Cnh Industrial N.v. · NYSE:CNH
Cnh Industrial — Deutsche Bank Industrials Conference 2019
37 slides from Cnh Industrial's conference presentation, Jun 6, 2019
Slide 1: CNH Industrial - Deutsche Bank Industrials Conference
CNH Industrial - Deutsche Bank Industrials Conference June 6, 2019 Exhibit 99.1
Slide 2: Safe Harbor Statement and Disclosures
Safe Harbor Statement and Disclosures All statements other than statements of historical fact contained in this presentation including statements regarding our competitive strengths; business strategy; future financial position or operating results; budgets; projections with respect to revenue, inco
Slide 3: Company Overview | Our Segments and Products
Company Overview | Our Segments and Products Financial Services Global financial services player, supporting customers and dealers with tailormade solutions Powertrain Global leader in regulated markets, producing more than half a million industrial engines a year and market leader in natural gas en
Slide 4: Company Overview | Global Revenue Split
Company Overview | Global Revenue Split | ca. $30bn Revenues in 2018 AGRICULTURE 36% COMMERCIAL & SPECIALTY VEHICLES 34% POWERTRAIN 15% CONSTRUCTION 9% FINANCIAL SERVICES 6% By Region ($ bn – 2018) by segment ($ bn - 2018) NAFTA 24% EMEA 53% APAC 13% LATAM 10% $11.7bn $2.0bn $3.0bn $4.6bn $10.9bn $3
Slide 5: Q1 2019 Financial Highlights
Q1 2019 Financial Highlights
Slide 6: Q1 2019 Highlights
Q1 2019 Highlights | Strongest Net Income First Quarter ever Note: All figures are provided herein on a US GAAP $ basis unless otherwise indicated. Non-GAAP measures (definition and reconciliation in appendix) FY 2019E Financial Targets Reaffirmed (*) Note: at CC means at constant currency Industria
Slide 7: Q1 2019 | Major change initiatives
Q1 2019 | Major change initiatives FOOTPRINT OPTIMIZATION Footprint optimization analysis in progress with early findings expected to be unveiled in connection with our strategic business plan presentation at our upcoming Capital Markets Day NEW ORGANIZATION Ongoing roll-out of the new organization
Slide 8: Q1 2019 | Industry and Company Unit Performances
Q1 2019 | Industry and Company Unit Performances COMPANY ACTUALS (Units) Worldwide deliveries down 2% in Tractors and up 1% in Combines vs. last year Worldwide production down 4% vs. last year Worldwide inventory was up 16% in Tractors and down 5% in Combines Worldwide deliveries down 9% (Compact an
Slide 9: Q1 2019 | Industrial Activities Net Sales
Q1 2019 | Industrial Activities Net Sales Net Sales split (1) BY SEGMENT AG CE C&SV PT (1) Note: Net Sales: Excluding Other Activities, Unallocated Items and Adjustment & Eliminations BY CURRENCY EUR 48% USD 23% BRL 7% CAD 4% GBP 1% AUD 3% OTHER 14% Note: Numbers may not add due to rounding (*) Note
Slide 10: Q1 2019 | Adj. EBIT walk
404 49 52 (50) (3) (34) (16) 19 (12) 409 Adj. EBIT VOL & MIX PRICING NET (*) PROD COST SG&A R&D FX | OTHER ELIM & OTHER (**) FS Adj. EBIT AG CE C&SV PT Q1 2018 Q1 2019 Q1 2019 | Adj. EBIT walk Non-GAAP measures (definition and reconciliation in appendix) 6.0% 6.3% INDUSTRIAL ACTIVITIES CHANGE IN ADJ
Slide 11: Q1 2019 | Industrial Activities Adj. EBITDA & Adj. EBIT walk by segment
Q1 2019 | Industrial Activities Adj. EBITDA & Adj. EBIT walk by segment Non-GAAP measures (definition and reconciliation in appendix) 547 286 261 (18) 13 2 1 19 278 247 525 Adj. EBITDA D&A Adj EBIT AG CE C&SV PT ELIM & OTHER (*) Adj EBIT D&A Adj EBITDA Gross Margin 16.6% 21.2% 14.1% 11.5% 15.0% 17.3
Slide 12: AG | Snapshot on Production and Orders
AG | Snapshot on Production and Orders Production (units equivalent) Orders (units equivalent) Flat (4%) Q1 2019 worldwide production was down 4% vs. Q1 2018 with North America row crop production up 2% vs. last year FY 2019E worldwide production expected 5% below retail with production level Flat v
Slide 13: Financial Services
Financial Services (*) Including unconsolidated JVs Managed Portfolio (*) & Retail Originations (*) Q1 ’19 retail originations at $2.2bn, flat compared to March 31, 2018 Managed portfolio* at $26.1bn, down $0.4bn compared to March 31, 2018 (up $1.2bn on a constant currency basis) $26.5bn $26.1bn Mar
Slide 14: Q1 2019 | Net Industrial Cash Flow and Available Liquidity
Q1 2019 | Net Industrial Cash Flow and Available Liquidity Available Liquidity Cash and Available Committed Lines 5.5 10.0 Change in Working Capital Cash inflow Cash outflow TRADE RECEIVABLES INVENTORIES TRADE PAYABLES OTHER CHG IN WORKING CAPITAL (1.1) Q1 2019 Q1 2018 Non-GAAP measures (reconciliat
Slide 15: Q1 2019 | Investment in Future Growth
Q1 2019 | Investment in Future Growth Total spending in new products was $149mn, up 23% vs. last year Digitalization; Electrification; Autonomous Regulatory Other New Products and Upgrades (1) Excluding assets sold under buy-back commitments and assets under operating leases Capex at $77mn up 26% vs
Slide 16: Our Leadership in Natural Gas
Our Leadership in Natural Gas
Slide 17: Our Natural Gas Leadership | Why Natural Gas?
Our Natural Gas Leadership | Why Natural Gas? Low cost of Natural Gas (NG) contributes significantly to reduce fuel costs NG reduces NOX up to 65%, PM 98% and Noise by ~80% NG vehicles receive subsidies similar to electrified vehicles because of their positive environmental impacts Lower overall TCO
Slide 18: Our Natural Gas Leadership | Why Natural Gas – Focus CO2 Reduction
Our Natural Gas Leadership | Why Natural Gas – Focus CO2 Reduction According to recent studies, synthetic bio-methane can reduce greenhouse gas emissions by up to 92% and if bio-methane produced from liquid manure is used, those emissions can be reduced by some 180%, in effect decarbonizing our envi
Slide 19: Our Natural Gas Leadership | FPT Industrial – A pioneer in Natural Gas engines
Our Natural Gas Leadership | FPT Industrial – A pioneer in Natural Gas engines 45,000+ natural gas engines produced by FPT since 1997 FPT Industrial is the only Engine Manufacturer to offer a full range Natural Gas line-up Urban Bus Heavy Duty Trucks Garbage collection Urban Bus Medium Duty Trucks G
Slide 20: Our Natural Gas Leadership | Natural Gas Vehicles
Our Natural Gas Leadership | Natural Gas Vehicles After pioneering the on-highway natural gas market, we will now create the market for off highway applications in CE and AG
Slide 21: Our Natural Gas Leadership | Bio-Gas and Circular economy
Our Natural Gas Leadership | Bio – Gas and Circular economy We are the leader in LNG/CNG and biomethane propulsion for on-highway applications and see a clear path for adoption for off-highway usage in the future Carbon Neutral New Engine Bio-methane Agreement A MoU for the development of bio-methan
Slide 22: Our Natural Gas Leadership | Conclusions
Our Natural Gas Leadership | Conclusions ALTERNATIVE SOLUTIONS While electrical vehicles are already a reality in light duty applications; fuel cell (hydrogen) vehicles for Heavy Duty applications are anticipated to be years in the future CAPEX FPT has been developing Natural Gas engines for more th
Slide 23: FY 2019E US GAAP Financial Targets and Market Outlook
FY 2019E US GAAP Financial Targets and Market Outlook
Slide 24: FY 2019E | Industry Outlook
FY 2019E | Industry Outlook (*) NOTE: Total Industry Volume FY 2019E vs. FY 2018 reflecting aggregate for key markets where Company competes (*) New Regional split definition in Appendix TRACTORS COMBINES NA EU SA RoW WW 0-140 HP Flat Flat – 5% Flat – 5% (5%) - Flat Flat 140+ HP Flat – 5% Flat – 5%
Slide 25: FY 2019E | US GAAP Financial Targets
FY 2019E | US GAAP Financial Targets (1) 2019 guidance does not include any impacts deriving from the gain resulting from the modification of the healthcare plan in the U.S. previously mentioned, as this gain has been considered non-recurring and therefore treated as an adjusting item for the purpos
Slide 26: Capital Markets Day | Key Questions to be addressed
Capital Markets Day | Key Questions to be addressed Defining the roadmap to transform CNH Industrial from good to great PROFITABILITY IMPROVEMENT Clear path to increase EBIT margin across each industrial segment through defined strategy and initiatives by business area, with mid-cycle margin targets
Slide 27: Appendix
Appendix
Slide 28: Q1 2019 | Financial Summary
Q1 2019 | Financial Summary (1) Non-GAAP measures (definition and reconciliation in appendix) Q1 2019 Q1 2018 Δ U.S. GAAP Revenues ($mn) 6,457 6,773 (4.7)% Net Sales | Industrial Activities ($mn) 6,006 6,300 (4.7)% Net Income ($mn) 264 202 30.7% Diluted EPS ($) 0.19 0.14 0.05 Non – GAAP (1) Adjusted
Slide 29: Industrial Activities | Q1 2019 Net Sales Split
Industrial Activities | Q1 2019 Net Sales Split Agriculture Q1 2019 | Split Chg. vs. Q1 ’18 Construction Q1 2019 | Split Chg. vs. Q1 ‘18 By region: By region: NA 35% 11% NA 47% (6%) EU 37% (2%) EU 21% (3%) SA 14% (3%) SA 11% (8%) RoW 14% (29%) RoW 21% (9%) By product: By product: TRACTORS 58% (5.7%)
Slide 30: Reconciliation of Net Income (Loss) to Adj. EBIT and EBITDA by Segment (Q1 2019)
Reconciliation of Net Income (Loss) to Adj. EBIT and EBITDA by Segment (US GAAP) For Industrial Activities, net income / (loss) net of “ Results from intersegment investments” This item includes the pre-tax gain of $30 million as a result of the amortization over approximately 4.5 years of the $527
Slide 31: Reconciliation of Net Income (Loss) to Adj. EBIT and EBITDA by Segment (Q1 2018)
Reconciliation of Net Income (Loss) to Adj. EBIT and EBITDA by Segment (US GAAP) (1) For Industrial Activities, net income / (loss) net of “ Results from intersegment investments” ($mn) Q1 2018 AG CE CV PT Unallocated Items, Elim. & Other Industrial Activities Financial Services Total Net Income (Lo
Slide 32: Reconciliation of Total Debt to Net Debt (US GAAP)
Reconciliation of Total Debt to Net Debt (US GAAP) Mar 31, 2019 Dec 31, 2018 Mar 31, 2019 Dec 31, 2018 Mar 31, 2019 Dec 31, 2018 Third party debt (23,807) (24,445) (5,242) (5,211) (18,565) (19,234) Intersegment notes payable - - (1,210) (1,136) (1,662) (1,202) Total (Debt) (1) (23,807) (24,445) (6,4
Slide 33: From Total Debt to Net Industrial Debt
From Total Debt to Net Industrial Debt Mar 31, 2019 Dec 31, 2018 Total (Debt) (1) (23,807) (24,445) Financial Services Third Party Debt 18,565 19,234 Intersegment Note Payables (1,210) (1,136) Intersegment Note Receivables 1,662 1,202 Cash and cash equivalents 3,226 4,553 Restricted cash 49 - Deriva
Slide 34: Debt Maturity Schedule
Debt Maturity Schedule | Breakdown Outstanding Mar 31, 2019 2019 2020 2021 2022 2023 2024 Beyond (4.1) Bank Debt (1.2) (1.9) (0.4) (0.2) (0.2) (0.1) (0.1) (8.7) Capital Market (1.0) (0.7) (1.5) (1.2) (1.2) (0.5) (2.6) (0.2) Other Debt (0.1) (0.0) (0.0) (0.0) (0.0) (0.0) (0.0) (13.0) Cash Portion of
Slide 35: New Geographic Information
New Geographic Information Starting from Q1 2019 the composition of our regions part of the geographic information have been amended as follow: North America (formerly NAFTA): United States, Canada and Mexico; Europe (member countries of the European Union, European Free Trade Association, Ukraine,
Slide 36: Non-GAAP Financial Measures
Non-GAAP Financial Measures 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 operating results and enhance the readers’ abil
Slide 37: Investor Relations Team
Investor Relations Team e-mail: investor.relations@cnhind.com website: www.cnhindustrial.com Federico Donati – Head of Global Investor Relations ( +44 (207) 76 - 60386 ( +39 (011) 00 - 71929 Noah Weiss – Investor Relations North America ( +1 (630) 887 - 3745 Giovanni Somajni – Investor Relations Eur
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