CNH Industrial presents updated 2024 Strategic Business Plan
- Strategic priorities center on
Customer-Inspired Innovation; Technology Leadership; Brand and
Dealer Strength; Operational Excellence; and Sustainability
Stewardship
- Launch of Company Purpose: Breaking
New Ground. Innovation Sustainability Productivity
- Updated Sustainability Targets,
including commitment to Science Based Targets initiative
(SBTi)
- Presentation of three-year
financial targets, including:
- Net sales of Industrial Activities
projected to grow to $20 - $22 billion by 2024 with CAGR of
~6%
- Adjusted 2024 EBIT Margin of
Industrial Activities of ~12% to 13%, more than 200bps increase
from 2021
- Agriculture EBIT Margin to reach
14.5% to 15.5% by 2024
- Adjusted EPS of above $1.70 by
2024
- ROIC of Industrial Activities
projected to achieve ~19%, with a 3% growth during the plan
period
- Cumulative 2022-2024 free cash flow
of Industrial Activities projected over $4.4 billion
London, February 22, 2022
CNH Industrial (NYSE: CNHI / MI: CNHI) today
announced its updated 2024 strategic plan at its Capital Markets
Day event in Miami, Florida.
Scott W. Wine, CNH Industrial Chief Executive
Officer, introduced the new Company and set forth its strategic
priorities, including
Customer-Inspired
Innovation;
Technology
Leadership;
Brand and Dealer
Strength; Operational
Excellence; and Sustainability
Stewardship.
Other senior members of the leadership team
presented on topics including Precision Technology, Agriculture,
Construction, Electrification and Alternative Fuels, Sustainability
and three-year Financial targets.
“Today, my colleagues and I had the privilege of
unveiling the new CNH Industrial and our long-term strategy for
enhanced customer inspired growth and improving financial
performance. We are confident that the plan we detailed today gives
us a strong foundation to advance with purpose and pace,” said
Scott W. Wine, Chief Executive Officer, CNH Industrial. “The
enhanced capabilities of our focused Agriculture and Construction
businesses will leverage our competitive strengths and acquired
assets. These are backed by a deeply experienced team, united by
common goals, which will deliver bold actions across the
organization for our stakeholders. Guided every step of the way by
our customers, our plan will enable CNH Industrial to deliver
world-class products with leading technology to the world’s farmers
and construction professionals.”
Breaking New Ground –
Innovation Sustainability
ProductivityUnderpinning this updated 2024
strategic plan is the new company purpose: Breaking New Ground,
which evokes CNH Industrial’s drive to move first to a place where
others follow and continually search for better solutions and
breakthrough ideas. The new company purpose is centered on
Innovation, Sustainability and Productivity to accelerate CNH
Industrial’s ability to help the global farming and construction
communities meet the enormous challenge of feeding and sheltering a
growing population.
A
disciplined
financial
strategyOddone Incisa, Chief
Financial Officer, presented the Company’s updated 2024 Financial
Plan. Through disciplined investment in the organization, CNH
Industrial will continue to deliver organic growth, while pursuing
inorganic growth opportunities that build capability and accelerate
profitable growth. The latter will be complemented by investments
performed by the newly formed CNH Industrial Ventures, which
envelops existing partnerships and explores further collaboration
with promising digital and technology start-ups operating in the
agriculture or construction space. Capex will increase during the
plan period to accelerate organic growth, improve customer
experiences and prepare for a sustainable future.
CNH Industrial is maintaining its commitment to
a strong balance sheet and liquidity and upholding its
investment-grade credit rating. The Company confirms its intention
to be net-debt free by 2023. Additional financial plan highlights
include:
- Gross Margin in excess of 24% by
2024, more than 300bps increase by the end of the plan period
- R&D of ~$2.6 billion, a step up
to ~4.5% of Net Sales focusing on new products and new precision
technology
The updated 2024 financial plan also commits to
a consistent dividend policy and confirms the Company’s ability to
exercise appropriate share buybacks.
Precision Technology: Targeting
digital
leadership Core to the new CNH
Industrial strategy is its focus on technology leadership in
automation and its commitment to delivering a fully autonomous
farming cycle, while increasingly extending this expertise to
enhance the capabilities of the Construction segment.
Parag Garg, Chief Digital Officer, illustrated
how the Company is working to enable and enhance farm productivity
and yield. By leveraging the great precision technology from the
Raven acquisition and championing plug and play automation and
autonomy and a full suite of digital services, the Company is
increasingly delivering smarter equipment solving customer
challenges and making their work easier. CNH Industrial’s strong
capabilities are significantly enhanced by Raven Industries,
allowing for the swift scaling up of best-in-class solutions to
meet evolving customer needs.
Supporting the above efforts are the pillars of
the Company’s Precision Technology strategy:
- Customer Obsession, where
technology solutions are designed with a heightened awareness of
customer needs;
- Tech Culture, a streamlined and
trend-adopting approach to work and delivery that optimizes
execution;
- Tech Stack, a flexible and robust
technological infrastructure that drives this path to automation
and autonomy; and,
- A healthy and conducive Partners
Ecosystem that fosters open collaboration and removes
obstacles.
Agriculture
Segment:
Industry-leading
products
(Great Iron)
with cutting-edge technology
(Great
Tech)Derek Neilson, President
Agriculture, discussed the Company’s Agriculture Segment. Present
in some 200 countries, it supplies a full range of equipment
through tailored brands, products and distribution networks. During
the plan period, R&D and Capex investments will almost double
to $4bn, focusing on customer-centric innovations in terms of
automation and autonomy, connected machine ecosystems and
alternative fuels. Agriculture margins are projected to reach 14.5
– 15.5% by 2024.
CNH Industrial will invest in a path to excellence in customer and
dealer satisfaction, fundamental to the Company’s future success.
The state-of-the-art and productivity-boosting agricultural product
portfolio will undergo significant expansion, with 150 product
launches expected over the plan period, supporting the
differentiated positioning of the Case IH and New Holland
Agriculture brands.
Construction
Segment:
Delivering
profitability Stefano Pampalone,
President Construction, demonstrated how the transformation of this
business has laid the foundations for future profitable growth. The
acquisition of the Sampierana business is a key enabling factor,
bringing further in-house technology capabilities and an extended
mini and midi excavator product portfolio, including electric
models. CNH Industrial’s Construction Segment will offer new
customer-facing solutions for enhanced productivity, safety, and
sustainability. The segment will continue to pursue a multi-brand
strategy via CASE, New Holland Construction (leveraging its
agriculture dealer network and applications) and Eurocomach (the
newly acquired brand within the Sampierana SpA portfolio).
Further investment in
Electrification & Alternative
Fuels With increasing global demand for zero emissions,
CNH Industrial will continue to build upon its leading position in
alternative propulsion (thanks to 15+ years of R&D and products
in commercial production). This will enable its customers to
achieve unrivalled results and increased productivity with an
enhanced user experience, simultaneously opening new use cases and
applications, while also doing good for the planet.
Selin Tur, Vice President of Advanced
Technologies and Innovations, presented the Company’s
Electrification & Alternative Fuels strategy. It is
characterized by a robust product pipeline with innovation
synergies foreseen across all product lines for both segments. The
Company adds to its existing capabilities with strategic
partnerships and extends product platform learnings to its own
supply chain operations.
Sustainability
Stewardship The new CNH Industrial continues on
its longstanding path of excellence in sustainability, which is
recognized by the foremost authorities. Kelly Manley, Chief
Diversity & Inclusion, Sustainability and Transformation
Officer, discussed the Company’s Sustainability strategy, which
includes:
- Carbon Footprint, a full commitment
to science-based target initiatives (SBTi) as a natural
continuation of CNH Industrial’s sustained efforts on climate and
the environment;
- Circularity & Eco Efficiency,
to ensure the sustainable lifecycle of its products together with
optimizing water usage and waste management at Company plants;
- Inclusion, Equity and Engagement,
where the Company is committed to building equitable human capital,
transforming its culture, and engaging meaningfully with the
communities in which operates; and,
- Governance and Commitment where CNH
Industrial is implementing enhanced metrics to measure its
sustainability performance. All of these efforts are focused on
securing CNH Industrial’s continued sustainability leadership in
its sectors and reinforcing its identity as an employer of
choice.
“This plan is a resonant demonstration of the
significant transformation that CNH Industrial is undertaking. We
are living in a dynamic world and compete in competitive
industries, but I am confident in our team and our strategy,” said
Suzanne Heywood, Chair of CNH Industrial. “The Board of Directors
and I fully endorse the plan presented here today and are
supportive of the Senior Leadership Team’s commitment to
customer-inspired growth, sustainability and continuously improving
the company culture, which will drive results for all
stakeholders.”
The materials presented today are available
through the CNH Industrial corporate website.
CNH Industrial (NYSE: CNHI /
MI: CNHI) is a world-class equipment and services company. Driven
by its purpose of Breaking New Ground, which centers on Innovation,
Sustainability and Productivity, the Company provides the strategic
direction, R&D capabilities, and investments that enable the
success of its five core Brands: Case IH, New Holland Agriculture
and STEYR, supplying 360° agriculture applications from machines to
implements and the digital technologies that enhance them; and CASE
and New Holland Construction Equipment delivering a full lineup of
construction products that make the industry more productive.
Across a history spanning over two centuries, CNH Industrial has
always been a pioneer in its sectors and continues to passionately
innovate and drive customer efficiency and success, driven by its
purpose of Breaking New Ground. As a truly global company, CNH
Industrial’s 35,000+ employees form part of a diverse and inclusive
workplace, focused on empowering customers to grow, and build, a
better world.
For more information and the latest financial
and sustainability reports visit: cnhindustrial.com
For news from CNH Industrial and its Brands
visit: media.cnhindustrial.com
Media contacts:
Laura OverallCNH Industrial Communications Tel.
+44 207 925 1964
Rebecca FabianCNH Industrial Communications Tel.
+1 312 515 2249
Email: mediarelations@cnhind.com
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 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 COVID-19; travel bans, border closures, other free
movement restrictions, and the introduction of social distancing
measures in our facilities may affect in the future our ability to
operate as well as the ability of our suppliers and distributors to
operate; 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 vehicles; the resolution of pending litigation and
investigations on a wide range of topics, including dealer and
supplier litigation, follow-on private litigation in various
jurisdictions after the settlement of the EU antitrust
investigation of the Iveco Group announced on July 19, 2016,
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;
further developments of the COVID-19 pandemic on our operations,
supply chains, distribution network, as well as negative evolutions
of the economic and financial conditions at global and regional
levels; 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”).
- Infographic_CNH_Industrial_Capital_Markets_Day_2022
- 20220222_PR_CNH_Industrial_Capital_Markets_Day
- 20220222_CS_CNH_Industrial_Capital_Markets_Day
CNH Industrial NV (BIT:CNHI)
Historical Stock Chart
From Aug 2024 to Sep 2024
CNH Industrial NV (BIT:CNHI)
Historical Stock Chart
From Sep 2023 to Sep 2024