Ford Motor Company 2004 Annual Report

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Ford Motor Company2004 Annual Report

• Mandy Bennett
• ACG 2021 Section 002

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Executive Summary

• The Ford Motor Company has had many
  disappointment in the past several years, but has
  slowly gained more confidence by introducing
  newer models and increasing technology. The
  company still has many problems that need to be
  worked out. The total liabilities are extremely
  high, resulting in low working capital. Accounts
  receivable are also remaining unpaid for far too
  long. Overall, the company seems to be improving
  from years past, but still has a long way to go.
• http//www.ford.com/en/company/investorInformation
  /companyReports/annualReports/2004annualReport/200
  4_pdfs.htm

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Introduction

• William Clay Ford, Jr. was appointed CEO of the
  Ford Motor Company on October 30, 2001.
• The home office is located in Dearborn, MI
• The last fiscal year ended on December 31, 2005
  (The 2004 reports are used for this project, as
  the 2005 reports have not been released.)
• The Ford Company deals in automobile sales (Ford,
  Lincoln, Mercury, Volvo, Jaguar, Land Rover, and
  Aston Martin). They also provide many customer
  services, such as Ford Credit, Hertz, and Auto
  Service.
• While Ford has many dealerships around the world,
  their main location is in the United States.

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Audit Report

• Ford Motor Company employs Pricewaterhouse
  Coopers LLC to perform the financial audit.
• They simply state that the yearly reports are
  adequate in all aspects.

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Stock Market Information

• 7.95 - The most recent price of the companys
  stock.
• 12.73 Twelve month high.
• 7.57 Twelve month low.
• .40 (5) Dividend per share.
• The above information is accurate as of March 1,
  2006.
• The stock for the Ford Company has been
  decreasing steadily for the past year, so I would
  not recommend buying, although if the stockholder
  already owned stock, I would consider holding it.
  The Company has several plans to increase the
  value of the stock.

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Industry Situation and Company Plans

• The Ford Motor Company has made many achievements
  during 2004, and plans to continue into 2005. In
  2004, Ford reduced its costs by almost 900
  million, and improved performance. They also
  improved per-unit revenue of 745 in North
  America. The new Ford F-series, and the Ford
  Escape set sales records in 2004, and will
  hopefully have continued success in 2005. Ford
  is also optimistic about its new Ford Escape
  Hybrid model. This model was named North
  American Truck of the Year, and appeals to all
  types of people. Overall, Ford plans to continue
  to improve its performance for 2005.

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Income Statement

• The Income Statement is prepared in multistep
  format.
• Within the year, the net income for the Ford
  Company has increased seven fold. Both the gross
  profit, and income from operations have increased
  greatly as well.

All numbers in millions
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Balance Sheet
While the total assets in 2004, have decreased,
the Stockholders equity has increased. The
biggest change is the decrease in liabilities in
2004.
All numbers in millions
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Statement of Cash Flows

• Cash flows from operations are much more than the
  net income
• The company is not growing through investing, and
  in fact lost money, due to its investing
  activities.
• Net Income has greatly improved from 2003.

All numbers in millions
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Accounting Policies

• Ford presents its financial statements on two
  bases
• Sector basis for Automotive and Financial
  Services
• Consolidated basis
• With this additional information, the reader is
  better able to understand the operating
  performance, financial position, cash flow and
  liquidity of the two very different businesses.

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Financial Analysis Liquidity Ratios
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Financial Analysis Profitability Ratios
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Financial Analysis Solvency Ratio
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Financial Analysis Market Strength Ratios
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Mandy Bennett

• Ford Motor Company