THE GROUP AT A GLANCE 12 14 16 17 18 20 2013 in Summary Introduction Group Structure Brands CNH Industrial around the World Our Commitment to Sustainable Development
12 THE GROUP 2013 AT A GLANCE IN SUMMARY 2013 IN SUMMARY Financial Results REVENUES 25.8 BILLION TRADING PROFIT 2.0 BILLION PROFIT 0.9 BILLION NET INDUSTRIAL DEBT TOTAL AVAILABLE LIQUIDITY 1.6 BILLION 6.3 BILLION The Group 12 BRANDS 190 NATIONAL MARKETS 48 R&D CENTERS 62 PLANTS 71,192 EMPLOYEES 6,300 INDIVIDUALS DEDICATED TO INNOVATION 934 MILLION INVESTED IN R&D
13 REVENUES ( MILLION) TRADING PROFIT ( MILLION) 2013 25,778 2013 1,985 2012 25,785 2012 2,063 2011 24,289 2011 1,690 0 10,000 20,000 30,000 0 1,000 2,000 PROFIT/(LOSS) ( MILLION) NET DEBT ( MILLION) 16,888 2013 917 2013 1,592 15,994 2012 900 2012 1,642 2011 694 2011 1,239 14,549-1,000 0 1,000 0 5,000 10,000 15,000 CNH Industrial Group Industrial Activities
14 THE GROUP INTRODUCTION AT A GLANCE INTRODUCTION CNH Industrial is the company formed by the merger, completed on September 29, 2013, between Fiat Industrial S.p.A. and its subsidiary CNH Global N.V. The merger had no impact on the consolidated activities of the former Fiat Industrial Group and therefore the results presented herein are consistent and comparable with those previously published by Fiat Industrial. CNH Industrial is a global leader in the capital goods sector that, through its various businesses, designs, produces and sells agricultural and construction equipment, trucks, commercial vehicles, buses and specialty vehicles, in addition to a broad portfolio of powertrain applications. Present in all major markets worldwide, CNH Industrial is focused on expanding its presence in high-growth markets, including through joint ventures. ***** Mergers of Fiat Industrial S.p.A. and CNH Global N.V. with and into CNH Industrial N.V. The deeds of merger for the mergers of Fiat Industrial S.p.A. and CNH Global N.V. with and into CNH Industrial N.V. were executed, respectively, on September 27 and 28, 2013. The effective date of the merger transactions (the Transaction ) was September 29, 2013. The main objective of the Transaction was to simplify the capital structure of the Fiat Industrial Group (the CNH Industrial Group subsequent to the Transaction) by creating a single class of liquid stock listed on the New York Stock Exchange ( NYSE ) and on the Mercato Telematico Azionario managed by Borsa Italiana S.p.A. ( MTA ). The principal steps in the reorganization were: the cross-border merger of Fiat Netherlands Holding N.V. ( FNH ) with and into Fiat Industrial S.p.A. (the FNH Merger ), which occurred on August 1, 2013; the cross-border reverse merger of Fiat Industrial S.p.A. with and into FI CBM Holdings N.V. (the FI Merger ); and the Dutch merger of CNH Global N.V. with and into FI CBM Holdings N.V. (the CNH Merger and, together with the FI Merger, the Merger or the Transaction) subsequently renamed CNH Industrial N.V. That Company has taken, as a consequence of the Transaction, the role of CNH Industrial Group s parent company. All the companies (i.e., Fiat Industrial S.p.A., FI CBM Holdings N.V., FNH and CNH Global N.V.) involved in the reorganization process were part of the Fiat Industrial Group; in particular: (i) FNH was a wholly-owned direct subsidiary of Fiat Industrial S.p.A.; (ii) FI CBM Holdings N.V. was a wholly-owned direct subsidiary of Fiat Industrial S.p.A.; and (iii) CNH Global N.V. was an indirect subsidiary of Fiat Industrial S.p.A. (controlled through FNH which owned approximately 87% of CNH Global N.V. s capital stock). In connection with the FI Merger, Fiat Industrial S.p.A. shareholders received one newly allotted common share in CNH Industrial N.V. (having a nominal value of 0.01 each) for each ordinary share held in Fiat Industrial S.p.A. (having a nominal value of 1.57 each). In connection with the CNH Merger, CNH Global N.V. shareholders received 3.828 newly allotted CNH Industrial N.V. common shares (having a nominal value of 0.01 each) for each common share held in CNH Global N.V. (having a nominal value of 2.25 each). At closing, CNH Industrial N.V. issued 1,348,867,772 common shares which were allotted to Fiat Industrial S.p.A. and CNH Global N.V. shareholders on the basis of the established exchange ratios described above. CNH Industrial N.V. also issued special voting shares (non-tradable) which were allotted to eligible Fiat Industrial S.p.A. and CNH Global N.V. shareholders who had elected to receive special voting shares. On the basis of the requests received, CNH Industrial issued a total of 474,474,276 special voting shares. On September 30, 2013, CNH Industrial N.V. common shares began trading on the NYSE and the MTA.
16 THE GROUP GROUP AT A GLANCE STRUCTURE GROUP STRUCTURE CNH Industrial is a leading global capital goods company engaged in the design, production, marketing, sale and financing of agricultural and construction equipment, trucks, commercial vehicles, buses and specialty vehicles for firefighting, defense and other uses, as well as engines and transmissions for those vehicles and engines for marine and power generation applications. The Group has industrial and financial services companies located in 44 countries and a commercial presence in approximately 190 countries. The Group had net revenues of 25,778 million in 2013 and, as of December 31, 2013, had 71,192 employees. Group segments presented in this Annual Report are as follows: Agricultural and Construction Equipment produces agricultural equipment such as tractors, combine harvesters, hay and forage, tillage and sprayer equipment under the Case IH Agriculture, New Holland Agriculture and Steyr brands and produces construction equipment such as excavators, loaders, backhoes, dozers and graders under the Case Construction and New Holland Construction brands. The segment also provides financial services solutions to its customers and dealers. Trucks and Commercial Vehicles produces a range of commercial vehicles under the Iveco brand, buses under the Iveco Bus (previously Iveco Irisbus) and Heuliez Bus brands and firefighting and special purpose vehicles under the Magirus, Iveco Astra and Iveco Defence Vehicles brands. The segment also provides financial services solutions to its customers and dealers. Powertrain produces engines and transmissions for trucks and commercial vehicles, agricultural and construction equipment and for marine and other industrial applications.
BRANDS THE GROUP AT A GLANCE 17 BRANDS AGRICULTURAL AND CONSTRUCTION EQUIPMENT TRUCKS AND COMMERCIAL VEHICLES POWERTRAIN
18 THE GROUP CNH INDUSTRIAL AT A GLANCE AROUND THE WORLD CNH INDUSTRIAL AROUND THE WORLD NAFTA 25,778 million Revenues 7,336 million REVENUES 11,948 EMPLOYEES 11 PLANTS 13 R&D CENTERS 71,192 Employees 62 Plants 48 R&D Centers LATAM 4,813 million REVENUES 12,081 EMPLOYEES 10 PLANTS 5 R&D CENTERS
19 EMEA 10,823 million REVENUES 41,961 EMPLOYEES 33 PLANTS 26 R&D CENTERS CNH INDUSTRIAL: A GLOBAL GROUP WITH A MAJOR INDUSTRIAL AND COMMERCIAL PRESENCE. EMPLOYING A GLOBAL VISION BUT INTERACTING AT THE LOCAL LEVEL, THE GROUP IS PREPARED TO FACE NEW CHALLENGES, FULLY LEVERAGE THE OPPORTUNITIES IN EACH MARKET AND RESPOND RAPIDLY TO THE NEEDS OF CUSTOMERS. APAC 2,806 million REVENUES 5,202 EMPLOYEES 8 PLANTS 4 R&D CENTERS
20 THE GROUP OUR COMMITMENT AT A GLANCE TO SUSTAINABLE DEVELOPMENT OUR COMMITMENT TO SUSTAINABLE DEVELOPMENT CNH Industrial believes that growth has value only if also sustainable and, therefore, considers the management of the environmental and social impacts of its activities to be fundamental. The full integration of environmental and social considerations with economic objectives enables the Company to identify potential risks and seize additional development opportunities, resulting in a process of continuous improvement. Sustainability is a core element of CNH Industrial s Corporate Governance, with top management playing a direct and active role. Within the Board of Directors, the Governance and Sustainability Committee is responsible for strategic oversight of sustainability-related issues and reviews the annual Sustainability Report. The Group Executive Council ( GEC ) - the Company s highest decision-making body after the Board of Directors - defines the strategic approach, evaluates the congruity of the Sustainability Plan with business objectives, and is regularly updated on the Company s sustainability performance. The Sustainability Unit, which is part of the CNH Industrial s financial organization, has operational responsibility for promoting a culture of sustainability throughout the Company. It facilitates the process of continuous improvement, and contributes to managing risks and strengthening the relationship with and perceptions of stakeholders, in addition to managing sustainability reporting and communication. In 2013, for the first time ever, CNH Industrial carried out a materiality analysis to identify and prioritize the environmental aspects considered most relevant by the Company and stakeholders alike, and to assess their economic, environmental and social impact on corporate performance. The results of the analysis are represented in the materiality matrix, which was approved by GEC members and the CEO and subsequently submitted for third party verification and assurance (SGS). The matrix contains several useful indications for defining the 2013 Sustainability Report (in line with GRI-G4 guidelines) and identifying improvement initiatives. The matrix suggests that greater importance is attached to business-related aspects and particularly to the ability to innovate in terms of safe use and environmental impact of products, product quality, and customer orientation and engagement. Other aspects suggested as significant are the safeguard of health and safety in the workplace, environmental protection, the management of suppliers and dealers, professional development, and initiatives in favor of local communities. The matrix and further details are available in the 2013 Sustainability Report. In 2013, CNH Industrial s values and commitment have been appreciated and recognized internationally, as evidenced by the appraisals of major sustainability rating agencies and international organizations. CNH Industrial s achievements have also been recognized through the inclusion in leading sustainability indices, such as the Dow Jones Sustainability (DJSI) World and Dow Jones Sustainability Europe as Industry Leader, MSCI Global ESG and MSCI Global SRI Indexes, Euronext Vigeo World 120, Euronext Vigeo Europe 120, Euronext Vigeo Eurozone 120, ECPI Global Agriculture Equity, ECPI EMU Ethical Equity, ECPI Euro Ethical Equity, ECPI Global Developed ESG Best in Class Equity, FTSE ECPI Italia SRI Benchmark and FTSE ECPI Italia SRI Leaders.
21 Lastly, the high level of information provided on issues related to climate change has earned CNH Industrial a spot among the ten companies admitted in the CDLI (Carbon Disclosure Leadership Index) Italy 100. For a detailed account of the environmental and social initiatives carried out in 2013 reference should be made to the Sustainability Report. The Sustainability Report, prepared on a voluntary basis applying the Global Reporting Initiative s guidelines (GRI-G4), integrates the economic aspects described herein with an allencompassing view of the environmental and social performance of CNH Industrial s operations, and includes the Sustainability Plan, which reports on the progress of existing projects and new targets to drive continuous improvement in the Company s sustainability performance.