Cnh Industrial N.v. · NYSE:CNH
Cnh Industrial — Q3 2013 Earnings Presentation
47 slides from Cnh Industrial's earnings presentation, Oct 31, 2013
Slide 1: Q3 & YTD September 2013 Results Review
Exhibit 99.2 Exhibit Q3 October & Sep99.2 31st, YTD 2013 2013 Results Review
Slide 2: The Merger completed; first day of trading
The Merger First On Common Total *EPS October 2Q3 See New & debut calculated day number Appendix Sep completed 31st, York of share YTD oftrading—September aof 2013 Stock new on capital Results for common common on global Trading Exchange September composition Review shares leader shares mechanisms (
Slide 3: Our leadership team
Our leadership Group Sergio CHAIRMAN Richard GROUP REGIONAL NAFTA LATAM APAC EMEA IVECO Powertrain BRAND Case Parts New Iveco INDUSTRIAL Head Cheif President, SUPPORT/CORPORATE President Chief 3October Holland IH & of Technical Lorenzo Quality Manufacturing Purchasing Financial Human Executive Stefa
Slide 4: Q3 and YTD September 2013 results highlights
Revenues (€/bn) Agricultural Construction (€/mn) constant Trading Improved Equipment offsetting and Net 291 EPS 2.5 2.3 Increased operating offset working 5.3 4.9 Down €1.6bn facilities) bond matured Jun-end Note: October 4Q3 Available ’13 ’12 & Net (€/bn) Powertrain Construction profit 248 at(€759m
Slide 5: Performance by segment: revenues and trading profit
Performance REVENUES 6,313 4,088 2,054 +1.9% -4.9% +18% TRADING Q3 444 508 +5.9% 15 110 -86.4% Agricultural *Equipment 5October Including 25 ’13 2012 470 6,217 3,889 2,093 35 (475) 646 -10.9% financial +40% 31st, Q3*762 PROFIT Financial -1.5% (527) &2013 by (€MN) 2013 (9) Construction segment highli
Slide 6: Revenues by currency and growth analysis
18,771 6,313 6,217 646 774 2,054 5.4% 2,093 4,088 Q3 currency Agricultural REVENUES Other, (€/mn) AUD, Foreign GBP, vs. CAD, USD BRL, BRL Revenues *USD, 6October Including EUR &(434) 2013 ‘12 /-6.5% 3% 14% Sep 338 (743) 2,223 4,207 35% 6% 3% EUR 8% 816 Organic Currency 31st, by (IFRS, constant EUR,
Slide 7: Income statement from trading profit to net profit
From (€mn) Q3 2012 Trading Unusual Operating Financial Investment Profit Taxes Net “EPS Sep the “Financial €114mn The *“Taxes”: 7October Unusual Please former & 2012 profit YTD, effective (basic) (diluted) 2013 trading Sep before (181) Sep profit 31st, in refer items, Q3 charges, items, 291 YTD inco
Slide 8: Financial charges and average cost of debt
Financial Q3 Average Rate Outstanding (%) (€/bn) Capital Short-term Gross Industrial IAS FX Net (*) 8October Net ’13 2012 (9) Industrial Financial (€/mn) 19 P/L Industrial (€/bn) (10) Industrial (interest Market 31st, Average Q3 Rate charges Cash Debt (%) Outstanding 2013 2013 Charges Debt P/L (fixe
Slide 9: Q3 net industrial debt and cash flow
Q3INTANGIBLE Cash CASH (€MN) (2,274) (246) (365) (9) 248 179 (299) JUN 2013 & OTHERS CHANGE TRANSACTION Net (228) seasonal (*) 9October Net ’13 Industrial 30, INCOME Flow 24FLOW (1) of (2,502) 31st, NET increase (5) CAPEX Vehicles IN – change 2013 NET D&A Debt FROM INin SCOPE *FUNDS Buy-back Q3 DEBT
Slide 10: Investments: tangible and intangible capex
SepInvestments Tangible New 17% (Capitalized Maintenance 23% Industrial LT BY 10% Commercial MAIN Foshan China AG Harbin, Argentina US India Trucks Madrid/Ulm Spain/Germany Production Argentina: Powertrain (*) October Q3 10 Net & –SEGMENT CATEGORY & YTD 60% Products Goodfield: –Sep CE INDUSTRIAL and
Slide 11: Appendix: Agricultural, Trucks, Powertrain, events, outlook
54321 Appendix 11Agricultural Trucks Powertrain Q3 Significant and Commercial & Construction events and Vehicles Outlook Equipment
Slide 12: Agricultural and Construction Equipment revenues and trading profit
1Agricultural REVENUES 4,147 TRADING +5.9% Q2 Q1 478 *2012 Revenues Global Units Trading AG CE October Q3 12Revenues Including 4,088 +6.6% 3,769 444 +26.4% 368 & revenues trading revenues trading 2013 deliveries Sep 470 tractors +11.7% profit 31st, -4.9% +0.7% at YTD 4,421 loss PROFIT profit Financi
Slide 13: Agricultural trading profit variance
1Agricultural (5) 133 (€mn) 444 10.9% (52) (26) *Positive October Q3 13 Trading Including (2) ‘12 &(22) Sep 470 12.1% Volume 31st, net Profit YTD Financial pricing and 2013 /Results Variance Construction Mix inServices Pricing, AGReview *partially net Equipment figures Prod. offsetCost by reduced SG
Slide 14: Agricultural and Construction inventory management
1Agricultural AGRICULTURAL (MAJOR AG CONSTRUCTION (LIGHT Q1’09 Company CE *Third Source: October 14Inventory Excluding Retail Retail quarter Q2’09 CNH 31st, &EQUIPMENT) Inventory Sales* Sales* HEAVY) management Joint and overproduction Q3’09 2013 Industrial Construction CE AG Ventures Q3 EQUIPMENT D
Slide 15: Agricultural commodity prices and industry drivers
1Agricultural COMMODITY $353 $600 $615 $800 $200 $322 $400 08 $0 Jan MONTHLY % Sep-12 vs. SOYBEANS CORN WHEAT 2010 Net IHS USDA—Aug. Gross World North Europe Commonwealth Asia Latin Source: October 15Industry change 08 Sep. Jun Farm Global 7.4% $500 $321 2011 America 08 America Domestic 4.3% 321 Sep
Slide 16: Agricultural and Construction industry volumes
1 Agricultural Industry AGRICULTURAL Tractors change Worldwide NAFTA < ³40 Flat EMEA LATAM APAC Global Overall NAFTA: October Q3 1640& ’13 hphp Sep ~10% Flat ~15% AG 2% Industry vs. CE ~15% ~10% 31st, Combines unit ~15% 10%; 5%; YTD prior ~15% industry ~10% industry volume LATAM ~5% 2013 EMEA: and E
Slide 17: Main new product launches and events
1Agricultural Tier Sitevi Two 18 Steiger Case Waste Midi New Nordbau Close NH drive October Q3 17Main new &to 4B Agritechnica Holland IH crawler solutions Sep cooperation Gold and do Quadtrac product tractor T7, 31st, isfair pioneering YTD recycling first Medal T8and in excavators in 2013 models and
Slide 18: Appendix: Trucks and Commercial Vehicles
54321 Appendix 18Agricultural Trucks Powertrain Q3 Significant and Commercial & Construction events and Vehicles Outlook Equipment
Slide 19: Trucks and Commercial Vehicles revenues and trading profit
2Trucks REVENUES TRADING Q2 1(Q1 2012 Revenues for EMEA Trading 0.7% October Delta Q3 19 9)Revenues parts 2,054 2,273 1,899 110 126 63 & 2013 down %Sep n.m. and flat; -86.4% -99.2% profit 31st, y-o-y and +1.9% -5.6% -3.9% at YTD Commercial PROFIT 15 4.7 and LATAM €2.1bn services, (€MN) 2013 at *Incl
Slide 20: Trucks trading profit variance
2Trucks 5.4% 110 (€mn) (22) 15 (7) (10) (6) (4) Negative *product October Q3 20Trading Including ’12 &0.7% (46) Sep and Volume launch 31st, market Profit YTD Commercial Financial 2013 costs /Results Variance and Mixand product Services Pricing, Review Vehicles unfavorable * mixnet figures Prod. and
Slide 21: Trucks units sold and order book
2Trucks UNITS ORDER Overall By EMEA LATAM APAC BOOK 2013 Q3 2012 2011 Q4 October 1.0 Q1 Q2 21Q3geography 1.20 1.02 Q3 ’13 Q2up down and up TO SOLD units order 31st, up INTAKE 0.9 units 3.6% 2.7% 33% BILL Commercial 30.3% 35% 20% sold intake 2013 sold due driven at mainly Q3 and to at 31.4k pre-buy 3
Slide 22: Commercial Vehicles inventory
2Trucks Company Over October 22Inventory production and 31st, Inventory Commercial management 2013 vs.Q3 retail Dealer &Vehicles (units Sep toInventory anticipate YTD of equipment) Results Trucks EuroReview V&pre-buy CVs Retail ahead sales of Euro Trucks VI & introduction CVs Production
Slide 23: EU27 industry and IVECO market share
2Trucks INDUSTRY 2012 +0.9% IVECO (3.5-6.0T) LIGHT (6.01-15.99T) -0.7 11.7% EU27 Light Medium Heavy October Q3 23EU27 ‘12 &p.p. 2013 down segment Sep overall market 11.0% up segment and Q3 MARKET –31st, -0.9 down segment Industry 4.7% YTD MEDIUM ‘13 Commercial 0.9% VOLUMES p.p. 25.4% industry share
Slide 24: LATAM industry and IVECO market share
2Trucks INDUSTRY Industry 2012 +27.7% Brazil IVECO (3.5-7.9T) LIGHT (8.0-31T) -0.2 17.7% LATAM Light Medium Heavy *Brazil: At October Q3 24LATAM* Reflects 9.0% ‘12 &p.p. 2013 +11.5%; segment Sep +32.6%; 17.5% segment Light and Q3 MARKET 31st, (³3.5T) +1.3 down overall market segment (>31T) YTD aggre
Slide 25: China industry and IVECO market share
2Trucks INDUSTRY Industry [k/units] 508 613 670 696 China Medium JVs 5.2% Light Heavy IVECO 32.7 33.2 36.0 26.5 October Q3 25CHINA ’09 &sales 32.2 of Trucks /Sep Bus Industry Trucks (SIH Medium and Q3 JVS the 31st, volumes 730 segment up –YTD (Daily (Daily) ’10 Commercial Industry market, segment) 8
Slide 26: Main product launches and sustainability
2Trucks MAIN LATAM Version The MAGIRUS—FIREFIGHTING Opening All EMEA Crossway, SUSTAINABILITY October Q3 26Main & in new Sep one PRODUCT and –product with 31st, –of identity Iveco YTD integrated New Urbanway Commercial the new 2013 Bus New launches Stralis Results (launch cab, LAUNCHES “The TECHNOLO
Slide 27: Appendix: Powertrain
54321 Appendix 27Agricultural Trucks Powertrain Q3 Significant and Commercial & Construction events and Vehicles Outlook Equipment
Slide 28: Powertrain revenues and trading profit
3 Revenues Powertrain REVENUES +18% TRADING Q2 25 Q1 2012 Revenues basis) third total Units Engines Agricultural customers, Gearboxes Trading vs. Higher improvement, aimed Capacity Delta October Q3 28 last 646 782 678 +40% 38 14 & revenues parties. 2013 % sold Sep reflecting 762 at +5.3% -14.3% reve
Slide 29: New Powertrain product launches
3 New Powertrain Anticipating Production Chongqing Started Cursor launched FPT’s buncher October Q3 29 & Sep Tier product 11 10 production and 31st, inand YTD Euro 4start-up (China) August the engines 2013 Cursor launches V Results M726E introduction 310 of of inwill N45 13 Latin Euro kW Review mulc
Slide 30: Appendix: Significant events
54321 Appendix 30Agricultural Trucks Powertrain Q3 Significant and Commercial & Construction events and Vehicles Outlook Equipment
Slide 31: Significant events
4 Significant Closing amount CNH may Confirmed Group’s October Q3 31 ’13 &also Industrial Capital Sep of of 31st, position beYTD 3.250% $500mn asapplied events LLC 2013 Sector N.V. Results asintends notes Notes Sector to Leader (NYSE: repay Review due of to Leader in CNH 2017, use CNHI Dow the refle
Slide 32: Industry outlook FY 2013E
4 Industry TRACTORS Agricultural LIGHT FY NAFTA Construction Equipment APAC Worldwide INDUSTRY Trucks Vehicles Commercial LATAM October Q3 32 & ’13E 2013E Sep 5-10% (0-5%) and HEAVY 5-10% 0-5% 31st, 15-20% 5-10% +5% EU27 YTD Outlook FY EMEA 5-10% (0-5%) FY (>3.5T) EMEA COMBINES 2013 APAC /2013E APAC
Slide 33: FY 2013 guidance
4FY “On guidance 2013 REVENUES Up October Guidance between ’13E the OUTLOOK back 31st, as follows:” 3%TRADING of 2013 the andQ3 Group’s 4%&Between MARGIN Sepperformance YTD7.5% Results NETand INDUSTRIAL toReview 8.3% date and Between 33our DEBT expectations €1.4bn and of €1.6bn recovering trading co
Slide 34: Reporting roadmap: IFRS and US GAAP
Roadmap IFRS Segment (Fiat and Supplemental Financial EU Subsequent Recast US Segments Agricultural On-going Dual 2013 October Q3 34 & Annual GAAP Commercial Industrial) reporting: 2014/Onwards in Sep ofEUR 31st, reporting Services 2011, for CNHI recast YTD and 2011, Report to &new Equipment 2013 se
Slide 35: Appendix
54321 Appendix 35Agricultural Trucks Powertrain Q3 Significant and Commercial & Construction events and Vehicles Outlook Equipment
Slide 36: Trading of CNH Industrial common shares
Trading CNH CNHI 9) Settlement, US Italy clearing Because normal regular 1,348,867,772) Common October “MT” Computershare “NYSE” “MTA” “DTCC” Q3 36 are & Transfer loyalty Industrial—common Sep settled common trading circumstances mechanism system 31st, MT Shares YTD both Agent: share maintains throu
Slide 37: Geographic market share information
Geographic Consistently NAFTA: LATAM: APAC: EMEA: Market Certain retail European other Not Southeast For In to October Q3 37 determine this addition, &Trucks alland shipment Sep report, agricultural Continental Share industry 27 31st, United Central shipment Construction Asia, YTD member &there Info
Slide 38: IAS 19 reported impact on profit
IASreported Impact PROFIT As Revenues Trading Unusual Operating Financial Investment Pre-tax Taxes Net October Q3 38 2012 & result 19Sep (182) on Revised result profit 31st, items, & Q3 charges, 6,313 297 YTD income 2012 income, LOSS Restated (181) 2012 479 2013 575 291 net Actual Results 6,313 472
Slide 39: Q3 2013 consolidated revenues and trading profit by segment
(€mn) Cons. Revenues Trading of Agricultural Trucks Powertrain Others CNH October Q3 39 which ’13($) & Industrial Sep Industrial & Change Profit 31st, 5,153 623 Elim. CVs & YTD 762 35 & Trading 504 2013 35 2,093 15 Construction 4,871 2013/2012 762 (527) (12) 6,217 508 Results Financial — 119 18— 421
Slide 40: YTD September 2013 revenues and trading profit by segment
Sepwhich (€mn) Cons. Revenues Trading of Agricultural Trucks Powertrain Others CNH October Q3 40 & YTD Industrial ($) Sep Industrial &Profit 31st, 15,944 1,956 Elim. ’13 CVs & YTD 2,346 87 & Trading Change 2013 87 76,063 Construction 1,562 (1,672) (30) 18,844 1,549 Results Financial 15,047 7— 2,346
Slide 41: Net industrial cash flow
Q3 ‘13 (€mn) D&A Tangible Cash Capital FX Change Net October 41 & Translation Income Industrial Flow (excl. Sep Sep Increase in 31st, &YTD Working Funds Investments, Net –Intangible from YTD Vehicle 248 change 2013 Cash (Debt)/Cash Industrial Effect ’13 747 /Operating Op. & ’13 Share Q3 Flow Capital
Slide 42: Net debt breakdown
Net (IFRS Jun. Cons. 21.5 (0.1) (3.7) *17.7 Note: October 42Netdebt 30, 4.9 2.3 (0.1) (2.5) of Numbers Ind. / €bn) ’13 31st, 16.5 15.4 intersegment breakdown 0.0 (1.1) Fin. Sep. Gross Net 2013 Derivatives Cons. may Cash 30, Debt Q3 Debt* not ’13 & Ind. receivables &17.9 Mktable add Sep Fin. M-to-M,
Slide 43: Gross debt and outstanding securitization
Gross (IFRS Outstanding Jun. 11.6 5.5 5.9 0.2 9.9 8.1 0.4 1.4 0.0 21.5 3.7 0.1 17.7 *1.6 October Sales ABS Adjust. Warehouse Bank Capital Other Securitization Sale Cash Derivatives Undrawn 30, Cash Gross Net debt / of €bn) ’13 31st, of /Debt & Debt Debt Securitization Receivables Maturities Receivab
Slide 44: Debt maturity schedule and available liquidity
Debt (IFRS Outstanding Sep. 5.7 5.2 0.2 11.2 3.3 0.6 1.6 *4.9 Note: October 44With Total Bank Capital Other Cash of Undrawn Total 30, maturity Numbers which /a€bn) 31st, ’13 residual Available & Debt Debt Cash Market Mktable 3M ABS committed 2013 schedule 1.6 0.1 may Maturities 2013 tenor related 1.
Slide 45: Financial measures definitions
Financial appropriate measures allocations CNHI Trading performance businesses. measure less Operating investments Net financial Therefore, Cash Constant comparisons October Q3 45 &Industrial frequent Flow Sep monitors key Profit 31st, that instruments) instruments), currency of Measures YTD Profit
Slide 46: Safe Harbor Statement
SafeCompany’s Certain “forecast”, looking the developments (possibly capital conditions environment, technologies deflation; investigation, deterioration foregoing. Exchange presented Forward-looking Industrial reliance publicly October Q3 46 &Harbor Sep goods-related statements statements on 31st,
Slide 47: Group Contacts
Group Contacts Manfred +41 +39 +1 e-mail: October Q3 47 (630) &(011) (91) Sep Investor investor.relations@cnhind.com 31st, Markevitch 985—3801 887—3745 00—62756 YTD 2013 Relations Results – Head Review Team of Investorwebsite: Relations www.cnhindustrial.com Federico Donati Noah Weiss