CNH Industrial SEC Filings

6-K
CNH INDUSTRIAL N.V. filed this Form 6-K on 11/06/2017
Entire Document
 

 

(A)

For the three and nine months ended September 30, 2017,  no shares were excluded from the computation of diluted earnings per share due to an anti-dilutive impact. For the three and nine months ended September 30, 2016, 6.5 million shares were excluded from the computation of diluted earnings per share as the impact of these shares (related to stock options) would have been anti-dilutive. For the nine months ended September 30, 2016, an additional 1.7 million shares of common stock were excluded due to the Company’s net loss position.

 

6. EMPLOYEE BENEFIT PLANS AND POSTRETIREMENT BENEFITS

The following summarizes the components of net periodic benefit cost of CNH Industrial’s defined benefit pension plans and postretirement health and life insurance plans for the three and nine months ended September 30, 2017 and 2016:

 

 

Pension

 

 

Healthcare

 

 

Other

 

 

 

Three Months Ended September 30,

 

 

Three Months Ended September 30,

 

 

Three Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(in millions)

 

Service cost

 

$

7

 

 

$

7

 

 

$

2

 

 

$

2

 

 

$

3

 

 

$

3

 

Interest cost

 

 

17

 

 

 

22

 

 

 

9

 

 

 

10

 

 

 

1

 

 

 

1

 

Expected return on assets

 

 

(26

)

 

 

(28

)

 

 

(1

)

 

 

(2

)

 

 

 

 

 

 

Amortization of:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prior service credit

 

 

 

 

 

 

 

 

(1

)

 

 

(1

)

 

 

 

 

 

1

 

Actuarial loss

 

 

21

 

 

 

19

 

 

 

1

 

 

 

4

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net periodic benefit cost

 

$

19

 

 

$

20

 

 

$

10

 

 

$

13

 

 

$

4

 

 

$

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension

 

 

Healthcare

 

 

Other

 

 

 

Nine Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

(in millions)

 

Service cost

 

$

21

 

 

$

22

 

 

$

5

 

 

$

5

 

 

$

10

 

 

$

10

 

Interest cost

 

 

53

 

 

 

66

 

 

 

27

 

 

 

30

 

 

 

2

 

 

 

3

 

Expected return on assets

 

 

(80

)

 

 

(86

)

 

 

(5

)

 

 

(5

)

 

 

 

 

 

 

Amortization of:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prior service credit

 

 

 

 

 

 

 

 

(2

)

 

 

(3

)

 

 

 

 

 

1

 

Actuarial loss

 

 

64

 

 

 

58

 

 

 

4

 

 

 

11

 

 

 

1

 

 

 

 

Other

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net periodic benefit cost

 

$

61

 

 

$

60

 

 

$

29

 

 

$

38

 

 

$

13

 

 

$

14

 

 

7. INCOME TAXES

The effective tax rate for the third quarter ended September 30, 2017 and 2016 was 64.0% and 55.2%, respectively. The effective tax rate for the third quarter of 2017 reflects the inability to book a tax benefit on certain restructuring expenses and the charge related to the repurchase by CNH Industrial Finance Europe S.A. (“CIFE”) of €347 million of its outstanding €1.2 billion 6.250% Notes due 2018, and €453 million of its outstanding €1.0 billion 2.750% Notes due 2019 (the “CIFE 2017 Notes repurchase”). The effective tax rate for the nine months ended September 30, 2017 was 43.9% compared to -104.7% for the nine months ended September 30, 2016. The effective tax rate for the nine months ended September 30, 2017 reflects the inability to book a tax benefit on certain restructuring expenses and charges related to the CIFE 2017 Notes repurchase and June 2017 early redemption of all of the outstanding $636 million 7.875% Case New Holland Inc. Senior Notes due 2017 (together, the “2017 Notes repurchase and early redemption”). The effective tax rate for the nine months ended September 30, 2016 was impacted by non-tax deductible charges of $551 million, related to the European Commission settlement, as well as by unbenefited losses in certain jurisdictions. For more information on the European Commission settlement, see “Note 14: Commitments and Contingencies”.

8. SEGMENT INFORMATION

The operating segments through which the Company manages its operations are based on the internal reporting used by the Company’s Chief Operating Decision Maker (“CODM”) to assess performance and make decisions about resource allocation. The segments are organized based on products and services provided by the Company.

 

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