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CNH Industrial N.V. Reports Fourth Quarter and Full Year 2024 Results

Fourth quarter consolidated revenues declined 28%; full year consolidated revenues declined 20% on lower industry demand for Agriculture and Construction equipmentFourth quarter net income of $176 million; full year net income of $1,259 millionFull year diluted EPS at $0.99; adjusted diluted EPS at $1.05Results reflect channel destocking and continued execution of cost savings initiatives Basildon, UK - February 4, 2025 - CNH Industrial N.V. (NYSE: CNH)today reported results for the...

Essex, 04/02/2025 (informazione.news - comunicati stampa - industria)

Fourth quarter consolidated revenues declined 28%; full year consolidated revenues declined 20% on lower industry demand for Agriculture and Construction equipment

Fourth quarter net income of $176 million; full year net income of $1,259 million

Full year diluted EPS at $0.99; adjusted diluted EPS at $1.05

Results reflect channel destocking and continued execution of cost savings initiatives

Basildon, UK - February 4, 2025 - CNH Industrial N.V. (NYSE: CNH) today reported results for the three months and twelve months ended December 31, 2024, with Q4 2024 net income of $176 million and diluted earnings per share of $0.14, compared with net income of $583 million and diluted earnings per share of $0.44 in Q4 2023 . Consolidated revenues were $4.88 billion in the quarter (down 28% compared to Q4 2023) and Net sales of Industrial Activities were $4.13 billion (down 31% compared to Q4 2023). Net cash provided by operating activities was $1,692 million, and Industrial Free Cash Flow was $848 million in Q4 2024.

Full year 2024 consolidated revenues were $19.84 billion, down 20% year-over-year, with Net sales of Industrial Activities at $17.06 billion, down 23%. Full year net income was $1,259 million compared to 2023 net income of $2,287 million. Full year diluted earnings per share was $0.99 compared to $1.69 in 2023 . Adjusted net income was $1,339 million compared to $2,217 million in 2023, with adjusted diluted earnings per share of $1.05 compared to $1.63 in 2023 . Full year net cash provided by operating activities was $1,968 million and Industrial Free Cash Flow absorption was $401 million.

“I applaud the CNH team's dedication to achieve the tasks we gave ourselves to close 2024. As intended, Agriculture dealer inventory went down in Q4 by over $700 million due to focused retail sales support and 34% fewer production hours. Our proactive and ongoing efforts to align our business structure with the current industry environment have allowed us to deliver our products with reasonable margin erosion. The challenging market conditions will continue at least through the first half of 2025, and we will keep production levels fairly low by design to drive channel inventory down further. I am confident that our continuing efforts to simplify, streamline, and raise the quality of our operations prepare us well for the regional cycle dynamics ahead.”

Gerrit Marx, Chief Executive Officer

2024 Fourth Quarter Results

(all amounts $ million, comparison vs Q4 2023 - unless otherwise stated)

Please note that in this and in the following tables and commentary, prior periods have been revised to reflect an immaterial correction to the financial statements. See note 1 for further details.

The decline in net sales of Industrial Activities was mainly due to lower shipment volumes on decreased industry demand and dealer destocking.

In Q4 2024, adjusted net income was $196 million with adjusted diluted earnings per share of $0.15. In comparison, in Q4 2023, CNH reported adjusted net income of $523 million and adjusted diluted earnings per share of $0.39.

Reported income tax expense was $89 million for the fourth quarter of 2024 ($58 million in Q4 2023), including the combined impact from the derecognition of deferred tax assets in Argentina and the recognition of deferred tax assets in China, with an effective tax rate (ETR) of 36.9% (10.1% in Q4 2023). The adjusted ETR was 34.1% (27.1% in Q4 2023).

Cash flow provided by operating activities in the quarter was $1,692 million ($1,515 million in Q4 2023). Free cash flow of Industrial Activities was $848 million. Consolidated debt was $27 billion as of December 31, 2024 ($27 billion at December 31, 2023).

In North America, industry volume was down 34% year-over-year in Q4 2024 for tractors over 140 HP and was down 10% for tractors under 140 HP; combines were down 33%. In Europe, Middle East and Africa (EMEA), tractor and combine demand was down 6% and 31%, respectively, of which Europe tractor and combine demand was down 8% and 11%, respectively. South America tractor demand was down 5% and combine demand was down 21%. Asia Pacific tractor demand was up 10%, and combine demand was down 1%.

Agriculture net sales decreased for the quarter by 31% to $3.4 billion primarily due to lower shipment volumes on decreased industry demand across all regions and dealer destocking.

Adjusted EBIT decreased to $244 million ($635 million in Q4 2023), primarily due to lower shipment volumes, partially offset by a continued reduction in SG&A expenses. R&D investments accounted for 6.2% of net sales (5.0% in Q4 2023). Adjusted EBIT margin was 7.2% (12.8% in Q4 2023).

Global industry volume for construction equipment increased 9% year-over-year in Q4 2024 for Heavy construction equipment; Light construction equipment was down 4%. Aggregated demand was flat in North America, decreased 11% in EMEA, and increased 14% in South America and 8% in Asia Pacific.

Construction net sales decreased for the quarter by 33% to $718 million, due to lower shipment volumes and mix driven by the market decline and dealer destocking, mainly in North America.

Adjusted EBIT decreased to $18 million ($62 million in Q4 2023), as a result of lower shipment volumes and product mix, unfavorable price realization mainly in North America and South America, partially offset by lower production costs and SG&A expenses. Adjusted EBIT margin was 2.5% (5.8% in Q4 2023).

Financial Services revenues decreased by 3% as a result of lower equipment sales related to decreased operating lease maturities, and the negative impact from currency translation, partially offset by higher average portfolio balances in all regions (except EMEA) and higher base rates in South America.

Net income was $92 million in the fourth quarter of 2024, a decrease of $21 million compared to the same quarter of 2023, primarily due to increased risk costs in North America and South America, lower recoveries on used equipment sales, partially offset by favorable volumes in all regions except EMEA. In addition, the net income for the quarter is affected by the derecognition of certain tax assets in Argentina ($35 million).

The managed portfolio (including unconsolidated joint ventures) was $27.8 billion as of December 31, 2024 (of which retail was 68% and wholesale 32%), down $1.1 billion compared to December 31, 2023 (up $1.0 billion on a constant currency basis).

At December 31, 2024, the receivable balance greater than 30 days past due as a percentage of receivables was down sequentially to 1.9%, however it was elevated from prior year (1.4% as of December 31, 2023), due to economic and environmental factors impacting farmers, specifically in South America.

Results for the Full Year 2024

(all amounts $ million, comparison vs FY 2023 - unless otherwise stated)

2025 Outlook

The Company forecasts that 2025 global industry retail sales will be lower in both the agriculture and construction equipment markets when compared to 2024. In addition, CNH is focused on driving down excess channel inventory primarily by producing fewer units than the retail demand level. Therefore, 2025 net sales will be lower than in 2024.

The lower production and sales levels will negatively impact our segment margin results. However, the Company's past and ongoing efforts to reduce its operating costs will partially mitigate the margin erosion. CNH is continuing to focus on reducing product costs through lean manufacturing principles and strategic sourcing. The Company will also carefully manage its SG&A and R&D expenses accordingly.

Consequently, the Company is providing the following 2025 outlook:

Notes

CNH reports quarterly and annual consolidated financial results under U.S. GAAP and annual consolidated financial results under 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.

Non-GAAP Financial Information

CNH monitors its operations through the use of several non-GAAP financial measures. CNH'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'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 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.

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

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 press 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 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 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: economic conditions in each of our markets, including the significant uncertainty caused by geopolitical events; production and supply chain disruptions, including industry capacity constraints, material availability, and global logistics delays and constraints; the many interrelated factors that affect consumer confidence and worldwide demand for capital goods and capital goods-related products, 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, commerce and infrastructure development; government policies on international trade and investment, including sanctions and actions after recent U.S. elections in respect to global trade, tariffs, trade agreements, and the uncertainty of our ability to sell products internationally based on these actions and policies; 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; labor relations; interest rates and currency exchange rates; inflation and deflation; energy prices; prices for agricultural commodities and material price increases; 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 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 pandemics (such as the COVID-19 pandemic), terrorist attacks in Europe and elsewhere; the remediation of a material weakness; our ability to realize the anticipated benefits from our business initiatives as part of our strategic plan, including targeted restructuring actions to optimize our cost structure and improve the efficiency of our operations; 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 press 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's control. CNH 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, including factors that potentially could materially affect its financial results, is included in the Company's reports and filings with the U.S. Securities and Exchange Commission ("SEC").

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

Additional factors could cause actual results to differ from those expressed or implied by the forward-looking statements included in the Company's filings with the SEC (including, but not limited to, the factors discussed in our most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q).

Conference Call and Webcast

Today, at 9:00 a.m. EST, management will hold a conference call to present fourth quarter and full year 2024 results to financial analysts and institutional investors. The call can be followed live online at bit.ly/CNH_Q4FY_2024 and a recording will be available later on the Company's website www.cnh.com. A presentation will be made available on the CNH website prior to the conference call.

CONTACTS

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

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

CNH INDUSTRIAL N.V.
Consolidated Statements of Operations for the three months and years ended December 31, 2024 and 2023
(Unaudited, U.S. GAAP)

These 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, 2023 included in the Annual Report on Form 10-K. These Consolidated Statements of Operations represent the consolidation of all CNH Industrial N.V. subsidiaries.

CNH INDUSTRIAL N.V.
Consolidated Balance Sheets as of December 31, 2024 and December 31, 2023
(Unaudited, U.S. GAAP)

These Consolidated Balance Sheets should be read in conjunction with the Company's Audited Consolidated Financial Statements and Notes for the year ended December 31, 2023 included in the Annual Report on Form 10-K. These Consolidated Balance Sheets represent the consolidation of all CNH Industrial N.V. subsidiaries.

CNH INDUSTRIAL N.V.
Consolidated Statement of Cash Flows for the years ended December 31, 2024 and 2023
(Unaudited, U.S. GAAP)

These 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, 2023 included in the Annual Report on Form 10-K. These Consolidated Statements of Cash Flows represent the consolidation of all CNH Industrial N.V. subsidiaries.

CNH INDUSTRIAL N.V.
Supplemental Statements of Operations for the Three Months Ended December 31, 2024 and 2023
(Unaudited, U.S. GAAP)

(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.

CNH INDUSTRIAL N.V.
Supplemental Statements of Operations for the years ended December 31, 2024 and 2023
(Unaudited, U.S. GAAP)

CNH INDUSTRIAL N.V.
Supplemental Balance Sheets as of December 31, 2024 and December 31, 2023
(Unaudited, U.S. GAAP)

(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.

CNH INDUSTRIAL N.V.
Supplemental Statements of Cash Flows for the years ended December 31, 2024 and 2023
(Unaudited, U.S. GAAP)

(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.
Other Supplemental Financial Information

(Unaudited)

(1) In the three months ended December 31, 2024 and 2023 this item includes the pre-tax gain of $6 million and $6 million, respectively, as a result of the amortization over the 4 years of the $101 million positive impact from the 2021 U.S. healthcare plan modification. In the year ended December 31, 2024 and 2023 this item includes the pre-tax gain of $24 million and $24 million, respectively, as a result of the amortization over the 4 years of the $101 million positive impact from the 2021 U.S. healthcare plan modification.

(2) In the three months ended December 31, 2024 this item includes a loss of $2 million on the sale of certain non-core product lines. In the year ended December 31, 2024 this item includes a loss of $17 million on the sale of certain non-core product lines and a gain of $14 million for investment fair value adjustments. In the three months ended December 31, 2023 this item did not include any discrete items. In the year ended December 31, 2023 this item includes a loss of $23 million on the sale of the CNH Industrial Russia and CNH Capital Russia businesses, partially offset by a gain of $13 million for the fair value remeasurement of Augmenta and Bennamann.