CNH Global N.V. has announced financial results for the quarter and year ended December 31, 2012. Net sales for the year increased 8% (12% on a constant currency basis) to $19.4 billion as solid global demand for agricultural equipment more than offset the negative effects of the more difficult trading conditions in the construction equipment segment and foreign currency translation. Equipment Operations posted an operating profit of $1.7 billion, or 8.6% of net sales for the year, as increased volumes and positive net pricing in both segments compensated for increased SG&A expenditures and R&D expense (+24%), primarily related to significant investments in new products and Tier 4 engine emissions compliance programs.
Equipment net sales in 2012 were 81% agricultural equipment and 19% construction equipment. The geographic distribution of net sales in the year was 44% North America, 31% EAME & CIS, 15% Latin America, and 10% APAC markets.
Equipment Operations generated $979 million in cash flow from operations for the full year, down $118 million or 11% from 2011, as the increased net working capital needed to support increased business activity more than offset improved net sales and operating performance. Full year capital expenditures totaled $556
million, a 36% increase from 2011, largely as a result of investments in new manufacturing sites and product launches in both the agricultural and construction equipment segments. Capital expenditures on new product development (inclusive of interim and final Tier 4 emission compliant equipment) and production capacity represented 61% of the total CAPEX spent during the year.
CNH's Equipment Operations ended the period with a net cash position of $3.0 billion.