe | 223 | 246 | 444 | 484 | ||||||||||||||||||||
| Other international | 160 | 189 | 315 | 341 | ||||||||||||||||||||
| Total contract volume | 874 | 1,066 | 1,722 | 2,119 | ||||||||||||||||||||
Borrowing Cost Rate | 4.3 | % | 5.1 | % | 4.4 | % | 5.2 | % | ||||||||||||||||
Credit losses(in millions) | ||||||||||||||||||||||||
On-balance sheet | ||||||||||||||||||||||||
| Retail installment & lease | $ | 421 | $ | 524 | $ | 915 | $ | 1,094 | ||||||||||||||||
| Wholesale | 17 | 8 | 17 | 16 | ||||||||||||||||||||
| Other | 14 | 14 | 13 | 21 | ||||||||||||||||||||
| Total | $ | 452 | $ | 546 | $ | 945 | $ | 1,131 | ||||||||||||||||
| Loss-to-receivables (LTR) Retail installment & lease | 1.81 | %* | 1.86 | % | 1.92 | %* | 1.91 | % | ||||||||||||||||
| Wholesale | 0.35 | 0.19 | 0.19 | 0.21 | ||||||||||||||||||||
| Total including other | 1.50 | %* | 1.58 | % | 1.54 | %* | 1.62 | % | ||||||||||||||||
| Allowance for credit losses (in billions) | $ | 3.2 | $ | 3.1 | $ | 3.2 | $ | 3.1 | ||||||||||||||||
| Allowance as a pct. of end-of-period receivables | 2.42 | % | 2.19 | % | 2.42 | % | 2.19 | % | ||||||||||||||||
Managed ** | ||||||||||||||||||||||||
| Retail installment & lease | $ | 608 | $ | 614 | $ | 1,293 | $ | 1,282 | ||||||||||||||||
| Wholesale | 19 | 8 | 20 | 16 | ||||||||||||||||||||
| Other | 14 | 14 | 13 | 21 | ||||||||||||||||||||
| Total | $ | 641 | $ | 636 | $ | 1,326 | $ | 1,319 | ||||||||||||||||
| Loss-to-receivables (LTR) Retail installment & lease | 1.75 | % | 1.56 | % | 1.81 | % | 1.60 | % | ||||||||||||||||
| Wholesale | 0.18 | 0.09 | 0.10 | 0.09 | ||||||||||||||||||||
| Total including other | 1.35 | % | 1.25 | % | 1.37 | % | 1.29 | % | ||||||||||||||||
| Memo: Ford Credit U.S. retail & lease | 1.72 | % | 1.23 | % | 1.77 | % | 1.32 | % | ||||||||||||||||
Sales of Receivables | ||||||||||||||||||||||||
| Income related to securitizations and whole-loan sales: | ||||||||||||||||||||||||
| Gain-on-sale of finance receivables | $ | 51 | $ | 18 | $ | 284 | $ | 231 | ||||||||||||||||
| Interest income, excess spread, servicing fees | 621 | 501 | 1,279 | 926 | ||||||||||||||||||||
| Total income related to securitizations and whole loan sales | $ | 672 | $ | 519 | $ | 1,563 | $ | 1,157 | ||||||||||||||||
| Impact of securitizations on net financing margin: | ||||||||||||||||||||||||
| Impact of current-period securitizations | $ | (12 | ) | $ | (12 | ) | $ | (300 | ) | $ | (244 | ) | ||||||||||||
| Impact of prior-period securitizations | (853 | ) | (633 | ) | (1,470 | ) | (1,152 | ) | ||||||||||||||||
| Total impact of securitizations on financing margin | $ | (865 | ) | $ | (645 | ) | $ | (1,770 | ) | $ | (1,396 | ) | ||||||||||||
| Pre-tax impact of securitizations and whole-loan sales | $ | (193 | ) | $ | (126 | ) | $ | (207 | ) | $ | (239 | ) | ||||||||||||
| Tax | 72 | 47 | 77 | 89 | ||||||||||||||||||||
| After-tax impact of securitizations and whole-loan sales | $ | (121 | ) | $ | (79 | ) | $ | (130 | ) | $ | (150 | ) | ||||||||||||
| * Includes credit losses on reacquired receivables | ||||||||||||||||||||||||
| Total excluding credit losses on reacquired receivables | 1.44 | % | 1.58 | % | 1.51 | % | 1.62 | % | ||||||||||||||||
| ** | See page 4 for additional information |
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Ford Motor Credit Company and Consolidated Subsidiaries
OPERATING HIGHLIGHTS
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. | ||
| • | Serviced-only receivables:receivables that Ford Credit sold in whole-loan sale transactions where Ford Credit retained no interest, but 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 includes receivables sold in securitizations. These receivables 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 obligation of Ford Credit. |
RECONCILIATION OF MEASURES:
| Finance Receivables and Operating Leases | Managed Receivables | |||||||||||||
| On-Balance | Off-Balance | |||||||||||||
| Sheet | Sheet | Total | ||||||||||||
| (in billions) | ||||||||||||||
June 30, 2003 | ||||||||||||||
| Retail installment contracts | $ | 76.8 | $ | 34.2 | $ | 111.0 | ||||||||
| Wholesale | 20.7 | 21.8 | 42.5 | |||||||||||
| Other finance receivables | 9.4 | 0.0 | 9.4 | |||||||||||
| Net investment in operating leases | 26.9 | 0.0 | 26.9 | |||||||||||
| Total | $ | 133.8 | $ | 56.0 | $ | 189.8 | ||||||||
December 31, 2002 | ||||||||||||||
| Retail installment contracts | $ | 68.4 | $ | 48.9 | $ | 117.3 | ||||||||
| Wholesale | 16.4 | 22.5 | 38.9 | |||||||||||
| Other finance receivables | 9.8 | 0.0 | 9.8 | |||||||||||
| Net investment in operating leases | 31.6 | 0.0 | 31.6 | |||||||||||
| Total | $ | 126.2 | $ | 71.4 | $ | 197.6 | ||||||||
June 30, 2002 | ||||||||||||||
| Retail installment contracts | $ | 78.9 | $ | 44.6 | $ | 123.5 | ||||||||
| Wholesale | 16.5 | 21.1 | 37.6 | |||||||||||
| Other finance receivables | 10.7 | 0.0 | 10.7 | |||||||||||
| Net investment in operating leases | 35.5 | 0.0 | 35.5 | |||||||||||
| Total | $ | 141.6 | $ | 65.7 | $ | 207.3 | ||||||||
| Leverage Calculation | June 30, | |||||||||||||||||
| March 31, | December 31, | |||||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||
| (in billions) | ||||||||||||||||||
| Total debt | $ | 146.2 | $ | 142.1 | $ | 137.3 | $ | 140.3 | ||||||||||
| Total securitized receivables outstanding | 56.0 | 65.7 | 73.3 | 71.4 | ||||||||||||||
| Retained interest in securitized receivables | (14.5 | ) | (11.5 | ) | (18.1 | ) | (17.6 | ) | ||||||||||
| Adjustments for cash and cash equivalents | (9.7 | ) | (4.2 | ) | (11.7 | ) | (6.8 | ) | ||||||||||
| Adjustments for SFAS No. 133 | (6.6 | ) | (3.3 | ) | (6.1 | ) | (6.2 | ) | ||||||||||
| Total adjusted debt | $ | 171.4 | $ | 188.8 | $ | 174.7 | $ | 181.1 | ||||||||||
| Total stockholder’s equity | $ | 12.9 | $ | 13.7 | $ | 13.2 | $ | 13.6 | ||||||||||
| Adjustments for SFAS No. 133 | 0.4 | 0.5 | 0.5 | 0.5 | ||||||||||||||
| Adjustments for minority interest | * | * | * | * | ||||||||||||||
| Total adjusted equity | $ | 13.3 | $ | 14.2 | $ | 13.7 | $ | 14.1 | ||||||||||
| Managed leverage = adjusted debt / adjusted equity | 12.9 | 13.3 | 12.8 | 12.8 | ||||||||||||||
| Memo: Financial statement leverage = total debt / stockholder’s equity | 11.3 | 10.4 | 10.4 | 10.3 | ||||||||||||||
| * | Less than $50 million |
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