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Ford Credit Earns Full Year 2012 Pre-Tax Profit of $1.7 Billion, Net Income of $1.2 Billion*



Ford Credit Earns Full Year 2012 Pre-Tax Profit of $1.7 Billion, Net Income of
                                $1.2 Billion*

PR Newswire

DEARBORN, Mich., Jan. 29, 2013

DEARBORN, Mich., Jan. 29, 2013 /PRNewswire/ -- Ford Motor Credit Company
reported a pre-tax profit of $1.7 billion in 2012, compared with $2.4 billion
a year earlier. The decrease in pre-tax earnings is more than explained by
fewer lease terminations, which resulted in fewer vehicles sold at a gain, and
lower financing margin as higher yielding assets originated in prior years run
off. Ford Credit's net income was $1.2 billion in 2012, compared with $1.8
billion in the previous year. 

In the fourth quarter of 2012, Ford Credit's pre-tax profit was $414 million,
a decrease of $92 million from a year earlier. The decrease in pre-tax
earnings is primarily explained by lower credit loss reserve reductions and
lower financing margin. Ford Credit reported fourth quarter net income of $268
million, a decrease of $343 million from a year earlier. The decrease is
primarily explained by the non-recurrence of a one-time, non-cash item related
to Ford Credit's net deferred tax liability. 

"Our 2012 results were solid, and we expect another strong performance in
2013," Ford Credit Chairman and CEO Bernard Silverstone said. "We will remain
focused on providing unparalleled support and service for Ford, our dealers
and our customers."

On December 31, 2012, Ford Credit's net receivables totaled $90 billion,
compared with $83 billion at year-end 2011. Managed receivables were
$91 billion on December 31, 2012, up from $85 billion on December 31, 2011.

On December 31, 2012, managed leverage was 8.3:1, unchanged from
December 31, 2011. Ford Credit distributed $600 million to its parent in 2012.

For 2013, Ford Credit projects a full year pre-tax profit about equal to 2012;
managed receivables at year end in the range of $95 billion to $105 billion;
managed leverage to continue in the range of 8:1 to 9:1; and planned
distributions of about $200 million. 

# # #

About Ford Motor Credit Company
Ford Motor Credit Company LLC has provided dealer and customer financing to
support the sale of Ford Motor Company products since 1959. Ford Credit is an
indirect, wholly owned subsidiary of Ford. For more information, visit
www.fordcredit.com or www.lincolnafs.com.

— — — — —
* The financial results discussed herein are presented on a preliminary basis;
final data will be included in our Annual Report on Form 10-K for the year
ended December 31, 2012.

Cautionary Statement Regarding Forward Looking Statements

Statements included or incorporated by reference herein may constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are based on
expectations, forecasts and assumptions by our management and involve a number
of risks, uncertainties, and other factors that could cause actual results to
differ materially from those stated, including, without limitation:

Automotive Related:

  o Decline in industry sales volume, particularly in the United States or
    Europe, due to financial crisis, recession, geopolitical events or other
    factors;
  o Decline in Ford's market share or failure to achieve growth;
  o Lower-than-anticipated market acceptance of new or existing Ford products;
  o Market shift away from sales of larger, more profitable vehicles beyond
    Ford's current planning assumption, particularly in the United States; 
  o An increase in fuel prices, continued volatility of fuel prices, or
    reduced availability of fuel;
  o Continued or increased price competition resulting from industry excess
    capacity, currency fluctuations or other factors;
  o Economic distress of suppliers that may require Ford to provide
    substantial financial support or take other measures to ensure supplies of
    components or materials and could increase Ford's costs, affect Ford's
    liquidity, or cause production constraints or disruptions;
  o Work stoppages at Ford or supplier facilities or other limitations on
    production (whether as a result of labor disputes, natural or man-made
    disasters, tight credit markets or other financial distress, information
    technology issues, production constraints or difficulties, or other
    factors);
  o Single-source supply of components or materials;
  o Restriction on use of tax attributes from tax law "ownership change";
  o The discovery of defects in Ford vehicles resulting in delays in new model
    launches, recall campaigns, reputational damage or increased warranty
    costs;
  o Increased safety, emissions, fuel economy or other regulation resulting in
    higher costs, cash expenditures and/or sales restrictions;
  o Unusual or significant litigation, governmental investigations or adverse
    publicity arising out of alleged defects in Ford products, perceived
    environmental impacts, or otherwise;
  o A change in Ford's requirements for parts where it has entered into
    long-term supply arrangements that commit it to purchase minimum or fixed
    quantities of certain parts, or to pay a minimum amount to the seller
    ("take-or-pay contracts");
  o Adverse effects on Ford's results from a decrease in or cessation or
    clawback of government incentives related to capital investments;

Ford Credit Related:

  o Inability to access debt, securitization or derivative markets around the
    world at competitive rates or in sufficient amounts, due to credit rating
    downgrades, market volatility, market disruption, regulatory requirements
    or other factors;
  o Increased competition from banks or other financial institutions seeking
    to increase their share of financing Ford vehicles;
  o Higher-than-expected credit losses, lower-than-anticipated residual values
    or higher-than-expected return volumes for leased vehicles;
  o Cybersecurity risks to operational systems, security systems, or
    infrastructure owned by us or a third-party vendor, or at a supplier
    facility;
  o New or increased credit, consumer or data protection or other laws and
    regulations resulting in higher costs and/or additional financing
    restrictions;
  o Changes in Ford's operations or changes in Ford's marketing programs could
    result in a decline in our financing volumes;

General:

  o Fluctuations in foreign currency exchange rates and interest rates;
  o Adverse effects on Ford's or our operations resulting from economic,
    geopolitical, or other events;
  o Failure of financial institutions to fulfill commitments under committed
    credit and liquidity facilities;
  o Labor or other constraints on Ford's or our ability to maintain
    competitive cost structure;
  o Substantial pension and postretirement healthcare and life insurance
    liabilities impairing Ford's or our liquidity or financial condition;
  o Worse-than-assumed economic and demographic experience for postretirement
    benefit plans (e.g., discount rates or investment returns); and
  o Inherent limitations of internal controls impacting financial statements
    and safeguarding of assets.

We cannot be certain that any expectations, forecasts, or assumptions made by
management in preparing these forward-looking statements will prove accurate,
or that any projections will be realized. It is to be expected that there may
be differences between projected and actual results. Our forward-looking
statements speak only as of the date of their initial issuance, and we do not
undertake any obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events, or
otherwise. For additional discussion of these risk factors, see Item 1A of
Part I of our 2011 10-K Report and Item 1A of Part I of Ford's 2011 10-K
Report.

 

FORD MOTOR CREDIT COMPANY LLC AND SUBSIDIARIES
PRELIMINARY
CONSOLIDATED INCOME STATEMENT
For the Periods Ended December 31, 2012 and 2011
(in millions)
                                   Fourth Quarter         Full Year
                                   2012        2011       2012       2011
                                   (unaudited)            (unaudited)
Financing revenue
       Operating leases            $  707      $  593     $ 2,616    $ 2,454
       Retail                         463         496       1,889      2,059
       Interest supplements and
       other support costs earned
          from affiliated             601         671       2,401      2,800
       companies
       Wholesale                      224         242       920        952
       Other                          13          16        56         56
             Total financing          2,008       2,018     7,882      8,321
             revenue
Depreciation on vehicles subject      (660)       (538)     (2,468)    (1,774)
to operating leases
Interest expense                      (709)       (831)     (3,027)    (3,507)
       Net financing margin           639         649       2,387      3,040
Other revenue
       Insurance premiums earned      30          23        105        100
       Other income, net              79          96        286        302
             Total financing
             margin and other         748         768       2,778      3,442
             revenue
Expenses
       Operating expenses             273         270       1,004      1,076
       Provision for credit losses    40          (9)       7          (118)
       Insurance expenses             21          1         70         80
             Total expenses           334         262       1,081      1,038
Income before income taxes            414         506       1,697      2,404
Provision for income taxes            146         (105)     483        609
       Net income                  $  268      $  611     $ 1,214    $ 1,795
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the Periods Ended December 31, 2012 and 2011
(in millions)
                                   Fourth Quarter         Full Year
                                   2012        2011       2012       2011
                                   (unaudited)            (unaudited)
Net income                         $  268      $  611     $ 1,214    $ 1,795
Other comprehensive income/(loss),
net of tax:
       Foreign currency               2           (139)     143        (221)
       translation
Total other comprehensive             2           (139)     143        (221)
income/(loss), net of tax
Comprehensive income               $  270      $  472     $ 1,357    $ 1,574
FORD MOTOR CREDIT COMPANY LLC AND SUBSIDIARIES
PRELIMINARY
CONSOLIDATED BALANCE SHEET
(in millions)
                                                          December   December
                                                          31,        31,

                                                          2012       2011
                                                          (unaudited)
ASSETS
       Cash and cash equivalents                          $ 9,189    $ 8,713
       Marketable securities                                2,106      3,835
       Finance receivables, net                             75,063     71,907
       Net investment in operating                          14,701     11,098
       leases
       Notes and accounts
       receivable from affiliated                           1,173      1,152
       companies
       Derivative financial                                 1,256      1,365
       instruments
       Other assets                                         2,256      2,172
               Total assets                               $ 105,744  $ 100,242
LIABILITIES
       Accounts payable
       Customer deposits, dealer                          $ 1,072    $ 901
       reserves, and other
       Affiliated companies                                 234        773
                  Total accounts                            1,306      1,674
                  payable
       Debt                                                 89,258     84,659
       Deferred income taxes                                1,669      1,134
       Derivative financial                                 400        286
       instruments
       Other liabilities and                                3,458      3,593
       deferred income 
               Total liabilities                            96,091     91,346
SHAREHOLDER'S INTEREST
       Shareholder's interest                               5,274      5,274
       Accumulated other                                    743        600
       comprehensive income
       Retained earnings                                    3,636      3,022
               Total shareholder's                          9,653      8,896
               interest
                  Total
                  liabilities and                         $ 105,744  $ 100,242
                  shareholder's
                  interest
The following table includes assets to be used to settle the liabilities of
the consolidated variable interest entities ("VIEs"). These assets and
liabilities are included in the consolidated balance sheet above. 
                                                          December   December
                                                          31,        31,

                                                          2012       2011
                                                          (unaudited)
ASSETS
       Cash and cash equivalents                          $ 2,877    $ 3,356
       Finance receivables, net                             47,190     49,329
       Net investment in operating                          6,308      6,354
       leases 
       Derivative financial                                 4          157
       instruments
LIABILITIES
       Debt                                               $ 40,245   $ 41,421
       Derivative financial                                 134        97
       instruments 
FORD MOTOR CREDIT COMPANY LLC AND SUBSIDIARIES
APPENDIX
In evaluating Ford Credit's financial performance, Ford Credit management uses
financial measures based on Generally Accepted Accounting Principles ("GAAP"),
as well as financial measures that include adjustments from GAAP.
RECONCILIATION OF NON-GAAP
MEASURES TO GAAP:
Net Finance Receivables and                               December   December
Operating Leases                                          31,        31,

                                                          2012       2011
Receivables (a)                                           (in billions)
       Finance Receivables – North
       America Segment
             Consumer
               Retail installment
               and direct                                 $ 39.5     $ 38.4
               financing leases
             Non-Consumer
               Wholesale                                    18.1       15.5
               Dealer loan                                  1.4        1.1
               Other                                        1.1        1.0
                  Total North
                  America Segment                           60.1       56.0
                  – finance
                  receivables
       Finance Receivables –
       International Segment
             Consumer
               Retail installment
               and direct                                   9.0        9.1
               financing leases
             Non-Consumer
               Wholesale                                    7.4        8.5
               Dealer loan                                  0.1        -
               Other                                        0.4        0.4
                  Total
                  International
                  Segment –                                 16.9       18.0
                  finance
                  receivables
       Unearned interest                                    (1.5)      (1.6)
       supplements
       Allowance for credit losses                          (0.4)      (0.5)
                  Finance                                   75.1       71.9
                  receivables, net
       Net investment in operating                          14.7       11.1
       leases
                       Total                              $ 89.8     $ 83.0
                  receivables
Memo: Total managed receivables                           $ 91.3     $ 84.6
(b)
                                                          December   December
Managed Leverage Calculation                              31,        31,

                                                          2012       2011
                                                          (in billions)
Total debt (c)                                            $ 89.3     $ 84.7
Adjustments for cash, cash
equivalents, and marketable                                 (10.9)     (12.1)
securities (d)
Adjustments for derivative                                  (0.8)      (0.7)
accounting (e)
       Total adjusted debt                                $ 77.6     $ 71.9
Equity (f)                                                $ 9.7      $ 8.9
Adjustments for derivative                                  (0.3)      (0.2)
accounting (e)
       Total adjusted equity                              $ 9.4      $ 8.7
Managed leverage (to 1) = Total
adjusted debt / Total adjusted                              8.3        8.3
equity
Memo: Financial statement leverage                          9.2        9.5
(to 1) = Total debt / Equity
— — — — —
       Includes finance receivables (retail and wholesale) and net investment
       in operating leases reported on Ford Credit's balance sheet that have
       been

       sold for legal purposes in securitization transactions that do not
       satisfy the requirements for accounting sale treatment. These
(a)    receivables are

       available only for payment of the debt and other obligations issued or
       arising in the securitization transactions; they are not available to
       pay the

       other obligations of Ford Credit or the claims of Ford Credit's other
       creditors.
       Equals total receivables, excluding unearned interest supplements of
(b)    $(1.5) billion at December 31, 2012 and $(1.6) billion December 31,
       2011.
       Includes debt reported on Ford Credit's balance sheet including
       obligations issued or arising in securitization transactions that are
       payable only out 

(c)    of collections on the underlying securitized assets and related
       enhancements. Ford Credit holds the right to the excess cash flows not
       needed to 

       pay the debt and other obligations issued or arising in each of these
       securitization transactions.
(d)    Excludes marketable securities related to insurance activities.
       Primarily related to market valuation adjustments to derivatives due to
       movements in interest rates. Adjustments to debt are related to
(e)    designated 

       fair value hedges and adjustments to equity are related to retained
       earnings.
(f)    Shareholder's interest reported on Ford Credit's balance sheet.

 

 

SOURCE Ford Motor Credit Company

Website: http://www.fordcredit.com
Contact: Margaret Mellott, Ford Credit Communications, +1-313-322-5393,
mmellott@ford.com; or Molly Tripp, Ford Fixed Income Investment Community,
+1-313-621-0881, fixedinc@ford.com
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