Exhibit 99.1

 

 

CNH Industrial reports continued strength in its third quarter performance

Consolidated revenues of $5,881 million (up 23.9% compared to Q3 2021 for continuing operations, up 29% at constant currency)

Net income of $559 million, Adjusted Net Income of $557 million, with diluted EPS and adjusted diluted EPS of $0.41

Adjusted EBIT of Industrial Activities of $670 million (up $250 million compared to Q3 2021)

Net cash provided by operating activities of $272 million and Industrial Free Cash Flow of $202 million

Net sales for Industrial Activities expected up 16% to 18% for the full year, despite foreign exchange rates headwinds

CNH Industrial will now voluntarily file annual and quarterly reports on Forms 10-K and 10-Q, as used by US domestic filers

Financial results presented under U.S. GAAP

“The CNH Industrial team delivered another strong quarter, driving record 3rd Quarter consolidated revenues, up nearly 24% over the previous year. A mixture of favorable volume, price realization, outstanding operational execution and supportive product mix permitted us to increase our Industrial Activities Gross and EBIT margins by 260 and 270 basis points respectively, with Agriculture generating a record EBIT margin of 14.8%. While our solid results reflect some sequential improvement in the global supply chain, significant challenges persist, and inflation continues to run hot. Free Cash Flow of Industrial Activities was positive for the quarter, and we continue to target over $1 billion for the full year as we accelerate completion and shipment of inventory in Q4. Order books remain robust as soft commodity prices continue to support global agriculture and many construction end markets sustain their strength. We look forward to sharing our future precision, automation/autonomy, and alternative fuel technologies at our Tech Day in December. With this solid foundation and improving execution we have elevated our full year guidance. The coming quarters will challenge our team, but they have consistently proven their mettle and I remain confident we will continue to support our customers, deliver for our shareholders, and progress our strategic initiatives regardless of the business climate.”

Scott W. Wine, Chief Executive Officer

 

2022 Third Quarter Results

(all amounts $ million, comparison vs Q3 2021 continuing operations - unless otherwise stated)

 

US-GAAP
		Q3 2022				PY(1)				Change				Change at c.c.(3)
Consolidated revenue			5,881				4,746				+23.9%				+29%
of which Net sales of Industrial Activities			5,396				4,336				+24.4%				+30%
Net income			559				460				+99
Diluted EPS $			0.41				0.34				+0.07
Cash flow from operating activities			272				673				(401)
Cash and cash equivalents(6)			3,154				2,855				299
Gross profit margin of Industrial Activities			23.0%				20.4%				+260 bps
NON-GAAP(2)
		Q3 2022				PY(1)				Change
Adjusted EBIT of Industrial Activities			670				420				+250
Adjusted EBIT Margin of Industrial Activities			12.4%				9.7%				+270 bps
Adjusted net income			557				463				+94
Adjusted diluted EPS $			0.41				0.34				+0.07
Free Cash flow of Industrial Activities			202				(70	)			+272
Available liquidity(6)			8,645				8,795				(150	)

Net sales of Industrial Activities of $5,396 million, up 24.4% mainly due to favorable price realization, despite more than 5% adverse currency conversion impacts.

Adjusted EBIT of Industrial Activities of $670 million ($420 million in Q3 2021), with both segments up year over year. Agriculture adjusted EBIT margin at record 14.8% and Construction at 2.7%.

Net income of $559 million, with diluted earnings per share of $0.41 (net income of $460 million in Q3 2021, with diluted earnings per share of $0.34). Adjusted net income of $557 million, with adjusted diluted earnings per share of $0.41 (adjusted net income of $463 million in Q3 2021, with adjusted diluted earnings per share of $0.34).

Gross profit margin of Industrial Activities of 23.0%, (20.4% in Q3 2021) with improvement in Agriculture and Construction despite continued cost pressures.

Reported income tax expense of $192 million and adjusted income tax expense⁽¹⁾ of $190 million, with adjusted effective tax rate (adjusted ETR⁽¹⁾) of 26.2% affected by the jurisdictional mix of pre-tax profits.

Free cash flow of Industrial Activities was $202 million. Manufacturing inventories remain at high levels, although reduced from June 2022, amid supply chain constraints, and finished goods inventories continue being lean relative to sales. Total Debt of $20.9 billion at September 30, 2022 ($20.9 billion at December 31, 2021).

Industrial Activities Net Debt⁽¹⁾ position at $1.3 billion, an increase of $146 million from December 31, 2021, and Available liquidity at $8,645 million as of September 30, 2022. The Company completed a €100 million share buyback program with 5.3 million common shares purchased during the third quarter. Additionally, 1.4 million common shares were purchased during the third quarter under the first $50 million tranche of the $300 million common share buyback program approved on July 29, 2022.

Beginning with the reporting of third quarter 2022 financial results, the Company intends to voluntarily report its financial results under the periodic reporting forms for U.S. domestic filers (i.e., CNH Industrial will now voluntarily file annual and quarterly reports on Forms 10-K and 10-Q). Management determined that following the spin-off of the Iveco Group and the refocus as an agricultural and construction equipment leader with significant presence in the US, reporting according to the standards for US public companies is more consistent with the Company’s operating profile and its investor base.

 

1

 

Agriculture

Q3 2022

Q3 2021(1)

Change

Change at c.c.(3)

Net sales ($ million)

4,501

3,563

+26%

+32%

Adjusted EBIT ($ million)

666

415

+251

Adjusted EBIT margin

14.8%

11.6%

+320 bps

In North America, industry volume was up 9% year over year for the third quarter for tractors over 140 HP and was down 16% for tractors under 140 HP; combines were up 13%. In Europe, Middle East and Africa (EMEA), tractor and combine demand was down 5% and 30%, respectively; combine demand in Europe alone was up 12%. South America tractor demand was up 12% and combine demand was up 20%. Asia Pacific tractor demand was up 8% and combine demand was up 12%.

Net sales were up 26%, due to favorable price realization and better mix, mostly driven by North America and South America, partially offset by the negative impact of foreign exchange rates.

Gross profit margin was at record 25.0%, with Gross Profit $340 million higher than in Q3 2021, mainly due to better mix and favorable price realization primarily in North America, South America and Asia Pacific regions, partially offset by higher production and raw material costs across all regions.

Adjusted EBIT was $666 million ($415 million for Q3 2021), with Adjusted EBIT margin at 14.8%. The $251 million increase was driven by favorable price realization and better mix , partially offset by higher SG&A costs, higher production and raw material costs, and increased R&D spend.

Order book in Agriculture was down less than 10% year over year for tractors. Order book for combines was down 21%, with declines in North America and South America offset partially by growth in EMEA. At above 2.5 times the pre-pandemic levels, order books remain strong in all regions and key products and orders are being kept curtailed as the medium-term cost scenario remains unclear.

 

Construction

Q3 2022

Q3 2021(1)

Change

Change at c.c.(3)

Net sales ($ million)

895

773

+16%

+20%

Adjusted EBIT ($ million)

24

21

+3

Adjusted EBIT margin

2.7%

2.7%

-

Global industry volume for construction equipment decreased in both Heavy and Light sub-segments year over year in the third quarter, with Heavy down 3% and Light down 4%, mostly driven by a 9% decrease in Light and Heavy equipment demand for Asia Pacific, particularly in China. Aggregated demand increased 1% in North America, decreased 5% in EMEA and increased 21% in South America.

Net sales were up 16%, driven by favorable price realization and contribution from the Sampierana business acquired in December 2021.

Gross profit margin was 12.6%, up 0.4 p.p. compared to Q3 2021, mainly due to higher volumes in North America and favorable price realization, partially offset by higher freight and raw material costs.

Adjusted EBIT increased $3 million due to favorable volume and mix and positive price realization, partially offset by higher production, freight and raw material costs and increased SG&A spend. Adjusted EBIT margin at 2.7%.

Construction order book up more than 20% year over year in both Heavy and Light sub-segments, with increases in the North America, EMEA and South America regions.

 

Financial Services
		Q3 2022				Q3 2021(1)				Change				Change at c.c.(3)
Revenue ($ million)			482				405				+19%				+21%
Net income ($ million)			86				96				(10	)
Equity at quarter-end ($ million)			2,207				2,157				+50
Retail loan originations ($ million)			2,478				2,357				+5.1%

Revenues were up 19% due to favorable volumes in all regions, higher base rates across all regions, mainly in South America, and higher used equipment sales, partially offset by changes in North America product mix.

Net income decreased $10 million to $86 million, primarily due to margin compression in North America, increased SG&A costs, specifically labor costs, and normalized risk costs, partially offset by favorable volumes in all regions and higher recoveries on used equipment sales.

The managed portfolio (including unconsolidated joint ventures) was $21.2 billion as of September 30, 2022 (of which retail was 70% and wholesale was 30%), up $1.2 billion compared to September 30, 2021 (up $2.4 billion on a constant currency basis).

The receivable balance greater than 30 days past due as a percentage of receivables was 1.3% (1.4% as of September 30, 2021).

2022 Outlook

 

The Company is updating the 2022 outlook for its Industrial Activities:

 

•

Net sales(5) up between 16% and 18% year on year including currency translation effects

 

•

SG&A expenses lower than 7.5% of net sales

 

•

Free Cash Flow of Industrial Activities(8) in excess of $1.0 billion

 

•

R&D expenses and capital expenditures at around $1.4 billion

Significant uncertainties remain, including rising inflation, geopolitical instability, the war in Ukraine, and may affect our forecast for the year.

 

2

 

RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022

Consolidated revenues of $16,608 million (up 18.5% year on year, up 22% at constant currency), net income of $1,447 million, with adjusted diluted EPS of $1.11, adjusted EBIT of Industrial Activities of $1,753 million, and Industrial Free Cash Flow absorption of $(453) million (Industrial Activities).

Results for the Nine Months Ended September 30, 2022

(all amounts $ million, comparison vs Q3 2021 continuing operations - unless otherwise stated)

 

US-GAAP
		YTD Q3 2022				PY(1)				Change				Change at c.c.(3)
Consolidated revenue			16,608				14,016				+18.5%				+22%
of which Net sales of Industrial Activities			15,189				12,808				+18.6%				+22%
Net income			1,447				1,337				+110
Diluted EPS $			1.06				0.98				+0.08
Cash flow from operating activities			(886)				1,474				(2,360)
Cash and cash equivalents(7)			3,154				5,044				(1,890)
Gross profit margin of Industrial Activities			22.2%				21.4%				+80bps
NON-GAAP(2)
		YTD Q3 2022				PY(1)				Change
Adjusted EBIT of Industrial Activities			1,753				1,385				+368
Adjusted EBIT Margin of Industrial Activities			11.5%				10.8%				+70bps
Adjusted net income			1,518				1,322				+196
Adjusted diluted EPS $			1.11				0.97				+0.14
Free Cash flow of Industrial Activities			(453	)			703				(1,156	)
Available liquidity(7)			8,645				10,521				(1,876	)
Adjusted gross margin of Industrial Activities			22.4%				21.4%				+100bps

 

Agriculture

YTD Q3 2022

YTD Q3 2021(1)

Change

Change at c.c.(3)

Net sales ($ million)

12,600

10,571

+19%

+23%

Adjusted EBIT ($ million)

1,755

1,396

+359

Adjusted EBIT margin

13.9%

13.2%

+70bps

Construction

YTD Q3 2022

YTD Q3 2021(1)

Change

Change at c.c.(3)

Net sales ($ million)

2,589

2,237

+16%

+18%

Adjusted EBIT ($ million)

90

70

+20

Adjusted EBIT margin

3.5%

3.1%

40bps

Financial Services

YTD Q3 2022

YTD Q3 2021(1)

Change

Change at c.c.(3)

Revenues ($ million)

1,419

1,194

+19%

+19%

Net income ($ million)

263

259

+4

 

3

 

Notes

CNH Industrial reports quarterly and annual consolidated financial results under U.S. GAAP and EU-IFRS. The tables and discussion related to the financial results of the Company and its segments shown in this press release are prepared in accordance with U.S. GAAP. Financial results under EU-IFRS are shown in specific tables at the end of this press release.

 

1.

Effective January 1, 2022, the Iveco Group business was separated from CNH Industrial N.V. by way of a demerger under Dutch law to Iveco Group N.V. and Iveco Group became a public listed company independent from CNH Industrial. Accordingly, that business is presented as discontinued operations beginning in the first quarter of 2022. The Company has reclassified the financial results of Iveco Group to Net income (loss) from discontinued operations in the Condensed Consolidated Statements of Operations for all periods presented. The Company has reclassified the related assets and liabilities as Assets held for distribution and Liabilities held for distribution on the Condensed Consolidated Balance Sheets as of December 31, 2021. Cash flows from the Company’s discontinued operations are presented in the Condensed Consolidated Statements of Cash Flows for all periods. All comparative figures shown exclude the results of the discontinued operations.

 

2.

This item is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Information” section of this press release for information regarding non-GAAP financial measures. Refer to the specific table in the “Other Supplemental Financial Information” section of this press release for the reconciliation between the non-GAAP financial measure and the most comparable GAAP financial measure.

 

3.

c.c. means at constant currency.

 

4.

Certain financial information in this report has been presented by geographic area. Our geographical regions are: (1) North America; (2) Europe, Middle East and Africa; (3) South America and (4) Asia Pacific. The geographic designations have the following meanings:

a.     North America: United States, Canada, and Mexico;

b.     Europe, Middle East, and Africa: member countries of the European Union, European Free Trade Association, the United Kingdom, Ukraine, Balkans, Russia, Turkey, the African continent, and the Middle East;

c.     South America: Central and South America, and the Caribbean Islands; and

d.     Asia Pacific: Continental Asia (including the Indian subcontinent) and Oceania.

 

5.

Net sales reflecting the exchange rate of 1.05 EUR/USD

 

6.

Comparison vs. June 30, 2022

 

7.

Comparison vs. December 31, 2021

 

8.

The Company is unable to provide this reconciliation without unreasonable effort due to the uncertainty and inherent difficulty of predicting the occurrence, the financial impact, and the periods in which the adjustments may be recognized. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.

Non-GAAP Financial Information

CNH Industrial monitors its operations through the use of several non-GAAP financial measures. CNH Industrial’s management believes that these non-GAAP financial measures provide useful and relevant information regarding its operating results and enhance the readers’ ability to assess CNH Industrial’s financial performance and financial position. Management uses these non-GAAP measures to identify operational trends, as well as make decisions regarding future spending, resource allocations and other operational decisions as they provide additional transparency with respect to our core operations. These non-GAAP financial measures have no standardized meaning under U.S. GAAP or EU-IFRS and are unlikely to be comparable to other similarly titled measures used by other companies and are not intended to be substitutes for measures of financial performance and financial position as prepared in accordance with U.S. GAAP and/or EU-IFRS.

CNH Industrial’s non-GAAP financial measures are defined as follows:

 

•

Adjusted EBIT of Industrial Activities under U.S. GAAP: is defined as net income (loss) before income taxes, Financial Services’ results, Industrial Activities’ interest expenses, net, foreign exchange gains/losses, finance and non-service component of pension and other post-employment benefit costs, restructuring expenses, and certain non-recurring items. In particular, non-recurring items are specifically disclosed items that management considers rare or discrete events that are infrequent in nature and not reflective of on-going operational activities.

 

•

Adjusted EBIT of Industrial Activities under EU-IFRS: is defined as profit/(loss) before taxes, Financial Services’ results, Industrial Activities’ financial expenses, restructuring costs, and certain non-recurring items.

 

•

Adjusted EBIT Margin of Industrial Activities: is computed by dividing Adjusted EBIT of Industrial Activities by Net Sales of Industrial Activities.

 

•

Adjusted Net Income (Loss): is defined as net income (loss), less restructuring charges and non-recurring items, after tax.

 

•

Adjusted Diluted EPS: is computed by dividing Adjusted Net Income (loss) attributable to CNH Industrial N.V. by a weighted-average number of common shares outstanding during the period that takes into consideration potential common shares outstanding deriving from the CNH Industrial share-based payment awards, when inclusion is not anti-dilutive. When we provide guidance for adjusted diluted EPS, we do not provide guidance on a earnings per share basis because the GAAP measure will include potentially significant items that have not yet occurred and are difficult to predict with reasonable certainty prior to year-end.

 

•

Adjusted Income Tax (Expense) Benefit: is defined as income taxes less the tax effect of restructuring expenses and non-recurring items, and non-recurring tax charges or benefits.

 

•

Adjusted Effective Tax Rate (Adjusted ETR): is computed by dividing a) adjusted income taxes by b) income (loss) before income taxes and equity in income of unconsolidated subsidiaries and affiliates, less restructuring expenses and non-recurring items.

 

•

Adjusted Gross Profit Margin of Industrial Activities: is computed by dividing Net sales less Cost of goods sold, as adjusted by non-recurring items, by Net sales.

 

•

Net Cash (Debt) and Net Cash (Debt) of Industrial Activities: Net Cash (Debt) is defined as total debt less intersegment notes receivable, cash and cash equivalents, restricted cash, other current financial assets (primarily current securities, short-term deposits and investments towards high-credit rating counterparties) and derivative hedging debt. CNH Industrial provides the reconciliation of Net Cash (Debt) to Total (Debt), which is the most directly comparable measure included in the consolidated balance sheets. Due to different sources of cash flows used for the repayment of the debt between Industrial Activities and Financial Services (by cash from operations for Industrial Activities and by collection of financing receivables for Financial Services), management separately evaluates the cash flow performance of Industrial Activities using Net Cash (Debt) of Industrial Activities.

 

4

 

•

Free Cash Flow of Industrial Activities (or Industrial Free Cash Flow): refers to Industrial Activities only, and is computed as consolidated cash flow from operating activities less: cash flow from operating activities of Financial Services; investments of Industrial Activities in assets sold under operating leases, property, plant and equipment and intangible assets; change in derivatives hedging debt of Industrial Activities; as well as other changes and intersegment eliminations.

 

•

Available Liquidity: is defined as cash and cash equivalents plus restricted cash, undrawn medium-term unsecured committed facilities, net receivables/payables with Iveco Group N.V. and other current financial assets (primarily current securities, short-term deposits and investments in instruments of high-credit rating counterparties).

 

•

Change excl. FX or Constant Currency: CNH Industrial discusses the fluctuations in revenues on a constant currency basis by applying the prior year average exchange rates to current year’s revenues expressed in local currency in order to eliminate the impact of foreign exchange rate fluctuations

The tables attached to this press release provide reconciliations of the non-GAAP measures used in this press release to the most directly comparable GAAP measures.

Forward-looking statements

All statements other than statements of historical fact contained in this earning release, including competitive strengths; business strategy; future financial position or operating results; budgets; projections with respect to revenue, income, earnings (or loss) per share, capital expenditures, dividends, liquidity, capital structure or other financial items; costs; and plans and objectives of management regarding operations and products, are forward-looking statements. Forward looking statements also include statements regarding the future performance of CNH Industrial and its subsidiaries on a standalone basis. These statements may include terminology such as “may”, “will”, “expect”, “could”, “should”, “intend”, “estimate”, “anticipate”, “believe”, “outlook”, “continue”, “remain”, “on track”, “design”, “target”, “objective”, “goal”, “forecast”, “projection”, “prospects”, “plan”, or similar terminology. Forward-looking statements, including those related to the COVID-19 pandemic, are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside our control and are difficult to predict. If any of these risks and uncertainties materialize (or they occur with a degree of severity that the Company is unable to predict) or other assumptions underlying any of the forward-looking statements prove to be incorrect, including any assumptions regarding strategic plans, the actual results or developments may differ materially from any future results or developments expressed or implied by the forward-looking statements. Factors, risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements include, among others: the continued uncertainties related to the unknown duration and economic, operational and financial impacts of the global COVID-19 pandemic and the actions taken or contemplated by governmental authorities or others in connection with the pandemic on our business, our employees, customers and suppliers; supply chain disruptions, including delays caused by mandated shutdowns, industry capacity constraints, material availability, and global logistics delays and constraints; disruption caused by business responses to COVID-19, including remote working arrangements, which may create increased vulnerability to cybersecurity or data privacy incidents; our ability to execute business continuity plans as a result of COVID-19; the many interrelated factors that affect consumer confidence and worldwide demand for capital goods and capital goods-related products, including demand uncertainty caused by COVID-19; general economic conditions in each of our markets, including the significant economic uncertainty and volatility caused by the war in the Ukraine and COVID-19; changes in government policies regarding banking, monetary and fiscal policy; legislation, particularly pertaining to capital goods-related issues such as agriculture, the environment, debt relief and subsidy program policies, trade and commerce and infrastructure development; government policies on international trade and investment, including sanctions, import quotas, capital controls and tariffs; volatility in international trade caused by the imposition of tariffs, sanctions, embargoes, and trade wars; actions of competitors in the various industries in which we compete; development and use of new technologies and technological difficulties; the interpretation of, or adoption of new, compliance requirements with respect to engine emissions, safety or other aspects of our products; production difficulties, including capacity and supply constraints and excess inventory levels; labor relations; interest rates and currency exchange rates; inflation and deflation; energy prices; prices for agricultural commodities; housing starts and other construction activity; our ability to obtain financing or to refinance existing debt; price pressure on new and used equipment; the resolution of pending litigation and investigations on a wide range of topics, including dealer and supplier litigation, intellectual property rights disputes, product warranty and defective product claims, and emissions and/or fuel economy regulatory and contractual issues; security breaches, cybersecurity attacks, technology failures, and other disruptions to the information technology infrastructure of CNH Industrial and its suppliers and dealers; security breaches with respect to our products; our pension plans and other post-employment obligations; political and civil unrest; volatility and deterioration of capital and financial markets, including other pandemics, terrorist attacks in Europe and elsewhere; our ability to realize the anticipated benefits from our business initiatives as part of our strategic plan; our failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures, strategic alliances or divestitures and other similar risks and uncertainties, and our success in managing the risks involved in the foregoing.

Forward-looking statements are based upon assumptions relating to the factors described in this earnings release, which are sometimes based upon estimates and data received from third parties. Such estimates and data are often revised. Actual results may differ materially from the forward-looking statements as a result of a number of risks and uncertainties, many of which are outside CNH Industrial’s control. CNH Industrial expressly disclaims any intention or obligation to provide, update or revise any forward-looking statements in this announcement to reflect any change in expectations or any change in events, conditions or circumstances on which these forward-looking statements are based. Further information concerning CNH Industrial, including factors that potentially could materially affect CNH Industrial’s financial results, is included in CNH Industrial’s reports and filings with the U.S. Securities and Exchange Commission (“SEC”), the Autoriteit Financiële Markten (“AFM”) and Commissione Nazionale per le Società e la Borsa (“CONSOB”).

All future written and oral forward-looking statements by CNH Industrial or persons acting on the behalf of CNH Industrial are expressly qualified in their entirety by the cautionary statements contained herein or referred to above.

Conference Call and Webcast

Today, at 3:30 p.m. CET / 2:30 p.m. GMT/ 9:30 a.m. ET, management will hold a conference call to present third quarter 2022 results to financial analysts and institutional investors. The call can be followed live online at https://bit.ly/CNH_Industrial_Q3_2022 and a recording will be available later on the Company’s website www.cnhindustrial.com. A presentation will be made available on the CNH Industrial website prior to the conference call.

London, November 8, 2022

CONTACTS

Media Inquiries – Laura Overall Tel +44 207 925 1964 or Rebecca Fabian Tel +1 312 515 2249 (Email mediarelations@cnhind.com)

Investor Relations – Jason Omerza Tel +1 630 740 8079 or Federico Pavesi Tel +39 345 605 6218 (Email investor.relations@cnhind.com)

 

5

 

CNH INDUSTRIAL N.V.

Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021

(Unaudited, U.S.-GAAP)

 

		Three Months Ended September 30,								Nine Months Ended September 30,
($ million)		2022				2021				2022				2021
Revenues
Net sales			5,396				4,336				15,189				12,808
Finance, interest and other income			485				410				1,419				1,208
TOTAL REVENUES			5,881				4,746				16,608				14,016
Costs and Expenses
Cost of goods sold			4,156				3,452				11,819				10,064
Selling, general and administrative expenses			422				349				1,224				1,023
Research and development expenses			213				157				609				453
Restructuring expenses			11				15				19				21
Interest expense			190				127				490				417
Other, net			159				124				490				422
TOTAL COSTS AND EXPENSES			5,151				4,224				14,651				12,400
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES			730				522				1,957				1,616
Income tax (expense) benefit			(192)				(79)				(579)				(347)
Equity in income (loss) of unconsolidated subsidiaries and affiliates			21				17				69				68
Net income (loss) from continuing operations			559				460				1,447				1,337
Net income (loss) from discontinued operations			—				(131)				—				116
NET INCOME (LOSS)			559				329				1,447				1,453
Net income attributable to noncontrolling interests			3				6				10				32
NET INCOME (LOSS) ATTRIBUTABLE TO CNH INDUSTRIAL N.V.			556				323				1,437				1,421
Basic earnings (loss) per share attributable to common shareholders (in $)
Continuing operations			0.41				0.34				1.06				0.98
Discontinued operations			—				(0.10)				—				0.07
Basic earnings per share attributable to CNH Industrial N.V.			0.41				0.24				1.06				1.05
Diluted earnings (loss) per share attributable to common shareholders (in $)
Continuing operations			0.41				0.34				1.06				0.98
Discontinued operations			—				(0.10)				—				0.06
Diluted earnings per share attributable to CNH Industrial N.V.			0.41				0.24				1.06				1.04
Average shares outstanding (in millions)
Basic			1,350				1,354				1,354				1,354
Diluted			1,355				1,361				1,359				1,360
Cash dividends declared per common share			—				—				0.302				0.132

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, 2021 included in the Annual Report on Form 20-F. These Condensed Consolidated Statements of Operations represent the consolidation of all CNH Industrial N.V. subsidiaries.

 

6

 

CNH INDUSTRIAL N.V.

Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021

(Unaudited, U.S.-GAAP)

 

($ million)		September 30, 2022				December 31, 2021
ASSETS
Cash and cash equivalents			3,154				5,044
Restricted cash			660				801
Financing receivables, net			16,901				15,376
Receivables from Iveco Group N.V.			224				—
Inventories, net			5,362				4,216
Property, plant and equipment, net and equipment under operating lease			2,944				3,213
Intangible assets, net			4,391				4,417
Other receivables and assets			2,208				2,803
Assets held for distribution			—				13,546
TOTAL ASSETS			35,844				49,416
LIABILITIES AND EQUITY
Debt			20,922				20,897
Payables to Iveco Group N.V.			95				502
Other payables and liabilities			8,418				9,272
Liabilities held for distribution			—				11,892
Total Liabilities			29,435				42,563
Redeemable noncontrolling interest			52				45
Equity			6,357				6,808
TOTAL LIABILITIES AND EQUITY			35,844				49,416

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, 2021, included in the Annual Report on Form 20-F. These Condensed Consolidated Balance Sheets represent the consolidation of all CNH Industrial N.V. subsidiaries.

 

7

 

CNH INDUSTRIAL N.V.

Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2022 and 2021

(Unaudited, U.S.-GAAP)

 

		Nine Months Ended September 30,
($ million)		2022				2021
Net income (loss)			1,447				1,453
Less: Net income (loss) of Discontinued Operations			—				116
Net income (loss) of Continuing Operations			1,447				1,337
Adjustments to reconcile net income (loss) from Continuing Operations to net cash provided by (used in) operating activities from Continuing Operations:			(2,333)				137
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS			(886)				1,474
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS			—				418
TOTAL NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES			(886)				1,892
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM CONTINUING OPERATIONS			(1,590)				(1,720)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS			—				134
TOTAL NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES			(1,590)				(1,586)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS			802				(1,242)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS			—				(450)
TOTAL NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES			802				(1,692)
Effect of foreign exchange rate changes on cash and cash equivalents and restricted cash			(357)				(329)
DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH			(2,031)				(1,715)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF YEAR			5,845				9,629
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD			3,814				7,914
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (Discontinued Operations)			—				720
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (Continuing Operations)			3,814				7,194

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, 2021 included in the Annual Report on Form 20-F. These Condensed Consolidated Statements of Cash Flows represent the consolidation of all CNH Industrial N.V. subsidiaries.

 

8

 

CNH INDUSTRIAL N.V.

Supplemental Statements of Operations for the three months ended September 30, 2022 and 2021

(Unaudited, U.S.-GAAP)

 

		Three Months Ended September 30, 2022																Three Months Ended September 30, 2021
($ million)		Industrial   Activities(1)				Financial Services				Eliminations				Consolidated				Industrial Activities(1)				Financial Services				Eliminations				Consolidated
Revenues
Net sales			5,396				—				—				5,396				4,336				—				—				4,336
Finance, interest and other income			27				482				(24	)  (2)			485				16				405				(11	)  (2)			410
TOTAL REVENUES			5,423				482				(24	)			5,881				4,352				405				(11	)			4,746
Costs and Expenses
Cost of goods sold			4,156				—				—				4,156				3,452				—				—				3,452
Selling, general and administrative expenses			377				45				—				422				317				32				—				349
Research and development expenses			213				—				—				213				157				—				—				157
Restructuring expenses			11				—				—				11				15				—				—				15
Interest expense			54				160				(24	)  (3)			190				37				101				(11	)  (3)			127
Other, net			(3	)			162				—				159				(24	)			148				—				124
TOTAL COSTS AND EXPENSES			4,808				367				(24	)			5,151				3,954				281				(11	)			4,224
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES			615				115				—				730				398				124				—				522
Income tax (expense) benefit			(160	)			(32	)			—				(192)				(48	)			(31	)			—				(79)
Equity in income (loss) of unconsolidated subsidiaries and affiliates			18				3				—				21				14				3				—				17
NET INCOME (LOSS) Continuing Operations			473				86				—				559				364				96				—				460
NET INCOME (LOSS) Discontinued Operations			—				—				—				—				(153	)			22				—				(131)
NET INCOME (LOSS)			473				86				—				559				211				118				—				329

 

(1)

Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services.

 

(2)

Elimination of Financial Services’ interest income earned from Industrial Activities.

 

(3)

Elimination of Industrial Activities’ interest expense to Financial Services.

 

9

 

CNH INDUSTRIAL N.V.

Supplemental Statements of Operations for the nine months ended September 30, 2022 and 2021

(Unaudited, U.S.-GAAP)

 

		Nine Months Ended September 30, 2022																		Nine Months Ended September 30, 2021
($ million)		Industrial Activities(1)				Financial Services				Eliminations				Consolidated						Industrial Activities(1)				Financial Services				Eliminations				Consolidated
Revenues
Net sales			15,189				—				—				15,189						12,808				—				—				12,808
Finance, interest and other income			52				1,419				(52)	(2)			1,419						43				1,194				(29)	(2)			1,208
TOTAL REVENUES			15,241				1,419				(52)				16,608						12,851				1,194				(29)				14,016
Costs and Expenses
Cost of goods sold			11,819				—				—				11,819						10,064				—				—				10,064
Selling, general and administrative expenses			1,087				137				—				1,224						936				87				—				1,023
Research and development expenses			609				—				—				609						453				—				—				453
Restructuring expenses			19				—				—				19						21				—				—				21
Interest expense			149				393				(52)	(3)			490						135				311				(29)	(3)			417
Other, net			(41)				531				—				490						(41)				463				—				422
TOTAL COSTS AND EXPENSES			13,642				1,061				(52)				14,651						11,568				861				(29)				12,400
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES			1,599				358				—				1,957						1,283				333				—				1,616
Income tax (expense) benefit			(473)				(106)				—				(579)						(264)				(83)				—				(347)
Equity in income (loss) of unconsolidated subsidiaries and affiliates			58				11				—				69						59				9				—				68
NET INCOME (LOSS) Continuing Operations			1,184				263				—				1,447						1,078				259				—				1,337
NET INCOME (LOSS) Discontinued Operations			—				—				—				—						67				49				—				116
NET INCOME (LOSS)			1,184				263				—				1,447						1,145				308				—				1,453

 

(1)

Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services.

 

(2)

Elimination of Financial Services’ interest income earned from Industrial Activities.

 

(3)

Elimination of Industrial Activities’ interest expense to Financial Services.

 

10

 

CNH INDUSTRIAL N.V.

Supplemental Balance Sheets as of September 30, 2022 and December 31, 2021

(Unaudited, U.S.-GAAP)

 

		September 30, 2022																		December 31, 2021
($ million)		Industrial Activities(1)				Financial   Services				Eliminations				Consolidated						Industrial   Activities(1)				Financial   Services				Eliminations				Consolidated
ASSETS
Cash and cash equivalents			2,736				418			—					3,154						4,386				658			—					5,044
Restricted cash			131				529			—					660						128				673			—					801
Financing receivables, net			601				17,068			(768)		(2)			16,901						199				15,508			(331)		(2)			15,376
Receivables from Iveco Group N.V.			151				73			—					224						—				—			—					—
Inventories, net			5,344				18			—					5,362						4,187				29			—					4,216
Property, plant and equipment, net and equipment on operating lease			1,434				1,510			—					2,944						1,504				1,709			—					3,213
Intangible assets, net			4,231				160			—					4,391						4,255				162			—					4,417
Other receivables and assets			1,957				437			(186)		(3)			2,208						2,656				345			(198)		(3)			2,803
Assets held for distribution			—				—			—					—						9,814				4,543			(811)					13,546
TOTAL ASSETS			16,585				20,213			(954)					35,844						27,129				23,627			(1,340)					49,416
LIABILITIES AND EQUITY
Debt			4,827				16,863			(768)		(2)			20,922						5,485				15,743			(331)		(2)			20,897
Payables to Iveco Group N.V.			6				89			—					95						334				168			—					502
Other payables and liabilities			7,550				1,054			(186)		(3)			8,418						8,426				1,044			(198)		(3)			9,272
Liabilities held for distribution			—				—			—					—						8,985				3,718			(811)					11,892
Total Liabilities			12,383				18,006			(954)					29,435						23,230				20,673			(1,340)					42,563
Redeemable noncontrolling interest			52				—			—					52						45				—			—					45
Equity			4,150				2,207			—					6,357						3,854				2,954			—					6,808
TOTAL LIABILITIES AND EQUITY			16,585				20,213			(954)					35,844						27,129				23,627			(1,340)					49,416

 

(1)

Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services.

 

(2)

This item includes the elimination of receivables/payables between Industrial Activities and Financial Services.

 

(3)

This item primarily represents the reclassification of deferred tax assets/liabilities in the same taxing jurisdiction and elimination of intercompany activity between Industrial Activities and Financial Services.

 

11

 

CNH INDUSTRIAL N.V.

Supplemental Statements of Cash Flows for the nine months ended September 30, 2022 and 2021

(Unaudited, U.S.-GAAP)

 

		Nine months ended September 30, 2022																				Nine months ended September 30, 2021
($ million)		Industrial Activities(1)				Financial   Services				Eliminations		(3)		Consolidated								Industrial   Activities(1)				Financial   Services				Eliminations		(3)		Consolidated
Net income (loss)			1,184				263			—					1,447								1,145				308			—					1,453
Less: Net income (loss) of Discontinued Operations			—				—			—					—								67				49			—					116
Net income (loss) of Continuing Operations			1,184				263			—					1,447								1,078				259			—					1,337
Adjustments to reconcile net income (loss) from Continuing Operations to net cash provided by (used in) operating activities from Continuing Operations:			(1,366	)			(852	)		(115)		(2)			(2,333	)							(152	)			449			(160)					137
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS			(182	)			(589	)		(115)					(886	)							926				708			(160)					1,474
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS			—				—			—					—								(103	)			523			(2)					418
TOTAL NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES			(182	)			(589	)		(115)					(886	)							823				1,231			(162)					1,892
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM CONTINUING OPERATIONS			(656	)			(955	)		21					(1,590	)							(940	)			(791	)		11					(1,720	)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS			—				—			—					—								113				19			2					134
TOTAL NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES			(656	)			(955	)		21					(1,590	)							(827	)			(772	)		13					(1,586	)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS			(471	)			1,179			94					802								(1,447	)			56			149					(1,242	)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS			—				—			—					—								(10	)			(440	)		-					(450	)
TOTAL NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES			(471	)			1,179			94		(4)			802								(1,457	)			(384	)		149					(1,692	)
Effect of foreign exchange rate changes on cash and cash equivalents and restricted cash			(338	)			(19	)		—					(357	)							(300	)			(29	)		—					(329	)
DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH			(1,647	)			(384	)		—					(2,031	)							(1,761	)			46			—					(1,715	)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF YEAR			4,514				1,331			—					5,845								8,116				1,513			—					9,629
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD			2,867				947			—					3,814								6,355				1,559			—					7,914
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (DISCONTINUED OPERATIONS)			—				—			—					—								510				210			—					720
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (CONTINUING OPERATIONS)			2,867				947			—					3,814								5,845				1,349			—					7,194

 

(1)

Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services.

 

(2)

This item includes the elimination of dividends from Financial Services to Industrial Activities, which are included in Industrial Activities net cash used in operating activities.

 

(3)

This item includes the elimination of certain minor activities between Industrial Activities and Financial Services.

 

(4)

This item includes the elimination of paid in capital from Industrial Activities to Financial Services.

 

12