SUPPLEMENTAL INFORMATION

6 Months Ended

Jun. 30, 2019

The operations and key financial measures and financial analysis differ significantly for manufacturing and distribution businesses and financial services businesses; therefore, management believes that certain supplemental disclosures are important in understanding the consolidated operations and financial results of CNH Industrial. This supplemental data is as follows:

Industrial Activities - The financial information captioned “Industrial Activities” reflects the consolidation of all majority-owned subsidiaries except for Financial Services. Financial Services has been included using the equity method of accounting whereby the net income and net assets of Financial Services are reflected, respectively, in “Equity in income of unconsolidated subsidiaries and affiliates” in the accompanying condensed consolidated statements of operations, and in “Investment in Financial Services” in the accompanying condensed consolidated balance sheets.

Financial Services - The financial information captioned “Financial Services” reflects the consolidation or combination of Financial Services business.

Transactions between the “Industrial Activities” and “Financial Services” have been eliminated to arrive at the condensed consolidated financial statements.



	Statement of Operations
	Industrial Activities						Financial Services
	Three Months Ended June 30,						Three Months Ended June 30,
	2019			2018			2019			2018
	(in millions)
Revenues
Net sales	$	7,068		$	7,579		$	—		$	—
Finance, interest and other income	23			23			519			498
Total Revenues	$	7,091		$	7,602		$	519		$	498
Costs and Expenses
Cost of goods sold	$	5,751		$	6,188		$	—		$	—
Selling, general and administrative expenses	497			545			58			48
Research and development expenses	273			262			—			—
Restructuring expenses	26			5			2			—
Interest expense	89			111			149			136
Other, net	18			124			193			178
Total Costs and Expenses	$	6,654		$	7,235		$	402		$	362
Income before income taxes and equity in income of unconsolidated subsidiaries and affiliates	437			367			117			136
Income tax (expense) benefit	(104		)	(79		)	(31		)	(39		)
Equity in income of unconsolidated subsidiaries and affiliates	3			18			5			5
Results from intersegment investments	91			102			—			—
Net income	$	427		$	408		$	91		$	102



	Statement of Operations
	Industrial Activities						Financial Services
	Six Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
	(in millions, except share data)
Revenues
Net sales	$	13,074		$	13,879		$	—		$	—
Finance and interest income	53			50			993			1,000
Total Revenues	$	13,127		$	13,929		$	993		$	1,000
Costs and Expenses
Cost of goods sold	$	10,717		$	11,444		$	—		$	—
Selling, general and administrative expenses	990			1,072			104			111
Research and development expenses	517			489			—			—
Restructuring expenses	34			8			2			—
Interest expense	172			231			302			272
Other, net	34			204			345			349
Total Costs and Expenses	$	12,464		$	13,448		$	753		$	732
Income before income taxes and equity in income of unconsolidated subsidiaries and affiliates	663			481			240			268
Income taxes	(158		)	(102		)	(67		)	(79		)
Equity income of unconsolidated subsidiaries and affiliates	—			26			13			16
Results from intersegment investments	186			205			—			—
Net income	$	691		$	610		$	186		$	205



	Balance Sheets
	Industrial Activities				Financial Services
	June 30, 2019		December 31, 2018		June 30, 2019		December 31, 2018
	(in millions)
ASSETS
Cash and cash equivalents	$	3,276	$	4,553	$	383	$	478
Restricted cash	54		—		633		772
Trade receivables, net	471		398		31		34
Financing receivables, net	1,639		1,253		20,961		20,252
Inventories, net	7,949		6,510		243		216
Property, plant and equipment, net	5,553		5,899		1		2
Investments in unconsolidated subsidiaries and affiliates	3,209		3,126		227		219
Equipment under operating leases	34		34		1,754		1,740
Goodwill	2,305		2,301		154		152
Other intangible assets, net	755		774		15		14
Deferred tax assets	573		635		164		175
Derivative assets	58		81		59		24
Other assets	2,210		1,707		300		323
Total Assets	$	28,086	$	27,271	$	24,925	$	24,401
LIABILITIES AND EQUITY
Debt	$	6,444	$	6,347	$	20,791	$	20,436
Trade payables	6,049		5,771		126		173
Deferred tax liabilities	14		83		275		250
Pension, postretirement and other postemployment benefits	1,427		1,470		18		18
Derivative liabilities	87		89		45		26
Other liabilities	8,543		8,413		759		681
Total Liabilities	$	22,564	$	22,173	$	22,014	$	21,584
Equity	5,489		5,068		2,911		2,817
Redeemable noncontrolling interest	33		30		—		—
Total Liabilities and Equity	$	28,086	$	27,271	$	24,925	$	24,401



	Statements of Cash Flows
	Industrial Activities						Financial Services
	Six Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
	(in millions)
Operating activities:
Net income	$	691		$	610		$	186		$	205
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization expense, net of assets under operating leases and assets sold under buy-back commitments	330			361			2			3
Depreciation and amortization expense of assets under operating leases and assets sold under buy-back commitments	158			197			124			126
Loss on disposal of assets	1			—			—			—
Undistributed loss of unconsolidated subsidiaries	(41		)	(94		)	(13		)	(16		)
Other non-cash items	50			83			24			27
Changes in operating assets and liabilities:
Provisions	(55		)	(52		)	(11		)	(4		)
Deferred income taxes	1			(51		)	41			(27		)
Trade and financing receivables related to sales, net	(74		)	(99		)	(822		)	(122		)
Inventories, net	(1,246		)	(988		)	214			223
Trade payables	294			608			(48		)	(31		)
Other assets and liabilities	(270		)	(182		)	93			41
Net cash provided by (used in) operating activities	$	(161	)	$	393		$	(210	)	$	425
Investing activities:
Additions to retail receivables	—			—			(1,987		)	(1,999		)
Collections of retail receivables	—			—			2,314			2,151
Proceeds from sale of assets, net of assets sold under operating leases and assets sold under buy-back commitments	2			1			—			—
Expenditures for property, plant and equipment and intangible assets, net of assets under operating leases and sold under buy-back commitments	(180		)	(158		)	(2		)	(3		)
Expenditures for assets under operating leases and assets sold under buy-back commitments	(261		)	(334		)	(364		)	(257		)
Other	(264		)	643			252			(473		)
Net cash provided by (used in) investing activities	$	(703	)	$	152		$	213		$	(581	)
Financing activities:
Proceeds from long-term debt	694			1			6,682			7,257
Payments of long-term debt	(726		)	(1,175		)	(6,687		)	(7,672		)
Net increase (decrease) in other financial liabilities	20			298			(125		)	567
Dividends paid	(278		)	(238		)	(132		)	(91		)
Other	(45		)	(134		)	20			39
Net cash provided by (used in) financing activities	$	(335	)	$	(1,248	)	$	(242	)	$	100
Effect of foreign exchange rate changes on cash and cash equivalents and restricted cash	(24		)	(172		)	5			(52		)
Decrease in cash and cash equivalents and restricted cash	(1,223		)	(875		)	(234		)	(108		)
Cash and cash equivalents and restricted cash, beginning of year	4,553			4,901			1,250			1,299
Cash and cash equivalents and restricted cash, end of period	$	3,330		$	4,026		$	1,016		$	1,191