CNH Industrial N.V. · NYSE:CNH
CNH Industrial — FY2016 Earnings Presentation
35 slides from CNH Industrial's earnings presentation, Jan 31, 2017
Slide 1: Q4 & FY 2016 Results Review
Q4 & FY 2016 Results Review January 31st, 2017 Exhibit 99.2
Slide 2: Safe Harbor Statement and Disclosures
Safe Harbor Statement and Disclosures January 31st, 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 respe
Slide 3: FY 2016 Highlights
FY 2016 Highlights Note: All figures are provided herein on a US GAAP $ basis unless otherwise indicated (1) Non-GAAP measures (definition and reconciliation in appendix) January 31st, 2017 Revenues at $24.9bn Down 4.0% vs. FY 2015 Net industrial debt (1) of $1.6bn Or $1bn excluding the EC Settlemen
Slide 4: FY 2016 Main product awards
FY 2016 Main product awards January 31st, 2017 SILVER INNOVATION MEDALS (SIMA) Case IH Autonomous Concept & New Holland NH Drive Autonomous Concept BEST UTILITY TRACTOR of The YEAR New Holland Agriculture T5.120 2017 TRACTOR of The YEAR Case IH Optum 300 CVX EUROPEAN GAS AWARDS of EXCELLENCE 2017 IV
Slide 5: Financial Highlights
Financial Highlights
Slide 6: Q4 & FY 2016 Financial Highlights
Q4 & FY 2016 Financial Highlights January 31st, 2017 (1) Non-GAAP measures (definition and reconciliation in appendix) (*) Note: Net Sales and Operating Profit: Excluding Other Activities, Unallocated Items & Adjustment & Eliminations Q4 2016 Δ vs. ’15 FY 2016 Δ vs. ’15 Net Sales Ind. Activities ($m
Slide 7: Q4 & FY 2016 Net Sales Industrial Activities Walk by Segment
Q4 & FY 2016 Net Sales Industrial Activities Walk by Segment (*) Note: Net Sales: Including Other Activities, Unallocated Items & Adjustment & Eliminations (1) Note: Net Sales: Excluding Other Activities, Unallocated Items & Adjustment & Eliminations January 31st, 2017 Net Sales By Currency (1) ($mn
Slide 8: Q4 & FY 2016 Operating Profit Industrial Activities Walk by Segment
Q4 & FY 2016 Operating Profit Industrial Activities Walk by Segment January 31st, 2017 Adjusted Net Income Walk ($Mn) 474 26 103 482 (141) (37) (18) (4) 79 Operating Profit Industrial Activities ($Mn) (141) 1,432 (134) (88) 50 46 (15) 1,291 5.8% 5.5% 8 563 (76) (48) (24) (1) (2) 412 262 (151) (3) (1
Slide 9: Q4 & FY 2016 Cash Flow – Change in Net Industrial Debt
Q4 & FY 2016 Cash Flow – Change in Net Industrial Debt January 31st, 2017 FY ’16 - Net Industrial Cash Flow 1,045 Dec 31, 2015 Net Income (Loss) D&A Change in provision and similar Change in WC Tangible & Intangible Capex Other changes Capital Increase and dividends, net FX Translation Effects and O
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 FY 2016 330 (US GAAP, $/mn) FY Cash inflow Cash outflow Net
Slide 11: Q4 & FY 2016 Financial Services performance
Q4 & FY 2016 Financial Services performance January 31st, 2017 Net Income ($mn) Delta % FY ’16 vs. FY ‘15 Net income was $334mn, down $34mn compared to FY 2015 Primarily due to reduced interest spreads, a lower average portfolio and the negative impact of currency translation FY ’16 Profitability ra
Slide 12: December 31, 2016 Liquidity & Debt Maturity
December 31, 2016 Liquidity & Debt Maturity Available Liquidity ($bn) Debt Maturity Schedule1 ($bn) 1 Represents cash portion of debt maturities as of 12/31/2016 2 Of which $0.8bn ABS related & Restricted Cash Company Available Liquidity Available liquidity at December 31, 2016 was $8.7bn, compared
Slide 13: Industrial Activities Overview
Industrial Activities Overview
Slide 14: Agricultural Equipment FY 2016 Financial Results
Agricultural Equipment FY 2016 Financial Results January 31st, 2017 Net Sales by Region & Product ($) Operating Profit Walk ($Mn) (134) 8.6% 8.1% 952 (312) 76 59 - 7 818 36 348 (39) 15 (27) (23) (5) 3 272 Q4 2016 Operating Profit Walk NAFTA LATAM APAC EMEA Tractors Other Combines Net sales were $10.
Slide 15: Agricultural Equipment Inventory management
Agricultural Equipment Inventory management (units of equipment) – Industry units (*) Source: CNH Industrial Internal Data Industry Units Tractors Combines For FY 2016 NAFTA ** (21%) EMEA (8%) LATAM 15% APAC 14% (**) Included in row crop sector definition Tractors Combines Q4 Worldwide Tractors and
Slide 16: Construction Equipment FY 2016 Financial Results
Construction Equipment FY 2016 Financial Results January 31st, 2017 Net Sales by Region & Product ($) Operating Profit Walk ($Mn) 90 3.5% 0.1% (86) (38) 24 9 5 (2) 2 (88) Net sales were $2.3bn, down 9.4% vs. FY 2015 (down 8.6% on a constant currency basis) 18 (18) (22) (12) 2 0 2 (30) Q4 2016 Operat
Slide 17: Construction Equipment Inventory management
Construction Equipment Inventory management (units of equipment) – Industry units Note: Starting from Q2 2014, industry volume data for Heavy Construction Equipment includes compaction equipment, which historically was not in the Light or Heavy Equipment definitions. Further, industry volume data fo
Slide 18: Commercial Vehicles FY 2016 Financial Results
Commercial Vehicles FY 2016 Financial Results January 31st, 2017 Net Sales by Region & Product ($) Operating Profit Walk ($Mn) Net Sales at $9.6bn, Flat vs. FY 2015 (up 1.8% on a constant currency basis) 246 (*) (113) 87 60 127 11 6 (4) 333 3.5% 2.6% Negative impact from Specialty Vehicles Q4 2016 O
Slide 19: Commercial Vehicles Inventory management
Commercial Vehicles Inventory management (units of equipment) – Industry units Commercial Vehicles (All Equipment) * Reflects aggregate for key markets where the Company competes: EMEA: 27 of the member countries of the European Union; LATAM: Brazil, Argentina and Venezuela; APAC: Russia, Turkey, So
Slide 20: Powertrain FY 2016 Financial Results
Powertrain FY 2016 Financial Results January 31st, 2017 FY 2016 third party Net sales at 47% vs. 46% in FY 2015 Net Sales & Operating Profit ($) Units Sold FY ’16 vs. FY ’15 Engines sold to third party at 57% vs. 55% in FY 2015 Net sales were $3.7bn, up 4.1% vs. FY 2015 (up 4.9% on a constant curren
Slide 21: FY 2017E US GAAP Financial Targets
FY 2017E US GAAP Financial Targets
Slide 22: FY 2017E Industry Units
January 31st, 2017 FY 2017E Industry Units 1 Reflects aggregate for key markets where Company competes Agricultural Equipment Flat (5%) – (10%) (5%) – (10%) Agricultural Equipment ~15% ~15% 0-140 HP 140+ HP Combines Combines Tractors Construction Equipment Flat Flat – (5%) Heavy Light Construction E
Slide 23: FY 2017E Outlook and US GAAP Financial Targets
FY 2017E Outlook and US GAAP Financial Targets January 31st, 2017 CNH Industrial is setting its 2017 guidance (*) as follows: Net sales of Industrial Activities between $23bn and $24bn Adjusted diluted EPS (**) between $0.39 and $0.41 Net industrial debt at the end of 2017 between $1.4bn and $1.6bn
Slide 24: Appendix
Appendix
Slide 25: Q4 & FY 2016 From Operating Profit to Net Income (Loss) under US GAAP
Q4 & FY 2016 From Operating Profit to Net Income (Loss) under US GAAP January 31st, 2017 ($mn) Q4 2016 Q4 2015 Δ FY 2016 FY 2015 Δ Industrial Activities Operating profit 412 563 (151) 1,291 1,432 (141) Financial Services Operating profit 115 118 (3) 478 515 (37) Elimination & Other (86) (85) (1) (33
Slide 26: Reconciliation of Adj. net income and Adj. income taxes
Q4 & FY 2016 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 January 31st, 2017 ($mn) Fourth Quarter Full Year 2016 2015 2016 2015 Net Income / (Loss) 96 231 (249) 248 Adjustments
Slide 27: Reconciliation of Adj. net income and Adj. income taxes (continued)
Q4 & FY 2016 Reconciliation of Adj. net income and Adj. income taxes to the most comparable GAAP financial measure and determination of Adj. diluted EPS and Adj. ETR under U.S.GAAP January 31st, 2017 ($mn) Fourth Quarter Full Year 2016 2015 2016 2015 (a) Adjustments impacting Income (loss) before in
Slide 28: Net Income / (Loss) US GAAP to Profit / (Loss) under EU-IFRS
Q4 & FY 2016 Net Income / (Loss) US GAAP to Profit / (Loss) under EU-IFRS - Reconciliation January 31st, 2017 The following reconciles Net Income / (Loss) in US GAAP to Profit / (Loss) under IFRS: Fourth Quarter Full Year 2016 EPS 2015 EPS 2016 EPS 2015 EPS Net Income / (Loss) attributable to CNH In
Slide 29: Total Equity – US GAAP to EU-IFRS Reconciliation
December 31, 2016 Total Equity – US GAAP to EU-IFRS Reconciliation January 31st, 2017 Dec. 31, 2016 Dec. 31, 2015 Total Equity in accordance with US GAAP 4,451 4,843 (a) Development costs 2,374 2,536 (b) Goodwill and other intangible assets (106) (113) (c) Defined benefit plans - - (d) Restructuring
Slide 30: Net Debt under US GAAP
December 31, 2016 Net Debt under US GAAP ($MN) January 31st, 2017 ($mn) Consolidated Industrial Activities Financial Services Dec. 31, 2016 Dec. 31, 2015 (1) Dec. 31, 2016 Dec. 31, 2015 (1) Dec. 31, 2016 Dec. 31, 2015 (1) Third party debt 25,276 26,301 6,694 7,214 18,582 19,087 Intersegment notes pa
Slide 31: From Total Debt to Net Industrial Debt
December 31, 2016 From Total Debt to Net Industrial Debt January 31st, 2017 ($mn) Year Ended December 31, 2016 2015 (1) Net industrial (debt)/cash at beginning of period (1,578) (1) (2,628) Net income (loss) (249) 248 Add back European Commission settlement (2) 551 - Add back cost of repurchase of 2
Slide 32: Debt Maturity Schedule - Breakdown
December 31, 2016 Debt Maturity Schedule - Breakdown Outstanding December 31, 2016 2017 2018 2019 2020 2021 Beyond 4.3 Bank Debt 1.6 1.3 0.8 0.3 0.1 0.1 9.0 Capital Market 1.3 2.5 1.6 0.6 1.7 1.3 0.2 Other Debt 0.1 0.0 0.0 0.0 0.0 0.1 13.5 Cash Portion of Debt Maturities 3.0 3.8 2.4 1.0 1.8 1.5 5.9
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: [email protected] website: www.cnhindustrial.com Contacts January 31st, 2017