SOURCE: CNH

CNH

October 21, 2010 04:23 ET

CNH Third Quarter Revenue Rises 20% to $3.5 Billion on Improved Demand for Agricultural and Construction Equipment

BURR RIDGE, IL--(Marketwire - October 21, 2010) - CNH Global N.V. (NYSE: CNH)

--  Net Sales up 20% to $3.5 billion (with minimal impact from foreign
    exchange)
    --  Agricultural Equipment +12.8%
    --  Construction Equipment +52.4%
--  Operating Profit of $239 million, up $167 million, at a 6.8% margin
--  Third quarter EPS before exceptional items at $0.43 per share, compared
    to loss of $0.09 per share in third quarter 2009
--  FY 2010 revenue and operating profit expected to beat high end of April
    guidance


                                             Quarter Ended
(US$ in millions)                        9/30/2010   9/30/2009    Change
                                         ---------   ---------   ---------
Net Sales of Equipment                   $   3,540   $   2,960        19.6%
Equipment Operations Operating Profit    $     239   $      72       231.9%
Equipment Operations Operating Margin          6.8%        2.4%        4.4%
Financial Services Net Income            $      47   $      32        46.9%
Net Income (Loss) attributable to CNH    $      83   $     (25)          nm
Net Income (Loss) Before Restructuring
 and Exceptional Items                   $     102   $     (22)          nm
Diluted EPS Before Restructuring
 and Exceptional Items                   $    0.43   $   (0.09)          nm
Equipment Operations
  Operating Cash Flow - YTD              $   1,239   $     362       242.3%
Equipment Operations Net (Cash) Debt     $  (1,762)  $     183           nm

CNH Global N.V. (NYSE: CNH) announced financial results for the third quarter ended September 30, 2010. For the quarter, Net Sales increased 19.6% (19.8% on a constant currency basis) to $3.5 billion due to solid performances delivered in the Americas and Rest of World regions augmented by a stabilization of trading conditions in Europe. Equipment Operations posted an Operating Profit of $239 million as a result of higher volumes, reduced industrial costs, and favorable product mix.

Net Sales were 78% agricultural equipment and 22% construction equipment for the quarter, as improving construction equipment unit demand continued to bring the Group's revenue distribution back to historical norms. The geographical distribution of revenue for the period was 44% North America, 19% Western Europe, 19% Latin America, and 18% Rest of World.

Equipment Operations generated $1.2 billion in cash flow from operating activities over the first three quarters of the year. Year-to-date capital expenditures totaled $153 million, a 11% increase from the comparable period, primarily in preparation for new product launches and engine emissions compliance upgrade; full year capital expenditures are expected to be in the $300 million range. CNH's Equipment Operations ended the period with a net cash position of $1.8 billion, an increase of $1.9 billion compared to the end of the third quarter in 2009. The 33% effective tax rate for the third quarter 2010 is within the Group's long term expectations of 32% to 36%, as a result of tax incentives and tax return to provision filing differences, which largely offset the impact of not recording a tax benefit on losses in Europe for which conditions for their recognition are not currently satisfied.

Net Income before restructuring and exceptional items for the period of $102 million ($83 million inclusive of exceptional items) resulted in the Group generating a third quarter EPS of $0.43 ($0.35 inclusive of exceptional items) compared to a loss of $0.09 in the comparable prior year period.

2010 Market Outlook

CNH anticipates that global agricultural equipment markets will be up 0-5% for FY 2010. The CNH outlook for the global construction equipment markets is for an increase of 40% to 45% in 2010.

2010 CNH Outlook

In view of the Group's performance through the first three quarters and current forecasts for trading activity in the remainder of the year, CNH anticipates that it will achieve the following financial targets: Net Sales in excess of $14.3 billion, Operating Profit of $900 million and net industrial cash of $1.3 billion.

SEGMENT RESULTS

Agricultural Equipment

                                             Quarter Ended
(US$ in millions)                        9/30/2010   9/30/2009    Change
                                         ---------   ---------   ---------
Net Sales of Equipment                   $   2,769   $   2,454        12.8%
Gross Profit                             $     547   $     441        24.0%
Gross Margin                                  19.8%       18.0%        1.8%
Operating Profit                         $     235   $     160        46.9%
Operating Margin                               8.5%        6.5%        2.0%

Agricultural Equipment Industry and Market

Worldwide agricultural industry retail unit sales decreased 1% compared to the third quarter of 2009. Global tractor sales fell 1% while global combine sales grew 6% for the quarter.

North American markets rose 2%, with tractor sales up 2% and combine sales up 7% on continued strong demand from the large cash crop segments. Sustained commodity prices and the continuation of government support programs drove demand in Latin America where tractor sales rose 21% and combine sales were up 16%. The decline in equipment demand moderated in Western European markets which were down 5% for the quarter, with tractor sales falling 4% and combine sales down 13%. Rest of World markets were down 6%, with a 6% drop in tractor sales and a 7% rise in combine sales.

CNH Agricultural Equipment Third Quarter Results

Net Sales in the agricultural equipment segment increased 12.8% for the quarter (13.4% on a constant currency basis) on the back of growth in demand in the Americas that more than offset the difficult, but stabilizing, trading conditions in Europe and Rest of World markets. Operating Margin increased to 8.5% from 6.5% from the comparable period in 2009. This improved profit performance was largely the result of improved industrial economics, product mix, and favorable geographic distribution of revenues.

Company and dealer inventories ended the period largely in line with estimated market demand and historical norms for the period. CNH production for the period was slightly below the pace of retail sales due to seasonal plant shutdowns, inventory balancing, and in preparation for new product launches.

CNH continued to invest in its agricultural equipment product portfolio and industrial capacity during the third quarter. The Company continued to significantly invest in the launch of Tier 4/Stage IIIA product introductions with dealer and customer training programs completed during the period for the first products in the line-up, 4-wheel drive tractors. Investments in the Group's industrial footprint for both whole goods manufacturing and components supply continued in conjunction with the product plan announced in April 2010.

Construction Equipment

                                             Quarter Ended
(US$ in millions)                        9/30/2010   9/30/2009    Change
                                         ---------   ---------   ---------
Net Sales of Equipment                   $     771   $     506        52.4%
Gross Profit                             $      98   $       7           nm
Gross Margin                                  12.7%        1.4%       11.3%
Operating Profit                         $       4   $     (88)          nm
Operating Margin                               0.5%     (17.4)%       17.9%

Construction Equipment Industry and Market

Global construction equipment industry retail unit sales rose 47% in the third quarter compared to the prior year, with light equipment up 34% and heavy equipment up 59%. North American demand was up 34%, with light equipment volumes up 34% and heavy equipment rising 33%. Western European markets rose 27% as the industry began to rebuild from the prior year's low levels. In Latin America, the market was up 85%, driven by strong demand from projects in public and private sectors. Industry sales in Rest of World markets rose 54% with continued strong demand in the Asia-Pacific region, primarily the heavy equipment segment in China.

CNH Construction Equipment Third Quarter Results

CNH's construction equipment segment Net Sales grew considerably, 52.4% (51.0% on a constant currency basis) driven by a robust recovery in demand in all regions compared with the low base in the third quarter 2009. The segment posted an Operating Profit for the quarter of $4 million, compared to the $88 million loss in the comparable quarter in 2009, largely as a result of increased volume, reduced industrial costs, and increased capacity utilization.

Finished goods unit inventory levels (company and dealer) for the segment declined from the comparative quarter. Due to inventory management in the prior period, production exceeded retail volume by 4% for the period as the Group began to re-stock its dealer network with fresh product and in preparation for new product launches.

New product launches announced in April 2010 in both light and heavy construction equipment remain on track with performance, safety, styling, and emissions compliance features incorporated in the new designs. The first global launch of the new Tier 4 compliant backhoe, produced in three different regions, is on schedule with product deliveries commencing in October.

CNH Financial Services Third Quarter Results

                                             Quarter Ended
(US$ in millions)                        9/30/2010   9/30/2009    Change
                                         ---------   ---------   ---------
Net Income                               $      47   $      32        46.9%
On-Book Asset Portfolio                  $  14,772   $   9,901        49.2%
Managed Asset Portfolio                  $  17,414   $  17,830       (2.3)%

Financial Services' Net Income for the quarter ending September 30, 2010 was $47 million, an increase of $15 million compared to the quarter ending September 30, 2009, as a result of higher loan originations in the agricultural equipment business and improved interest margins which were partially offset by higher provisions for credit losses in the agricultural portfolio. Due to the adoption of new accounting standards on January 1, 2010, Financial Services was required to consolidate $5.7 billion of receivables and related liabilities in its balance sheet. Consequently, on-book receivables are higher compared to September 2009.

The managed asset portfolio decreased $416 million from September 2009 due to lower retail originations in the construction equipment market over the last 24 months.

Delinquency indicators showed improvements in all loan portfolios.

Unconsolidated Equipment Operations Subsidiaries

Third quarter results for the Group's unconsolidated Equipment Operations subsidiaries improved to $15 million from a $5 million net loss in the comparable period in the prior year as a result of robust market conditions in Turkey in agricultural equipment and improved relative performance of the Group's construction equipment joint ventures.

Other

Exceptional and Other Items

On July 28, 2010, the Company completed the redemption of its $500 million in notes due in 2014, and as a result, CNH incurred a pretax loss of $22 million ($14 million after tax) on retirement of debt in the third quarter of 2010.

Equipment Operations Cash Flow and Net Debt

                                   Fiscal Year-to-Date (nine months ended)
(US$ in millions)                  9/30/2010                     9/30/2009
                                   ---------                     ---------
Net Income (loss)                  $     232                     $    (243)
Depreciation & Amortization              208                           195
Cash Change in Working Capital*          335                           295
Other                                    464                           115
                                   ---------                     ---------
Net Cash Provided (Used) by
 Operating Activities                  1,239                           362
Net Cash Provided (Used) by
 Investing Activities**                 (147)                         (151)
All Other                                140                            29
                                   ---------                     ---------
(Increase)/Decrease in  Net Debt
 (Cash)                            $   1,232                     $     240
                                   =========                     =========
Net (Cash) Debt                    $  (1,762)                    $     183

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

ABOUT CNH

CNH Global N.V. is a world leader in the agricultural and construction equipment businesses. Supported by more than 11,600 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 at the New York Stock Exchange (NYSE: CNH), is a majority-owned subsidiary of Fiat S.p.A. (MI: FIA). 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 October 21, 2010 to review third quarter 2010 results. The conference call webcast will begin at 7:00 a.m. U.S. Central Time; 8:00 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 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. Exceptional items include charges or income that may mask underlying operating results or business trends such as the impact of divestitures, retirement of debt and changes in law. 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

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 predominantly based on our interpretation of what we consider key economic assumptions and involves risks and uncertainties that could cause actual results to differ. Crop production and commodity prices are strongly affected by weather and can fluctuate significantly. Housing starts and other construction activity are sensitive to the availability of credit and to interest rates and government spending. Some of the other significant factors which may affect our results include general economic and capital market conditions, the cyclical nature of our business, customer buying patterns and preferences, foreign currency exchange rate movements, our hedging practices, our customers' access to credit, restrictive covenants in our debt agreements, actions by rating agencies concerning the ratings of our debt securities and asset backed securities, risks related to our relationship with Fiat S.p.A., the effect of the contemplated demerger pursuant to which CNH would be separated from Fiat S.p.A.'s automotive business, political uncertainty and civil unrest or war in various areas of the world, pricing, product initiatives and other actions 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 and international trade), 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 and critical suppliers, the cost and availability of supplies from our suppliers, raw material costs and availability, energy prices, real estate values, animal diseases, crop pests, harvest yields, government farm programs and consumer confidence, housing starts and construction activity, concerns related to modified organisms and fuel and fertilizer costs. 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, 2009.

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 September 30, 2010 and 2009
                               (Unaudited)

                                               Equipment       Financial
                              Consolidated    Operations       Services
                              -------------  -------------  ---------------
                              Three Months   Three Months     Three Months
                                  Ended          Ended          Ended
                              September 30,  September 30,   September 30,
                              -------------  -------------  ---------------
                               2010   2009    2010   2009     2010    2009
                              ------ ------  ------ ------  ------- -------
                                             (in millions,
                                              except per
                                              share data)
Revenues:
  Net sales                   $3,540 $2,960  $3,540 $2,960  $    -- $    --
  Finance and interest income    282    238      45     33      355     295
                              ------ ------  ------ ------  ------- -------

                               3,822  3,198   3,585  2,993      355     295
                              ------ ------  ------ ------  ------- -------

Costs and Expenses:
  Cost of goods sold           2,895  2,512   2,895  2,512       --      --
  Selling, general and
   administrative                411    363     294    278      117      85
  Research, development and
   engineering                   112     98     112     98       --      --
  Restructuring                    6      9       6      8       --       1
  Interest expense               228    172     128     84      153     131
  Interest compensation to
   Financial Services             --     --      65     54       --      --
  Other, net                      73     84      43     42       30      35
                              ------ ------  ------ ------  ------- -------

 Total                         3,725  3,238   3,543  3,076      300     252
                              ------ ------  ------ ------  ------- -------

Income (loss) before income
 taxes and equity in income
 (loss) of unconsolidated
 subsidiaries and affiliates      97    (40)     42    (83)      55      43
Income tax provision (benefit)    32     (8)     21    (21)      11      13
Equity in income (loss) of
 unconsolidated subsidiaries
 and affiliates:
  Financial Services               3      2      47     32        3       2
  Equipment Operations            15     (5)     15     (5)      --      --
                              ------ ------  ------ ------  ------- -------

Net income (loss)                 83    (35)     83    (35)      47      32
Net income (loss) attributable
 to noncontrolling interests      --    (10)     --    (10)      --      --
                              ------ ------  ------ ------  ------- -------

Net income (loss) attributable
 to CNH Global N.V.           $   83 $  (25) $   83 $  (25) $    47 $    32
                              ====== ======  ====== ======  ======= =======


Weighted average shares
 outstanding:
  Basic                          238    237
                              ====== ======
  Diluted                        239    237
                              ====== ======

Basic and diluted earnings
 (loss) per share ("EPS")
 attributable to CNH Global
 N.V. common shareholders:
  Basic EPS                   $ 0.35 $(0.11)
                              ====== ======
  Diluted EPS                 $ 0.35 $(0.11)
                              ====== ======

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, 2009.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include primarily CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include primarily 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 Nine Months Ended September 30, 2010 and 2009
                               (Unaudited)

                                               Equipment       Financial
                            Consolidated      Operations       Services
                           ---------------  --------------  ---------------
                             Nine Months     Nine Months      Nine Months
                                Ended           Ended           Ended
                            September 30,    September 30,   September 30,
                           ---------------  --------------  ---------------
                            2010     2009     2010   2009     2010    2009
                           -------  ------  ------- ------  ------- -------
                                            (in millions,
                                             except per
                                             share data)

Revenues:
  Net sales                $10,715  $9,570  $10,715 $9,570  $    -- $    --
  Finance and interest
   income                      838     680      107     97    1,038     829
                           -------  ------  ------- ------  ------- -------

                            11,553  10,250   10,822  9,667    1,038     829
                           -------  ------  ------- ------  ------- -------

Costs and Expenses:
  Cost of goods sold         8,770   8,172    8,770  8,172       --      --
  Selling, general and
   administrative            1,236   1,087      909    840      327     247
  Research, development
   and engineering             323     286      323    286       --      --
  Restructuring                  8      82        8     78       --       4
  Interest expense             620     509      287    236      464     379
  Interest compensation to
   Financial Services           --      --      176    143       --      --
  Other, net                   202     251      114    147       88     101
                           -------  ------  ------- ------  ------- -------

 Total                      11,159  10,387   10,587  9,902      879     731
                           -------  ------  ------- ------  ------- -------

Income (loss) before income
 taxes and equity in income
 (loss) of unconsolidated
 subsidiaries and affiliates   394    (137)     235   (235)     159      98
Income tax provision           213      71      177     45       36      26
Equity in income (loss) of
 unconsolidated subsidiaries
 and affiliates:
  Financial Services             8       6      131     78        8       6
  Equipment Operations          43     (41)      43    (41)      --      --
                           -------  ------  ------- ------  ------- -------

Net income (loss)              232    (243)     232   (243)     131      78
Net income (loss)
 attributable to
 noncontrolling interests      (11)    (25)     (11)   (25)      --      --
                           -------  ------  ------- ------  ------- -------

Net income (loss)
 attributable to CNH
 Global N.V.               $   243  $ (218) $   243 $ (218) $   131 $    78
                           =======  ======  ======= ======  ======= =======

Weighted average shares
 outstanding:
   Basic                       238     237
                           =======  ======
   Diluted                     238     237
                           =======  ======

Basic and diluted earnings
 (loss) per share ("EPS")
 attributable to CNH
 Global N.V. common
 shareholders:
   Basic EPS               $  1.02  $(0.92)
                           =======  ======
   Diluted EPS             $  1.02  $(0.92)
                           =======  ======

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, 2009.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include primarily CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include primarily 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 SHEET
                       AND SUPPLEMENTAL INFORMATION
        As of September 30, 2010 (Unaudited) and December 31, 2009

                                          Equipment         Financial
                    Consolidated         Operations          Services
                   ------------------ ------------------ ------------------
                  September December September December September December
                     30,       31,      30,       31,       30,      31,
                    2010      2009     2010      2009      2010     2009
                   -------- --------- -------- --------- -------- ---------
                                        (in millions)
ASSETS
Cash and cash
 equivalents       $  1,182 $   1,263 $    334 $     290 $    848 $     973
Deposits in Fiat
 affiliates cash
 management pools     3,214     2,251    3,126     2,144       88       107
Accounts, notes
 receivable and
 other - net         14,511     8,426      893       788   13,906     7,952
Intersegment notes
 receivable              --        --    3,443     2,398      490       634
Inventories           2,998     3,297    2,998     3,297       --        --
Property, plant
 and equipment, net   1,722     1,764    1,720     1,761        2         3
Equipment on
 operating leases
 - net                  626       646        1         3      625       643
Investment in
 Financial
 Services                --        --    2,090     2,377       --        --
Investments in
 unconsolidated
 affiliates             439       415      358       330       81        85
Goodwill and other
 intangibles          3,057     3,091    2,900     2,935      157       156
Other assets          3,028     2,055    1,848     1,557    1,180       498
                   -------- --------- -------- --------- -------- ---------

     Total Assets  $ 30,777 $  23,208 $ 19,711 $  17,880 $ 17,377 $  11,051
                   ======== ========= ======== ========= ======== =========

LIABILITIES AND
 EQUITY
Short-term debt    $  3,736 $   1,972 $    120 $     136 $  3,616 $   1,836
Accounts payable      2,077     1,915    2,171     2,061      183       151
Long-term debt,
 including current
 maturities          12,126     7,436    4,531     3,532    7,595     3,904
Intersegment debt        --        --      490       634    3,443     2,398
Accrued and other
 liabilities          5,705     5,075    5,267     4,708      449       384
                   -------- --------- -------- --------- -------- ---------

       Total
        Liabilities  23,644    16,398   12,579    11,071   15,286     8,673
Equity                7,133     6,810    7,132     6,809    2,091     2,378
                   -------- --------- -------- --------- -------- ---------

      Total
       Liabilities
       and Equity  $ 30,777 $  23,208 $ 19,711 $  17,880 $ 17,377 $  11,051
                   ======== ========= ======== ========= ======== =========

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, 2009.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include primarily CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include primarily 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 Nine Months Ended September 30, 2010 and 2009
                               (Unaudited)

                                              Equipment       Financial
                             Consolidated     Operations       Services
                            --------------  --------------  --------------
                              Nine Months     Nine Months    Nine Months
                                Ended           Ended            Ended
                             September 30,   September 30,   September 30,
                            --------------  --------------  --------------
                             2010    2009    2010    2009    2010    2009
                            ------  ------  ------  ------  ------  ------
                                            (in millions)
Operating activities:
   Net income (loss)        $  232  $ (243) $  232  $ (243) $  131  $   78
   Adjustments to reconcile
    net income (loss) to
    net cash provided
    (used) by operating
    activities:
     Depreciation and
      amortization             299     289     208     195      91      94
     Intersegment activity      --      --    (123)    (52)    123      52
     Changes in operating
      assets and
      liabilities              108     646     923     442    (815)    204
     Other, net               (137)    (58)     (1)     20     (17)     (6)
                            ------  ------  ------  ------  ------  ------

Net cash provided (used) by
 operating activities          502     634   1,239     362    (487)    422
                            ------  ------  ------  ------  ------  ------

Investing activities:
   Expenditures for
    property, plant and
    equipment                 (153)   (139)   (153)   (138)     --      (1)
   Expenditures for
    equipment on operating
    leases                    (262)   (207)     --      --    (262)   (207)
   Net collections from
    retail receivables          24     785      --      --      24     785
   Net withdrawals from
    (deposits in) Fiat
    affiliates cash
    management pools          (988)  1,158  (1,002)    975      14     183
   Other, net                  138     106       6     (13)    112     119
                            ------  ------  ------  ------  ------  ------

Net cash provided (used) by
 investing activities       (1,241)  1,703  (1,149)    824    (112)    879
                            ------  ------  ------  ------  ------  ------

Financing activities:
   Intersegment activity        --      --    (989)    (63)    989      63
   Net increases
    (decreases) in
    indebtedness               647  (1,997)    946    (842)   (299) (1,155)
   Dividends paid               --      --      --      --    (250)   (150)
   Other, net                  (11)    (15)    (11)    (15)     20      --
                            ------  ------  ------  ------  ------  ------

Net cash provided (used) by
 financing activities          636  (2,012)    (54)   (920)    460  (1,242)
                            ------  ------  ------  ------  ------  ------

Effect of foreign exchange
 rate changes on cash and
 cash equivalents               22     119       8      14      14     105
                            ------  ------  ------  ------  ------  ------

Increase (decrease) in cash
 and cash equivalents          (81)    444      44     280    (125)    164
Cash and cash equivalents,
 beginning of period         1,263     633     290     173     973     460
                            ------  ------  ------  ------  ------  ------

Cash and cash equivalents,
 end of period              $1,182  $1,077  $  334  $  453  $  848  $  624
                            ======  ======  ======  ======  ======  ======

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, 2009.

The supplemental Equipment Operations (with Financial Services on the equity basis) data in these statements include primarily CNH Global N.V.'s agricultural and construction equipment operations. The supplemental Financial Services data in these statements include primarily 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 Nine Months Ended
                       September 30, 2010 and 2009
                               (Unaudited)
                                          Equipment         Financial
                    Consolidated         Operations          Services
                  ------------------ ------------------  ------------------
                  September December September December September December
                     30,       31,      30,       31,       30,      31,
                    2010      2009     2010      2009      2010     2009
                  -------- --------- --------  --------  -------- ---------
                                        (in millions)
Short-term debt:
  With Fiat
   affiliates     $    151 $     537 $     19  $      7  $    132 $     530
  Owed to
   securitization
   investors         2,044        --       --        --     2,044        --
  Other              1,541     1,435      101       129     1,440     1,306
  Intersegment          --        --       --       161     2,903     1,594
                  -------- --------- --------  --------  -------- ---------
Total short-term
 debt                3,736     1,972      120       297     6,519     3,430
                  -------- --------- --------  --------  -------- ---------
Long-term debt:
  With Fiat
   affiliates        1,334     2,352      568       931       766     1,421
  Owed to
   securitization
   investors         4,102        --       --        --     4,102        --
   Other             6,690     5,084    3,963     2,601     2,727     2,483
   Intersegment         --        --      490       473       540       804
                  -------- --------- --------  --------  -------- ---------
Total long-term
 debt               12,126     7,436    5,021     4,005     8,135     4,708
                  -------- --------- --------  --------  -------- ---------
Total debt:
   With Fiat
    affiliates       1,485     2,889      587       938       898     1,951
   Owed to
    securitization
    investors        6,146        --       --        --     6,146        --
   Other             8,231     6,519    4,064     2,730     4,167     3,789
   Intersegment         --        --      490       634     3,443     2,398
                  -------- --------- --------  --------  -------- ---------
Total debt        $ 15,862 $   9,408 $  5,141  $  4,302  $ 14,654 $   8,138
                  ======== ========= ========  ========  ======== =========
Less:
  Cash and cash
   equivalents       1,182     1,263      334       290       848       973
  Deposits in
   Fiat affiliates
   cash management
   pools             3,214     2,251    3,126     2,144        88       107
  Intersegment
   notes receivable     --        --    3,443     2,398       490       634
                  -------- --------- --------  --------  -------- ---------
Net debt (cash)   $ 11,466 $   5,894 $ (1,762) $   (530) $ 13,228 $   6,424
                  ======== ========= ========  ========  ======== =========

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 and Nine Months Ended September 30, 2010 and 2009
                                  (Unaudited)


                        Three Months Ended        Nine Months Ended
                          September 30,             September 30,
                        ----------------          ----------------
                                            %                         %
                          2010     2009   Change    2010     2009   Change
                        -------  -------  ------  -------  -------  ------
                                           (in millions,
                                              except
                                            percentages)
1. Revenues and net
 sales:
  Net sales
    Agricultural
     equipment          $ 2,769  $ 2,454   12.8%  $ 8,543  $ 8,037    6.3%
    Construction
     equipment              771      506   52.4%    2,172    1,533   41.7%
                        -------  -------          -------  -------
      Total net sales     3,540    2,960   19.6%   10,715    9,570   12.0%
   Financial services       355      295   20.3%    1,038      829   25.2%
   Eliminations and
    other                   (73)     (57)            (200)    (149)
                        -------  -------          -------  -------

   Total revenues       $ 3,822  $ 3,198   19.5%  $11,553  $10,250   12.7%
                        =======  =======          =======  =======


2. Net sales on a
 constant currency
 basis:

  Agricultural
   equipment
   net sales            $ 2,769  $ 2,454   12.8%  $ 8,542  $ 8,037    6.3%
  Effect of currency
   translation               13             0.6%     (247)           (3.1)%
                        -------  -------          -------  -------
      Agricultural
       equipment net
       sales on a
       constant
       currency
       basis            $ 2,782  $ 2,454   13.4%  $ 8,295  $ 8,037    3.2%
                        =======  =======          =======  =======

  Construction
   equipment
   net sales            $   771  $   506   52.4%  $ 2,172  $ 1,533   41.7%
  Effect of currency
   translation               (7)           (1.4)%     (91)           (5.9)%
                        -------  -------          -------  -------
      Construction
       equipment net
       sales on a
       constant
       currency
       basis            $   764  $   506   51.0%  $ 2,081  $ 1,533   35.8%
                        =======  =======          =======  =======

      Total Equipment
       Operations net
       sales on a
       constant
       currency
       basis            $ 3,546  $ 2,960   19.8%  $10,376  $ 9,570    8.4%
                        =======  =======          =======  =======

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 Nine Months Ended September 30, 2010 and 2009
                               (Unaudited)


3. Equipment
 Operations
 gross and
 operating
 profit and         Three Months Ended            Nine Months Ended
 margin:               September 30,                September 30,
             ------------------------------ -----------------------------
                 2010            2009           2010           2009
             -------------- --------------- -------------- --------------
                                    (in millions,
                                       except
                                     percentages)



Net sales    $ 3,540 100.0% $ 2,960  100.0% $10,715 100.0% $ 9,570  100.0%
Less:
  Cost of
   goods sold  2,895  81.8%   2,512   84.9%   8,770  81.8%   8,172   85.4%
             -------        -------         -------        -------
Equipment
 Operations
 gross profit    645  18.2%     448   15.1%   1,945  18.2%   1,398   14.6%
Less:
  Selling,
   general and
   administra-
   tive          294   8.3%     278    9.4%     909   8.5%     840    8.8%
  Research and
   development   112   3.2%      98    3.3%     323   3.0%     286    3.0%
             -------        -------         -------        -------
Equipment
 Operations
 operating
 profit      $   239   6.8% $    72    2.4% $   713   6.7% $   272    2.8%
             =======        =======         =======        =======

Gross profit
 and margin:
  Agricultural
   equipment $   547  19.8% $   441   18.0% $ 1,671  19.6% $ 1,381   17.2%
  Construction
   equipment      98  12.7%       7    1.4%     274  12.6%      17    1.1%
             -------        -------         -------        -------
Equipment
 Operations
 gross
 profit      $   645  18.2% $   448   15.1% $ 1,945  18.2% $ 1,398   14.6%
             =======        =======         =======        =======

Operating
 profit and
 margin:
  Agricultural
   equipment $   235   8.5% $   160    6.5% $   732   8.6% $   545    6.8%
  Construction
   equipment       4   0.5%     (88) (17.4)%    (19) (0.9)%   (273) (17.8)%
             -------        -------         -------        -------
Equipment
 Operations
 operating
 profit      $   239   6.8% $    72    2.4% $   713   6.7% $   272    2.8%
             =======        =======         =======        =======




4. Net income (loss) and diluted          Three Months      Nine Months
 earnings (loss) per share before            Ended            Ended
 restructuring and exceptional items:     September 30,     September 30,
                                        ----------------  ----------------
                                          2010     2009     2010     2009
                                        -------  -------  -------  -------
                                       (in millions, except per share data)

Net income (loss) attributable to CNH   $    83  $   (25) $   243  $  (218)
                                        -------  -------  -------  -------
Restructuring, after tax:
  Restructuring                               6        9        8       82
  Tax benefit                                (1)      (6)      (1)     (26)
                                        -------  -------  -------  -------
    Restructuring, after tax                  5        3        7       56
                                        -------  -------  -------  -------
Exceptional items:
  Loss from debt redemption, net of
   tax                                       14       --       14       --
  Gain from the sale of business, net
   of tax                                    --       --       (4)      --
  Tax charge for Medicare Part D
   retiree drug subsidy                      --       --       20       --
                                        -------  -------  -------  -------
Net income (loss) before restructuring
 and exceptional items                  $   102  $   (22) $   280  $  (162)
                                        =======  =======  =======  =======
Weighted average common shares
 outstanding - diluted                      239      237      238      237
                                        =======  =======  =======  =======
Diluted earnings (loss) per share
 before restructuring and
 exceptional items                      $  0.43  $ (0.09) $  1.17  $ (0.68)
                                        =======  =======  =======  =======


                                     Effect
                           Balance     of                Balance    Cash
                            as of   Foreign               as of   Generated
5. Equipment Operations   December  Currency  Non-Cash  September   from
 cash generated from         31,    Transla-  Transac-     30,     Working
 working capital            2009      tion     tions      2010     Capital
                          --------  --------  --------  --------  --------
                                            (in millions)

Accounts, notes
 receivable and other -
 net - Total              $    788  $      9  $      9  $    893  $    (87)
Inventories                  3,297       (28)        -     2,998       271
Accounts payable - Total    (2,061)       41         -    (2,171)      151
                          --------  --------  --------  --------  --------
Working Capital           $  2,024  $     22  $      9  $  1,720  $    335
                          ========  ========  ========  ========  ========


Note: Equipment Operations Gross and Operating Profit, Net Income and Diluted Earnings Per Share Before Restructuring and Exceptional Items and Working Capital are non-GAAP financial measures. See description of non-GAAP measures contained in this release.

Contact Information

  • For more information contact:
    Gerry Spahn
    Investor Relations
    +1 (630) 887-2385