Ford 2003 Annual Report Download - page 38

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36 FORD MOTOR COMPANY
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULT OF OPERATIONS
FULL-YEAR 2003 RESULTS OF OPERATIONS
The results of our continuing operations below exclude the results of discontinued and held-for-sale operations, which are
described in Note 3 of the Notes to Financial Statements.
Our worldwide net income was $495 million or $0.27 per share of Common and Class B stock in 2003, up $1.5 billion from a
loss of $980 million or $0.55 per share in 2002.
Results by business sector for 2003, 2002, and 2001 are shown below (in millions)
2003 2002 2001
Income/(loss) before income taxes
Automotive sector $ (1,957) $ (1,153) $ (8,857)
Financial Services sector 3,327 2,104 1,438
Total Company 1,370 951 (7,419)
Provision for/(benefit from) income taxes 135 301 (2,096)
Minority interests in net income/(loss) of subsidiaries 314 367 24
Income/(loss) from continuing operations 921 283 (5,347)
Income/(loss) from discontinued/held-for-sale operations (8) (62) (106)
Loss on disposal of discontinued/held-for-sale operations (154) (199) -
Cumulative effect of change in accounting principle* (264) (1,002) -
Net income/(loss) $ 495 $ (980) $ (5,453)
–––––––––––––
* Related to adoption of FIN 46 in 2003 and the adoption of Statement of Financial Accounting Standards No. 142 in 2002
(see Notes 13 and 7, respectively, of the Notes to Financial Statements).
We established and communicated milestones for 2003. Our results against these milestones are listed below:
Planning Assumptions Actual
Industry Volume
U.S. 16.5 million units 17.0
Europe 17.0 million units 17.0
Net Pricing
U.S. Zero (0.6)%
Europe 1% (1.7)%
2003 Milestone Results
Physicals
Automotive
Quality Improve in all regions Improved
Market share Improve in all regions Mixed
Cost performance a/ Improve by at least $500 million $3.2 Bils.
Capital spending $8 billion $7.4 Bils.
Financial Results
Automotive
Income before income taxes b/ Breakeven $0.1 Bils.
Operating related cash flow c/ Breakeven $ 0.1 Bils.
Ford Credit
Cash contribution to parent Improve Up $ 3.3 Bils.
Managed leverage d/ Maintain in low end of 13-14 to 1 range 13.0 to 1
–––––––––––––
a/ Calculated at constant volume, mix and exchange, excluding special items (see chart below for additional information on cost performance).
b/ Excluding special items (see GAAP equivalent measure and reconciliation below).
c/ We have redefined this milestone to exclude pension and long-term VEBA contributions in addition to the exclusion of tax refunds.
For the calculation of this non-GAAP measure and reconciliation to its GAAP equivalent (Automotive cash flows from operating
activities before securities trading of $1.3 billion) see “Liquidity and Capital Resources — Gross Cash.”
d/ See “Liquidity and Capital Resources, Financial Services Sector, Ford Credit — Leverage” for the calculation and reconciliation of this non-GAAP measure.
FIN33_72 3/21/04 5:39 PM Page 36