Why Cnh is going backwards on the stock market
CNH collapses on the stock market after the publication of third quarter results: the stock loses 9.8 percent. The Exor group company cuts revenue forecasts and announces a restructuring plan to contain costs
CNH Industrial, an Italian-American company of the Exor group that produces machinery for agriculture and construction, lost up to 15 percent today on the Italian stock exchange, then settling at -9.8 percent. This is due to the results of the third quarter of 2023, which in some cases missed the values expected by analysts and which, above all, led CNH to cut its forecasts for revenues from industrial activities for the whole of 2023: the company now expects growth of 3-6 percent, compared to the previous estimate of +8-11 percent. Due to the "weakening of end-market conditions", CNH lowered its forecasts for free cash flow from industrial activities, positioning it between 1 and 1.2 billion dollars instead of between 1.3 and 1 .5 billion.
CNH INDUSTRIAL RESULTS IN THE THIRD QUARTER OF 2023
In the third quarter of 2023, CNH Industrial reported a net profit of 570 million and consolidated revenues of 5.9 billion: 2 percent more on an annual basis, but less than what analysts expected (the consensus was around 6 billion) .
Net sales revenues from industrial activities were 5.3 billion, 1 percent less than in the same period of 2022. Revenues from the Agriculture branch instead fell by 2.6 percent, to 4.3 billion .
The cash flow from operating activities amounts to 232 million, while the free cash flow from industrial activities is negative for 127 million.
RESULTS IN THE PERIOD JANUARY-SEPTEMBER 2023
Broadening the perspective to the first nine months of 2023 (January-September), CNH saw its consolidated revenues grow by 8 percent, to 17.8 billion; revenues from industrial activities instead increased by 6 percent, to 16 billion. Net profit grew by 22 percent, to 1.7 billion.
RENOVATION TO CUT COSTS
The company has announced a 200 million restructuring plan that aims to reduce labor costs by 5 percent. In parallel with this, a program to rationalize the company's cost structure will be carried out from next year.
In total, counting the reductions expected for 2023 and those for 2024, CNH expects to reduce its costs by 10-15 percent compared to total corporate, administrative and sales costs.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/cnh-risultati-terzo-trimestre-2023/ on Tue, 07 Nov 2023 15:26:13 +0000.