LONDON, July 26, 2017 /PRNewswire/ --
Financial results presented under U.S. GAAP (1)
- Industrial Activities' revenues up 3.2% (up 4.5% on a constant currency basis) on strengthening agricultural
equipment demand in LATAM and positive developments in APAC markets across all segments
- Operating profit(2)(3) of Industrial Activities increased 6.2% to $481
million, with an operating margin of 7.2% as a result of a solid performance in all segments
- Adjusted net income increased to $266 million in the second quarter of 2017, with adjusted
diluted EPS(2)(3) of $0.19
- Net industrial debt(2)(3) was $2.1 billion at June 30,
2017, in line with March 31, 2017
- In June, S&P Global Ratings raised the credit ratings of both CNH Industrial N.V. and CNH Industrial Capital LLC to
"investment grade", with stable outlook
- Full year guidance leading to the high end of the sales and EPS range
|
Summary of Results ($ million except
EPS)
|
|
|
|
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
2017
|
2016
|
Change
|
|
2017
|
2016
|
Change
|
|
|
12,629
|
12,125
|
4.2%
|
Revenues
|
6,948
|
6,753
|
2.9%
|
|
|
296
|
(384)
|
680
|
Net income (loss)
|
247
|
129
|
118
|
|
|
324
|
217
|
107
|
Adjusted net income
|
266
|
216
|
50
|
|
|
0.21
|
(0.28)
|
0.49
|
Basic EPS ($)
|
0.18
|
0.10
|
0.08
|
|
|
0.21
|
(0.28)
|
0.49
|
Diluted EPS ($)
|
0.18
|
0.10
|
0.08
|
|
|
0.23
|
0.16
|
0.07
|
Adjusted diluted EPS ($)
|
0.19
|
0.16
|
0.03
|
|
|
CNH Industrial N.V. (NYSE:CNHI / MI:CNHI) today announced consolidated revenues of $6,948
million for the second quarter of 2017, up 2.9% compared to the second quarter of 2016. Net sales of Industrial Activities
were $6,655 million in the second quarter of 2017, up 3.2% compared to the second quarter of 2016.
Reported net income was $247 million for the second quarter of 2017 and includes a charge of
$17 million ($11 million net of tax impact) related to the early redemption, in June 2017, of all outstanding Case New Holland Industrial Inc. 7⅞% Senior Notes due 2017. Adjusted net income
was $266 million for the second quarter, with adjusted diluted EPS of $0.19, up 19% compared
to the second quarter of 2016.
Operating profit of Industrial Activities was $481 million for the second quarter of 2017, a
$28 million increase compared to the second quarter of 2016, with an operating margin of 7.2%, up
0.2 p.p. compared to the second quarter of 2016.
(1)
|
CNH Industrial reports quarterly and annual consolidated financial
results under U.S. GAAP and EU-IFRS. The tables and discussion related to the financial results of the Company and its
segments shown in this press release are prepared in accordance with U.S. GAAP. Financial results under EU-IFRS are shown
in specific tables at the end of this press release.
|
(2)
|
This item is a non-GAAP financial measure. Refer to the "Non-GAAP
Financial Information" section of this press release for information regarding non-GAAP financial measures.
|
(3)
|
Refer to the specific table in the "Other Supplemental Financial
Information" section of this press release for the reconciliation between the non-GAAP financial measure and the most
comparable GAAP financial measure.
|
Income taxes were $113 million in the second quarter of 2017 ($107
million in the second quarter of 2016). Adjusted income taxes(1)(2) for the second quarter of 2017 were
$123 million ($107 million in the second quarter of 2016). The
adjusted effective tax rate (adjusted ETR)(1)(2) was 34% (36% in the second quarter of 2016).
Net industrial debt was $2.1 billion at June 30, 2017, in line
with March 31, 2017, with cash flow generation from industrial operations of more than $400
million in the second quarter, offset by the payment of $161 million in dividends to shareholders in May 2017 and a foreign exchange impact on euro denominated debt. Total debt was $25.5 billion at June 30, 2017, compared to $24.5
billion at March 31, 2017. At June 30, 2017, available liquidity(1)(2) was $8.3 billion, up $0.8 billion compared to March 31, 2017.
During the quarter, the Company redeemed all of the outstanding $636 million aggregate principal
amount of its 7⅞% Senior Notes due 2017 (the "2017 Notes"). The $17 million one-time charge related
to the early redemption of the notes will be more than offset by interest cost savings achieved through the remaining original
term of the 2017 Notes.
On June 15, 2017, S&P Global Ratings raised its long-term corporate credit rating on both
CNH Industrial N.V. and CNH Industrial Capital LLC from "BB+" to "BBB-" with stable outlook. The short-term rating of CNH
Industrial N.V. was raised from "B" to "A-3". The issue-level ratings of both CNH Industrial N.V. and CNH Industrial
Capital LLC were also raised to "BBB-".
Segment Results
CNH INDUSTRIAL
Revenues by Segment ($ million)
|
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
2017
|
2016
|
% change
|
% change
excl. FX(1)
|
|
2017
|
2016
|
% change
|
% change
excl. FX(1)
|
|
|
5,239
|
4,932
|
6.2
|
5.6
|
Agricultural Equipment
|
2,893
|
2,808
|
3.0
|
3.3
|
|
|
1,199
|
1,131
|
6.0
|
5.8
|
Construction Equipment
|
676
|
595
|
13.6
|
13.5
|
|
|
4,666
|
4,640
|
0.6
|
2.9
|
Commercial Vehicles
|
2,575
|
2,595
|
-0.8
|
1.4
|
|
|
2,138
|
1,905
|
12.2
|
15.3
|
Powertrain
|
1,136
|
1,023
|
11.0
|
13.8
|
|
|
(1,203)
|
(1,082)
|
-
|
-
|
Eliminations and other
|
(625)
|
(571)
|
-
|
-
|
|
|
12,039
|
11,526
|
4.5
|
5.4
|
Total Industrial Activities
|
6,655
|
6,450
|
3.2
|
4.5
|
|
|
796
|
787
|
1.1
|
-0.5
|
Financial Services
|
400
|
399
|
0.3
|
-
|
|
|
(206)
|
(188)
|
-
|
-
|
Eliminations and other
|
(107)
|
(96)
|
-
|
-
|
|
|
12,629
|
12,125
|
4.2
|
4.9
|
Total
|
6,948
|
6,753
|
2.9
|
3.8
|
|
|
(1) "Change excl. FX" or "constant currency" is a
non-GAAP financial measure. Refer to the "Non-GAAP Financial Information" section of this press release for information
regarding non-GAAP financial measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
This item is a non-GAAP financial measure. Refer to the "Non-GAAP
Financial Information" section of this press release for information regarding non-GAAP financial measures.
|
(2)
|
Refer to the specific table in the "Other Supplemental Financial
Information" section of this press release for the reconciliation between the non-GAAP financial measure and the most
comparable GAAP financial measure.
|
|
|
CNH INDUSTRIAL
Operating Profit (loss)(1) by Segment ($ million)
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
2017
Profit
|
2016
Profit
|
$
change
|
2017 Margin
|
2016 Margin
|
|
2017
Profit
|
2016
Profit
|
$
change
|
2017
Margin
|
2016
Margin
|
|
|
462
|
391
|
71
|
8.8%
|
7.9%
|
Agricultural Equipment
|
303
|
301
|
2
|
10.5%
|
10.7%
|
|
|
(5)
|
31
|
-36
|
(0.4)%
|
2.7%
|
Construction Equipment
|
17
|
17
|
-
|
2.5%
|
2.9%
|
|
|
119
|
138
|
-19
|
2.6%
|
3.0%
|
Commercial Vehicles
|
91
|
100
|
-9
|
3.5%
|
3.9%
|
|
172
|
119
|
53
|
8.0%
|
6.2%
|
Powertrain
|
98
|
66
|
32
|
8.6%
|
6.5%
|
|
(48)
|
(48)
|
-
|
-
|
-
|
Eliminations and other
|
(28)
|
(31)
|
3
|
-
|
-
|
|
|
700
|
631
|
69
|
5.8%
|
5.5%
|
Total
Industrial Activities
|
481
|
453
|
28
|
7.2%
|
7.0%
|
|
|
245
|
249
|
-4
|
30.8%
|
31.6%
|
Financial Services
|
125
|
119
|
6
|
31.3%
|
29.8%
|
|
|
(165)
|
(160)
|
-5
|
-
|
-
|
Eliminations and other
|
(83)
|
(84)
|
1
|
-
|
-
|
|
|
780
|
720
|
60
|
6.2%
|
5.9%
|
Total
|
523
|
488
|
35
|
7.5%
|
7.2%
|
|
|
(1) Operating profit of Industrial Activities (a non-GAAP
financial measure) is defined as net sales less cost of goods sold, selling, general and administrative expenses, and
research and development expenses. Operating profit of Financial Services (a non-GAAP financial measure) is defined as
revenues less selling, general and administrative expenses, interest expense and certain other operating
expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Agricultural Equipment's net sales increased 3.0% in the second quarter of 2017 compared to the second quarter of 2016
(up 3.3% on a constant currency basis), as a result of a strong rebound in demand in LATAM. Net sales increased in APAC, mainly
driven by favorable volume in Australia, and in the EMEA region. Net sales, as forecast, were
down in NAFTA due to unfavorable industry volume in the small grain and hay & forage product lines.
Operating profit was $303 million in the second quarter ($301
million in the second quarter of 2016), with an operating margin of 10.5% (down 0.2 p.p. compared to the second quarter of
2016). Favorable volume in LATAM including improved fixed cost absorption, and disciplined net price realization across all
regions, offset negative volume and mix in NAFTA and increased spending on research and development.
Construction Equipment's net sales increased 13.6% in the second quarter of 2017 compared to the second quarter of 2016
(up 13.5% on a constant currency basis), as a result of a strengthening of NAFTA and APAC markets.
Operating profit was $17 million in the second quarter of 2017, flat compared to the second
quarter of 2016, with an operating margin of 2.5% (down 0.4 p.p. compared to the second quarter of 2016). The favorable volume
trend was offset by foreign exchange impact on product cost. Net pricing was stable across the major markets.
Commercial Vehicles' net sales decreased 0.8% in the second quarter of 2017 compared to the second quarter of 2016 (up
1.4% on a constant currency basis). Higher volumes in APAC and LATAM were more than offset by lower truck and bus volume in EMEA,
mainly due to the 2016 Euro VI pre-buy effect in the light vehicle range.
Operating profit was $91 million for the second quarter of 2017 ($100 million in the second
quarter of 2016), with an operating margin of 3.5% (down 0.4 p.p. compared to the second quarter of 2016). The decrease was
primarily due to lower volume and unfavorable mix in EMEA, partially offset by manufacturing efficiencies and material cost
reductions.
Powertrain's net sales increased 11.0% in the second quarter of 2017 compared to the second quarter of 2016
(up 13.8% on a constant currency basis), as a result of higher volumes. Sales to external customers accounted for 47% of
total net sales (46% in the second quarter of 2016).
Operating profit was $98 million for the second quarter of 2017, a $32
million increase compared to the second quarter of 2016, with an operating margin of 8.6%, up 2.1 p.p. compared to the
second quarter of 2016 as a result of higher volumes and manufacturing efficiencies.
Financial Services' revenues totaled $400 million in the second quarter of 2017, flat
compared to the second quarter of 2016. In the second quarter of 2017, retail loan originations (including unconsolidated joint
ventures) were $2.3 billion, flat compared to the second quarter of 2016. The managed portfolio
(including unconsolidated joint ventures) was $25.6 billion as of June 30,
2017 (of which retail was 63% and wholesale 37%), up $0.3 billion compared to
June 30, 2016.
Net income was $87 million in the second quarter of 2017, flat compared to the second quarter of
2016.
2017 Outlook
During the first half of 2017, market conditions across our major segments have been better than originally expected, despite
continued inventory destocking efforts in high horsepower tractors in NAFTA row crop, weakened demand in hay & forage product
lines, and persisting end-market weakness in France. Therefore, the Company is leading its 2017
guidance for sales and EPS to the upper end of the range while keeping the net industrial debt guidance unchanged as
follows:
- Net sales of Industrial Activities of approximately $24 billion;
- Adjusted diluted EPS(1) of approximately $0.41;
- Net industrial debt at the end of 2017 between $1.4 billion and $1.6 billion.
(1)
|
Outlook is not provided on diluted EPS, the most comparable GAAP
financial measure of this non-GAAP financial measure, as the income or expense excluded from the calculation of adjusted
diluted EPS and instead included in the calculation of diluted EPS are, by definition, not predictable and
uncertain.
|
About CNH Industrial
CNH Industrial N.V. (NYSE: CNHI /MI: CNHI) is a global leader in the capital goods sector with established industrial
experience, a wide range of products and a worldwide presence. Each of the individual brands belonging to the Company is a major
international force in its specific industrial sector: Case IH, New Holland Agriculture and Steyr for tractors and agricultural
machinery; Case and New Holland Construction for earth moving equipment; Iveco for commercial vehicles; Iveco Bus and Heuliez Bus
for buses and coaches; Iveco Astra for quarry and construction vehicles; Magirus for firefighting vehicles; Iveco Defence
Vehicles for defence and civil protection; and FPT Industrial for engines and transmissions. More information can be found on the
corporate website: www.cnhindustrial.com
Additional Information
Today, at 3:30 p.m. CEST / 2:30 p.m. BST / 9:30 a.m. EDT, management will hold a conference call to present 2017 second quarter and first half results to
financial analysts and institutional investors. The call can be followed live online at: http://bit.ly/CNH_Industrial_Q2_2017 and a recording will be available
later on the Company's website (www.cnhindustrial.com). A presentation will be made available on the CNH Industrial website prior to the call.
Non-GAAP Financial Information
CNH Industrial monitors its operations through the use of several non-GAAP financial measures. CNH Industrial's management
believes that these non-GAAP financial measures provide useful and relevant information regarding its results and allow
management and investors to assess CNH Industrial's operating trends, financial performance and financial position. Management
uses these non-GAAP measures to identify operational trends, as well as make decisions regarding future spending, resource
allocations and other operational decisions as they provide additional transparency with respect to our core operations. These
non-GAAP financial measures have no standardized meaning presented in U.S. GAAP or EU-IFRS and are unlikely to be comparable to
other similarly titled measures used by other companies due to potential differences between the companies in calculations. As a
result, the use of these non-GAAP measures has limitations and they should not be considered as substitutes for measures of
financial performance and financial position as prepared in accordance with U.S. GAAP and/or EU-IFRS.
CNH Industrial non-GAAP financial measures are defined as follows:
- Operating Profit under U.S. GAAP: Operating Profit of Industrial Activities is defined as net sales less cost of goods
sold, selling, general and administrative expenses, and research and development expenses. Operating Profit of Financial
Services is defined as revenues less selling, general and administrative expenses, interest expense and certain other operating
expenses.
- Trading Profit under EU-IFRS: Trading Profit is derived from financial information prepared in accordance with EU-IFRS and
is defined as net revenues less cost of sales, selling, general and administrative costs, research and development costs, and
other operating income and expenses.
- Operating Profit under EU-IFRS: Operating Profit under EU-IFRS is computed starting from Trading Profit under EU-IFRS
plus/minus restructuring costs, other income (expenses) that are unusual in the ordinary course of business (such as gains and
losses on the disposal of investments and other unusual items arising from infrequent external events or market
conditions).
- Adjusted Net Income (Loss): is defined as net income (loss), less restructuring charges and non-recurring items, after tax.
In particular, non-recurring items are specifically disclosed items that management considers rare or discrete events that are
infrequent in nature and not reflective of on-going operational activities.
- Adjusted Diluted EPS: is computed by dividing Adjusted Net Income (loss) attributable to CNH Industrial N.V. by a
weighted-average number of common shares outstanding during the period that takes into consideration potential common shares
outstanding deriving from the CNH Industrial share-based payment awards, when inclusion is not anti-dilutive.
- Adjusted Income Taxes: is defined as income taxes less the tax effect of restructuring expenses and non-recurring items and
non-recurring tax charges.
- Adjusted Effective Tax Rate (Adjusted ETR): is computed by dividing a) adjusted income taxes by b) income (loss) before
income taxes and equity in income of unconsolidated subsidiaries and affiliates, less restructuring expenses and non-recurring
items.
- Net Debt and Net Debt of Industrial Activities (or Net Industrial Debt): Net Debt is defined as total debt less
intersegment notes receivable, cash and cash equivalents, restricted cash and derivative hedging debt. CNH Industrial provides
the reconciliation of Net Debt to Total Debt, which is the most directly comparable measure included in the consolidated
balance sheets. Due to different sources of cash flows used for the repayment of the debt between Industrial Activities and
Financial Services (by cash from operations for Industrial Activities and by collection of financing receivables for Financial
Services), management separately evaluates the cash flow performance of Industrial Activities using Net Debt of Industrial
Activities.
- Available Liquidity: is defined as cash and cash equivalents plus restricted cash and undrawn committed facilities.
- Change excl. FX or Constant Currency: CNH Industrial discusses the fluctuations in revenues on a constant currency basis by
applying the prior year average exchange rates to current year's revenues expressed in local currency in order to eliminate the
impact of foreign exchange rate fluctuations.
The tables attached to this press release provide reconciliations of the non-GAAP measures used in this press release to the
most directly comparable GAAP measures.
Forward-looking statements
All statements other than statements of historical fact contained in this earning release including statements regarding our
competitive strengths; business strategy; future financial position or operating results; budgets; projections with respect to
revenue, income, earnings (or loss) per share, capital expenditures, dividends, capital structure or other financial items;
costs; and plans and objectives of management regarding operations and products, are forward-looking statements. These statements
may include terminology such as "may", "will", "expect", "could", "should", "intend", "estimate", "anticipate", "believe",
"outlook", "continue", "remain", "on track", "design", "target", "objective", "goal", "forecast", "projection", "prospects",
"plan", or similar terminology. Forward-looking statements are not guarantees of future performance. Rather, they are based on
current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside our
control and are difficult to predict. If any of these risks and uncertainties materialize or other assumptions underlying any of
the forward-looking statements prove to be incorrect, the actual results or developments may differ materially from any future
results or developments expressed or implied by the forward-looking statements. Factors, risks and uncertainties that could cause
actual results to differ materially from those contemplated by the forward-looking statements include, among others: the many
interrelated factors that affect consumer confidence and worldwide demand for capital goods and capital goods-related products;
general economic conditions in each of our markets; changes in government policies regarding banking, monetary and fiscal
policies; legislation, particularly relating to capital goods-related issues such as agriculture, the environment, debt relief
and subsidy program policies, trade and commerce and infrastructure development; government policies on international trade and
investment, including sanctions, import quotas, capital controls and tariffs; actions of competitors in the various industries in
which we compete; development and use of new technologies and technological difficulties; the interpretation of, or adoption of
new, compliance requirements with respect to engine emissions, safety or other aspects of our products; production difficulties,
including capacity and supply constraints and excess inventory levels; labor relations; interest rates and currency exchange
rates; inflation and deflation; energy prices; prices for agricultural commodities; housing starts and other construction
activity; our ability to obtain financing or to refinance existing debt; a decline in the price of used vehicles; the resolution
of pending litigation and investigations on a wide range of topics, including dealer and supplier litigation, follow-on private
litigation in various jurisdictions after the settlement of the EU antitrust investigation announced on July 19, 2016, intellectual property rights disputes, product warranty and defective product claims, and
emissions and/or fuel economy regulatory and contractual issues; our pension plans and other post-employment obligations;
political and civil unrest; volatility and deterioration of capital and financial markets, including further deterioration of the
Eurozone sovereign debt crisis, possible effects of "Brexit", political evolutions in Turkey,
terror attacks in Europe and elsewhere, and other similar risks and uncertainties and our
success in managing the risks involved in the foregoing. Further information concerning factors, risks, and uncertainties that
could materially affect the Company's financial results is included in our annual report on Form 20-F for the year ended
December 31, 2016, prepared in accordance with U.S. GAAP, and in the Company's EU Annual Report at
December 31, 2016, prepared in accordance with EU-IFRS. Investors should refer to and consider the incorporated information
on risks, factors, and uncertainties in addition to the information presented here.
Forward-looking statements speak only as of the date on which such statements are made. Furthermore, in light of ongoing
difficult macroeconomic conditions, both globally and in the industries in which we operate, it is particularly difficult to
forecast our results and any estimates or forecasts of particular periods that we provide in this earnings release are uncertain.
Accordingly, investors should not place undue reliance on such forward-looking statements. We can give no assurance that the
expectations reflected in our forward-looking statements will prove to be correct. Our outlook is based upon assumptions relating
to the factors described in the earnings release, which are sometimes based upon estimates and data received from third parties.
Such estimates and data are often revised. Our actual results could differ materially from those anticipated in such
forward-looking statements. We undertake no obligation to update or revise publicly our outlook or forward-looking statements.
Further information concerning CNH Industrial and its businesses, including factors that potentially could materially affect CNH
Industrial's financial results, is included in CNH Industrial's reports and filings with the U.S. Securities and Exchange
Commission ("SEC"), the Autoriteit Financiële Markten ("AFM") and Commissione Nazionale per le Società e la Borsa ("CONSOB").
All future written and oral forward-looking statements by CNH Industrial or persons acting on the behalf of CNH Industrial are
expressly qualified in their entirety by the cautionary statements contained herein or referred to above.
Contacts
|
|
Media
Inquiries
|
Investor Relations
|
|
|
United Kingdom
|
United Kingdom
|
|
|
Richard Gadeselli
|
Federico Donati
|
Tel: +44 207 7660
346
|
Tel: +44 207 7660 386
|
|
|
Laura Overall
|
United States
|
Tel: +44 207 7660 338
|
|
|
Noah Weiss
|
|
Tel: +1 630 887 3745
|
E-mail: mediarelations@cnhind.com
|
|
www.cnhindustrial.com
|
|
CNH INDUSTRIAL N.V.
|
Condensed Consolidated Statements of Operations
|
For The Three Months Ended June 30, 2017 and 2016 and For The Six Months
Ended June 30, 2017 and 2016
|
(Unaudited)
|
|
(U.S. GAAP)
|
|
($ million)
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
2017
|
|
2016
|
2017
|
|
2016
|
Revenues
|
|
|
|
|
|
|
Net sales
|
6,655
|
|
6,450
|
12,039
|
|
11,526
|
Finance and interest income
|
293
|
|
303
|
590
|
|
599
|
TOTAL REVENUES
|
6,948
|
|
6,753
|
12,629
|
|
12,125
|
Costs and Expenses
|
|
|
|
|
|
|
Cost of goods sold
|
5,427
|
|
5,252
|
9,924
|
|
9,490
|
Selling, general and administrative expenses
|
575
|
|
595
|
1,117
|
|
1,141
|
Research and development expenses
|
228
|
|
225
|
419
|
|
408
|
Restructuring expenses
|
12
|
|
10
|
24
|
|
25
|
Interest expense(1)
|
234
|
|
240
|
453
|
|
470
|
Other, net(2)
|
139
|
|
190
|
280
|
|
820
|
TOTAL COSTS AND EXPENSES
|
6,615
|
|
6,512
|
12,217
|
|
12,354
|
INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED
SUBSIDIARIES AND AFFILIATES
|
333
|
|
241
|
412
|
|
(229)
|
Income tax (expense)
|
(113)
|
|
(107)
|
(161)
|
|
(147)
|
Equity in income of unconsolidated subsidiaries and
affiliates(3)
|
27
|
|
(5)
|
45
|
|
(8)
|
NET INCOME (LOSS)
|
247
|
|
129
|
296
|
|
(384)
|
Net income (loss) attributable to noncontrolling interests
|
5
|
|
3
|
8
|
|
2
|
NET INCOME (LOSS) ATTRIBUTABLE TO CNH INDUSTRIAL N.V.
|
242
|
|
126
|
288
|
|
(386)
|
|
|
|
|
|
|
|
(in $)
|
|
|
|
|
|
|
Earnings (loss) per share attributable to common shareholders
|
|
|
|
|
|
|
Basic
|
0.18
|
|
0.10
|
0.21
|
|
(0.28)
|
Diluted
|
0.18
|
|
0.10
|
0.21
|
|
(0.28)
|
Cash dividends declared per common share
|
0.118
|
|
0.148
|
0.118
|
|
0.148
|
|
|
|
|
Notes:
|
|
(1)
|
In the three and six months ended June 30, 2017, Interest expense
includes the charge of $17 million related to the early redemption of all outstanding Case New Holland Industrial Inc.
7⅞% Senior Notes due 2017.
|
(2)
|
In the three and six months ended June 30, 2016, Other, net included the
non-recurring charge of $49 million and $551 million, respectively, related to the European Commission
settlement.
|
(3)
|
In the three and six months ended June 30, 2016, Equity in income of
unconsolidated subsidiaries and affiliates included a negative impact of $28 million incurred by the joint venture
Naveco Ltd due to its exit from a line of business.
|
|
|
|
These Condensed Consolidated Statements of Operations should be read in
conjunction with the Company's Audited Consolidated Financial Statements and Notes for the Year Ended December 31, 2016
included in the Annual Report on Form 20-F. These Condensed Consolidated Statements of Operations represent the
consolidation of all CNH Industrial N.V. subsidiaries.
|
|
|
CNH INDUSTRIAL N.V.
|
Condensed Consolidated Balance Sheets
|
As of June 30, 2017 and December 31, 2016
|
(Unaudited)
|
|
(U.S. GAAP)
|
|
($ million)
|
|
|
June 30, 2017
|
|
December 31, 2016
|
ASSETS
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
4,601
|
|
5,017
|
Restricted cash
|
|
|
690
|
|
837
|
Trade receivables, net
|
|
|
656
|
|
623
|
Financing receivables, net
|
|
|
18,939
|
|
18,662
|
Inventories, net
|
|
|
6,965
|
|
5,609
|
Property, plant and equipment, net
|
|
|
6,794
|
|
6,397
|
Investments in unconsolidated subsidiaries and affiliates
|
|
|
532
|
|
487
|
Equipment under operating leases
|
|
|
1,928
|
|
1,907
|
Goodwill
|
|
|
2,463
|
|
2,449
|
Other intangible assets, net
|
|
|
776
|
|
787
|
Deferred tax assets
|
|
|
1,000
|
|
937
|
Derivative assets
|
|
|
88
|
|
95
|
Other assets
|
|
|
1,832
|
|
1,740
|
TOTAL ASSETS
|
|
|
47,264
|
|
45,547
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
Debt
|
|
|
25,474
|
|
25,276
|
Trade payables
|
|
|
6,129
|
|
5,185
|
Deferred tax liabilities
|
|
|
98
|
|
84
|
Pension, postretirement and other postemployment benefits
|
|
|
2,328
|
|
2,276
|
Derivative liabilities
|
|
|
94
|
|
249
|
Other liabilities
|
|
|
8,661
|
|
8,005
|
Total Liabilities
|
|
|
42,784
|
|
41,075
|
Redeemable noncontrolling interest
|
|
|
23
|
|
21
|
Common shares, €0.01, par value; outstanding 1,364,122,455 common shares
and 396,237,285 special voting shares at 06/30/2017; and outstanding 1,361,630,903 common shares and 412,268,203 special
voting shares at 12/31/2016
|
|
|
25
|
|
25
|
Treasury stock, at cost: 9,674 common shares at 06/30/2017 and 1,278,708
common shares at 12/31/2016
|
|
|
-
|
|
(9)
|
Additional paid in capital
|
|
|
4,413
|
|
4,408
|
Retained earnings
|
|
|
1,914
|
|
1,787
|
Accumulated other comprehensive loss
|
|
|
(1,902)
|
|
(1,767)
|
Noncontrolling interests
|
|
|
7
|
|
7
|
Equity
|
|
|
4,457
|
|
4,451
|
TOTAL LIABILITIES AND EQUITY
|
|
|
47,264
|
|
45,547
|
|
|
These Condensed Consolidated Balance Sheets should be read in conjunction
with the Company's Audited Consolidated Financial Statements and Notes for the Year Ended December 31, 2016 included in
the Annual Report on Form 20-F. These Condensed Consolidated Balance Sheets represent the consolidation of all CNH
Industrial N.V. subsidiaries.
|
|
|
CNH INDUSTRIAL N.V.
|
Condensed Consolidated Statements of Cash Flows
|
For The Six Months Ended June 30, 2017 and 2016
|
(Unaudited)
|
|
(U.S. GAAP)
|
($ million)
|
Six Months Ended June 30,
|
2017
|
2016
|
Operating activities:
|
|
|
Net income (loss)
|
296
|
(384)
|
Adjustments to reconcile net income (loss) to net cash provided by (used
in) operating activities:
|
|
|
Depreciation and amortization expense, net of assets under operating
leases and assets sold under buy-back commitments
|
354
|
358
|
Depreciation and amortization expense of assets under operating
leases and assets sold under buy-back commitments
|
280
|
271
|
Loss from disposal of assets
|
12
|
2
|
Loss on repurchase/early redemption of Notes
|
17
|
-
|
Undistributed income (loss) of unconsolidated subsidiaries
|
(10)
|
65
|
Other non-cash items
|
87
|
116
|
Changes in operating assets and liabilities:
|
|
|
Provisions
|
41
|
507
|
Deferred income taxes
|
(85)
|
9
|
Trade and financing receivables related to sales, net
|
(291)
|
(276)
|
Inventories, net
|
(1,057)
|
(806)
|
Trade payables
|
617
|
394
|
Other assets and liabilities
|
6
|
222
|
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
267
|
478
|
Investing activities:
|
|
|
Additions to retail receivables
|
(1,806)
|
(1,781)
|
Collections of retail receivables
|
2,190
|
2,328
|
Proceeds from the sale of assets, net of assets under operating leases
and
assets sold under buy-back commitments
|
2
|
8
|
Proceeds from the sale of assets previously under operating leases and
assets sold under buy-back commitments
|
377
|
323
|
Expenditures for property, plant and equipment and intangible assets, net
of assets under operating leases and assets sold under buy-back commitments
|
(165)
|
(172)
|
Expenditures for assets under operating leases and assets sold under
buy-back commitments
|
(850)
|
(669)
|
Other
|
145
|
(148)
|
NET CASH USED IN INVESTING ACTIVITIES
|
(107)
|
(111)
|
Financing activities:
|
|
|
Proceeds from long-term debt
|
7,395
|
5,417
|
Payment of long-term debt
|
(8,104)
|
(5,981)
|
Net increase (decrease) in other financial liabilities
|
90
|
(192)
|
Dividends paid
|
(165)
|
(204)
|
Other
|
(5)
|
(58)
|
NET CASH USED IN FINANCING ACTIVITIES
|
(789)
|
(1,018)
|
Effect of foreign exchange rate changes on cash and cash
equivalents
|
213
|
149
|
DECREASE IN CASH AND CASH EQUIVALENTS
|
(416)
|
(502)
|
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
|
5,017
|
5,384
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
4,601
|
4,882
|
|
|
These Condensed Consolidated Statements of Cash Flows should be read in
conjunction with the Company's Audited Consolidated Financial Statements and Notes for the Year Ended December 31, 2016
included in the Annual Report on Form 20-F. These Condensed Consolidated Statements of Cash Flows represent the
consolidation of all CNH Industrial N.V. subsidiaries.
|
|
|
CNH INDUSTRIAL N.V.
|
Supplemental Statements of Operations
|
For The Three Months Ended June 30, 2017 and 2016 and For The Six Months
Ended June 30, 2017 and 2016
|
(Unaudited)
|
|
(U.S. GAAP)
|
|
Industrial Activities
|
Financial Services
|
($ million)
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
Revenues
|
|
|
|
|
|
|
|
|
Net sales
|
6,655
|
6,450
|
12,039
|
11,526
|
-
|
-
|
-
|
-
|
Finance and interest income
|
29
|
33
|
65
|
64
|
400
|
399
|
796
|
787
|
TOTAL REVENUES
|
6,684
|
6,483
|
12,104
|
11,590
|
400
|
399
|
796
|
787
|
Costs and Expenses
|
|
|
|
|
|
|
|
|
Cost of goods sold
|
5,427
|
5,252
|
9,924
|
9,490
|
-
|
-
|
-
|
-
|
Selling, general and administrative expenses
|
519
|
520
|
996
|
997
|
56
|
75
|
121
|
144
|
Research and development expenses
|
228
|
225
|
419
|
408
|
-
|
-
|
-
|
-
|
Restructuring expenses
|
11
|
9
|
22
|
24
|
1
|
1
|
2
|
1
|
Interest expense
|
150
|
152
|
289
|
302
|
137
|
132
|
268
|
258
|
Interest compensation to Financial Services
|
84
|
85
|
166
|
161
|
-
|
-
|
-
|
-
|
Other, net
|
53
|
116
|
116
|
681
|
85
|
74
|
165
|
140
|
TOTAL COSTS AND EXPENSES
|
6,472
|
6,359
|
11,932
|
12,063
|
279
|
282
|
556
|
543
|
INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED
SUBSIDIARIES AND AFFILIATES
|
212
|
124
|
172
|
(473)
|
121
|
117
|
240
|
244
|
Income tax (expense)
|
(72)
|
(70)
|
(82)
|
(64)
|
(41)
|
(37)
|
(79)
|
(83)
|
Equity in income of unconsolidated subsidiaries and affiliates
|
20
|
(12)
|
32
|
(21)
|
7
|
7
|
13
|
13
|
Results from intersegment investments
|
87
|
87
|
174
|
174
|
-
|
-
|
-
|
-
|
NET INCOME (LOSS)
|
247
|
129
|
296
|
(384)
|
87
|
87
|
174
|
174
|
|
|
These Supplemental Statements of Operations are presented for informational
purposes. The supplemental Industrial Activities data in these statements (with Financial Services on the equity basis)
include CNH Industrial N.V.'s Agricultural Equipment, Construction Equipment, Commercial Vehicles and Powertrain
segments, as well as Corporate functions. The supplemental Financial Services data in these statements refer to CNH
Industrial N.V.'s Financial Services segment. Transactions between Industrial Activities and Financial Services have been
eliminated to arrive at the consolidated financial statements.
|
|
|
CNH INDUSTRIAL N.V.
|
Supplemental Balance Sheets
|
As of June 30, 2017 and December 31, 2016
|
(Unaudited)
|
|
(U.S. GAAP)
|
|
Industrial Activities
|
Financial Services
|
($ million)
|
June 30,
2017
|
December 31,
2016
|
June 30,
2017
|
December 31,
2016
|
ASSETS
|
|
|
|
|
Cash and cash equivalents
|
4,085
|
4,649
|
516
|
368
|
Restricted cash
|
6
|
-
|
684
|
837
|
Trade receivables
|
626
|
596
|
54
|
58
|
Financing receivables
|
1,373
|
1,592
|
19,687
|
19,546
|
Inventories, net
|
6,767
|
5,396
|
198
|
213
|
Property, plant and equipment, net
|
6,792
|
6,395
|
2
|
2
|
Investments in unconsolidated subsidiaries and affiliates
|
3,008
|
2,886
|
181
|
153
|
Equipment under operating leases
|
31
|
17
|
1,897
|
1,890
|
Goodwill
|
2,309
|
2,296
|
154
|
153
|
Other intangible assets, net
|
763
|
772
|
13
|
15
|
Deferred tax assets
|
1,161
|
1,060
|
205
|
188
|
Derivative assets
|
83
|
98
|
16
|
8
|
Other assets
|
1,718
|
1,505
|
334
|
382
|
TOTAL ASSETS
|
28,722
|
27,262
|
23,941
|
23,813
|
LIABILITY AND EQUITY
|
|
|
|
|
Debt
|
7,468
|
7,691
|
20,127
|
20,061
|
Trade payables
|
6,020
|
5,042
|
137
|
180
|
Deferred tax liabilities
|
157
|
84
|
308
|
310
|
Pension, postretirement and other postemployment benefits
|
2,300
|
2,256
|
28
|
20
|
Derivative liabilities
|
91
|
239
|
14
|
21
|
Other liabilities
|
8,206
|
7,478
|
671
|
669
|
Total Liabilities
|
24,242
|
22,790
|
21,285
|
21,261
|
Redeemable noncontrolling interest
|
23
|
21
|
-
|
-
|
Equity
|
4,457
|
4,451
|
2,656
|
2,552
|
TOTAL LIABILITIES AND EQUITY
|
28,722
|
27,262
|
23,941
|
23,813
|
|
|
These Supplemental Balance Sheets are presented for informational purposes.
The supplemental Industrial Activities data in these statements (with Financial Services on the equity basis) include CNH
Industrial N.V.'s Agricultural Equipment, Construction Equipment, Commercial Vehicles and Powertrain segments, as well as
Corporate functions. The supplemental Financial Services data in these statements refer to CNH Industrial N.V.'s
Financial Services segment. Transactions between Industrial Activities and Financial Services have been eliminated to
arrive at the consolidated financial statements.
|
|
|
CNH INDUSTRIAL N.V.
|
Supplemental Statements of Cash Flows
|
For The Six Months Ended June 30, 2017 and 2016
|
(Unaudited)
|
|
(U.S. GAAP)
|
|
Industrial Activities
|
Financial Services
|
($ million)
|
Six Months Ended June 30,
|
Six Months Ended June 30,
|
Operating activities:
|
2017
|
2016
|
2017
|
2016
|
Net income (loss)
|
296
|
(384)
|
174
|
174
|
Adjustments to reconcile net income (loss) to net cash provided by (used
in) operating activities:
|
|
|
|
|
Depreciation and amortization expense, net of assets under operating
leases and assets sold under buy-back commitments
|
352
|
355
|
2
|
3
|
Depreciation and amortization expense of assets under operating
leases and assets sold under buy-back commitments
|
152
|
146
|
128
|
125
|
Loss from disposal of assets
|
12
|
2
|
-
|
-
|
Loss on repurchase/early redemption of Notes
|
17
|
-
|
-
|
-
|
Undistributed income (loss) of unconsolidated subsidiaries
|
(2)
|
63
|
(13)
|
(13)
|
Other non-cash items
|
48
|
54
|
39
|
62
|
Changes in operating assets and liabilities:
|
|
|
|
|
Provisions
|
45
|
514
|
(4)
|
(7)
|
Deferred income taxes
|
(73)
|
(1)
|
(12)
|
10
|
Trade and financing receivables related to sales, net
|
(2)
|
(113)
|
(284)
|
(158)
|
Inventories, net
|
(1,073)
|
(791)
|
16
|
(15)
|
Trade payables
|
658
|
447
|
(45)
|
(58)
|
Other assets and liabilities
|
(52)
|
30
|
57
|
192
|
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
378
|
322
|
58
|
315
|
Investing activities:
|
|
|
|
|
Additions to retail receivables
|
-
|
-
|
(1,806)
|
(1,781)
|
Collections of retail receivables
|
-
|
-
|
2,190
|
2,328
|
Proceeds from the sale of assets, net of assets sold under operating leases
and assets sold under buy-back commitments
|
2
|
8
|
-
|
-
|
Proceeds from the sale of assets previously under operating leases and
assets sold under buy-back commitments
|
144
|
152
|
233
|
171
|
Expenditures for property, plant and equipment and intangible assets, net
of assets under operating leases and assets sold under buy-back
commitments
|
(165)
|
(172)
|
-
|
-
|
Expenditures for assets under operating leases and assets sold under
buy-back commitments
|
(496)
|
(338)
|
(354)
|
(331)
|
Other
|
(139)
|
(91)
|
255
|
(57)
|
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
|
(654)
|
(441)
|
518
|
330
|
Financing activities:
|
|
|
|
|
Proceeds from long-term debt
|
713
|
978
|
6,682
|
4,439
|
Payment of long-term debt
|
(973)
|
(794)
|
(7,131)
|
(5,187)
|
Net increase (decrease) in other financial liabilities
|
(67)
|
(127)
|
157
|
(65)
|
Dividends paid
|
(165)
|
(204)
|
(169)
|
(159)
|
Other
|
(5)
|
(58)
|
29
|
-
|
NET CASH USED IN FINANCING ACTIVITIES
|
(497)
|
(205)
|
(432)
|
(972)
|
Effect of foreign exchange rate changes on cash and cash
equivalents
|
209
|
103
|
4
|
46
|
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(564)
|
(221)
|
148
|
(281)
|
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
|
4,649
|
4,551
|
368
|
833
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
4,085
|
4,330
|
516
|
552
|
|
|
|
|
These Supplemental Statements of Cash Flows are presented for informational
purposes. The supplemental Industrial Activities data in these statements (with Financial Services on the equity basis)
include CNH Industrial N.V.'s Agricultural Equipment, Construction Equipment, Commercial Vehicles and Powertrain
segments, as well as Corporate functions. The supplemental Financial Services data in these statements refer to CNH
Industrial N.V.'s Financial Services segment. Transactions between Industrial Activities and Financial Services have been
eliminated to arrive at the consolidated financial statements.
|
|
|
|
|
|
CNH INDUSTRIAL N.V.
|
|
Other Supplemental Financial Information
|
|
(Unaudited)
|
|
|
|
CNH INDUSTRIAL
Reconciliation of Operating Profit (loss) to Net Income (loss) under U.S. GAAP ($ million)
|
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
|
2017
|
2016
|
|
2017
|
2016
|
|
|
|
780
|
720
|
Total Operating Profit
|
523
|
488
|
|
|
|
24
|
25
|
Restructuring expenses
|
12
|
10
|
|
|
|
225
|
239
|
Interest expenses of Industrial Activities, net of interest income and
eliminations(1)
|
122
|
120
|
|
|
|
(119)
|
(685)
|
Other, net(2)
|
(56)
|
(117)
|
|
|
|
412
|
(229)
|
Income (loss) before income taxes and equity in income of unconsolidated
subsidiaries and affiliates
|
333
|
241
|
|
|
|
(161)
|
(147)
|
Income tax (expense)
|
(113)
|
(107)
|
|
|
|
45
|
(8)
|
Equity in income of unconsolidated subsidiaries and
affiliates(3)
|
27
|
(5)
|
|
|
|
296
|
(384)
|
Net income (loss)
|
247
|
129
|
|
|
|
(1) In the three and six months ended June 2017, Interest expenses
includes the charge of $17 million related to the early redemption of all outstanding Case New Holland Industrial Inc.
7⅞% Senior Notes due 2017.
(2) In the three and six months ended June 2016, Other, net included the non-recurring charge of $49 million and
$551 million, respectively, related to the European Commission settlement.
(3) In the three and six months ended June 30, 2016, Equity in income of unconsolidated subsidiaries and affiliates
included a negative impact of $28 million incurred by the joint venture Naveco Ltd due to its exit from a line of
business.
|
|
CNH INDUSTRIAL
Reconciliation of Total Debt to Net debt under U.S. GAAP ($ million)
|
|
|
Consolidated
|
|
Industrial Activities
|
|
Financial Activities
|
|
|
|
June 30,
2017
|
December 31,
2016
|
|
June 30,
2017
|
December 31,
2016
|
|
June 30,
2017
|
December 31,
2016
|
|
|
Third party debt
|
25,474
|
25,276
|
|
6,665
|
6,694
|
|
18,809
|
18,582
|
|
|
Intersegment notes payable
|
-
|
-
|
|
803
|
997
|
|
1,318
|
1,479
|
|
|
Total Debt(1)
|
25,474
|
25,276
|
|
7,468
|
7,691
|
|
20,127
|
20,061
|
|
|
Less:
Cash and cash equivalents
|
4,601
|
5,017
|
|
4,085
|
4,649
|
|
516
|
368
|
|
|
Restricted cash
|
690
|
837
|
|
6
|
-
|
|
684
|
837
|
|
|
Intersegment notes receivable
|
-
|
-
|
|
1,318
|
1,479
|
|
803
|
997
|
|
|
Derivatives hedging debt
|
(5)
|
2
|
|
(5)
|
2
|
|
-
|
-
|
|
|
Net debt (cash)(2)
|
20,188
|
19,420
|
|
2,064
|
1,561
|
|
18,124
|
17,859
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total Debt of Industrial Activities includes
Intersegment notes payable to Financial Services of $803 million and $997 million as of June 30, 2017 and December 31,
2016, respectively. Total Debt of Financial Services includes Intersegment notes payable to Industrial Activities of
$1,318 million and $1,479 million as of June 30, 2017 and December 31, 2016, respectively.
|
|
(2) The net intersegment receivable/payable balance owed by
Financial Services to Industrial Activities was $515 million and $482 million as of June 30, 2017 and December 31,
2016, respectively.
|
CNH INDUSTRIAL
Reconciliation of Cash and cash equivalents to Available liquidity under
U.S. GAAP
($ million)
|
|
|
June 30, 2017
|
March 31, 2017
|
December 31, 2016
|
|
|
Cash and cash equivalents
|
4,601
|
3,924
|
5,017
|
|
|
Restricted cash
|
690
|
743
|
837
|
|
|
Undrawn committed facilities
|
3,033
|
2,887
|
2,890
|
|
|
Available liquidity
|
8,324
|
7,554
|
8,744
|
|
|
|
CNH INDUSTRIAL N.V.
|
Other Supplemental Financial Information
|
(Unaudited)
|
|
CNH INDUSTRIAL
Change in Net Industrial Debt under U.S. GAAP
($ million)
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
(1,561)
|
|
(1,578)
|
Net industrial (debt)/cash at beginning of period
|
(2,123)
|
|
(2,470)
|
|
|
296
|
|
(384)
|
Net income (loss)
|
247
|
|
129
|
|
|
-
|
|
551
|
Add back European Commission settlement
|
-
|
|
49
|
|
|
17
|
|
-
|
Add back cost of repurchase/early redemption of 2017
Notes(1)
|
17
|
|
-
|
|
|
352
|
|
355
|
Amortization and depreciation(2)
|
176
|
|
178
|
|
|
(49)
|
|
99
|
Changes in provisions and similar(3)
|
44
|
|
137
|
|
|
(597)
|
|
(484)
|
Change in working capital
|
29
|
|
189
|
|
|
(165)
|
|
(172)
|
Investments in property, plant and equipment, and intangible
assets(2)
|
(91)
|
|
(92)
|
|
|
36
|
|
15
|
Other changes
|
1
|
|
12
|
|
|
(110)
|
|
(20)
|
Net industrial cash flow
|
423
|
|
602
|
|
|
(170)
|
|
(218)
|
Capital increases and dividends(4)
|
(169)
|
|
(211)
|
|
|
(223)
|
|
(319)
|
Currency translation differences and other(5)
|
(195)
|
|
(56)
|
|
|
(503)
|
|
(557)
|
Change in Net industrial debt
|
59
|
|
335
|
|
|
(2,064)
|
|
(2,135)
|
Net industrial (debt)/cash at end of period
|
(2,064)
|
|
(2,135)
|
|
(1) Add back item to be excluded from the calculation of net
industrial cash flow.
(2) Excluding assets sold under buy-back commitments and assets under operating leases.
(3) This item also includes changes in items related to assets sold under buy-back commitments, and assets
under operating leases.
(4) This item also includes share buy-back transactions.
(5) In the three and six months ended June 30, 2017, this item also includes the charge of $17 million
related to the early redemption of all outstanding Case New Holland Industrial Inc. 7⅞% Senior Notes due 2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNH INDUSTRIAL N.V.
|
Other Supplemental Financial Information
|
(Unaudited)
|
|
CNH INDUSTRIAL
Reconciliation of Adjusted net income and Adjusted income tax (expense)
to the most comparable GAAP financial measure and determination of Adjusted diluted EPS and Adjusted ETR under
U.S.GAAP
($ million, except per share data)
|
|
Six Months Ended June 30,
|
|
|
Three Months Ended June 30,
|
|
|
2017
|
2016
|
|
|
2017
|
2016
|
|
|
296
|
(384)
|
|
Net income (loss)
|
247
|
129
|
|
|
41
|
576
|
|
Adjustments impacting Income (loss) before income tax (expense) and equity
in income of unconsolidated subsidiaries and affiliates (a)
|
29
|
59
|
|
|
(13)
|
(3)
|
|
Adjustments impacting Income tax (expense) (b)
|
(10)
|
-
|
|
|
-
|
28
|
|
Adjustments impacting Equity in income of unconsolidated subsidiaries and
affiliates (c)
|
-
|
28
|
|
|
324
|
217
|
|
Adjusted net income
|
266
|
216
|
|
|
316
|
215
|
|
Adjusted net income attributable to CNH Industrial N.V.
|
261
|
213
|
|
|
1,366
|
1,364
|
|
Weighted average shares outstanding – diluted (million)
|
1,367
|
1,364
|
|
|
0.23
|
0.16
|
|
Adjusted diluted EPS ($)
|
0.19
|
0.16
|
|
|
|
|
|
412
|
(229)
|
|
Income (loss) before income tax (expense) and equity in income of
unconsolidated subsidiaries and affiliates
|
333
|
241
|
|
|
41
|
576
|
|
Adjustments impacting Income (loss) before income tax (expense) and equity
in income of unconsolidated subsidiaries and affiliates (a)
|
29
|
59
|
|
|
453
|
347
|
|
Adjusted income (loss) before income tax (expense) and equity in income
of unconsolidated subsidiaries and affiliates (A)
|
362
|
300
|
|
|
|
|
|
(161)
|
(147)
|
|
Income tax (expense)
|
(113)
|
(107)
|
|
|
(13)
|
(3)
|
|
Adjustments impacting Income tax (expense) (b)
|
(10)
|
-
|
|
|
(174)
|
(150)
|
|
Adjusted income tax (expense) (B)
|
(123)
|
(107)
|
|
|
|
|
|
38%
|
43%
|
|
Adjusted Effective Tax Rate (Adjusted ETR) (C=B/A)
|
34%
|
36%
|
|
|
|
|
|
a) Adjustments impacting Income (loss)
before income tax (expense) and equity in income of unconsolidated subsidiaries and affiliates
|
|
|
24
|
25
|
|
Restructuring expenses
|
12
|
10
|
|
|
-
|
551
|
|
European Commission settlement
|
-
|
49
|
|
|
17
|
-
|
|
Cost of repurchase/early redemption of 2017 Notes
|
17
|
-
|
|
|
41
|
576
|
|
Total
|
29
|
59
|
|
b) Adjustments impacting Income tax
(expense)
|
|
(13)
|
(3)
|
|
Tax effect of adjustments impacting Income (loss) before income tax (expense)
and equity in income of unconsolidated subsidiaries and affiliates
|
(10)
|
-
|
|
|
(13)
|
(3)
|
|
Total
|
(10)
|
-
|
|
|
c) Adjustments impacting Equity in income
of unconsolidated subsidiaries and affiliates
|
|
|
-
|
28
|
|
Negative impact incurred by the joint venture Naveco Ltd due to its exit from
a line of business
|
-
|
28
|
|
|
-
|
28
|
|
Total
|
-
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNH INDUSTRIAL N.V.
|
Other Supplemental Financial Information
|
(Unaudited)
|
|
CNH INDUSTRIAL
Revenues by Segment under EU-IFRS ($
million)
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
2017
|
2016
|
% change
|
|
2017
|
2016
|
% change
|
|
|
5,239
|
4,932
|
6.2
|
Agricultural Equipment
|
2,893
|
2,808
|
3.0
|
|
|
1,199
|
1,131
|
6.0
|
Construction Equipment
|
676
|
595
|
13.6
|
|
|
4,778
|
4,746
|
0.7
|
Commercial Vehicles
|
2,636
|
2,649
|
-0.5
|
|
|
2,139
|
1,909
|
12.0
|
Powertrain
|
1,137
|
1,025
|
10.9
|
|
|
(1,203)
|
(1,082)
|
-
|
Eliminations and other
|
(625)
|
(571)
|
-
|
|
|
12,152
|
11,636
|
4.4
|
Total of Industrial Activities
|
6,717
|
6,506
|
3.2
|
|
|
1,017
|
950
|
7.1
|
Financial Services
|
503
|
495
|
1.6
|
|
|
(246)
|
(225)
|
-
|
Eliminations and other
|
(126)
|
(115)
|
-
|
|
|
12,923
|
12,361
|
4.5
|
Total
|
7,094
|
6,886
|
3.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNH INDUSTRIAL
Trading profit/(loss)(1) by Segment under EU-IFRS ($
million)
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
2017
|
2016
|
Change
|
|
2017
|
2016
|
Change
|
|
|
309
|
247
|
62
|
Agricultural Equipment
|
238
|
228
|
10
|
|
|
(42)
|
(9)
|
-33
|
Construction Equipment
|
-
|
(3)
|
3
|
|
|
64
|
93
|
-29
|
Commercial Vehicles
|
67
|
78
|
-11
|
|
|
160
|
110
|
50
|
Powertrain
|
93
|
64
|
29
|
|
|
(55)
|
(48)
|
-7
|
Eliminations and other
|
(34)
|
(31)
|
-3
|
|
|
436
|
393
|
43
|
Total of Industrial Activities
|
364
|
336
|
28
|
|
|
242
|
245
|
-3
|
Financial Services
|
122
|
118
|
4
|
|
|
-
|
-
|
-
|
Eliminations and other
|
-
|
-
|
-
|
|
|
678
|
638
|
40
|
Total
|
486
|
454
|
32
|
|
|
(1) This item is a non-GAAP financial measure. Refer
to the "Non-GAAP Financial Information" section of this press release for information regarding non-GAAP financial
measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
CNH INDUSTRIAL
Key Balance Sheet data under EU-IFRS ($
million)
|
|
|
June 30, 2017
|
March 31, 2017
|
December 31, 2016
|
|
|
|
|
Total Assets
|
49,598
|
47,270
|
47,834
|
|
|
|
|
Total Equity
|
6,711
|
6,728
|
6,634
|
|
|
|
|
Equity attributable to CNH Industrial N.V.
|
6,699
|
6,717
|
6,623
|
|
|
|
|
Net debt
|
(20,301)
|
(20,059)
|
(19,734)
|
|
|
|
|
Of which Net industrial debt(1)
|
(2,132)
|
(2,307)
|
(1,822)
|
|
|
|
|
(1) This item is a non-GAAP financial measure. Refer to the
"Non-GAAP Financial Information" section of this press release for information regarding non-GAAP financial
measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
CNH INDUSTRIAL N.V.
|
Other Supplemental Financial Information
|
(Unaudited)
|
|
CNH INDUSTRIAL
Net income reconciliation U.S. GAAP to EU-IFRS ($
million)
|
|
Six Months Ended June 30,
|
|
Three Months Ended June 30,
|
|
|
|
2017
|
2016
|
|
2017
|
2016
|
|
|
296
|
(384)
|
Net income (loss) in accordance with U.S. GAAP
|
247
|
129
|
|
|
|
|
Adjustments to conform with EU-IFRS:
|
|
|
|
|
(64)
|
(54)
|
Development costs
|
(22)
|
(14)
|
|
|
26
|
26
|
Other adjustments
|
16
|
6
|
|
|
8
|
3
|
Tax impact on adjustments
|
(2)
|
(7)
|
|
|
(9)
|
2
|
Deferred tax assets and tax contingencies recognition
|
(5)
|
9
|
|
|
(39)
|
(23)
|
Total adjustments
|
(13)
|
(6)
|
|
|
257
|
(407)
|
Profit (loss) in accordance with EU-IFRS
|
234
|
123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNH INDUSTRIAL
Total Equity reconciliation U.S. GAAP to EU-IFRS
($ million)
|
|
|
June 30, 2017
|
December 31, 2016
|
|
|
Total Equity under U.S. GAAP
|
4,457
|
4,451
|
|
|
Adjustments to conform with EU-IFRS:
|
|
|
|
|
Development costs
|
2,440
|
2,374
|
|
|
Other adjustments
|
(136)
|
(121)
|
|
|
Tax impact on adjustments
|
(701)
|
(655)
|
|
|
Deferred tax assets and tax contingencies recognition
|
651
|
585
|
|
|
Total adjustments
|
2,254
|
2,183
|
|
|
Total Equity under EU-IFRS
|
6,711
|
6,634
|
|
|
|
|
|
|
|
|
|
Translation of financial statements denominated in a currency other than the U.S. dollar
The principal exchange rates used to translate into U.S. dollars the financial statements prepared in currencies other than the
U.S. dollar were as follows:
|
Six Months Ended June 30, 2017
|
|
At December 31, 2016
|
|
Six Months Ended June 30, 2016
|
|
Average
|
At June 30
|
|
|
|
Average
|
At June 30
|
Euro
|
0.923
|
0.876
|
|
0.949
|
|
0.896
|
0.901
|
Pound sterling
|
0.795
|
0.771
|
|
0.812
|
|
0.698
|
0.744
|
Swiss franc
|
0.994
|
0.958
|
|
1.019
|
|
0.982
|
0.979
|
Polish zloty
|
3.942
|
3.703
|
|
4.184
|
|
3.914
|
3.996
|
Brazilian real
|
3.179
|
3.295
|
|
3.254
|
|
3.701
|
3.233
|
Canadian dollar
|
1.335
|
1.296
|
|
1.346
|
|
1.330
|
1.296
|
Argentine peso
|
15.694
|
16.476
|
|
15.850
|
|
14.314
|
14.951
|
Turkish lira
|
3.637
|
3.517
|
|
3.517
|
|
2.920
|
2.888
|
CNH INDUSTRIAL N.V.
|
Condensed Consolidated Income Statement
|
For The Three Months Ended June 30, 2017 and 2016 and For The Six Months
Ended June 30, 2017 and 2016
|
(Unaudited)
|
|
(EU-IFRS)
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
($ million)
|
2017
|
2016
|
2017
|
2016
|
Net revenues
|
7,094
|
6,886
|
12,923
|
12,361
|
Cost of sales
|
5,778
|
5,606
|
10,636
|
10,142
|
Selling, general and administrative costs
|
558
|
559
|
1,074
|
1,073
|
Research and development costs
|
255
|
245
|
495
|
470
|
Other income/(expenses)
|
(17)
|
(22)
|
(40)
|
(38)
|
TRADING PROFIT/(LOSS)
|
486
|
454
|
678
|
638
|
Gains/(losses) on the disposal of investments
|
-
|
-
|
-
|
-
|
Restructuring costs
|
10
|
10
|
23
|
25
|
Other unusual income/(expenses)(1)
|
-
|
(50)
|
8
|
(554)
|
OPERATING PROFIT/(LOSS)
|
476
|
394
|
663
|
59
|
Financial income/(expenses)(2)
|
(151)
|
(149)
|
(292)
|
(305)
|
Result from investments(3):
|
29
|
(17)
|
48
|
(19)
|
Share of the profit/(loss) of investees accounted for using the equity
method
|
29
|
(17)
|
48
|
(19)
|
Other income/(expenses) from investments
|
-
|
-
|
-
|
-
|
PROFIT/(LOSS) BEFORE TAXES
|
354
|
228
|
419
|
(265)
|
Income tax (expense)
|
(120)
|
(105)
|
(162)
|
(142)
|
PROFIT/(LOSS) FROM CONTINUING OPERATIONS
|
234
|
123
|
257
|
(407)
|
PROFIT/(LOSS) FOR THE PERIOD
|
234
|
123
|
257
|
(407)
|
|
|
|
|
|
PROFIT/(LOSS) FOR THE PERIOD ATTRIBUTABLE TO:
|
|
|
|
|
Owners of the parent
|
229
|
119
|
249
|
(410)
|
Non-controlling interests
|
5
|
4
|
8
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in $)
|
|
|
|
|
BASIC EARNINGS/(LOSS) PER COMMON SHARE
|
0.17
|
0.09
|
0.18
|
(0.30)
|
DILUTED EARNINGS/(LOSS) PER COMMON SHARE
|
0.17
|
0.09
|
0.18
|
(0.30)
|
|
|
Notes:
|
|
(1)
|
In the three and six months ended June 30, 2016, Other unusual
income/(expenses) included the non-recurring charge of $49 million and $551 million, respectively, related to the
European Commission settlement.
|
(2)
|
In the three and six months ended June 30, 2017, Financial
income/(expenses) includes the charge of $17 million related to the early redemption of all outstanding Case New Holland
Industrial Inc. 7⅞ % Senior Notes due 2017.
|
(3)
|
In the three and six months ended June 30, 2016, Result from investments
included a negative impact of $42 million incurred by the joint venture Naveco Ltd due to its exit from a line of
business.
|
|
|
This Condensed Consolidated Income Statement should be read in conjunction
with the Company's Audited Consolidated Financial Statements and Notes for the Year Ended December 31, 2016 included in
the EU Annual Report. This Condensed Consolidated Income Statement represents the consolidation of all CNH Industrial
N.V. subsidiaries.
|
|
|
CNH INDUSTRIAL N.V.
|
Condensed Consolidated Statement of Financial Position
|
As of June 30, 2017 and December 31, 2016
|
(Unaudited)
|
|
(EU-IFRS)
|
|
($ million)
|
|
June 30, 2017
|
December 31, 2016
|
ASSETS
|
|
|
|
Intangible assets
|
|
5,578
|
5,504
|
Property, plant and equipment
|
|
6,636
|
6,278
|
Investments and other financial assets:
|
|
597
|
554
|
Investments accounted for using the equity method
|
|
553
|
505
|
Other investments and financial assets
|
|
44
|
49
|
Leased assets
|
|
1,928
|
1,907
|
Defined benefit plan assets
|
|
5
|
5
|
Deferred tax assets
|
|
994
|
959
|
Total Non-current assets
|
|
15,738
|
15,207
|
Inventories
|
|
7,127
|
5,732
|
Trade receivables
|
|
656
|
623
|
Receivables from financing activities
|
|
18,939
|
18,662
|
Current tax receivables
|
|
258
|
430
|
Other current assets
|
|
1,474
|
1,209
|
Current financial assets:
|
|
88
|
95
|
Current securities
|
|
-
|
-
|
Other financial assets
|
|
88
|
95
|
Cash and cash equivalents
|
|
5,291
|
5,854
|
Total Current assets
|
|
33,833
|
32,605
|
Assets held for sale
|
|
27
|
22
|
TOTAL ASSETS
|
|
49,598
|
47,834
|
EQUITY AND LIABILITIES
|
|
|
|
Issued capital and reserves attributable to owners of the parent
|
|
6,699
|
6,623
|
Non-controlling interests
|
|
12
|
11
|
Total Equity
|
|
6,711
|
6,634
|
Provisions:
|
|
5,972
|
5,687
|
Employee benefits
|
|
2,522
|
2,532
|
Other provisions
|
|
3,450
|
3,155
|
Debt:
|
|
25,586
|
25,434
|
Asset-backed financing
|
|
11,462
|
11,784
|
Other debt
|
|
14,124
|
13,650
|
Other financial liabilities
|
|
94
|
249
|
Trade payables
|
|
6,129
|
5,185
|
Current tax payables
|
|
90
|
229
|
Deferred tax liabilities
|
|
162
|
188
|
Other current liabilities
|
|
4,854
|
4,228
|
Liabilities held for sale
|
|
-
|
-
|
Total Liabilities
|
|
42,887
|
41,200
|
TOTAL EQUITY AND LIABILITIES
|
|
49,598
|
47,834
|
|
|
This Condensed Consolidated Statement of Financial Position should be read
in conjunction with the Company's Audited Consolidated Financial Statements and Notes for the Year Ended December 31,
2016 included in the EU Annual Report. This Condensed Consolidated Statement of Financial Position represents the
consolidation of all CNH Industrial N.V. subsidiaries.
|
|
|
CNH INDUSTRIAL N.V.
|
Condensed Consolidated Statement of Cash Flows
|
For The Six Months Ended June 30, 2017 and 2016
|
(Unaudited)
|
|
(EU-IFRS)
|
|
|
Six Months Ended June 30,
|
($ million)
|
2017
|
2016
|
A) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
5,854
|
6,311
|
B) CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES:
|
|
|
Profit/(loss) for the period
|
257
|
(407)
|
Amortization and depreciation (net of vehicles sold under buy-back
commitments and operating leases)
|
585
|
599
|
(Gains)/losses on disposal of non-current assets (net of vehicles sold
under buy-back commitments)
|
-
|
1
|
Other non-cash items
|
(4)
|
102
|
Loss on repurchase/early redemption of Notes
|
17
|
-
|
Dividends received
|
35
|
57
|
Change in provisions
|
(13)
|
459
|
Change in deferred income taxes
|
(77)
|
32
|
Change in items due to buy-back commitments(1)
|
21
|
84
|
Change in operating lease items(2)
|
10
|
(49)
|
Change in working capital
|
(415)
|
(559)
|
TOTAL
|
416
|
319
|
C) CASH FLOWS FROM/(USED IN) INVESTMENT ACTIVITIES:
|
|
|
Investments in:
|
|
|
Property, plant and equipment and intangible assets (net of vehicles sold
under buy-back commitments and operating leases)
|
(335)
|
(363)
|
Consolidated subsidiaries and other equity investments
|
(4)
|
5
|
Proceeds from the sale of non-current assets (net of vehicles sold under
buy-back commitments)
|
2
|
8
|
Net change in receivables from financing activities
|
176
|
399
|
Change in current securities
|
-
|
16
|
Other changes
|
(105)
|
(144)
|
TOTAL
|
(266)
|
(79)
|
D) CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES:
|
|
|
Bonds issued
|
1,141
|
1,058
|
Repayment of bonds
|
(1,153)
|
(263)
|
Issuance of other medium-term borrowings (net of repayment)
|
(24)
|
(335)
|
Net change in other financial payables and other financial
assets/liabilities
|
(734)
|
(1,076)
|
Capital increase
|
11
|
-
|
Dividends paid
|
(165)
|
(204)
|
(Purchase)/sale of treasury shares
|
(16)
|
(14)
|
(Purchase)/sale of ownership interests in subsidiaries
|
-
|
(44)
|
TOTAL
|
(940)
|
(878)
|
Translation exchange differences
|
227
|
143
|
E) TOTAL CHANGE IN CASH AND CASH EQUIVALENTS
|
(563)
|
(495)
|
F) CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
5,291
|
5,816
|
|
|
|
|
|
|
(1)
|
Cash generated from the sale of vehicles under buy-back commitments, net
of amounts included in Profit/(loss) for the period, is recognized under operating activities in a single line item,
which includes changes in working capital, capital expenditure, depreciation and impairment losses. The item also
includes gains and losses arising from the sale of vehicles subject to buy-back commitments before the end of the
agreement and without repossession of the vehicle.
|
(2)
|
Cash from operating lease is recognized under operating activities in a
single line item, which includes capital expenditure, depreciation, write-downs and changes in inventory.
|
|
|
These Condensed Consolidated Statement of Cash Flows should be read in
conjunction with the Company's Audited Consolidated Financial Statements and Notes for the Year Ended December 31, 2016
included in the EU Annual Report. This Condensed Consolidated Statement of Cash Flows represents the consolidation of all
CNH Industrial N.V. subsidiaries.
|
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SOURCE CNH Industrial N.V.