CNH Industrial closed second quarter with revenues of $7.0 billion, operating profit of Industrial Activities of $401 million, and net income of $122 million

Jul 29, 2015, 07:15 ET from CNH Industrial N.V.

LONDON, July 29, 2015 /PRNewswire/ --

Financial results under U.S. GAAP(*) (**)

  • Second quarter revenues totaled $7.0 billion, down 10% compared to Q2 2014 on a constant currency basis (down 22% on a reported basis). Net sales of Industrial Activities were $6.6 billion, down 10% compared to Q2 2014 on a constant currency basis (down 23% on a reported basis). 
  • Operating profit of Industrial Activities for the quarter was $401 million ($678 million in Q2 2014), with operating margin at 6.0% (7.9% in Q2 2014).
  • Costs for research and development and selling, general and administrative expenses were $851 million in Q2 2015, down $199 million or 19% compared to Q2 2014.
  • Net income was $122 million, or $0.09 per share. Net income before restructuring and other exceptional items was $141 million, or $0.11 per share, down $241 million compared to Q2 2014.
  • Net industrial debt was $3.0 billion at June 30, 2015 ($3.1 billion at March 31, 2015). Available liquidity totaled $7.8 billion ($7.2 billion at March 31, 2015).
  • Full year guidance updated as follows: net sales of Industrial Activities in the range of $26-27 billion, with operating margin of Industrial Activities between 5.6% and 6.0% and net industrial debt at the end of 2015 between $2.0 billion and $2.2 billion.

 

(*)  

CNH Industrial reports quarterly and annual consolidated financial results under U.S. GAAP and IFRS. The following tables and discussion related to the financial results of the Company and its segments are prepared in accordance with U.S. GAAP. Financial results under IFRS are shown in specific tables at the end of this press release.



(**) 

Refer to the Non-GAAP Financial Information section of this press release for information regarding non-GAAP financial measures.

 




CNH INDUSTRIAL

Summary Income Statement   ($ million)




1st Half




2nd Quarter



2015

2014

Change


2015

2014

Change



12,918

16,451

-21.5%

Revenues

6,958

8,911

-21.9%



145

459

-314

Net income

122

358

-236



174

559

-385

Net income before restructuring and other exceptional items (1)

141

382

-241



146

454

-308

Net income attributable to CNH Industrial N.V.

124

354

-230












0.11

0.33

-0.22

Basic EPS ($)

0.09

0.26

-0.17



0.11

0.33

-0.22

Diluted EPS ($)

0.09

0.26

-0.17



0.13

0.41

-0.28

Basic EPS before restructuring and other exceptional items (1) ($)

0.11

0.28

-0.17



(1)   This item is a non-GAAP measure. Refer to the Non-GAAP Financial Information section of this press release for information regarding non GAAP financial measures.











 



CNH INDUSTRIAL

Income Statement Data of Industrial Activities(1)   ($ million)




1st Half




2nd Quarter



2015

2014

Change


2015

2014

Change



12,259

15,777

-22.3%

Net sales of Industrial Activities

6,634

8,564

-22.5%



624

1,090

-466

Operating profit of Industrial Activities (2)

401

678

-277



5.1

6.9

-1.8 p.p.

Operating margin of Industrial Activities (%)

6.0

7.9

-1.9 p.p.



(1)   Industrial Activities represent the activities carried out by the four industrial segments: Agricultural Equipment, Construction Equipment, Commercial Vehicles, and Powertrain, as well as Corporate functions.

(2)   Operating profit of Industrial Activities is a non-GAAP measure and is defined as net sales less cost of goods sold, selling, general and administrative expenses, and research and development expenses. 



















CNH Industrial N.V. (NYSE: CNHI / MI:CNHI) today announced consolidated revenues of $6,958 million for the second quarter of 2015, down 10.0% compared to Q2 2014 on a constant currency basis (21.9% on a reported basis). Net sales of Industrial Activities were $6,634 million in Q2 2015, down 10.0% compared to Q2 2014 on a constant currency basis (22.5% on a reported basis). Excluding the negative impact of currency translation, net sales increased for Commercial Vehicles (up 11.9%) confirming a positive trend in EMEA for trucks and buses. This increase was more than offset by the forecasted protracted decline in Agricultural Equipment, driven by lower industry volumes in the row crop sector and dealer inventory de-stocking actions, primarily in NAFTA, slightly offset by favorable net pricing in all regions. Furthermore, net sales decreased in Construction Equipment, due to negative industry volumes primarily in LATAM, and in Powertrain, due to lower sales to captive customers.

 

CNH INDUSTRIAL

Revenues by Segment    ($ million)

1st Half

2nd Quarter

2015

2014

% change

2015

2014

% change

5,612

8,142

-31.1

Agricultural Equipment

3,035

4,436

-31.6

1,342

1,705

-21.3

Construction Equipment

740

931

-20.5

4,507

5,012

-10.1

Commercial Vehicles

2,470

2,704

-8.7

1,848

2,451

-24.6

Powertrain

947

1,250

-24.2

(1,050)

(1,533)

-

Eliminations and other

(558)

(757)

-

12,259

15,777

-22.3

Total Industrial Activities

6,634

8,564

-22.5

836

908

-7.9

Financial Services

423

468

-9.6

(177)

(234)

-

Eliminations and other

(99)

(121)

-

12,918

16,451

-21.5

Total

6,958

8,911

-21.9

 

Operating profit of Industrial Activities was $401 million in Q2 2015, a $257 million decrease compared to Q2 2014 on a constant currency basis (down $277 million on a reported basis), with an operating margin for the second quarter of 6.0%, down 1.9 p.p. compared to Q2 2014. Operating profit declined in Agricultural Equipment, driven by negative volume and product mix in the row crop sector, primarily in NAFTA, and negative foreign exchange impacts, primarily resulting from the weakening of the euro and the Brazilian real. These negative factors were partially offset by positive net pricing, and cost control actions including purchasing efficiencies and structural cost reductions. Commercial Vehicles' operating result improved due to favorable volume, product and market mix, and pricing, as well as manufacturing efficiencies and cost reductions in selling, general and administrative ("SG&A") expenses. Construction Equipment's operating profit improved as cost containment actions more than offset the negative impact from lower volume in LATAM, primarily in Brazil. Net of the negative impact of currency translation, Powertrain's operating profit was substantially flat, as a result of lower volumes offset by favorable product mix and manufacturing efficiencies.

CNH INDUSTRIAL

Operating profit/(loss) by Segment (1)   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

467

1,096

-629

Agricultural Equipment

263

632

-369

35

31

4

Construction Equipment

35

28

7

68

(91)

159

Commercial Vehicles

67

(21)

88

89

98

-9

Powertrain

53

64

-11

(35)

(44)

9

Eliminations and other

(17)

(25)

8

624

1,090

-466

Total Industrial Activities

401

678

-277

269

286

-17

Financial Services

140

152

-12

(142)

(174)

32

Eliminations and other

(74)

(94)

20

751

1,202

-451

Total

467

736

-269

(1)       Operating profit of Industrial Activities (a non-GAAP 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 measure) is defined as revenues less selling, general and administrative expenses, interest expense and certain other operating expenses.

 

CNH INDUSTRIAL

Reconciliation of Operating Profit to Net Income   ($ million)

1st Half

2nd Quarter

2015

2014

2015

2014

751

1,202

Total Operating Profit

467

736

34

42

Restructuring expenses

22

30

223

299

Interest expenses of Industrial Activities, net of interest income and eliminations

117

158

(168)

(157)

Other, net

(93)

(63)

326

704

Income before income taxes and equity in income of unconsolidated subsidiaries and affiliates

235

485

203

301

Income taxes

126

158

22

56

Equity in income of unconsolidated subsidiaries and affiliates

13

31

145

459

Net income

122

358

 

Restructuring expenses totaled $22 million for the quarter, $8 million lower than Q2 2014, and mainly relate to actions in Commercial Vehicles and Agricultural Equipment as part of the Company's Efficiency Program launched in 2014.

Interest expense, net totaled $117 million for the quarter, a decrease of $41 million or 26% compared to Q2 2014, primarily due to a more favorable cost of funding and a lower average indebtedness in the quarter.

Other, net was a charge of $93 million for the quarter, an increase of $30 million compared to Q2 2014 mainly as a result of higher foreign exchange losses.

Income taxes totaled $126 million, representing an effective tax rate of 53.6% for the quarter (32.6% in Q2 2014, which had been impacted by certain discrete tax benefits as a result of the favorable resolution of tax audits). The Q2 2015 tax rate is negatively impacted by the inability to record deferred tax assets on losses in certain jurisdictions. The Company's effective tax rate for the full year is expected now to be in the range of 48% to 52%. Nonetheless, the long-term effective tax rate target of between 34% to 36% range remains unchanged.

Equity in income of unconsolidated subsidiaries and affiliates totaled $13 million for the quarter ($31 million for Q2 2014). The decrease was mainly due to lower results of joint ventures in APAC.

Net income of Financial Services was $98 million for the quarter compared to $105 million for Q2 2014, mainly due to the negative impact of currency translation partially offset by a reduction in SG&A expenses.

Consolidated net income was $122 million for the quarter ($358 million for Q2 2014), or $0.09 per share ($0.26 for Q2 2014). Net income before restructuring and other exceptional items was $141 million for the quarter ($382 million in Q2 2014) or $0.11 per share ($0.28 for Q2 2014).

Net industrial debt was $3.0 billion at June 30, 2015 ($3.1 billion at March 31, 2015 and $2.7 billion at December 31, 2014). Net industrial cash flow generation of $0.5 billion in the second quarter 2015 was primarily attributable to a reduction in working capital as a result of inventory reduction actions in Agricultural Equipment and the increase in demand for Commercial Vehicles in EMEA. The change in net industrial debt in the second quarter includes $0.3 billion in dividends paid to shareholders in April 2015 and an unfavorable foreign exchange impact on euro denominated debt.

Available liquidity at June 30, 2015 was $7.8 billion, inclusive of $2.8 billion in undrawn committed facilities, $0.6 billion higher than March 31, 2015, mainly due to the new CNH Industrial Capital LLC $0.6 billion three-year bond issuance and positive cash-flow from operating activities that more than offset bank debt reduction and dividend distribution.

Agricultural Equipment

AGRICULTURAL EQUIPMENT

Net sales & Operating profit/(loss)   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

5,612

8,142

-31.1%

Net sales

3,035

4,436

-31.6%

467

1,096

-629

Operating profit

263

632

-369

8.3

13.5

-5.2 p.p.

Operating margin (%)

8.7

14.2

-5.5 p.p.

 

Agricultural Equipment's net sales were $3,035 million for the quarter, down 23.7% compared to Q2 2014 on a constant currency basis (down 31.6% on a reported basis). The decrease was driven by the  anticipated decline in industry volumes in the row crop sector and dealer inventory de-stocking actions, primarily in NAFTA, slightly offset by favorable net pricing in all regions. The geographic distribution of net sales for the period was 38% NAFTA, 39% EMEA, 10% LATAM and 13% APAC.

In the Company's key product segments in NAFTA, the over 140 horsepower ("hp") tractor segment as well as the combine segment were down 31%. The under 40 hp tractor segment in the region was up 5%, and the 40-140 hp tractor segment was up 2%. EMEA markets were down 7% for tractors and 9% for combines. In LATAM, tractor and combine markets decreased 26% and 19%, respectively. APAC markets decreased 3% for tractors and 17% for combines. Worldwide agricultural equipment industry unit sales were down 4% for tractors and down 17% for combines.

The Company's market share performance in Agricultural Equipment was mixed in the second quarter. Tractor market share improved in all markets, most significantly in the higher horsepower tractor segment in NAFTA, while market share declined in the under 40 hp tractor segment in NAFTA. For combines, market share decreased in all regions, after a strong performance in Q1 2015. For the six-month period, the Company's market share was generally up in both tractors and combines.

In Q2 2015, Agricultural Equipment's worldwide unit production was 14% below retail sales in the continued effort to reduce channel inventory and align production with current demand. The finished goods inventory for the Company and its dealers declined approximately a combined $700 million since Q2 2014, and current production levels are expected to further drive down total inventory levels in the second half of 2015.

Agricultural Equipment's operating profit was $263 million for the quarter ($632 million in Q2 2014), with an operating margin of 8.7% (14.2 % in Q2 2014). The year-over-year change was driven by lower sales volume and less favorable product mix in the row crop sector, primarily in NAFTA, and by negative foreign exchange impacts, primarily as a result of the sharp weakening of the euro and the Brazilian real. Those effects were slightly offset by positive net pricing and cost control actions, including purchasing efficiencies and structural cost reductions.

Construction Equipment

CONSTRUCTION EQUIPMENT

Net sales & Operating profit/(loss)   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

1,342

1,705

-21.3%

Net sales

740

931

-20.5%

35

31

4

Operating profit

35

28

7

2.6

1.8

0.8 p.p.

Operating margin (%)

4.7

3.0

1.7 p.p.

 

Construction Equipment's net sales were $740 million for the quarter, down 14.8% compared to Q2 2014 on a constant currency basis (down 20.5% on a reported basis), due to negative industry volumes primarily in LATAM. The geographic distribution of net sales for the period was 58% NAFTA, 20% EMEA, 12% LATAM and 10% APAC.

In Q2 2015, Construction Equipment's worldwide heavy and light industry sales were down 18% and 1%, respectively. Industry light equipment sales were up in NAFTA and EMEA, but down in LATAM and APAC. Industry heavy equipment sales decreased in all regions, primarily in LATAM and APAC.

Construction Equipment's worldwide market share was mainly in line with prior year for both heavy and light construction equipment in all regions except for LATAM, where municipality-driven demand declined significantly as infrastructure investments, where the Company has a significant position, slowed.

Construction Equipment's worldwide production levels were 16% above retail sales in the quarter to accommodate seasonal shutdowns scheduled for the third quarter in NAFTA and EMEA.

Construction Equipment reported operating profit of $35 million for the second quarter compared to $28 million for Q2 2014. Operating margin increased 1.7 p.p. to 4.7% (3.0% in Q2 2014), as cost containment actions more than offset the negative impact from lower volume in LATAM, primarily in Brazil.

Commercial Vehicles

COMMERCIAL VEHICLES

Net sales & Operating profit/(loss)   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

4,507

5,012

-10.1%

Net sales

2,470

2,704

-8.7%

68

(91)

159

Operating profit/(loss)

67

(21)

88

1.5

(1.8)

3.3 p.p.

Operating margin (%)

2.7

(0.8)

3.5 p.p.

 

Commercial Vehicles' net sales were $2,470 million for the quarter, up 11.9% compared to Q2 2014 on a constant currency basis (down 8.7% on a reported basis), confirming a positive trend in EMEA for trucks and buses. In APAC, net sales increased mainly driven by positive performance of buses, while trucks' performance was affected by the market decline in Russia. In LATAM, net sales decreased mainly due to a further decline in the Brazilian market for heavy trucks, partially offset by a modest market recovery in Argentina. The geographic distribution of net sales for the period was 77% EMEA, 14% LATAM and 9% APAC.

The European truck market (GVW ≥3.5 tons) was up 17.4% compared to Q2 2014. The light vehicle market (GVW 3.5-6.0 tons) increased 15.2%, the medium vehicle market (GVW 6.1-15.9 tons) increased 6.3% and the heavy vehicle market (GVW >16 tons) increased 24.1%. In LATAM, new truck registrations (GVW ≥3.5 tons), declined 35.2% compared to Q2 2014, with a decrease of 44.3% in Brazil and 26.3% in Venezuela, while Argentina increased by 26.1%. In APAC registrations declined 6.3%.

In Q2 2015, the Company's market share in the European truck market (GVW ≥3.5 tons) was 11.5%, up 0.6 p.p. compared with Q2 2014. The Company's market share in LATAM was 12.5%, up 3.2 p.p. compared to Q2 2014.

Commercial Vehicles delivered approximately 37,800 vehicles (including buses and specialty vehicles) in the quarter, representing a 14% increase compared to Q2 2014. Volumes were higher in all segments, with light up 14%, medium up 18% and heavy up 7%. Commercial Vehicles' deliveries increased 22% in EMEA, while LATAM and APAC were down 8% and 17%, respectively.

Commercial Vehicles' Q2 2015 ending book-to-bill ratio was 1.06, an increase of 17% over Q2 2014. Second quarter 2015 truck order intake in EMEA increased 49% compared to Q2 2014, with a 62% increase in heavy trucks in Europe.

Commercial Vehicles closed the second quarter with an operating profit of $67 million compared to a loss of $21 million for Q2 2014 (up $89 million on a constant currency basis), with an operating margin of 2.7% (negative margin of 0.8% in Q2 2014), as a result of higher volume, better product and market mix, positive pricing, manufacturing efficiencies and SG&A expense reductions. In EMEA, the increase in operating profit is mainly attributable to trucks and buses. Results in APAC were substantially flat compared to Q2 2014. LATAM, despite the significant negative market trend in Brazil, was able to reduce its cost base to partially offset the negative impact of reduced wholesale volumes. Furthermore, LATAM performance was positively impacted by a modest improvement in Argentina and a recovery of Company's activity in Venezuela. However, the continuing economic uncertainty in Venezuela, including changes to government currency control mechanisms, may substantially impact Venezuelan operations in the future. CNH Industrial will continue to closely monitor these developments.

Powertrain

POWERTRAIN

Net sales & Operating profit/(loss)   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

1,848

2,451

-24.6%

Net sales

947

1,250

-24.2%

89

98

-9

Operating profit

53

64

-11

4.8

4.0

0.8 p.p.

Operating margin (%)

5.6

5.1

0.5 p.p.

 

Powertrain's net sales were $947 million for the quarter, a decrease of 6.9% compared to Q2 2014 on a constant currency basis (down 24.2% on a reported basis), on lower volumes mainly in the captive portion of the business as a result of decreased agricultural equipment demand and the 2014 build-up of Tier 4 final transition engine inventory for the off-road segment. Sales to external customers accounted for 42% of total net sales (41% in Q2 2014).

During the quarter, Powertrain sold approximately 134,800 engines, a decrease of 16% compared to Q2 2014. By major customer, 10% of engine units were supplied to Agricultural Equipment, 35% to Commercial Vehicles, 4% to Construction Equipment and the remaining 51% to external customers. Additionally, Powertrain delivered approximately 20,900 transmissions and 51,800 axles, an increase of 14% and 17%, respectively, compared to Q2 2014.

Powertrain's operating profit was $53 million for the quarter, down $11 million compared to Q2 2014, with an operating margin of 5.6% (up 0.5 p.p. compared to Q2 2014). Net of the negative impact of currency translation, operating profit was substantially flat, as a result of lower volumes offset by favorable product mix and manufacturing efficiencies.

Financial Services

FINANCIAL SERVICES

Revenues & Net income   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

836

908

-7.9%

Revenues

423

468

-9.6%

183

191

-8

Net income

98

105

-7

 

Financial Services' revenues were $423 million for the quarter, an increase of 2.5% compared to Q2 2014 on a constant currency basis (down 9.6% on a reported basis), due to the geographical mix of the portfolio.

Financial Services' net income was $98 million, down $7 million compared to Q2 2014, as the negative impact of currency translation was partially offset by reduced SG&A expenses.

Retail loan originations in the quarter were $2.4 billion, down $0.4 billion compared to Q2 2014, mostly due to the decline in Agricultural Equipment sales. The managed portfolio (including unconsolidated joint ventures) of $25.4 billion as of June 30, 2015 (of which retail was 65% and wholesale 35%) was up $0.2 billion compared to March 31, 2015. Excluding the impact of currency translation, the portfolio decreased $0.2 billion, primarily in LATAM (retail and wholesale).

2015 U.S. GAAP Guidance

As a result of continued demand weakness in the agricultural row crop sector and in order to foster additional clearing of finished goods inventory, primarily in the North American and LATAM markets, the Company will adjust production accordingly in the second half of 2015.

Full year guidance is therefore updated as follows to reflect the negative impact on operating margin and the positive impact on working capital due to these production adjustments:

  • Net sales of Industrial Activities in the range of $26-27 billion, with an operating margin of Industrial Activities between 5.6% and 6.0%;
  • Net industrial debt at the end of 2015 between $2.0 billion and $2.2 billion.

 

Sergio Marchionne

Richard Tobin

Chairman

Chief Executive Officer

 

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 Company's individual brands 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, transmissions and axles. More information can be found on the corporate website: www.cnhindustrial.com

Additional Information

Today, at 3:00 p.m. CET / 2:00 p.m. GMT / 9:00 a.m. EDT, management will hold a conference call to present 2015 second quarter and first half results to financial analysts and institutional investors. The call can be followed live online at: http://bit.ly/1fF2LU3 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 believes that these non-GAAP financial measures provide useful and relevant information regarding its results and enhance the reader's ability to assess CNH Industrial's financial performance and financial position. They provide measures which facilitate management's ability to identify operational trends, as well as make decisions regarding future spending, resource allocations and other operational decisions. These and similar measures are widely used in the industries in which the Company operates. These financial measures may not be comparable to other similarly titled measures used by other companies and are not intended to be substitutes for measures of financial performance and financial position prepared in accordance with U.S. GAAP and/or 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 expenses and certain other operating expenses.
  • Trading Profit under IFRS: Trading Profit is derived from financial information prepared in accordance with IFRS and is defined as income before restructuring, gains/(losses) on disposal of investments and other unusual items, interest expense of Industrial Activities, income taxes, equity in income (loss) of unconsolidated subsidiaries and affiliates, non-controlling interests.
  • Operating Profit under IFRS: Operating Profit under IFRS is computed starting from Trading Profit under 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).
  • Net income (loss) before restructuring and other exceptional items: is defined as Net income (loss), less restructuring charges and exceptional items, after tax.
  • Net Debt and Net Debt of Industrial Activities (or Net Industrial 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.
  • Working capital: is defined as trade receivables and financing receivables related to sales, net, plus inventories, less trade payables, plus other assets (liabilities), net.
  • Constant currency: CNH Industrial discusses the fluctuations in revenues and certain non-GAAP financial measures on a constant currency basis by applying the prior-year exchange rates to current year's values expressed in local currency in order to eliminate the impact of foreign exchange rate fluctuations.

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 the Company's 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 including, 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 the Company's 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 the Company competes; development and use of new technologies and technological difficulties; compliance requirements (including engine emissions legislation and/or regulations); 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; the Company's ability to obtain financing or to refinance existing debt; a decline in the price of used vehicles; the resolution of pending litigation and investigations; the evolution of the Company's alliance with Kobelco Construction Machinery Co., Ltd. and Sumitomo (S.H.I.) Construction Machinery Co., Ltd.; the Company's 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 and other similar risks and uncertainties; and the Company's 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, 2014, prepared in accordance with U.S. GAAP and in our EU Annual Report at December 31, 2014, prepared in accordance with 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 CNH Industrial operates, it is particularly difficult to forecast results, and any estimates or forecasts of particular periods that are provided in this earnings release are uncertain. Accordingly, investors should not place undue reliance on such forward-looking statements. The Company can give no assurance that the expectations reflected in any forward-looking statements will prove to be correct. Actual results could differ materially from those anticipated in such forward-looking statements. The Company's 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. The Company undertakes no obligation to update or revise publicly its outlook or forward-looking statements, whether as a result of new developments or otherwise. Further information concerning the Company and its businesses, including factors that potentially could materially affect the Company's financial results, is included in the Company'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 the Company or persons acting on Company's behalf are expressly qualified in their entirety by the cautionary statements contained herein or referred to above.

Contacts

Media Inquiries

Investor Relations

Richard Gadeselli

Federico Donati

Tel: +44 207 7660 346

Tel: +39 011 00 62756

Laura Overall

Noah Weiss

Tel: +44 207 7660 346

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, 2015 and 2014 and For The Six Months Ended June 30, 2015 and 2014

(Unaudited)

(U.S. GAAP)

($ million)

Three Months Ended June 30,

Six Months Ended June 30,

2015

2014

2015

2014

Revenues

Net sales

6,634

8,564

12,259

15,775

Finance and interest income

324

347

659

676

TOTAL REVENUES

6,958

8,911

12,918

16,451

Costs and Expenses

Cost of goods sold

5,456

6,922

10,172

12,799

Selling, general and administrative expenses

626

752

1,193

1,504

Research and development expenses

225

298

415

555

Restructuring expenses

22

30

34

42

Interest expense

282

338

566

649

Other, net

112

86

212

198

TOTAL COSTS AND EXPENSES

6,723

8,426

12,592

15,747

INCOME BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES

235

485

326

704

Income taxes

126

158

203

301

Equity in income of unconsolidated subsidiaries and affiliates

13

31

22

56

NET INCOME

122

358

145

459

Net income attributable to noncontrolling interests

(2)

4

(1)

5

NET INCOME ATTRIBUTABLE TO CNH INDUSTRIAL N.V.

124

354

146

454

(in $)

Earnings per share attributable to common shareholders

Basic

0.09

0.26

0.11

0.33

Diluted

0.09

0.26

0.11

0.33

 

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, 2014 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, 2015 and December 31, 2014

(Unaudited)

(U.S. GAAP)

($ million)

June 30, 2015

December 31, 2014

ASSETS

Cash and cash equivalents

4,235

5,163

Restricted cash

749

978

Trade receivables, net

833

1,054

Financing receivables, net

20,126

21,472

Inventories, net

7,220

7,008

Property, plant and equipment, net

6,443

6,865

Investments in unconsolidated subsidiaries and affiliates

574

605

Equipment under operating leases

1,712

1,518

Goodwill

2,466

2,484

Other intangible assets, net

807

850

Deferred tax assets

1,564

1,747

Derivative assets

179

205

Other assets

2,022

1,964

TOTAL ASSETS

48,930

51,913

LIABILITIES AND EQUITY

Debt

27,340

29,594

Trade payables

5,944

5,982

Deferred tax liabilities

468

452

Pension, postretirement and other postemployment benefits

2,511

2,614

Derivative liabilities

164

235

Other liabilities

7,647

8,059

Total liabilities

44,074

46,936

Redeemable noncontrolling interest

18

16

Equity

4,838

4,961

TOTAL EQUITY AND LIABILITIES

48,930

51,913

 

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, 2014 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, 2015 and 2014

(Unaudited)

(U.S. GAAP)

($ million)

Six Months Ended June 30,

2015

2014

Operating activities:

Net income

145

459

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation and amortization expense, net of assets under operating lease and assets sold under buy-back commitments

349

360

Depreciation and amortization expense of assets under operating lease and assets sold under buy-back commitments

195

196

Loss from disposal of assets

3

1

Undistributed income of unconsolidated subsidiaries

16

4

Other noncash items

97

88

Changes in operating assets and liabilities:

Provisions

(42)

193

Deferred income taxes

42

(38)

Trade and financing receivables related to sales, net

94

(1,317)

Inventories, net

(694)

(1,380)

Trade payables

301

(271)

Other assets and liabilities

(90)

126

NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES

416

(1,579)

Investing activities:

Net collections of retail receivables

414

202

Proceeds from the sale of assets, net of assets under operating leases and assets sold under buy-back commitments

2

10

Proceeds from the sale of assets previously under operating leases and assets sold under buy-back commitments

360

268

Expenditures for property, plant and equipment and intangible assets, net of assets under operating lease and assets sold under buy-back commitments

(224)

(354)

Expenditures for assets under operating leases and assets sold under buy-back commitments

(856)

(773)

Other

413

292

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

109

(355)

Financing activities:

Net increase (decrease) in debt

(822)

1,326

Dividends paid

(294)

(379)

Other

17

6

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES

(1,099)

953

Effect of foreign exchange rate changes on cash and cash equivalents

(354)

29

DECREASE IN CASH AND CASH EQUIVALENTS

(928)

(952)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

5,163

5,567

CASH AND CASH EQUIVALENTS, END OF PERIOD

4,235

4,615

 

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, 2014 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, 2015 and 2014 and For The Six Months Ended June 30, 2015 and 2014

(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,

2015

2014

2015

2014

2015

2014

2015

2014

Revenues

Net sales

6,634

8,564

12,259

15,777

-

-

-

-

Finance and interest income

59

66

130

126

423

468

836

908

TOTAL REVENUES

6,693

8,630

12,389

15,903

423

468

836

908

Costs and Expenses

Cost of goods sold

5,456

6,922

10,172

12,801

-

-

-

-

Selling, general and administrative expenses

552

666

1,048

1,331

74

86

145

173

Research and development expenses

225

298

415

555

-

-

-

-

Restructuring expenses

21

30

33

42

1

-

1

-

Interest expense

175

224

349

419

151

178

307

350

Interest compensation to Financial Services

75

94

146

180

-

-

-

-

Other, net

91

58

164

147

60

57

119

109

TOTAL COSTS AND EXPENSES

6,595

8,292

12,327

15,475

286

321

572

632

INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES

98

338

62

428

137

147

264

276

Income taxes

82

111

112

206

44

47

91

95

Equity in income of unconsolidated subsidiaries and affiliates

8

27

12

48

5

4

10

8

Result from intersegment investments

98

104

183

189

-

1

-

2

NET INCOME

122

358

145

459

98

105

183

191

 

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, 2015 and December 31, 2014

(Unaudited)

(U.S. GAAP)

Industrial Activities

Financial Services

($ million)

June 30, 2015

December 31, 2014

June 30, 2015

December 31, 2014

ASSETS

Cash and cash equivalents

3,109

4,122

1,126

1,041

Restricted cash

22

1

727

977

Trade receivables

813

1,025

49

92

Financing receivables

2,746

4,767

20,883

22,717

Inventories, net

7,019

6,845

201

163

Property, plant and equipment, net

6,441

6,862

2

3

Investments in unconsolidated subsidiaries and affiliates

3,018

3,063

128

136

Equipment under operating leases

12

20

1,700

1,498

Goodwill

2,312

2,324

154

160

Other intangible assets, net

788

828

19

22

Deferred tax assets

1,359

1,508

205

239

Derivative assets

174

198

6

9

Other assets

1,744

1,502

501

781

TOTAL ASSETS

29,557

33,065

25,701

27,838

LIABILITIES AND EQUITY

Debt

8,844

11,520

21,999

24,086

Trade payables

5,815

5,850

176

197

Deferred tax liabilities

182

202

286

250

Pension, postretirement and other post-employment benefits

2,483

2,594

28

20

Derivative liability

154

221

11

16

Other liabilities

7,223

7,701

629

675

Total liabilities

24,701

28,088

23,129

25,244

Equity

4,838

4,961

2,572

2,594

Redeemable noncontrolling interest

18

16

-

-

TOTAL EQUITY AND LIABILITIES

29,557

33,065

25,701

27,838

 

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, 2015 and 2014

(Unaudited)

(U.S. GAAP)

Industrial Activities

Financial Services

($ million)

Six Months Ended

June 30,

Six Months Ended

June 30,

2015

2014

2015

2014

Operating activities:

Net income

145

459

183

191

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation and amortization expense, net of assets under operating lease and assets sold under buy-back commitments

346

358

3

2

Depreciation and amortization expense of assets under operating lease and assets sold under buy-back commitments

98

125

97

71

Loss from disposal of assets

3

-

-

1

Undistributed income (loss) of unconsolidated subsidiaries

(125)

(87)

(6)

(10)

Other non-cash items

38

27

59

61

Changes in operating assets and liabilities:

Provisions

(45)

165

3

28

Deferred income taxes

(4)

(29)

46

(9)

Trade and financing receivables related to sales, net

164

84

(43)

(1,413)

Inventories, net

(655)

(1,384)

(39)

4

Trade payables

315

(174)

(24)

(84)

Other assets and liabilities

(351)

(147)

244

272

NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES

(71)

(603)

523

(886)

Investing activities:

Net collections of retail receivables

-

-

414

202

Proceeds from sale of assets, net of assets sold under operating leases and assets sold under buy-back commitments

2

10

-

-

Proceeds from sale of assets under operating leases and assets sold under buy-back commitments

162

138

198

130

Expenditures for property, plant and equipment and intangible assets, net of assets under operating lease and assets sold under buy-back commitments

(224)

(342)

-

(12)

Expenditures for assets under operating lease and assets sold under buy-back commitments

(341)

(372)

(515)

(401)

Other

1,478

96

(1,044)

182

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

1,077

(470)

(947)

101

Financing activities:

Net increase (decrease) in debt

(1,466)

1,124

644

202

Dividends paid

(294)

(379)

(36)

(90)

Other

17

6

(21)

14

NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES

(1,743)

751

587

126

Effect of foreign exchange rate changes on cash and cash equivalents

(276)

11

(78)

18

(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

(1,013)

(311)

85

(641)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

4,122

4,010

1,041

1,557

CASH AND CASH EQUIVALENTS, END OF PERIOD

3,109

3,699

1,126

916

 

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)

(U.S. GAAP)

CNH INDUSTRIAL Net debt    ($ million)

June 30, 2015

March 31, 2015

December 31, 2014

Total debt (1)

(27,340)

(26,639)

(29,594)

- Asset-backed financing

(12,710)

(12,501)

(13,587)

- Other debt

(14,630)

(14,138)

(16,007)

Derivative hedging debt

35

39

35

Cash and cash equivalents

4,235

3,698

5,163

Restricted cash

749

817

978

Net debt (2)

(22,321)

(22,085)

(23,418)

Of which :    Industrial Activities

(3,016)

(3,051)

(2,691)

Financial Services

(19,305)

(19,034)

(20,727)

Cash, cash equivalents and restricted cash

4,984

4,515

6,141

Undrawn committed facilities

2,845

2,674

2,716

Available liquidity

7,829

7,189

8,857

(1)   Inclusive of adjustments to fair value hedges.

(2)   Net Debt is a non-GAAP measure. Refer to the Non-GAAP Financial Information section of this press release for information regarding non-GAAP financial measures.

 

CNH INDUSTRIAL Change in Net Industrial Debt    ($ million)

1st Half

2nd Quarter

2015

2014

2015

2014

(2,691)

(2,214)

Net industrial (debt)/cash at beginning of period

(3,051)

(4,024)

145

459

Net income

122

358

346

358

Amortization and depreciation (*)

174

183

(116)

87

Changes in provisions and similar, and items related to assets sold under buy-back commitments, and assets under operating lease

(61)

24

(626)

(1,744)

Change in working capital

413

267

(224)

(342)

Investments in property, plant and equipment, and intangible assets (*)

(136)

(200)

2

24

Other changes

7

4

(473)

(1,158)

Net industrial cash flow (1)

519

636

(277)

(373)

Capital increases and dividends

(279)

(374)

425

53

Currency translation differences

(205)

70

(325)

(1,478)

Change in Net industrial debt

35

332

(3,016)

(3,692)

Net industrial (debt)/cash at end of period

(3,016)

(3,692)

(*)     Excluding assets sold under buy-back commitments and assets under operating lease.

(1)   This item is a non-GAAP 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)

(U.S. GAAP)

CNH INDUSTRIAL Net Income and basic EPS before Restructuring and Exceptional Items ($ million, except per share data)

Six Months Ended June 30,

Three Months Ended June 30,

2015

2014

2015

2014

145

459

Net income

122

358

29

36

Restructuring expenses, net of tax

19

24

-

64

Other exceptional items, net of tax

-

-

174

559

Net income before restructuring and other exceptional items

141

382

175

554

Net income before restructuring and other exceptional items attributable to CNH Industrial N.V.

143

378

1,360

1,353

Weighted average shares outstanding (million)

1,361

1,354

0.13

0.41

Basic EPS before restructuring and exceptional items ($)

0.11

0.28

 

(U.S. GAAP)

CNH INDUSTRIAL Industrial Activities Cash Provided (Used) by Working Capital   ($ million)

Balance as of June 30, 2015

Balance as of March 31, 2015

Differences

Of which:

effect of Foreign Currency Translation and Non-Cash Transactions

Cash Provided (Used) by Working Capital

Trade and financing receivables related to sales, net

872

836

(36)

(22)

(14)

Inventories, net

7,019

6,939

(80)

(172)

92

Trade payables

(5,815)

(5,385)

430

121

309

Other assets and liabilities, net

(190)

(176)

14

(12)

26

Working capital (1)

1,886

2,214

328

(85)

413

(1)   This item is a non-GAAP measure. Refer to the Non-GAAP Financial Information section of this press release for information regarding non GAAP financial measures.

 

(U.S. GAAP)

CNH INDUSTRIAL Industrial Activities Cash Provided (Used) by Working Capital   ($ million)

Balance as of June 30, 2015

Balance as of December 31, 2014

Differences

Of which:

effect of Foreign Currency Translation and Non-Cash Transactions

Cash Provided (Used) by Working Capital

Trade and financing receivables related to sales, net

872

1,096

224

60

164

Inventories, net

7,019

6,845

(174)

472

(646)

Trade payables

(5,815)

(5,850)

(35)

(350)

315

Other assets and liabilities, net

(190)

(674)

(484)

(25)

(459)

Working capital

1,886

1,417

(469)

157

(626)

 

CNH INDUSTRIAL N.V.

Condensed Consolidated Income Statement

For The Three Months Ended June 30, 2015 and 2014 and For The Six Months Ended June 30, 2015 and 2014

(Unaudited)

(IFRS)

($ million)

2nd Quarter 2015

2nd Quarter 2014

1st Half 2015

1st Half 2014

Net revenues

7,060

9,008

13,127

16,652

Cost of sales

5,770

7,249

10,817

13,438

Selling, general and administrative costs

590

719

1,129

1,438

Research and development costs

212

220

415

428

Other income/(expenses)

(31)

(19)

(42)

(37)

TRADING PROFIT/(LOSS)

457

801

724

1,311

Gains/(losses) on the disposal of investments

-

-

-

-

Restructuring costs

23

35

32

65

Other unusual income/(expenses)

(11)

(10)

(11)

(10)

OPERATING PROFIT/(LOSS)

423

756

681

1,236

Financial income/(expenses)

(157)

(179)

(312)

(394)

Result from investments:

16

30

26

56

Share of the profit/(loss) of investees accounted for using the equity method

16

30

28

56

Other income/(expenses) from investments

-

-

(2)

-

PROFIT/(LOSS) BEFORE TAXES

282

607

395

898

Income taxes

105

204

188

349

PROFIT/(LOSS) FROM CONTINUING OPERATIONS

177

403

207

549

Profit/(loss) from discontinued operations

-

-

-

-

PROFIT/(LOSS) FOR THE PERIOD

177

403

207

549

PROFIT/(LOSS) FOR THE PERIOD ATTRIBUTABLE TO:

Owners of the parent

178

399

206

544

Non-controlling interests

(1)

4

1

5

(in $)

BASIC EARNINGS/(LOSS) PER COMMON SHARE

0.13

0.29

0.15

0.40

DILUTED EARNINGS/(LOSS) PER COMMON SHARE

0.13

0.29

0.15

0.40

 

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, 2014 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, 2015 and December 31, 2014

(Unaudited)

(IFRS)

($ million)

June 30, 2015

December 31, 2014

ASSETS

Intangible assets

5,811

6,031

Property, plant and equipment

6,339

6,733

Investments and other financial assets:

660

690

Investments accounted for using the equity method

605

633

Other investments and financial assets

55

57

Leased assets

1,712

1,518

Defined benefit plan assets

16

20

Deferred tax assets

1,500

1,655

Total Non-current assets

16,038

16,647

Inventories

7,325

7,140

Trade receivables

833

1,054

Receivables from financing activities

20,126

21,472

Current tax receivables

442

324

Other current assets

1,381

1,434

Current financial assets:

180

205

Current securities

1

-

Other financial assets

179

205

Cash and cash equivalents

4,984

6,141

Total Current assets

35,271

37,770

Assets held for sale

12

24

TOTAL ASSETS

51,321

54,441

EQUITY AND LIABILITIES

Issued capital and reserves attributable to owners of the parent

7,314

7,534

Non-controlling interests

52

43

Total Equity

7,366

7,577

Provisions:

6,006

6,386

Employee benefits

2,697

2,831

Other provisions

3,309

3,555

Debt:

27,348

29,701

Asset-backed financing

12,710

13,587

Other debt

14,638

16,114

Other financial liabilities

164

235

Trade payables

5,944

5,982

Current tax payables

257

206

Deferred tax liabilities

374

399

Other current liabilities

3,862

3,955

Liabilities held for sale

-

-

Total Liabilities

43,955

46,864

TOTAL EQUITY AND LIABILITIES

51,321

54,441

 

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, 2014 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, 2015 and 2014

(Unaudited)

(IFRS)

($ million)

1st Half 2015

1st Half 2014

A) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

6,141

6,489

B) CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES DURING THE PERIOD:

Profit/(loss) for the period

207

549

Amortization and depreciation (net of vehicles sold under buy-back commitments and operating lease)

561

557

(Gains)/losses on disposal of non-current assets (net of vehicles sold under buy-back commitments)

4

(1)

Other non-cash items

57

18

Dividends received

38

60

Change in provisions

(119)

120

Change in deferred income taxes

39

(7)

Change in items due to buy-back commitments (a)

72

16

Change in operating lease items (b)

(252)

(196)

Change in working capital

(317)

(1,456)

TOTAL

290

(340)

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 lease)

(450)

(691)

Consolidated subsidiaries and other equity investments

(5)

(5)

Proceeds from the sale of non-current assets (net of vehicles sold under buy-back commitments)

(3)

10

Net change in receivables from financing activities

357

(1,151)

Change in current securities

-

-

Other changes

227

76

TOTAL

126

(1,761)

D) CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES:

Bonds issued

600

1,868

Repayment of bonds

(1,126)

-

Issuance of other medium-term borrowings

973

1,767

Repayment of other medium-term borrowings

(1,122)

(1,679)

Net change in other financial payables and other financial assets/liabilities

(251)

(639)

Capital increase

17

6

Dividends paid

(294)

(379)

TOTAL

(1,203)

944

Translation exchange differences

(370)

34

E) TOTAL CHANGE IN CASH AND CASH EQUIVALENTS

(1,157)

(1,123)

F) CASH AND CASH EQUIVALENTS AT END OF PERIOD

4,984

5,366

(a) 

The cash flows generated by the sale of vehicles under buy-back commitments, net of the amounts included in Profit/(loss) for the period, are included under operating activities in a single line item which includes changes in working capital, capital expenditures, depreciation and impairment losses. This item also includes gains and losses arising from the sales of vehicles transferred under buy-back commitments that occur before the end of the agreement term without repossession of the vehicle.

(b)  

Cash flows generated during the period by operating lease arrangements are included in operating activities in a single line item which includes capital expenditures, depreciation, impairment losses and changes in inventories.

 

This 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, 2014 included in the EU Annual Report. This Condensed Consolidated Statement of Cash Flows represents the consolidation of all CNH Industrial N.V. subsidiaries.

CNH INDUSTRIAL N.V.

Other Supplemental Financial Information

(Unaudited)

CNH INDUSTRIAL Revenues by Segment under IFRS   ($ million)

1st Half

2nd Quarter

2015

2014

% change

2015

2014

% change

5,612

8,142

-31.1

Agricultural Equipment

3,035

4,436

-31.6

1,342

1,705

-21.3

Construction Equipment

740

931

-20.5

4,622

5,110

-9.5

Commercial Vehicles

2,531

2,756

-8.2

1,853

2,457

-24.6

Powertrain

949

1,252

-24.2

(1,050)

(1,533)

-

Eliminations and other

(558)

(757)

-

12,379

15,881

-22.1

Total Industrial Activities

6,697

8,618

-22.3

985

1,037

-5.0

Financial Services

491

528

-7.0

(237)

(266)

-

Eliminations and other

(128)

(138)

-

13,127

16,652

-21.2

Total

7,060

9,008

-21.6

 

CNH INDUSTRIAL Trading profit/(loss) by Segment under IFRS   ($ million)

1st Half

2nd Quarter

2015

2014

Change

2015

2014

Change

368

1,053

-685

Agricultural Equipment

211

611

-400

15

35

-20

Construction Equipment

19

34

-15

34

(113)

147

Commercial Vehicles

56

(39)

95

78

95

-17

Powertrain

50

65

-15

(36)

(35)

-1

Eliminations and other

(17)

(16)

-1

459

1,035

-576

Total Industrial Activities

319

655

-336

265

276

-11

Financial Services

138

146

-8

-

-

-

Eliminations and other

-

-

-

724

1,311

-587

Total

457

801

-344

 

CNH INDUSTRIAL Key Balance Sheet data under IFRS   ($ million)

June 30, 2015

March 31, 2015

December 31, 2014

Total assets

51,321

49,632

54,441

Total equity

7,366

7,383

7,577

Equity attributable to CNH Industrial N.V.

7,314

7,339

7,534

Net debt

(22,348)

(22,164)

(23,590)

Of which Net industrial debt

(3,053)

(3,120)

(2,874)

 

CNH INDUSTRIAL N.V.

Other Supplemental Financial Information

(Unaudited)

CNH INDUSTRIAL Net income reconciliation   ($ million)

1st Half

2nd Quarter

2015

2014

2015

2014

145

459

Net income under U.S. GAAP

122

358

Adjustments to conform with IFRS:

9

142

Development costs, net of amortization

19

82

4

4

Goodwill and other intangible assets

2

2

22

8

Defined benefit plans

11

4

2

(23)

Restructuring provisions

(1)

(5)

10

7

Other adjustments

3

8

(14)

(46)

Tax impact on adjustments

(6)

(32)

29

(2)

Deferred tax assets and tax contingencies recognition

27

(14)

62

90

Total adjustments

55

45

207

549

Profit under IFRS

177

403

 

CNH INDUSTRIAL Total Equity reconciliation   ($ million)

June 30, 2015

December 31, 2014

Total Equity under U.S. GAAP

4,838

4,961

Adjustments to conform with IFRS:

Development costs, net of amortization

2,655

2,819

Goodwill and other intangible assets

(117)

(122)

Defined benefit plans

(33)

(6)

Restructuring provisions

(8)

(12)

Other adjustments

(2)

(16)

Tax impact on adjustments

(773)

(815)

Deferred tax assets and tax contingencies recognition

806

768

Total adjustments

2,528

2,616

Total Equity under IFRS

7,366

7,577

 

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:

1st Half 2015

At December 31, 2014

1st Half 2014

Average

At June 30

Average

At June 30

Euro

0.896

0.894

0.824

0.730

0.732

Pound sterling

0.656

0.636

0.642

0.599

0.587

Swiss franc

0.947

0.931

0.990

0.891

0.890

Polish zloty

3.711

3.746

3.520

3.047

3.043

Brazilian real

2.968

3.101

2.653

2.298

2.197

Canadian dollar

1.235

1.237

1.158

1.097

1.068

Argentine peso

8.819

9.084

8.551

7.825

8.130

Turkish lira

2.566

2.677

2.333

2.165

2.121

 

 

SOURCE CNH Industrial N.V.



RELATED LINKS

http://www.cnhindustrial.com