SOURCE: CNH

CNH

August 01, 2012 04:30 ET

CNH Second Quarter 2012 Net Sales Top $5 Billion, up 3% (9% Constant Currency Basis); EPS up 11% to $1.47

BURR RIDGE, IL--(Marketwire - Aug 1, 2012) - CNH Global N.V. (NYSE: CNH)

  • Net Sales of $5.0 billion +3% (+9% constant currency basis)
    • Agricultural equipment net sales of $4.0 billion +5% (+11% constant currency basis)
    • Construction equipment net sales of $1.0 billion -3% (+4% constant currency basis)
  • Equipment Operations' Operating Profit of $524 million, or 10.4% for the period
  • Diluted EPS attributable to CNH common shareholders at $1.47 per share, compared to $1.33 per share in Q2 2011
    Quarter Ended        
    6/30/2012     6/30/2011     Change
  (US $ in millions, except per share data and percentages)  
Net Sales of Equipment   $ 5,026     $ 4,881     3.0 %
Equipment Operations Operating Profit   $ 524     $ 521     0.6 %
Equipment Operations Operating Margin     10.4 %     10.7 %   -0.3 pts  
Financial Services Net Income   $ 78     $ 52     50.0 %
Net Income Attributable to CNH   $ 355     $ 320     10.9 %
Net Income Before Restructuring and Exceptional Items   $ 356     $ 320     11.3 %
Diluted EPS Attributable to CNH common shareholders   $ 1.47     $ 1.33     10.5 %
                       

CNH Global N.V. (NYSE: CNH) today announced financial results for the quarter ended June 30, 2012. For the quarter, net sales increased 3% (9% constant currency basis) to $5.0 billion as firm global demand for agricultural equipment, on the back of favorable agricultural commodity prices, compensated for a more mixed trading environment in the construction equipment sector. Equipment Operations posted a comparable period improvement in gross profit margin of 80 basis points to 21% for the second quarter and an Operating Profit of $524 million as higher revenues and positive net pricing compensated for increased SG&A expenditures and R&D investment and the negative impact from foreign exchange.

Equipment net sales during the quarter were 80% agricultural equipment and 20% construction equipment, in line with last year. The geographical distribution of net sales in the quarter was 43% North America, 35% EAME & CIS, 13% Latin America, and 9% APAC markets.

In the second quarter, Equipment Operations generated $789 million in cash flow from operations, a 67% increase over the prior year, resulting in $281 million cash generation on a year-to-date basis, as improved net sales and operating performance more than offset the increased net working capital needed to support business activity. Year-to-date capital expenditures totaled $206 million, a 64% increase from the comparable 2011 period, largely as a result of investments in new manufacturing sites and product launches in both the agricultural and construction equipment segments. Through the second quarter, 72% of the capital expenditures were on new product development (inclusive of interim and final Tier 4 emission compliant equipment) and production capacity. The Group expects full year capital expenditures and R&D investment of approximately $1 billion. CNH's Equipment Operations ended the period with a net cash position of $2.8 billion. The 32% effective tax rate for the second quarter is within the Group's full year 2012 forecasted effective tax rate guidance of 32% to 35%.

For the quarter, net income, before restructuring and exceptional items, was $356 million, an increase of 11.3% as a result of solid trading conditions in most regions during the quarter, satisfactory industrial performance, and improved performance by the Group's financial services business offsetting negative currency translation in the period and reduced contribution from unconsolidated industrial subsidiaries. This resulted in the Group generating diluted earnings per share of $1.47 (before restructuring and exceptional items), up 11% compared to $1.33 per share in the comparable period of 2011.

2012 Full Year Market Outlook

  • Worldwide agricultural equipment unit volume is expected to be flat to down 5%
  • Worldwide construction equipment unit volume is expected to be flat to down 5%

CNH Confirms Its Previously Released Guidance For The Full Year 2012
Despite a mixed economic climate in certain of the Groups' operating regions, the negative effect from the translation of earnings to the U.S. dollar, and the poor climatic conditions in the United States, CNH confirms its full year financial guidance.

  • Revenues up 5%+
  • Operating Margin in excess of 8.6%

SEGMENT RESULTS
Agricultural Equipment

    Quarter Ended        
    6/30/2012     6/30/2011     Change  
  (US $ in millions, except percentages)  
Net Sales of Equipment   $ 4,025     $ 3,851     4.5 %
Gross Profit   $ 915     $ 850     7.6 %
Gross Margin     22.7 %     22.1 %   0.6 pts  
Operating Profit   $ 507     $ 496     2.2 %
Operating Margin     12.6 %     12.9 %   -0.3 pts  
                       

CNH Agricultural Equipment Second Quarter Results
CNH's net sales in the agricultural equipment sector increased 5% for the quarter (11% on a constant currency basis) driven by volume, positive net pricing, and favorable product mix. All of the Group's regions reported increased revenue on a constant currency basis. Operating profit increased by $11 million to $507 million at an operating margin of 12.6%.

Second quarter market share performance for agricultural equipment was in line with the overall market for both tractors and combines. Combine market shares increased in Latin America and APAC and was in line with the market in North America in the quarter.

CNH worldwide production of agricultural equipment matched retail sales in the quarter resulting in a stable level of company and dealer inventory.

At the 2012 Agrishow in Brazil, Case IH, through its strategic partnership with Semeato, expanded its no-till planter offerings to include a range of 7 to 36-row models. As a result of this launch, the Case IH brand now provides the most complete planter product offering in Brazil. In Latin America, the brand also began delivering the larger, more efficient 7120 and 8120 combine models with their industry leading grain quality, and unique features including CVT drives and slope compensation system. Still in Brazil, the brand's sugar cane harvester was honored by Revista Rural magazine with the "Top of Mind" award. In Europe, Case IH's Puma 145 with Efficient Power was awarded "HIT of the Fair" at the XIII Mazowieckie Dni Rolnictwa (Mazovian Agricultural Days) exhibition in Poland. Furthermore, Case IH began assembly, at the company joint venture manufacturing facility in Russia, of Axial-Flow Combines 6088 for the local market.

In Europe and in Australia, New Holland Agriculture launched the new BigBaler range, which provides up to 20% increased capacity and up to 5% denser bales for improved productivity. In North America, strong growth in the dairy & livestock customer segments and the onset of an early hay season enabled New Holland to consolidate leadership in this area. With the introduction of the flexible SmartTrax track option on the T9 4WD tractor family, New Holland is well positioned for growth with mixed farmers who are diversifying their income with the opportunities in cash crops available today. At the Agrishow in Brazil, New Holland, as part of its partnership with Semeato, launched the new SOLTT planting equipment, which provides a full range of solutions, from the very small up to the largest planter in the market. The brand also presented the new CR5080, CR6080SL and CR9080 models, which complete the Twin Rotor combine range that features engines from 300 to 450 hp. As part of its Clean Energy Leader strategy, New Holland displayed a project developed in partnership with the Center for Sugarcane Technology (CTC), based in Piracicaba, Brazil which aims to generate renewable energy by baling sugar cane straw. New Holland also sponsored the Rio +20 Summit United Nations Conference on Sustainable Development in Rio de Janeiro and delivered a lecture on sustainable solutions for agribusiness.

New Holland launched its new TT Compact tractor series in several key African countries, including South Africa, Morocco and Tunisia. Featuring fuel-efficient engines ranging from 35 to 47 hp, these all-purpose tractors deliver powerful performance in a compact size for maximum maneuverability, reduced fuel consumption and low emissions. This addition further extends the popular TT tractor range, offering a wider choice for more applications. In South Africa, New Holland also launched the new fuel efficient TD5 series. The new tractors, available for the local market with fuel efficient Tier 3 compliant engines ranging from 88 to 110 hp, feature a completely new cab and can be equipped with a PowerShuttle transmission and a front loader for increased versatility in multiple uses.

Construction Equipment

    Quarter Ended        
    6/30/2012     6/30/2011     Change  
  (US $ in millions, except percentages)  
Net Sales of Equipment   $ 1,001     $ 1,030     -2.8 %
Gross Profit   $ 138     $ 138     0.0 %
Gross Margin     13.8 %     13.4 %   0.4 pts  
Operating Profit   $ 17     $ 25     -32.0 %
Operating Margin     1.7 %     2.4 %   -0.7 pts  
                       

CNH Construction Equipment Second Quarter Results
CNH's construction equipment second quarter 2012 net sales increased 4% on a constant currency basis (-3% on a reported basis) as market conditions remained largely flat to Q1 2012 in the North American market and improved equipment availability drove higher sales in the EAME & CIS markets. Challenging market conditions in Europe and Brazil, coupled with the negative effects of currency translation led to a comparative period margin decline of 70 basis points from the prior period.

Worldwide construction equipment market share was up in the second quarter, with gains in EAME & CIS and APAC light equipment markets and the North American heavy sector, as a result of new product launches and good equipment availability.

Worldwide production of construction equipment was moderately above retail sales during the quarter. The Group expects to moderately reduce construction equipment manufacturing levels, primarily in Latin America and Europe, to balance inventory levels over the remainder of the year.

New Holland Construction continued to renew its product range in high growth and emerging markets. During the quarter, it introduced the new C series crawler excavator and its C series wheel loader with Tier 3 compliant engines to its key markets in Africa, the Middle East, the CIS and Central Asia.

Case Construction Equipment introduced its new 521F and 621F wheel loaders equipped with Tier 3 compliant engines in Africa, the Middle East, the CIS and Central Asia, completing the renewal of its range of heavy line wheel loaders in these markets. In addition, at the CTT trade show in Moscow, Russia, Case presented its latest range of Tier 3 compliant SR and SV skid steer and TR compact track loaders.

In June, CNH celebrated the production of its 25,000th American-made Kobelco excavator at the company's manufacturing facility in Calhoun, Georgia (U.S.).

CNH Financial Services Second Quarter Results

    Quarter Ended      
    6/30/2012   6/30/2011   Change  
  (US $ in millions, except percentages)  
Net Income   $ 78   $ 52   50.0 %
On-Book Asset Portfolio   $ 16,075   $ 15,642   2.8 %
Managed Asset Portfolio   $ 18,399   $ 18,449   -0.3 %
                   

Net income attributable to Financial Services was $78 million for the quarter, compared with $52 million in the second quarter of 2011. Improved results were due to a higher average portfolio and lower provision for credit losses, partially offset by a higher provision for income taxes.

At the end of the second quarter of 2012, delinquent receivables greater than 30 days past due were 1.6% of the total on-book portfolio, a decrease from 1.9% at the end of the first quarter of 2012.

Unconsolidated Equipment Operations Subsidiaries
Second quarter results for the Group's unconsolidated Equipment Operations subsidiaries were $25 million, down from $35 million in the comparable period of 2011 largely as a result of reduced profits in the construction equipment sector and foreign currency translation.

Combination Transaction Proposal From Fiat Industrial
On May 30, 2012, CNH's Board of Directors received a proposal from Fiat Industrial S.p.A. regarding a combination transaction between Fiat Industrial S.p.A. and CNH Global N.V. The Board of Directors has appointed a special committee of unconflicted directors to evaluate the proposal. The special committee will make a recommendation to the unconflicted members of the board who will make a recommendation to the company's shareholders.

Equipment Operations Cash Flow and Net Debt

    Year to Date  
    6/30/2012     6/30/2011  
    (US $ in millions)  
Net Income   $ 623     $ 464  
Depreciation & Amortization     155       155  
Cash Change in Working Capital*     (643 )     (496 )
Other     146       109  
Net Cash Provided by Operating Activities     281       232  
Net Cash (Used) by Investing Activities**     (215 )     (177 )
All Other     (3 )     164  
Increase in Net (Cash)   $ 63     $ 219  
Net (Cash)   $ (2,794 )   $ (2,414 )
                 

* Net cash change in receivables, inventories and payables including inter-segment receivables and payables.
** Excluding Net (Deposits In)/Withdrawals from Fiat Industrial Cash Management Systems, as they are a part of Net (Cash).

ABOUT CNH
CNH Global N.V. is a world leader in the agricultural and construction equipment businesses. Supported by approximately 11,300 dealers in approximately 170 countries, CNH brings together the knowledge and heritage of its Case and New Holland brand families with the strength and resources of its worldwide commercial, industrial, product support and finance organizations. CNH Global N.V., whose stock is listed on the New York Stock Exchange (NYSE: CNH), is a majority-owned subsidiary of Fiat Industrial S.p.A. (FI.MI). More information about CNH and its Case and New Holland products can be found online at www.cnh.com.

CNH CONFERENCE CALL AND WEBCAST
CNH management will hold a conference call on August 1, 2012 to review second quarter 2012 results. The conference call webcast will begin at 6:00 a.m. U.S. Central Time (7:00 a.m. U.S. Eastern Time). This call can be accessed through the investor information section of the company's website at www.cnh.com and will be transmitted by CCBN.

NON-GAAP MEASURES
CNH utilizes various figures that are "Non-GAAP Financial Measures" as this term is defined under Regulation G, as promulgated by the SEC. In accordance with Regulation G, CNH has detailed either the computation of these measures from multiple U.S. GAAP figures or reconciled these non-GAAP financial measures to the most relevant U.S. GAAP equivalent in the accompanying tables to this press release. Some of these measures do not have standardized meanings and investors should consider that the methodology applied in calculating such measures may differ among companies and analysts. CNH's management believes these non-GAAP measures provide useful supplementary information to investors in order that they may evaluate CNH's financial performance using the same measures used by our management. These non-GAAP financial measures should not be considered as a substitute for, nor superior to, measures of financial performance prepared in accordance with U.S. GAAP.

CNH defines "Equipment Operations Gross Profit" as net sales of equipment less costs classified as cost of goods sold. CNH defines "Equipment Operations Operating Profit" as gross profit less costs classified as selling, general and administrative and research and development costs. CNH defines "Equipment Operations Gross Margin" as gross profit as a percent of net sales of equipment. CNH defines "Equipment Operations Operating Margin" as operating profit as a percent of net sales of equipment. "Net Debt (Cash)" is defined as total debt (including intersegment debt) less cash and cash equivalents, deposits in Fiat Industrial affiliates cash management pool and intersegment notes receivable. CNH defines "Net income (loss) and diluted EPS before restructuring and exceptional items" as Net income (loss) attributable to CNH, less restructuring charges and exceptional items, after tax. Equipment Operations "working capital" is defined as accounts and notes receivable and other-net, excluding intersegment notes receivables, plus inventories less accounts payable. The U.S. dollar computation of cash generated from working capital, as defined, is impacted by the effect of foreign currency translation and other non-cash transactions. CNH defines the "change in net sales on a constant currency basis" as the difference between prior year actual net sales and current year net sales translated at prior year average exchange rates. Elimination of the currency translation effect provides constant comparisons without the distortion of currency rate fluctuations.

FORWARD-LOOKING STATEMENTS
This press release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this press release, including statements regarding our competitive strengths, business strategy, future financial position, operating results, budgets, projected costs and plans and objectives of management, are forward-looking statements. These statements may include terminology such as "may," "will," "expect," "could," "should," "intend," "estimate," "anticipate," "believe," "outlook," "continue," "remain," "on track," "goal," or similar terminology.

Our outlook is largely based on our interpretation of what we consider to be relevant economic assumptions and involves risks and uncertainties that could cause actual results to differ (possibly materially) from such forward-looking statements. Macro-economic factors including monetary policy, interest rates, currency exchange rates, inflation, deflation, credit availability and the intervention by governments and non-governmental organizations in an attempt to influence such factors can have a material impact on our customers and the demand for our goods. Crop production and commodity prices are strongly affected by weather and can fluctuate significantly. Housing starts and other construction activity are sensitive to, among other things, credit availability, interest rates and government spending. Some of the other significant factors that may affect our results include general economic and capital market conditions, the cyclical nature of our businesses, customer buying patterns and preferences, the impact of changes in geographical sales mix and product sales mix, foreign currency exchange rate movements, our hedging practices, investment returns, our and our customers' access to credit, restrictive covenants in our debt agreements, actions by rating agencies concerning the ratings on our debt and asset-backed securities and the credit ratings of Fiat Industrial, risks related to our relationship with Fiat Industrial, the effect of the demerger transaction consummated by Fiat pursuant to which CNH was separated from Fiat's automotive business and became a subsidiary of Fiat Industrial, political uncertainty and civil unrest or war in various areas of the world, pricing, product initiatives and other actions taken by competitors, disruptions in production capacity, excess inventory levels, the effect of changes in laws and regulations (including those related to tax, healthcare, retiree benefits, government subsidies, engine emissions, and international trade regulations), the results of legal proceedings, technological difficulties, results of our research and development activities, changes in environmental laws, employee and labor relations, pension and health care costs, relations with and the financial strength of dealers, the cost and availability of supplies, raw material costs and availability, energy prices, real estate values, animal diseases, crop pests, harvest yields, government farm programs, consumer confidence, housing starts and construction activity, concerns related to modified organisms and fuel and fertilizer costs, and the growth of non-food uses for some crops (including ethanol and biodiesel production). Additionally, our achievement of the anticipated benefits of our margin improvement initiatives depends upon, among other things, industry volumes as well as our ability to effectively rationalize our operations and to execute our brand strategy. Further information concerning factors that could significantly affect expected results is included in our annual report on Form 20-F for the year ended December 31, 2011.

Furthermore, in light of ongoing difficult macroeconomic conditions, both globally and in the industries in which we operate, it is particularly difficult to forecast our results and any estimates or forecasts of particular periods that we provide are uncertain. We can give no assurance that the expectations reflected in our forward-looking statements will prove to be correct. Our actual results could differ materially from those anticipated in these forward-looking statements. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by the factors we disclose that could cause our actual results to differ materially from our expectations. We undertake no obligation to update or revise publicly any forward-looking statements.

 
CNH GLOBAL N.V.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND SUPPLEMENTAL INFORMATION
For the Three Months Ended June 30, 2012 and 2011
(Unaudited)
 
    Consolidated     Equipment Operations     Financial Services
    Three Months Ended June 30,     Three Months Ended June 30,     Three Months Ended June 30,
    2012     2011     2012     2011     2012   2011
    (in millions, except per share data)
Revenues:                                            
    Net sales   $ 5,026     $ 4,881     $ 5,026     $ 4,881     $ -   $ -
    Finance and interest income     253       284       33       44       327     353
      5,279       5,165       5,059       4,925       327     353
Costs and Expenses:                                            
    Cost of goods sold     3,973       3,893       3,973       3,893       -     -
    Selling, general and administrative     426       455       367       342       59     113
    Research, development and engineering     162       125       162       125       -     -
    Restructuring     2       -       2       -       -     -
    Interest expense     173       203       82       100       120     140
    Interest compensation to Financial Services     -       -       78       76       -     -
    Other, net     67       67       39       41       28     26
Total     4,803       4,743       4,703       4,577       207     279
                                             
Income before income taxes and equity in income of unconsolidated subsidiaries and affiliates    
476
     
422
     
356
     
348
     
120
   
74
Income tax provision     151       142       105       116       46     26
Equity in income of unconsolidated subsidiaries and affiliates:                                            
    Financial Services     4       4       78       52       4     4
    Equipment Operations     25       35       25       35       -     -
Net income     354       319       354       319       78     52
  Net loss attributable to noncontrolling interests     (1 )     (1 )     (1 )     (1 )     -     -
Net income attributable to CNH Global N.V.   $ 355     $ 320     $ 355     $ 320     $ 78   $ 52
                                             
                                             
Weighted average shares outstanding:                                            
  Basic     241       240                              
  Diluted     242       241                              
                                             
Basic and diluted earnings per share ("EPS") attributable to CNH Global N.V. common shareholders:                                            
  Basic EPS   $ 1.48     $ 1.34                              
  Diluted EPS   $ 1.47     $ 1.33                              
                                               

These Condensed Consolidated Statements of Operations should be read in conjunction with the Company's Audited Consolidated Financial Statements and Notes for the year ended December 31, 2011.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include CNH Global N.V.'s financial services business. Transactions between Equipment Operations and Financial Services have been eliminated to arrive at the consolidated data. 

 
CNH GLOBAL N.V.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND SUPPLEMENTAL INFORMATION
For the Six Months Ended June 30, 2012 and 2011
(Unaudited)
 
    Consolidated     Equipment Operations     Financial Services
    Six Months Ended June 30,     Six Months Ended June 30,     Six Months Ended June 30,
    2012     2011     2012     2011     2012   2011
    (in millions, except per share data)
Revenues:                                            
    Net sales   $ 9,665     $ 8,678     $ 9,665     $ 8,678     $ -   $ -
    Finance and interest income     513       569       67       88       659     692
      10,178       9,247       9,732       8,766       659     692
Costs and Expenses:                                            
    Cost of goods sold     7,697       7,007       7,697       7,007       -     -
    Selling, general and administrative     859       870       727       663       132     207
    Research, development and engineering     311       241       311       241       -     -
    Restructuring     2       3       2       3       -     -
    Interest expense     358       402       170       196       249     279
    Interest compensation to Financial Services     -       -       152       138       -     -
    Other, net     116       104       63       49       53     55
Total     9,343       8,627       9,122       8,297       434     541
Income before income taxes and equity in income of unconsolidated subsidiaries and affiliates    
835
     
620
     
610
     
469
     
225
   
151
Income tax provision     263       222       182       170       81     52
Equity in income of unconsolidated subsidiaries and affiliates:                                            
    Financial Services     7       7       151       106       7     7
    Equipment Operations     44       59       44       59       -     -
Net income     623       464       623       464       151     106
  Net loss attributable to noncontrolling interests     (1 )     (8 )     (1 )     (8 )     -     -
Net income attributable to CNH Global N.V.   $ 624     $ 472     $ 624     $ 472     $ 151   $ 106
                                             
Weighted average shares outstanding:                                            
  Basic     240       239                              
  Diluted     242       241                              
                                             
Basic and diluted earnings per share ("EPS") attributable to CNH Global N.V. common shareholders:                                            
  Basic EPS   $ 2.60     $ 1.97                              
  Diluted EPS   $ 2.58     $ 1.96                              
                                               

These Condensed Consolidated Statements of Operations should be read in conjunction with the Company's Audited Consolidated Financial Statements and Notes for the year ended December 31, 2011.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include CNH Global N.V.'s financial services business. Transactions between Equipment Operations and Financial Services have been eliminated to arrive at the consolidated data.

 
CNH GLOBAL N.V.
CONDENSED CONSOLIDATED BALANCE SHEETS
AND SUPPLEMENTAL INFORMATION
As of June 30, 2012 and December 31, 2011
(Unaudited)
 
    Consolidated   Equipment Operations   Financial Services
    Jun. 30,   Dec. 31,   Jun. 30,   Dec. 31,   Jun. 30,   Dec. 31,
2012   2011   2012   2011   2012   2011
    (in millions)
ASSETS                                    
Cash and cash equivalents   $ 1,092   $ 2,055   $ 601   $ 1,251   $ 491   $ 804
Deposits in Fiat Industrial subsidiaries' cash management system     3,927     4,116     3,725     3,980     202     136
Accounts, notes receivable and other, net     15,932     14,491     947     894     15,463     14,072
Intersegment notes receivable     -     -     2,700     1,993     532     693
Inventories     4,234     3,662     4,234     3,662     -     -
Property, plant and equipment, net     1,986     1,936     1,984     1,934     2     2
Equipment on operating leases, net     688     666     8     7     680     659
Investment in Financial Services     -     -     2,133     2,045     -     -
Investments in unconsolidated affiliates     476     506     396     423     80     83
Goodwill and other intangibles     3,059     3,084     2,903     2,926     156     158
Other assets     3,191     3,577     1,510     2,065     1,681     1,512
  Total Assets   $ 34,585   $ 34,093   $ 21,141   $ 21,180   $ 19,287   $ 18,119
                                     
LIABILITIES AND EQUITY                                    
Short-term debt   $ 4,472   $ 4,072   $ 184   $ 144   $ 4,288   $ 3,928
Accounts payable     3,173     2,952     3,323     3,219     321     199
Long-term debt, including current maturities     12,872     13,038     3,516     3,656     9,356     9,382
Intersegment debt     -     -     532     693     2,700     1,993
Accrued and other liabilities     5,635     6,107     5,154     5,545     488     571
  Total Liabilities   $ 26,152   $ 26,169   $ 12,709   $ 13,257   $ 17,153   $ 16,073
Equity     8,433     7,924     8,432     7,923     2,134     2,046
  Total Liabilities and Equity   $ 34,585   $ 34,093   $ 21,141   $ 21,180   $ 19,287   $ 18,119
                                       

These Condensed Consolidated Balance Sheets should be read in conjunction with the Company's Audited Consolidated Financial Statements and Notes for the year ended December 31, 2011.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include CNH Global N.V.'s financial services business. Transactions between Equipment Operations and Financial Services have been eliminated to arrive at the consolidated data.

   
CNH GLOBAL N.V.  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  
AND SUPPLEMENTAL INFORMATION  
For the Six Months Ended June 30, 2012 and 2011  
(Unaudited)  
   
    Consolidated     Equipment Operations     Financial Services  
    Six Months Ended     Six Months Ended     Six Months Ended  
June 30,     June 30,     June 30,  
    2012     2011     2012     2011     2012     2011  
    (in millions)  
Operating activities:                                                
  Net income   $ 623     $ 464     $ 623     $ 464     $ 151     $ 106  
  Adjustments to reconcile net income to net cash used by operating activities:                                                
    Depreciation and amortization     210       216       155       155       55       61  
    Intersegment activity     -       -       (172 )     (234 )     172       234  
    Changes in operating assets and liabilities     (1,518 )     (750 )     (199 )     62       (1,319 )     (812 )
    Other, net     46       (108 )     (126 )     (215 )     21       1  
                                                 
Net cash (used) provided by operating activities     (639 )     (178 )     281       232       (920 )     (410 )
                                                 
Investing activities:                                                
  Expenditures for property, plant and equipment     (206 )     (126 )     (206 )     (126 )     -       -  
  Expenditures for equipment on operating leases     (186 )     (192 )     (1 )     -       (185 )     (192 )
  Net collections from retail receivables     (214 )     (38 )     -       -       (214 )     (38 )
  Net withdrawals from (deposits in) Fiat Industrial     174       (1,702 )     245       (1,727 )     (71 )     25  
  Other, net     (272 )     201       (8 )     (51 )     (262 )     252  
                                                 
Net cash (used) provided by investing activities     (704 )     (1,857 )     30       (1,904 )     (732 )     47  
                                                 
Financing activities:                                                
  Intersegment activity     -       -       (892 )     53       892       (53 )
  Net increase (decrease) in indebtedness     392       (131 )     (91 )     (438 )     483       307  
  Other, net     23       28       34       28       (13 )     -  
                                                 
Net cash provided (used) by financing activities     415       (103 )     (949 )     (357 )     1,362       254  
                                                 
Effect of foreign exchange rate changes on cash and cash equivalents     (35 )     68       (12 )     44       (23 )     24  
                                                 
Decrease in cash and cash equivalents     (963 )     (2,070 )     (650 )     (1,985 )     (313 )     (85 )
Cash and cash equivalents, beginning of period     2,055       3,618       1,251       2,934       804       684  
                                                 
Cash and cash equivalents, end of period   $ 1,092     $ 1,548     $ 601     $ 949     $ 491     $ 599  
                                                 

These Condensed Consolidated Statements of Cash Flows should be read in conjunction with the Company's Audited Consolidated Financial Statements and Notes for the year ended December 31, 2011. 

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include CNH Global N.V.'s financial services business. Transactions between Equipment Operations and Financial Services have been eliminated to arrive at the consolidated data.

 
CNH Global N.V.
TOTAL DEBT AND NET DEBT (CASH)
For the Six Months Ended June 30, 2012 and the Year Ended December 31, 2011
(Unaudited)
 
    Consolidated   Equipment Operations     Financial Services
    Jun. 30,   Dec. 31,   Jun. 30,     Dec. 31,     Jun. 30,   Dec. 31,
2012   2011   2012     2011     2012   2011
    (in millions)
Short-term debt:                                        
  With Fiat Industrial subsidiaries   $ 568   $ 325   $ 111     $ 80     $ 457   $ 245
  Owed to securitization investors     2,404     2,302     -       -       2,404     2,302
  Other     1,500     1,445     73       64       1,427     1,381
  Intersegment     -     -     -       95       2,167     1,394
Total short-term debt     4,472     4,072     184       239       6,455     5,322
Long-term debt:                                        
  With Fiat Industrial subsidiaries     124     314     63       65       61     249
  Owed to securitization investors     6,865     6,511     -       -       6,865     6,511
  Other     5,883     6,213     3,453       3,591       2,430     2,622
  Intersegment     -     -     532       598       533     599
Total long-term debt     12,872     13,038     4,048       4,254       9,889     9,981
Total debt:                                        
  With Fiat Industrial subsidiaries     692     639     174       145       518     494
  Owed to securitization investors     9,269     8,813     -       -       9,269     8,813
  Other     7,383     7,658     3,526       3,655       3,857     4,003
  Intersegment     -     -     532       693       2,700     1,993
Total debt   $ 17,344   $ 17,110   $ 4,232     $ 4,493     $ 16,344   $ 15,303
Less:                                        
  Cash and cash equivalents     1,092     2,055     601       1,251       491     804
  Deposits in Fiat Industrial subsidiaries' cash management system     3,927     4,116     3,725       3,980       202     136
  Intersegment notes receivable     -     -     2,700       1,993       532     693
Net debt (cash)   $ 12,325   $ 10,939   $ (2,794 )   $ (2,731 )   $ 15,119   $ 13,670
                                         

Note: Net Debt (Cash) is a non-GAAP financial measure. See description of non-GAAP measures contained in this release.

   
CNH GLOBAL N.V.  
SUPPLEMENTAL SCHEDULES  
For the Three Months and Six Months Ended June 30, 2012 and 2011  
(Unaudited)  
   
    Three Months Ended     Six Month Ended  
    June 30,     June 30,  
    2012     2011     % Change     2012     2011     % Change  
    (in millions, except percentages)  
1. Revenues and net sales:                                            
  Net sales                                            
    Agricultural equipment   $ 4,025     $ 3,851     4.5 %   $ 7,640     $ 6,922     10.4 %
    Construction equipment     1,001       1,030     -2.8 %     2,025       1,756     15.3 %
      Total net sales     5,026       4,881     3.0 %     9,665       8,678     11.4 %
  Financial services     327       353     -7.4 %     659       692     -4.8 %
  Eliminations and other     (74 )     (69 )           (146 )     (123 )      
  Total revenues   $ 5,279     $ 5,165     2.2 %   $ 10,178     $ 9,247     10.1 %
                                             
                                             
2. Net sales on a constant currency basis:                                            
                                             
  Agricultural equipment net sales   $ 4,025     $ 3,851     4.5 %   $ 7,640     $ 6,922     10.4 %
  Effect of currency translation     234             6.1 %     311             4.5 %
      Agricultural equipment net sales on a constant currency basis   $ 4,259     $ 3,851     10.6 %   $ 7,951     $ 6,922     14.9 %
                                             
  Construction equipment net sales   $ 1,001     $ 1,030     -2.8 %   $ 2,025     $ 1,756     15.3 %
  Effect of currency translation     68             6.6 %     88             5.0 %
    Construction equipment net sales on a constant currency basis   $ 1,069     $ 1,030     3.8 %   $ 2,113     $ 1,756     20.3 %
                                                 
    Total Equipment Operations net sales on a constant currency basis   $ 5,328     $ 4,881     9.2 %   $ 10,064     $ 8,678     16.0 %
                                                 

Note: Net sales on a constant currency basis is a non-GAAP financial measure. See description of non-GAAP measures contained in this release.

   
CNH GLOBAL N.V.  
SUPPLEMENTAL SCHEDULES  
For the Three and Six Months Ended June 30, 2012 and 2011  
(Unaudited)  
   
3. Equipment Operations gross and operating profit and margin:  
   
    Three Months Ended     Six Months Ended  
June 30,     June 30,  
    2012     2011     2012     2011  
    (in millions, except percentages)  
                                                 
Net sales   $ 5,026   100.0 %   $ 4,881   100.0 %   $ 9,665   100.0 %   $ 8,678   100.0 %
Less:                                                
  Cost of goods sold     3,973   79.0 %     3,893   79.8 %     7,697   79.6 %     7,007   80.7 %
Equipment Operations gross profit   $ 1,053   21.0 %   $ 988   20.2 %   $ 1,968   20.4 %   $ 1,671   19.3 %
Less:                                                
  Selling, general and administrative     367   7.3 %     342   7.0 %     727   7.5 %     663   7.6 %
  Research and development     162   3.2 %     125   2.6 %     311   3.2 %     241   2.8 %
                                                 
Equipment Operations operating profit   $ 524   10.4 %   $ 521   10.7 %   $ 930   9.6 %   $ 767   8.8 %
                                                 
Gross profit and margin:                                                
  Agricultural equipment   $ 915   22.7 %   $ 850   22.1 %   $ 1,675   21.9 %   $ 1,441   20.8 %
  Construction equipment     138   13.8 %     138   13.4 %     293   14.5 %     230   13.1 %
                                                 
Equipment Operations gross profit   $ 1,053   21.0 %   $ 988   20.2 %   $ 1,968   20.4 %   $ 1,671   19.3 %
                                                 
Operating profit and margin:                                                
  Agricultural equipment   $ 507   12.6 %   $ 496   12.9 %   $ 879   11.5 %   $ 759   11.0 %
  Construction equipment     17   1.7 %     25   2.4 %     51   2.5 %     8   0.5 %
                                                 
Equipment Operations operating profit   $ 524   10.4 %   $ 521   10.7 %   $ 930   9.6 %   $ 767   8.8 %
                                                 
                                                 
4. Net income and diluted earnings per share before restructuring and exceptional items:
 
   
    Three Months Ended June 30,   Six Months Ended June 30,  
    2012   2011   2012   2011  
    (in millions, except per share data)  
                           
Net income attributable to CNH   $ 355   $ 320   $ 624   $ 472  
Restructuring:                          
  Restructuring, net of tax     1     -     1     2  
Exceptional item:                          
  (Gain) on purchase of business, net of tax     -     -     -     (16 )
                           
Net income before restructuring and exceptional items   $ 356   $ 320   $ 625   $ 458  
                           
  Weighted average common shares outstanding - diluted     242     241     242     241  
  Diluted earnings per share before restructuring and exceptional items   $ 1.47   $ 1.33   $ 2.59   $ 1.90  
                             
                             
CNH GLOBAL N.V.  
SUPPLEMENTAL SCHEDULES  
For the Six Months Ended June 30, 2012  
(Unaudited)  
   
5. Equipment Operations cash generated from working capital:  
   
    Balance as of December 31, 2011     Effect of Foreign Currency Translation     Non-Cash Transactions   Balance as of June 30, 2012     Cash Generated from (used by) Working Capital  
    (in millions)  
                             
Accounts, notes receivable and other - net - Total   $ 894     $ 48     $ 4   $ 947     $ (105 )
Inventories     3,662       117       20     4,234       (709 )
Accounts payable - Total     (3,219 )     (67 )     -     (3,323 )     171  
                                       
Working Capital   $ 1,337     $ 98     $ 24   $ 1,858     $ (643 )
                                       

Note: Working Capital is a non-GAAP financial measure. See description of non-GAAP measures contained in this release.

Contact Information

  • For more information contact:
    CNH Investor Relations
    +1 (630) 887-3745