First-quarter diluted EPS of $0. 31; Adjusted diluted EPS of $0. 33 (Q1 2023 – $0. 35)
Agriculture adjusted EBIT margin in the first quarter decreased through two hundred foundation issuances year-over-year to 12. 5%; Construction increases foundation emissions by 150 to 6. 7%
Cost relief systems in place, helping to mitigate the effect of the market slowdown.
Basildon, United Kingdom – May 2, 2024 – CNH Industrial N. V. (NYSE: CNHI) today reported effects for the quarter ended March 31, 2024, with net revenue from a net source of $402 million and diluted earnings consistent with a consistent percentage of $0. 31, comparatively. to a net source of income of $486 million. and diluted earnings consistent with a consistent percentage of $0. 35 for the quarter ended March 31, 2023. Consolidated revenue was $4. 82 billion (approximately 10% less than the first quarter of 2023) and net sales of the industrial business were $4. 13 billion (approximately 14% less than the first quarter of 2023). ). Net money used in counterpart activities was $894 million and the absorption of loose trade money was $1,209 million in the first quarter.
“The CNH team faced a declining market environment in the first quarter as a decline in industry demand persisted, specifically in South America and Europe. Anticipating those headwinds, we continue with what we can control: production efficiency, disciplined business execution, judicious discounts on administrative and promotional expenses, and considered investments in products and technology. As always, the team faces demanding situations head-on and works diligently to provide answers to our clients. I must thank our employees and distributors for their unwavering support of farmers. and developers from all over the world.
Scott W. Wine, President & Chief Executive Officer
First Quarter 2024 Results
Industrial net sales were $4. 13 billion, down 14% from the same period last year. This decrease is basically due to declining industry demand and broker stock management. Price realization remained favorable for agriculture and necessarily sound for construction.
In the first quarter of 2024, net source of revenue of $402 million, with diluted earnings consistent with a consistent percentage of $0. 31 ($486 million and $0. 35, respectively, in the first quarter of 2023). Adjusted Net Source of Revenue of $421 Million with Adjusted Diluted Earnings Comparative, in the first quarter of 2023, the adjusted net source of income was $475 million with adjusted diluted earnings consistent with a percentage of $0. 35.
Gross profit margin of Industrial Activities 22. 7% (24. 4% in the first quarter of 2023). This decline is due to the Agriculture sector, whose margin was affected by the reduction in production volumes, only partially offset by the realisation of the value and efficiency of the production rate. Highest construction gross profit margin across all regions, for an overall improvement of 150 basis points.
Cash used in operating activities during the quarter was $894 million (Q1 2023: $701 million). The absorption of free money flow from trading operations was $1,209 million, mainly due to seasonal growth in stocks. Consolidated third-party debt was $27. 8 billion as of March 31, 2024 ($27. 3 billion as of December 31, 2023).
The Company’s restructuring program continues to progress as planned, with CNH expecting 10-15% relief in the execution rate of hard and non-hard work overhead. The Company has incurred a total of $78 million in restructuring fees in the first quarter of 2024, adding $53 million in 2023, and expects to incur up to $200 million in total.
In North America, industry volume declined 15% year-over-year in the first quarter for tractors under 140 hp and 2% for tractors over 140 hp; Combines fell 17%. In Europe, the Middle East and Africa (EMEA), demand for tractors and mixed combines fell by 15% and 24%, respectively. Demand for tractors in South America fell by 18% and demand for mixed combines by up to 40%, continuing the negative trend of the second part of 2023. Demand for tractors in Asia-Pacific decreased by 12%, while demand for mixed harvesters increased by as much as 16% across the region, but decreased by 22% in Australia and New Zealand.
Agricultural net sales decreased 14% during the quarter to $3. 37 billion, primarily due to declining industry volume across all regions and brokers’ equity management, offset by favorable pricing realization.
Adjusted EBIT decreased to $421 million ($570 million in the first quarter of 2023), due to lower volumes, offset by an increase in purchasing and production costs, and continued relief in selling, general and administrative expenses. Investments in R
The volume of the global structure apparatus industry decreased by 1% year-on-year in the first quarter for heavy structure apparatus; Lightweight appliances fell by 8%. Overall demand decreased 14% in EMEA, 6% in North America, 10% in South America and 3% in Asia-Pacific.
CNH Construction’s sales decreased 11% during the quarter to $758 million due to volume declines in all regions, primarily due to declining market demand.
Gross profit margin 17. 4%, 150 foundation emissions more than in the first quarter of 2023, mainly due to higher purchase and production costs, partially offset by an unfavorable mix.
Financial Services earnings increased 25% due to favorable volumes and yields in all regions, offset by lower used appliance sales due to lower operating lease expirations.
Net source of revenue of $118 million in the first quarter of 2024, an increase of $40 million compared to the same quarter of 2023, primarily due to favorable volumes in all regions, margin improvement in South America, and a favorable effective tax rate due to discrete elements in the neighborhood; partly offset by higher threat prices due to the accumulation of delinquencies of older people in South America.
The controlled portfolio (including unconsolidated joint ventures) $28. 7 billion as of March 31, 2024 (with retail accounting for 65% and wholesale industry accounting for 35%), a cumulative of $4. 2 billion since March 31, 2023 (an increase of $4. 3 billion on consistent terms). currency). ).
As of March 31, 2024, the balance of accounts receivable overdue for more than 30 days as a percentage of accounts receivable 1. 7% (March 31, 2023: 1. 4%).
The Company expects that in 2024, global industry retail sales will decline in the agricultural and structural appliance markets compared to 2023. In all the key markets in which the Company competes, CNH had estimated in the past that retail sales in the agricultural sector would decline by 10% to 15%, but now expects industry volumes to decline by around 15%, at the lower end of the previous range. Retail sales in the structural apparatus sector are still expected to be down about 10% in comparison. until 2023.
CNH continues its efforts to improve cycle margins through its previously announced rate relief programs, focused on product prices and SG expenses.
Due to lower sales projections for the agricultural sector, the Company updates its outlook for 2024 as follows:
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Non-GAAP Financial Information
CNH monitors its operations using various non-GAAP monetary measures. CNH’s control believes that these non-GAAP monetary measures provide useful and applicable data related to the effects of transactions and enhance readers’ ability to compare CNH’s monetary functionality and condition. Non-GAAP measures to identify operational trends, as well as to make decisions about long-term spending, resource allocation, and other operational decisions, as they provide greater transparency to our core operations. These non-GAAP monetary measures do not have a standardized meaning. prescribed through US GAAP and are unlikely to be comparable to other named measures used through other corporations and are not intended to be a replacement for measures of monetary functionality and monetary condition listed in accordance with US GAAP.
CNH’s non-GAAP monetary measures are explained below:
The tables attached to this press release provide reconciliations of the non-GAAP measures used in this press release to the comparable maximum GAAP measures.
All statements other than statements of fact contained in this press release add to competitive strengths; business strategy; long-term monetary condition or consistent relationship effects; budgets; projections relating to earnings, income, equity gains (or losses), capital expenditures, dividends, liquidity, capital draws or other monetary items; costs; and management’s plans and objectives related to consistent operations and products, are forward-looking statements. Forward-looking statements also include statements regarding the long-term functionality of CNH and its subsidiaries on a stand-alone basis. These statements would likely come with words like “possibly,” “will,” “expect,” “could,” “should,” “intend,” “estimate,” “anticipate,” “believe. ” ”. Matrix “stay”, “on track”, “design”, “goal”, “objective”, “goal”, “forecast”, “projection”, “outlook”, “plan” or similar terminology. Forward-looking statements are not promises of long-term functionality. Rather, they are based on existing reviews and assumptions and involve known and unknown hazards, uncertainties and other factors, many of which are beyond our control and difficult to predict. If any such dangers and uncertainties materialize (or occur with a degree of severity that the Company cannot predict) or if other assumptions underlying any of the forward-looking statements prove to be incorrect, adding any assumptions related to the Company’s strategic plans, Actual effects or developments could differ materially from any long-term effects or developments expressed or implied by the forward-looking statements.
Factors, hazards and uncertainties that could cause actual effects to differ materially from those considered in the forward-looking statements include, but are not limited to: economic situations in each of our markets, adding significant uncertainty caused by geopolitical events; disruptions in the production and origin chain, adding limitations to industry capacity, curtain availability and global logistics delays and limitations; the numerous interrelated points affecting customer confidence and global demand for capital goods and related products, adjustments in government policies related to banking, economic and fiscal policy; legislation, specifically in relation to capital goods issues such as agriculture, the environment, debt relief policies and subsidy programmes, industry and infrastructure development; government policies related to foreign industry and investment, adding sanctions, import quotas, capital controls and tariffs; volatility in foreign industry caused by the imposition of tariffs, sanctions, embargoes and industrial wars; competition movements in the various industries in which we compete; progression and use of new technologies and technological difficulties; interpret or adopt new compliance needs with respect to engine emissions, shielding or other facets of our products; hard work relationships; interest rates and exchange rates; inflation and deflation; energy charges; agricultural commodity rates and emerging curtain rates; beginnings and other design activities; our ability to discharge financing or refinance existing debt; stress on new and used equipment charges; resolve ongoing disputes and investigations on a wide variety of matters, including disputes between brokers and suppliers, disputes over intellectual asset rights, product warranties and defective product claims, and challenge regulatory and contractual regulations on emissions and/or fuel economy fuel; security issues, cybersecurity attacks, build errors and other disruptions to the IT infrastructure of CNH and its suppliers and resellers; security briefings related to our products; our pension plans and other post-employment obligations; political and civil unrest; volatility and deterioration of economic and capital markets, including pandemics (such as the COVID-19 pandemic), terrorist attacks in Europe and elsewhere; correcting a weakness in the curtains; our ability to realize expected benefits from our business projects in accordance with our strategic plan; add targeted restructuring moves to optimize our charge design and the strength of our operations; our inability to realize, or delay the realization of, all of the expected benefits of our acquisitions, joint ventures, alliances or strategic arrangements and other similar dangers and uncertainties, and our good fortune in managing the dangers related to the foregoing.
Forward-looking statements are based on assumptions relating to the points described in this press release, which are rarely based on estimates and knowledge obtained from third parties. These estimates and insights are revised. Actual effects would likely differ materially from forward-looking statements, as a result of a number of dangers and uncertainties, many of which are beyond CNH’s control. CNH expressly disclaims any objective or legal responsibility to provide, update or revise any forward-looking statements contained in this announcement to reflect any replacement expectations or any replacement. in the events, situations or cases on which such forward-looking statements are based.
In the company’s filings with the U. S. Securities and Exchange Commission, the company said:More data related to CNH is included in the U. S. Securities and Exchange Commission (“SEC”) data, adding points that could potentially substantially affect its monetary results.
Additional items may cause actual effects to differ from those expressed or implied by the forward-looking statements included in the Company’s filings with the SEC (including, but not limited to, the items discussed in our 2023 Annual Report and upcoming quarterly reports). .
Conference Call & Webcast
Today, at 9:00 a. m. EDT (2:00 p. m. m. BST / 3:00 p. m. CEST), Control will hold a conference call to provide the effects of the first quarter of 2024 to monetary analysts and investors. The call can be followed live online at https://bit. ly/CNH_Q1_2024 and a replay can be seen later on the company’s online page www. cnh. com. A provision will be made on CNH’s website prior to the convention.
CONTACTS
Investor Relations – Jason Omerza Tel. 1 630 740 8079 or Federico Pavesi Tel. 39 345 605 6218 (e-mail invest. relations@cnh. com)
CNH INDUSTRIAL N. V. Consolidated Statement of Operations for the 3 Months Ended March 31, 2024 and 2023 (Unaudited, US GAAP)
These consolidated statements of sources of income should be read in conjunction with the Company’s audited consolidated monetary statements and accompanying notes for the year ended December 31, 2023 included in the Annual Report on Form 10-K. These consolidated statements of revenue sources constitute the consolidation of all subsidiaries of CNH Industrial N. V.
CNH INDUSTRIAL N. V. Consolidated Sheets as of March 31, 2024 and December 31, 2023 (Unaudited, US GAAP)
CNH INDUSTRIAL N. V. Consolidated Statement of Cash Flows for the Three Months Ended March 31, 2024 and 2023 (Unaudited, US GAAP)
These consolidated statements of money deserve to be read in conjunction with the Company’s audited consolidated monetary statements and accompanying notes for the year ended December 31, 2023 included in the Annual Report on Form 10-K. These consolidated money statements constitute the consolidation of all subsidiaries of CNH Industrial N. V.
CNH INDUSTRIAL N. V. Supplemental Statements of Operations for the 3 Months Ended March 31, 2024 and 2023 (Unaudited, US GAAP)
(1) Industrial activities constitute the business without money services. Industrial activities come with the structure and agriculture sectors of the company, as well as other assets, liabilities, sources of income, and expenses of the company that are not reflected in money services. (2) Elimination of interest, source of income from business activities in money services. (3) Removal of interests from commercial activities.
(1) Industrial activities constitute the business without money services. Industrial activities come with the agriculture and business structure sectors, as well as other assets, liabilities, income, and expenses of the business not reflected in money services. (2) This detail comes with the elimination of duties/liabilities between commercial activities and monetary services. (3) This item basically constitutes the reclassification of deferred tax assets/liabilities within the same tax jurisdiction and the elimination of intercorporate activities between Industrial Activities and Financial Services.
CNH INDUSTRIAL N. V. Supplemental Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023 (Unaudited, US GAAP)
(1) Industrial activities constitute the business without the monetary whole. Industrial activities come with the agriculture and structure sectors of the Company, as well as other assets, liabilities, income and expenses of the Company not reflected in the monetary set (2) This item comes with the elimination of dividends from Money to commercial activities, which are included in net commercial activities. Cash used in operational activities. (3) This item comes with the elimination of certain minor activities between Industrial Activities and Financial Services.
Other Additional Monetary Information
(1) For the three months ended March 31, 2024 and 2023, this item includes pretax gain of $6 million and $6 million resulting from the amortization over four years of the $101 million positive effect of the 2021 adjustments to a U. S. physical care plan. U. S.
(2) For the 3 months ended March 31, 2024, this item did not include any separate items. For the 3 months ended March 31, 2023, this item generated a gain of $13 million similar to the fair price revaluation of Augmenta and Bennamann, partially offset by a loss of $6 million on the sale of our currency business in Russia.
Other additional monetary information
(1) Total trade (debt) includes intersegment notes to monetary activities for $218 million and $301 million as of March 31, 2024 and December 31, 2023, respectively. General Financial Services (debt) includes intersegment notes to commercial activities for $(416) million and $(527) million as of March 31, 2024 and December 31, 2023, respectively. (2) Net money receivable/(payable) between segments similar to business activities was $(198) million and $(226) million as of March 31, 2024 and December 31, 2023, respectively.
(1) This item basically includes capital increases for cross-sectoral holdings and adjustments in monetary entitlements.
Other Additional Monetary Information
(Unaudited)