Cnh Industrial N.v. · NYSE:CNH
Cnh Industrial — Q1 2021 Earnings Presentation
37 slides from Cnh Industrial's earnings presentation, May 5, 2021
Slide 1: Q1 2021 Results Review
Q1 2021 Results Review May 5th, 2021
Slide 2: Safe Harbor Statement and Disclosures
Safe Harbor Statement and Disclosures 2 All statements other than statements of historical fact contained in this presentation including statements under “2021 Outlook” and statements regarding our future responses to and effects of the COVID-19 pandemic; competitive strengths; business strategy; fu
Slide 3: First Quarter | Summary
First Quarter | Summary 3 Growth and Profitability: strong margin improvements from solid market demand across segments and regions Supply Chain: multiple disruptions, material inflation - extraordinary measures performed by our supply chain and manufacturing teams to meet customers’ demand Free Cas
Slide 4: First Quarter | Industry Unit Performances vs. Q1 2020
First Quarter | Industry Unit Performances vs. Q1 2020 4 North America Europe South America Rest of World Worldwide 0-140 HP 53% Tractors 20% 31% 57% 51% 140+ HP 15% Combines 17% 14% 28% 30% 27% Light 30% (4%) 44% 33% 24% Heavy 11% 3% 38% 47% 38% LCV - 24% 17% 10% 20% M&H - 17% 32% 9% 16% Buses - (1
Slide 5: First Quarter | WW Company Unit Statistics
First Quarter | WW Company Unit Statistics 5 TRACTORS COMBINES Order book in AG more than doubled year-over- year for both tractors and combines across regions, driven by strong growth in NA for tractors and South America for combines Q120 Q220 Q320 Q420 Q121 Q120 Q220 Q320 Q420 Q121 LIGHT HEAVY Ord
Slide 6: Consolidated Financial Highlights
First Quarter | Financial Highlights 6 Net Sales % chg. y-o-y Net Sales at $7bn up 36% at constant currency, with all segment up year over year, higher volume, favorable mix and positive pricing $7.0bn +41% Industrial Activities Gross Margin bps chg. y-o-y Gross Margin improvement across all industr
Slide 7: Industrial Activities Net Sales and vs. Q1 2020
First Quarter | Industrial Activities Net Sales and vs. Q1 2020 7 AG CE C&SV PT Industrial Activities (1) $3,038mn $656mn $2,805mn $1,234mn $7,043mn +35% +34% @CC +55% +55% @CC +39% +30% @CC +64% +52% @CC +41% +36% @CC By Region By Region By Region By Region By Region As reported As reported As repo
Slide 8: Walk by Segment
First Quarter | Ind. Activities Adj EBIT walk (Driver & Segment) 8 7.7% (3.0%) (148) 447 165 28 8 (36) 87 (6) 545 Adj. EBIT (1) UNALLOCATED, Adj. EBIT (1) VOL & MIX PRICING NET PROD COST SG&A R&D FX | OTHER Q120 ELIM & OTHER Q121 Gross Adj EBIT Margin Margin Walk by Segment AG 220 100 14 11 (10) 40
Slide 9: First Quarter | Financial Services
First Quarter | Financial Services 9 ($mn) Net Income Profitability Ratios 3.7% 3.3% 3.2% 3.4% Q1 2021 91 2.2% 2.0% 1.9% 1.7% Q1 2020 80 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2018 2019 2020 2021 Gross Margin / Average Assets on Book ROA (**) Managed Portfolio (*) & Retail Originations (*) Delinquen
Slide 10: Free Cash Flow and Debt Maturity Profile
First Quarter | Free Cash Flow and Debt Maturity Profile 10 ($mn) Industrial Activities | Free Cash Flow (*) 763 (85) (873) (71) (70) (35) (371) CASH INTEREST CHG IN CHG IN PROVISIONS. & IA | ADJ EBITDA PP&E CAPEX (2) OTHER CHANGES IA FREE CASH FLOW AND TAXES WORKING CAPITAL OTHERS (1) Δ vs. 691 (6)
Slide 11: Q1 2021 Final Remarks
Q1 2021 Final Remarks Corporate Presentation 2017
Slide 12: First Quarter | Capital Allocation
First Quarter | Capital Allocation 12 IA Gross Debt Reduction Organic Growth Inorganic Growth Industrial Activities gross debt reduced by Capex at $70mn up 11% vs. Q1 2020 Completed acquisition of four divisions of CEG in South Africa Capex at 1.0% of net sales in Q1 ’21 (direct distribution network
Slide 13: Agriculture | Alternative Propulsions – Leading the Green Revolution
Agriculture | Alternative Propulsions – Leading the Green Revolution 13 CNHI is promoting circular economy in AG Partnering with local stakeholder and tech companies to drive the change Product Roadmap based around different technologies Leveraging Minority investments through M&A to expand product
Slide 14: FY 2021E Updated Guidance
FY 2021E Updated Guidance Corporate Presentation 2017
Slide 15: FY 2021E Outlook | Industry Unit Performances vs. FY 2020
FY 2021E Outlook | Industry Unit Performances vs. FY 2020 15 North America Europe South America Rest of World Worldwide 0-140 HP ~ 20% Tractors 5% - 10% ~ 15% 5%+ 10% 140+ HP ~ 20% Combines ~ 20% 5% - 10% 10% - 15% 5% 5% - 10% Light 15% - 20% Flat – 5% 20% 10% - 15% 10% - 15% Heavy ~ 10% ~ 10% ~ 20%
Slide 16: FY 2021E Updated Guidance
FY 2021E Updated Guidance 16 Previous Guidance Updated Guidance Net Sales (*) Up between Up between (including currency translation effects) 8% and 12% 14% and 18% Industrial Activities SG&A ≤ 7.5% of Net Sales Confirmed Positive between Positive between Free Cash Flow $0.4bn / $0.8bn $0.6bn / $1.0b
Slide 17: Spin Off Perimeter
Spin Off Perimeter 17 CNH Industrial N.V. “NewCo” Off - Highway On - Highway AG CE FS FS C&SV PT Off-Highway On-Highway May 5th, 2021 Q1 2021 Results Review
Slide 18: Spin Off Roadmap
Spin Off Roadmap 18 EXTRAORDINARY GENERAL MEETING QUARTERLY RESULTS & SPIN POSTPONED ANALYSTS’ CALL CONFERENCE DUE TO COVID (May 5th) QUARTERLY RESULTS & ANALYSTS’ CALL CONFERENCE DAY 1 (November 4th) 2020 Q1 ’21 Q2 ’21 Q3 ’21 Q4 ’21 Q1 ’22 REGULATORY ANNUAL APPROVALS GENERAL MEETING (April 15th) QU
Slide 19: FY 2021E | CEO Takeaway messages
FY 2021E | CEO Takeaway messages 19 Strong demand expected to continue in all segments Refocused efforts on the spin, first quarter outperformance demonstrates our confidence in developing a successful On-Highway company Continued diligent supply chain management to serve customers and deliver on ou
Slide 20: Appendix
Appendix INDUSTRIAL
Slide 21: First Quarter 2021 | Financial Summary
First Quarter 2021 | Financial Summary 21 Q1 2021 Q1 2020 Δ U.S. GAAP Revenues ($mn) 7,473 5,461 37% Net Sales | Industrial Activities ($mn) 7,043 4,993 41% Net Income ($mn) 425 (54) 887% Diluted EPS ($) 0.30 (0.05) 700% Non – GAAP (1) Net Sales | Industrial Activities @CC ($mn) 6,795 4,933 36% Adju
Slide 22: First Quarter 2021 | Financials by Segment
First Quarter 2021 | Financials by Segment 22 REVENUES GROSS PROFIT Adj. EBIT Adj. EBIT Margin % D&A Q1 21 Q1 20 Q1 21 Q1 20 Q1 21 Q1 20 Q1 21 Q1 20 Q1 21 Q1 20 AG 3,038 2,244 709 343 399 24 13.1% 1.1% 62 64 CE 656 422 94 (9) 25 (83) 3.8% (19.7)% 9 13 C&SV 2,805 2,021 327 167 76 (56) 2.7% (2.8)% 115
Slide 23: First Quarter 2021 | Net Sales and Adj EBIT breakdown
First Quarter 2021 | Net Sales and Adj EBIT breakdown 23 Net Sales Split AG CE C&SV PT Q1 21 Q1 20 Q1 21 Q1 20 Q1 21 Q1 20 Q1 21 Q1 20 NA 35% 37% NA 43% 40% NA n.m. n.m. NA 3% 4% EU 34% 35% EU 20% 22% EU 80% 81% EU 70% 74% SA 13% 13% SA 13% 16% SA 7% 6% SA 6% 6% RoW 18% 15% RoW 24% 22% RoW 13% 13% R
Slide 24: Capex and R&D
Capex and R&D (1) 24 ($mn) Q1 Q1 2021 2020 Investments in property, plant and equipment, and intangible assets (1) 70 63 Breakdown by Category NEW PRODUCT & TECHNOLOGY 54% 56% MAINTENANCE & OTHER 43% 43% INDUSTRIAL CAPACITY EXPANSION & LT INVESTMENTS 3% 1% Breakdown by Segment AGRICULTURE 44% 50% CO
Slide 25: Debt Maturity Schedule | Breakdown
Debt Maturity Schedule | Breakdown 25 ($mn) Outstanding Mar 31, 2021 9M 2021 2022 2023 2024 2025 Beyond 2.7 Bank Debt 1.3 0.5 0.2 0.1 0.1 0.5 9.7 Capital Market 1.7 0.9 1.8 1.4 0.9 3.0 0.3 Other Debt 0.1 0.2 0.0 0.0 0.0 0.0 12.7 Cash Portion of (Debt) Maturities 3.1 1.6 1.9 1.5 1.0 3.5 of which Indu
Slide 26: Europe Trucks | Company performance
Europe Trucks | Company performance 26 Q1 2018 2019 2020 2021 MKT SHARE(1) Light (3.5-7.49t) 13.8% 13.1% 12.1% 12.0% M&H (≥7.5t) 8.2% 6.0% 8.5% 8.3% Europe (*) 11.6% 10.4% 10.8% 10.8% B-TO-B Light (3.5-7.49t) 1.35 1.21 1.50 2.00 M&H (≥7.5t) 1.04 1.12 1.27 1.70 Europe (*) 1.26 1.19 1.44 1.92 Δ 18/19
Slide 27: Reconciliations
Reconciliations INDUSTRIAL
Slide 28: Reconciliation of Net Income (Loss) to Adj. EBIT by Segment (US GAAP)
Reconciliation of Net Income (Loss) to Adj. EBIT by Segment (US GAAP) 28 Q1 2021 Unallocated ($mn) Industrial AG CE CV PT Items, Elim. & Activities Other Consolidated Net income 425 Less: Consolidated Income tax (expense) benefit (157) Consolidated Income before taxes 582 Less: Financial Services Fi
Slide 29: Reconciliation of Net Income (Loss) to Adj. EBIT by Segment (US GAAP)
Reconciliation of Net Income (Loss) to Adj. EBIT by Segment (US GAAP) 29 ($mn) Q1 2020 Unallocated Industrial AG CE CV PT Items, Elim. & Activities Other Consolidated Net income (loss) (54) Less: Consolidated Income tax (expense) benefit 23 Consolidated Income (loss) before taxes (77) Less: Financia
Slide 30: First Quarter 2021
First Quarter 2021 30 Reconciliation of Adj. net income and Adj. income tax (expense) benefit to Net Income (loss) and Income tax (expense) ($mn) benefit and calculation of Adj. diluted EPS and Adj. ETR under U.S.GAAP Q1 2021 Q1 2020 Net income (loss) 425 (54) Adjustments impacting Income (loss) bef
Slide 31: First Quarter 2021
First Quarter 2021 31 Reconciliation of Adj. net income and Adj. income tax (expense) benefit to Net Income (loss) and Income tax (expense) ($mn) benefit and calculation of Adj. diluted EPS and Adj. ETR under U.S.GAAP Q1 2021 Q1 2020 (a) Adjustments impacting Income (loss) before income tax (expense
Slide 32: Reconciliation of Total Debt to Net Debt (US GAAP)
Reconciliation of Total Debt to Net Debt (US GAAP) 32 ($mn) Consolidated Industrial Activities Financial Services March 31, December 31, March 31, December 31, March 31, December 31, 2021 2020 2021 2020 2021 2020 Third party debt (23,805) (26,053) (6,286) (7,271) (17,519) (18,782) Intersegment notes
Slide 33: First Quarter 2021
First Quarter 2021 33 Reconciliation of Net cash provided by (used in) Operating Activities to Free cash flow of Industrial Activities under U.S. GAAP ($mn) Q1 2021 Q1 2020 Net cash provided by (used in) Operating Activities 372 (532) Less: Cash flows from Operating Activities of Financial Services
Slide 34: First Quarter 2021
First Quarter 2021 34 Reconciliation of Cash and cash equivalents to Available liquidity under U.S.-GAAP ($mn) March 31, 2021 December 31, 2020 Cash and cash equivalent 7,059 8,785 Restricted cash 908 844 Undrawn committed facilities 5,755 6,148 Other current financial assets(1) 164 94 Available liq
Slide 35: Geographic Information
Geographic Information 35 The composition of our regions part of the geographic information is as follow: ▪ North America: United States, Canada and Mexico; ▪ Europe: member countries of the European Union, European Free Trade Association, Ukraine, and Balkans; ▪ South America: Central and South Ame
Slide 36: Non-GAAP Financial Measures
Non-GAAP Financial Measures 36 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’ a
Slide 37: Investor Relations Team
Investor Relations Team ▪ 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 Europe +44 (207) 76 - 60369 e-mail: investor.relations@cnhind.co