Ford Mtr Co Del · NYSE:F
Ford Mtr Co Del — Ford Motor Credit Company — Q2 2021 Earnings Presentation
20 slides from Ford Mtr Co Del's earnings presentation, Jul 28, 2021
Slide 1: Q2 2021 Earnings Review
Q2 2021 Earnings Review July 28, 2021 1
Slide 2: Information Regarding This Presentation
Information Regarding This Presentation FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements. 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 caus
Slide 3: Key Takeaways
Key Takeaways • Q2 EBT of $1,623M highest ever quarterly EBT • Off-lease auction values at record-high levels • Portfolio performing well – historically low losses and strong recoveries during the period. Credit loss reserve reduced reflecting expectation of lower COVID-related losses • Distribution
Slide 4: Key Metrics
Key Metrics EBT ($M) $1,623 Q2 Headlines $1,123 $912 $962 • Launched the first loyalty-building Ford Pro FinSimple products and services with $543 digital commercial lines of credit and digital combined billing $30 • Established product teams to increase speed and robustness of our digital portfolio
Slide 5: Q2 2021 Net Receivables Mix
Q2 2021 Net Receivables Mix ($B) Net Investment in Operating Leases Consumer Financing Non-Consumer Financing $117.7 • Receivables declined $13B YoY, primarily reflecting lower $26.2 wholesale receivables $93.7 • Operating lease portfolio was $25.9 22% of total net receivables $74.3 $56.4 $19.3 $17.
Slide 6: U.S. Origination Metrics And Credit Loss Drivers
U.S. Origination Retail & Lease FICO and Retail Repossessions (000) and Metrics And Higher Risk Mix (%) Repossession Rate (%) Higher Risk Portfolio Mix (%) Repossession Rate (%) Credit Loss 743 748 747 Drivers 739 738 735 7 6% 6% 6% 6% 6% 5% 5 5 5 1.24% 3 1.04% 1.01% 3 • Disciplined and consistent 0
Slide 7: Worldwide Credit Loss Metrics
Worldwide Credit Loss Net Charge-Offs ($M) and LTR Ratio (%) Metrics LTR Ratio (%) $101 $88 0.35% $67 0.32% $45 0.24% $41 • Worldwide credit loss metrics 0.17% 0.16% $1 remain strong and below year 0.00% ago levels, reflecting historically low losses Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 •
Slide 8: U.S. Lease Metrics
U.S. Lease Metrics Lease Return Volume (000) and Return Rates (%) Lease Placement Volume (000) 24-Month Return Rate (%) 36-Month 39-Month / Other • Auction values up 39% YoY 70 75 12 62 62 67 58 65 11 57 reflecting continued strong 52 11 10 11 53 51 9 36 demand for used vehicles 38 59 41 76% 76% 63%
Slide 9: Cumulative Maturities At June 30, 2021
Cumulative Maturities At June 30, 2021* ($B) Assets Debt • Strong balance sheet is $138 inherently liquid with cumulative $120 debt maturities having a longer $107 tenor than asset maturities $81 $84 $65 • As of June 30, 2021 $72B of $47 $36 $138B assets are unencumbered Jul – Dec 2021 2022 2023 202
Slide 10: Funding Structure – Managed Receivables
Funding Structure – Managed 2020 Dec 31 2021 Jun 30 Receivables* ($B) Term Unsecured Debt $ 76.6 $ 67.1 Term Asset-Backed Securities 54.6 45.9 • Well capitalized with a strong Ford Interest Advantage / Deposits 6.5 8.0 balance sheet; $33B in net Other 5.7 6.0 liquidity Equity 15.6 13.1 • Funding is
Slide 11: Public Term Funding Plan
Public Term Funding Plan* ($B) • Completed $7B of public 2019 2020 2021 Through issuance in 2021 Actual Actual Forecast Jul 27 • Strong balance sheet and substantial liquidity provide Unsecured $ 17 $ 14 $ 5-8 $ 2 funding flexibility Securitizations** 14 13 8 - 10 5 • Significantly reduced public fu
Slide 12: Cautionary Note On Forward-Looking Statements
Cautionary Note On 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 assumptio
Slide 13: Appendix
Appendix EBT By Segment A2 Financing Shares And Contract Placement Volume A3 Total Net Receivables Reconciliation To Managed Receivables A4 Financial Statement Leverage Reconciliation To Managed Leverage A5 Liquidity Sources A6 Non-GAAP Financial Measures That Supplement GAAP Measures A7 Definitions
Slide 14: EBT By Segment ($M)
EBT By Segment* ($M) Q2 YTD H / (L) H / (L) 2021 2020 ** 2021 2020 ** Results United States and Canada segment $ 1,466 $ 1,021 $ 2,462 $ 1,995 Europe segment 81 16 147 65 All Other segment 22 5 7 (17) Total segments $ 1,569 $ 1,042 $ 2,616 $ 2,043 Unallocated other 54 38 (31) (31) Earnings before ta
Slide 15: Financing Shares And Contract Placement Volume
Financing Shares And Contract Placement Volume Q2 YTD 2020 2021 2020 2021 Share of Ford Sales* United States 77 % 47 % 67 % 47 % Canada 63 74 63 68 U.K. 44 37 44 36 Germany 34 41 39 39 China 37 45 36 43 Wholesale Share United States 73 % 71 % 74 % 72 % Canada 42 9 45 11 U.K. 100 100 100 100 Germany
Slide 16: Total Net Receivables Reconciliation To Managed Receivables ($B)
Total Net Receivables Reconciliation To Managed Receivables ($B) 2020 2020 2021 Jun 30 Dec 31 Jun 30 Finance receivables, net (GAAP) $ 103.9 $ 105.0 $ 91.5 Net investment in operating leases (GAAP) 26.4 26.7 26.2 Total net receivables* $ 130.3 $ 131.7 $ 117.7 Unearned interest supplements and residu
Slide 17: Financial Statement Leverage Reconciliation To Managed Leverage ($B)
Financial Statement Leverage Reconciliation To Managed Leverage* ($B) 2020 2020 2021 Jun 30** Dec 31 Jun 30 Leverage Calculation Debt $ 135.3 $ 137.7 $ 121.0 Adjustments for cash (17.1) (18.5) (15.3) Adjustments for derivative accounting (1.8) (1.5) (0.9) Total adjusted debt $ 116.4 $ 117.7 $ 104.8
Slide 18: Liquidity Sources ($B)
Liquidity Sources* ($B) 2020 2020 2021 Jun 30 Dec 31 Jun 30 Liquidity Sources Cash $ 17.1 $ 18.5 $ 15.3 Committed asset-backed facilities 37.1 38.1 38.4 Other unsecured credit facilities 2.5 2.5 2.6 Total liquidity sources $ 56.7 $ 59.1 $ 56.3 Utilization of Liquidity Securitization & restricted cas
Slide 19: Non-GAAP Financial Measures That Supplement GAAP Measures
Non-GAAP Financial Measures That Supplement GAAP Measures We use both GAAP and non-GAAP financial measures for operational and financial decision making, and to assess Company and segment business performance. The non-GAAP measures listed below are intended to be considered by users as supplemental
Slide 20: Definitions And Calculations
Definitions And Calculations ABS capacity in excess of eligible receivables and other adjustments (as shown on the Liquidity Sources chart) Includes asset-backed capacity in excess of eligible receivables; cash related to the Ford Credit Revolving Extended Variable-utilization program (“FordREV”), w
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