SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF

THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2012

Commission File No. 333-05752

 

 

CNH GLOBAL N.V.

(Translation of Registrant’s Name Into English)

 

 

World Trade Center Amsterdam Airport

Schiphol Boulevard 217

1118 BH Schiphol Airport, Amsterdam

The Netherlands

(Address of Principal Executive Offices)

 

 

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F   x             Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule101(b)(1): ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule101(b)(7): ¨

(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

Yes  ¨             No   x

(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-             .)

 

 

 

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CNH GLOBAL N.V.

Form 6-K for the month of August 2012

List of Exhibits:

 

1.	News Release entitled, “CNH Second Quarter 2012 Net Sales top $5 billion, up 3% (9% constant currency basis); EPS up 11% to $1.47”

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

August 1, 2012

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FOR IMMEDIATE RELEASE

For more information contact:

 

CNH Investor Relations		+1 (630) 887-3745

CNH Second Quarter 2012 Net Sales top $5 billion, up 3% (9% constant currency basis); EPS up 11% to $1.47

 

•

Net Sales of $5.0 billion +3% (+9% constant currency basis)

 

•

Agricultural equipment net sales of $4.0 billion +5% (+11% constant currency basis)

 

•

Construction equipment net sales of $1.0 billion -3% (+4% constant currency basis)

 

•

Equipment Operations’ Operating Profit of $524 million, or 10.4% for the period

 

•

Diluted EPS attributable to CNH common shareholders at $1.47 per share, compared to $1.33 per share in Q2 2011

 

		Quarter Ended								Change
		6/30/2012				6/30/2011
		(US $ in millions, except per share data and percentages)
Net Sales of Equipment		$	5,026			$	4,881				3.0	%
Equipment Operations Operating Profit		$	524			$	521				0.6	%
Equipment Operations Operating Margin			10.4	%			10.7	%			-0.3 pts
Financial Services Net Income		$	78			$	52				50.0	%
Net Income Attributable to CNH		$	355			$	320				10.9	%
Net Income Before Restructuring and Exceptional Items		$	356			$	320				11.3	%
Diluted EPS Attributable to CNH common shareholders		$	1.47			$	1.33				10.5	%

BURR RIDGE, IL — (August 1, 2012) — CNH Global N.V. (NYSE: CNH) today announced financial results for the quarter ended June 30, 2012. For the quarter, net sales increased 3% (9% constant currency basis) to $5.0 billion as firm global demand for agricultural equipment, on the back of favorable agricultural commodity prices, compensated for a more mixed trading environment in the construction equipment sector. Equipment Operations posted a comparable period improvement in gross profit margin of 80 basis points to 21% for the second quarter and an Operating Profit of $524 million as higher revenues and positive net pricing compensated for increased SG&A expenditures and R&D investment and the negative impact from foreign exchange.

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

 

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

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

2012 Full Year Market Outlook

 

–

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

 

–

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

CNH Confirms Its Previously Released Guidance For The Full Year 2012

Despite a mixed economic climate in certain of the Groups’ operating regions, the negative effect from the translation of earnings to the U.S. dollar, and the poor climatic conditions in the United States, CNH confirms its full year financial guidance.

 

–

Revenues up 5%+

 

–

Operating Margin in excess of 8.6%

SEGMENT RESULTS

Agricultural Equipment

 

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

CNH Agricultural Equipment Second Quarter Results

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

 

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

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

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

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

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

Construction Equipment

 

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

 

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CNH Construction Equipment Second Quarter Results

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

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

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

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

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

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

CNH Financial Services Second Quarter Results

 

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

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

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

Unconsolidated Equipment Operations Subsidiaries

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

 

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Combination Transaction Proposal From Fiat Industrial

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

Equipment Operations Cash Flow and Net Debt

 

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

 

*	Net cash change in receivables, inventories and payables including inter-segment receivables and payables.

**	Excluding Net (Deposits In)/Withdrawals from Fiat Industrial Cash Management Systems, as they are a part of Net (Cash).

 

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ABOUT CNH

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

CNH CONFERENCE CALL AND WEBCAST

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

NON-GAAP MEASURES

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

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

FORWARD-LOOKING STATEMENTS

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

Our outlook is largely based on our interpretation of what we consider to be relevant economic assumptions and involves risks and uncertainties that could cause actual results to differ (possibly materially) from such forward-looking statements. Macro-economic factors including monetary policy, interest rates, currency exchange rates, inflation,

 

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

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

 

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CNH GLOBAL N.V.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND SUPPLEMENTAL INFORMATION

For the Three Months Ended June 30, 2012 and 2011

(Unaudited)

 

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

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

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

 

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CNH GLOBAL N.V.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND SUPPLEMENTAL INFORMATION

For the Six Months Ended June 30, 2012 and 2011

(Unaudited)

 

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

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

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

 

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CNH GLOBAL N.V.

CONDENSED CONSOLIDATED BALANCE SHEETS

AND SUPPLEMENTAL INFORMATION

As of June 30, 2012 and December 31, 2011

(Unaudited)

 

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

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

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

 

10

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CNH GLOBAL N.V.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

AND SUPPLEMENTAL INFORMATION

For the Six Months Ended June 30, 2012 and 2011

(Unaudited)

 

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

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

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

 

11

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CNH Global N.V.

TOTAL DEBT AND NET DEBT (CASH)

For the Six Months Ended June 30, 2012 and the Year Ended December 31, 2011

(Unaudited)

 

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

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

 

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CNH GLOBAL N.V.

SUPPLEMENTAL SCHEDULES

For the Three Months and Six Months Ended June 30, 2012 and 2011

(Unaudited)

 

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

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

 

13

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CNH GLOBAL N.V.

SUPPLEMENTAL SCHEDULES

For the Three and Six Months Ended June 30, 2012 and 2011

(Unaudited)

3. Equipment Operations gross and operating profit and margin:

 

		Three Months Ended June 30,																Six Months Ended June 30,
		2012								2011								2012								2011
		(in millions, except percentages)
Net sales		$	5,026				100.0	%		$	4,881				100.0	%		$	9,665				100.0	%		$	8,678				100.0	%
Less:
Cost of goods sold			3,973				79.0	%			3,893				79.8	%			7,697				79.6	%			7,007				80.7	%
Equipment Operations gross profit		$	1,053				21.0	%		$	988				20.2	%		$	1,968				20.4	%		$	1,671				19.3	%
Less:
Selling, general and administrative			367				7.3	%			342				7.0	%			727				7.5	%			663				7.6	%
Research and development			162				3.2	%			125				2.6	%			311				3.2	%			241				2.8	%
Equipment Operations operating profit		$	524				10.4	%		$	521				10.7	%		$	930				9.6	%		$	767				8.8	%
Gross profit and margin:
Agricultural equipment		$	915				22.7	%		$	850				22.1	%		$	1,675				21.9	%		$	1,441				20.8	%
Construction equipment			138				13.8	%			138				13.4	%			293				14.5	%			230				13.1	%
Equipment Operations gross profit		$	1,053				21.0	%		$	988				20.2	%		$	1,968				20.4	%		$	1,671				19.3	%
Operating profit and margin:
Agricultural equipment		$	507				12.6	%		$	496				12.9	%		$	879				11.5	%		$	759				11.0	%
Construction equipment			17				1.7	%			25				2.4	%			51				2.5	%			8				0.5	%
Equipment Operations operating profit		$	524				10.4	%		$	521				10.7	%		$	930				9.6	%		$	767				8.8	%

4. Net income and diluted earnings per share before restructuring and exceptional items:

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2012				2011				2012				2011
		(in millions, except per share data)
Net income attributable to CNH		$	355			$	320			$	624			$	472
Restructuring:
Restructuring, net of tax			1				—				1				2
Exceptional item:
(Gain) on purchase of business, net of tax			—				—				—				(16	)
Net income before restructuring and exceptional items		$	356			$	320			$	625			$	458
Weighted average common shares outstanding - diluted			242				241				242				241
Diluted earnings per share before restructuring and exceptional items		$	1.47			$	1.33			$	2.59			$	1.90

 

14

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CNH GLOBAL N.V.

SUPPLEMENTAL SCHEDULES

For the Six Months Ended June 30, 2012

(Unaudited)

5. Equipment Operations cash generated from working capital:

 

		Balance as of December 31, 2011				Effect of Foreign Currency Translation				Non-Cash Transactions				Balance as of June 30, 2012				Cash Generated from (used by) Working Capital
		(in millions)
Accounts, notes receivable and other – net – Total		$	894			$	48			$	4			$	947			$	(105	)
Inventories			3,662				117				20				4,234				(709	)
Accounts payable - Total			(3,219	)			(67	)			—				(3,323	)			171
Working Capital		$	1,337			$	98			$	24			$	1,858			$	(643	)

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

 

15

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