CNH Industrial N.V. · NYSE:CNH
CNH Industrial — Q1 2017 Earnings Presentation
35 slides from CNH Industrial's earnings presentation, Apr 27, 2017
Slide 1: Q1 2017 Results Review
Q1 2017 Results Review April 27th, 2017 Exhibit 99.3
Slide 2: Safe Harbor Statement and Disclosures
Safe Harbor Statement and Disclosures April 27th, 2017 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
Slide 3: Q1 2017 Highlights
Q1 2017 Highlights Note: All figures are provided herein on a US GAAP $ basis unless otherwise indicated (1) Non-GAAP measures (definition and reconciliation in appendix) Revenues at $5.7bn Up 5.8% vs. Q1 2016 Net industrial debt (1) of $2.1bn Up $0.6bn vs. December 31, 2016 Industrial operations ca
Slide 4: Q1 2017 Main product awards
Q1 2017 Main product awards April 27th, 2017 MACHINE OF THE YEAR 2017 (SIMA) Combine category for CR and CX combines SUSTAINABLE TRUCK OF THE YEAR Daily Electric & Eurocargo CNG WCM GOLD MEDAL IVECO Spain (Madrid) Plant
Slide 5: Financial Highlights
Financial Highlights
Slide 6: Q1 2017 Financial Highlights
Q1 2017 Financial Highlights April 27th, 2017 (1) Non-GAAP measures (definition and reconciliation in appendix) (*) Note: Net Sales and Operating Profit: Excluding Other Activities, Unallocated Items & Adjustment & Eliminations Q1 2017 Q1 2016 Δ vs. ’16 Net Sales Ind. Activities ($mn) 5,384 5,076 6.
Slide 7: Q1 2017 Net Sales Industrial Activities Walk by Segment
Q1 2017 Net Sales Industrial Activities Walk by Segment April 27th, 2017 (*) Note: Net Sales: Including Other Activities, Unallocated Items & Adjustment & Eliminations (1) Note: Net Sales: Excluding Other Activities, Unallocated Items & Adjustment & Eliminations Net Sales By Currency (1) ($mn) Net S
Slide 8: Q1 2017 Industrial Activities Operating Profit and Adjusted Net Income Walk
Q1 2017 Industrial Activities Operating Profit and Adjusted Net Income Walk Adjusted Net Income Walk ($Mn) 1 21 (8) 58 41 (10) (6) 16 3 Operating Profit Industrial Activities ($Mn) 41 178 69 (36) (10) 21 (3) 219 3.5% 4.1% 57 April 27th, 2017 (*) Excluding EC investigation (**) Excluding changes in t
Slide 9: Q1 2017 Cash Flow – Change in Net Industrial Debt
Q1 2017 Cash Flow – Change in Net Industrial Debt Q1 ‘17 - Net Industrial Cash Flow (533) Q1 ‘17 - Change in Net Industrial Debt (562) Dec 31, 2016 Net Income (Loss) D&A Change in provision and similar Change in WC Tangible & Intangible Capex Other changes Capital Increase and dividends, net FX Tran
Slide 10: Capex & Cash Flow
Capex & Cash Flow (Change in Working Capital and Net Industrial Cash Flow) Capex * (*) Excluding assets sold under buy-back commitments and assets under operating leases Note: Only change in company inventory will impact industrial cash flow Q1 2017 (626) (US GAAP, $/mn) Cash inflow Cash outflow Net
Slide 11: Q1 2017 Financial Services performance
Q1 2017 Financial Services performance Net Income ($mn) Delta % Q1 ’17vs. Q1 ‘16 Net income was $87mn, flat compared to Q1 2016 Q1 ’17 Profitability ratios: Gross Margin / Average Assets On-Book = 3.6% RoA ** = 2.1% (**) RoA defined as: PBT / average managed assets annualized 87 Delinquencies On-Boo
Slide 12: March 31, 2017 Liquidity & Debt Maturity
March 31, 2017 Liquidity & Debt Maturity Available Liquidity ($bn) Debt Maturity Schedule1 ($bn) 1 Represents cash portion of debt maturities as of 03/31/2017 2 Of which $0.7bn ABS related & Restricted Cash Company Available Liquidity Available liquidity at March 31, 2017 was $7.6bn, compared to $8.
Slide 13: Industrial Activities Overview
Industrial Activities Overview
Slide 14: Agricultural Equipment Q1 2017 Financial Results
Agricultural Equipment Q1 2017 Financial Results Net Sales up 10.5% to $2.3bn NAFTA LATAM APAC EMEA Tractors Combines Others 33% 36% 16% 15% 15% 13% 58% 19% 23% Delta % Q1 ’17 vs. Q1 ’16 (as reported) (0.4%) (2%) 67% 32% 6% April 27th, 2017 Operating Profit Walk ($Mn) 69 4.2% 6.8% 90 38 23 21 (8) 15
Slide 15: Agricultural Equipment Inventory management
Agricultural Equipment Inventory management (units of equipment) – Industry units (*) Source: CNH Industrial Internal Data Industry Units Tractors Combines For Q1 2017 NAFTA ** (2%) EMEA (6%) LATAM 32% APAC 3% (**) Included in row crop sector definition Tractors Combines Q1 Worldwide Tractors and Co
Slide 16: Construction Equipment Q1 2017 Financial Results
Construction Equipment Q1 2017 Financial Results Net Sales down 2.4% to $523mn NAFTA LATAM APAC EMEA 54% 19% 11% 16% 5% 56% 43% 1% Delta % Q1 ’17 vs. Q1 ’16 (as reported) (1%) (14%) 14% Flat Light Heavy Others Operating Profit Walk ($Mn) 14 2.6% (4.2%) (4) (8) (13) (6) 2 (7) (22) (36) (7%) (68%) Apr
Slide 17: Construction Equipment Inventory management
Construction Equipment Inventory management (units of equipment) – Industry units Light Heavy Construction Equipment (Light & Heavy) For Q1 2017 NAFTA (5%) EMEA (2%) LATAM (4%) APAC 30% For Q1 2017 NAFTA 6% EMEA 8% LATAM 2% APAC 24% Industry Units Q1 overproduction vs. retail of 10% Production level
Slide 18: Commercial Vehicles Q1 2017 Financial Results
Commercial Vehicles Q1 2017 Financial Results Net Sales up 2.2% to $2.1bn NAFTA LATAM APAC EMEA 0% 84% 8% 8% (68%) 17% Flat 19% April 27th, 2017 1% 79% 15% 6% Delta % Q1 ’17 vs. Q1 ’16 (as reported) Trucks Buses Specialty Vehicles 14% (12%) Operating Profit Walk ($Mn) 38 (11) (10) (1) 8 1 (0) (8) 28
Slide 19: Commercial Vehicles Inventory management
Commercial Vehicles Inventory management (units of equipment) – Industry units April 27th, 2017 Commercial Vehicles (All Equipment) (*) Reflects aggregate for key markets where the Company competes: EMEA / Europe: EU 27 countries reflecting key markets where the segment competes (excluding United Ki
Slide 20: Powertrain Q1 2017 Financial Results
Powertrain Q1 2017 Financial Results April 27th, 2017 Q1 2017 third party Net sales at 45% vs. 44% in Q1 2016 Net Sales & Operating Profit ($) Units Sold Q1 ’17 vs. Q1 ’16 Engines sold to third party at 51% vs. 54% in Q1 2016 Net sales were $1.0bn, up 13.6% vs. Q1 2016 (up 16.9% on a constant curren
Slide 21: FY 2017E US GAAP Financial Targets
FY 2017E US GAAP Financial Targets
Slide 22: FY 2017E Industry Units
FY 2017E Industry Units April 27th, 2017 1 Reflects aggregate for key markets where Company competes Agricultural Equipment Flat (5%) – (10%) Flat – (5%) Agricultural Equipment ~15% 10 - 15% 0-140 HP 140+ HP Combines Combines Tractors Construction Equipment Flat Flat Heavy Light Construction Equipme
Slide 23: FY 2017E Outlook and US GAAP Financial Targets
FY 2017E Outlook and US GAAP Financial Targets (*) FX €/USD at 1.05 (**) Outlook is not provided on diluted EPS, the most comparable GAAP financial measure of this non-GAAP financial measure, as the income or expense excluded from the calculation of adjusted diluted EPS are, by definition, not predi
Slide 24: Appendix
Appendix
Slide 25: Q1 2017 From Operating Profit to Net Income (Loss) under US GAAP
Q1 2017 From Operating Profit to Net Income (Loss) under US GAAP ($mn) Q1 2017 Q1 2016 Δ Industrial Activities Operating profit 219 178 41 Financial Services Operating profit 120 130 (10) Elimination & Other (82) (76) (6) Operating Profit 257 232 25 Restructuring expenses (12) (15) 3 Interest expens
Slide 26: Q1 2017 Reconciliation of Adj. net income and Adj. income taxes
Q1 2017 Reconciliation of Adj. net income and Adj. income taxes to the most comparable GAAP financial measure and determination of Adj. diluted EPS and Adj. ETR under U.S.GAAP ($mn) First Quarter 2017 2016 Net Income / (Loss) 49 (513) Adjustments impacting Income (loss) before income taxes and equit
Slide 27: Q1 2017 Reconciliation of Adj. net income and Adj. income taxes
Q1 2017 Reconciliation of Adj. net income and Adj. income taxes to the most comparable GAAP financial measure and determination of Adj. diluted EPS and Adj. ETR under U.S.GAAP ($mn) First Quarter 2017 2016 (a) Adjustments impacting Income (loss) before income taxes and equity in income of unconsolid
Slide 28: Q1 2017 Net Income / (Loss) US GAAP to Profit / (Loss) under EU-IFRS
Q1 2017 Net Income / (Loss) US GAAP to Profit / (Loss) under EU-IFRS - Reconciliation April 27th, 2017 The following reconciles Net Income / (Loss) in US GAAP to Profit / (Loss) under IFRS: First Quarter 2017 EPS 2016 EPS Net Income / (Loss) attributable to CNH Industrial N.V. 46 0.03 (512) (0.38) P
Slide 29: March 31, 2017 Total Equity – US GAAP to EU-IFRS Reconciliation
March 31, 2017 Total Equity – US GAAP to EU-IFRS Reconciliation April 27th, 2017 Mar. 31, 2017 Dec. 31, 2016 Total Equity in accordance with US GAAP 4,547 4,451 Development costs 2,365 2,374 Other adjustments (129) (121) Tax effect on adjustments (648) (655) Deferred tax assets and tax contingencies
Slide 30: March 31, 2017 Reconciliation of Total Debt to Net Debt
March 31, 2017 Reconciliation of Total Debt to Net Debt (US GAAP - $MN) ($mn) Consolidated Industrial Activities Financial Services Mar. 31, 2017 Dec. 31, 2016 Mar. 31, 2017 Dec. 31, 2016 Mar. 31, 2017 Dec. 31, 2016 Third party debt 24,500 25,276 6,505 6,694 17,995 18,582 Intersegment notes payable
Slide 31: March 31, 2017 From Total Debt to Net Industrial Debt
March 31, 2017 From Total Debt to Net Industrial Debt ($mn) March 31 2017 2016 Net industrial (debt)/cash at beginning of period (1,561) (1,578) Net income (loss) 49 (513) Amortization and depreciation (1) 176 177 Changes in provisions and similar (2) (93) 464 Change in working capital (626) (673) I
Slide 32: March 31, 2017 Debt Maturity Schedule - Breakdown
March 31, 2017 Debt Maturity Schedule - Breakdown Outstanding March 31, 2017 9M ‘17 2018 2019 2020 2021 Beyond 4.4 Bank Debt 1.4 1.3 0.8 0.4 0.2 0.2 8.7 Capital Market 0.7 2.6 1.7 0.6 1.7 1.4 0.2 Other Debt 0.1 0.0 0.0 0.0 0.0 0.0 13.2 Cash Portion of Debt Maturities 2.2 3.9 2.5 1.1 1.9 1.6 4.7 Cash
Slide 33: Geographic Information
Geographic Information Certain financial and market information in this presentation has been presented by geographic area. CNH Industrial defines its geographic areas as NAFTA: United States, Canada and Mexico LATAM: Central and South America, and the Caribbean Islands APAC: Continental Asia (inclu
Slide 34: 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 results and allow management and investors to a
Slide 35: Investor Relations Team
Investor Relations Team Federico Donati – Head of Investor Relations ( +44 (207) 76 - 60386 ( +39 (011) 00 - 71929 Noah Weiss – Investor Relations North America ( +1 (630) 887 - 3745 e-mail: investor.relations@cnhind.com website: www.cnhindustrial.com Contacts April 27th, 2017