Letter from the Chairman and the Chief Executive Officer


In 2013, we took another historic step forward with the successful merger of Fiat Industrial and CNH Global to form CNH Industrial, marking the beginning of a new era for the Group.

The transaction represents the culmination of a simplification process initiated approximately three years ago, as well as being an essential step in ensuring the autonomy, efficiency and strategic development of the Group.

It has unlocked our potential and positioned us to compete at the very highest level and appeal to a broad base of international investors.

CNH Industrial’s trading debut on the New York Stock Exchange and Mercato Telematico Azionario organized and managed by Borsa Italiana S.p.A. on  September 30, 2013 represented the market launch of a global leader in the capital goods sector.

The organizational structure and composition of the global management team also reflect the international character of our businesses and will be fundamental in ensuring operating synergies across businesses and providing the experience and leadership essential for the Group’s continued development.

To  further  facilitate  growth  and  efficiency,  the  business  has  been  organized  by  our  different  segments – Agricultural Equipment, Construction Equipment, Commercial Vehicles (including trucks, buses, and specialty vehicles), Powertrain and Financial Services – which operate in four regions (NAFTA, EMEA, LATAM and APAC).

CNH Industrial closed 2013 with strong financial results, consistent with its ambitions as a global leader. Revenues totaled €25.8 billion, in line with 2012 on a reported basis, but up 4.3% on a constant currency basis. Trading profit was approximately €2 billion for the year with trading margin at 7.7%.

Net profit was up 2% to €917 million.

On the basis of those results, which demonstrate the solidity of CNH Industrial and its businesses, the Board of Directors is recommending a total dividend of approximately €270 million, corresponding to €0.20 per common share.

Although 2013 marked the beginning of a new era for the Group, it was also a year of continuity in several key areas.

CNH Industrial’s proven track record in the sustainable management of its activities at all levels was once again recognized by leading rating agencies and other international organizations.

The Group was confirmed as Industry Leader in the prestigious Dow Jones Sustainability World and Europe Indices, reflecting the significant results achieved, including the highest score in the principal areas of analysis in the environmental and social dimensions, as well as in supply chain management.

In addition, for the third consecutive year, CNH Industrial achieved a leading position in the CDP’s Italy 100 Climate Disclosure Leadership Index (CDLI), based on the quality of climate change data disclosed to the market through CDP.

We consider these important recognitions as well as a challenge to maintain our commitment and set even more ambitious targets for the future.

None of these results would have been possible without the determination and dedication of the men and women at CNH Industrial who have embraced the Group’s values and translated them into concrete action every day.

With regards to the near-term outlook, projected improvements in operating performance for the Trucks and Commercial Vehicles and Construction Equipment businesses, coupled with continued industrial efficiencies, are expected to offset the decline in unit demand forecasted for Agricultural Equipment in 2014.

On the basis of those expectations, CNH Industrial has set 2014 guidance of revenues flat to up 5%, trading margin between 7.8% and 8.2%, and net industrial debt between €1.5 billion and €1.7 billion.

From fiscal quarter ending March 31, 2014, CNH Industrial will begin to report financial results under accounting standards generally accepted in the United States (“U.S. GAAP”) for U.S. reporting and investor presentation purposes and will adopt the U.S. dollar as its reporting currency for all financial reporting purposes. CNH Industrial will, however, continue to report for Dutch corporate law and European listing purposes under IFRS.

At the beginning of May, following the Q1 2014 earnings release, we will set out a well-defined development path that the Group intends to execute with the same level of determination, responsibility and efficiency that have distinguished it to date.

Our thanks to all shareholders for your continued support during 2013 and for remaining with us as we enter this next historic phase.

February 27, 2014

Sergio Marchionne

Sergio Marchionne