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Consolidated revenues of $5,881 million (up 23.9% compared to Q3 2021 for continuing operations, up 29% at constant currency) Net income of $559 million, Adjusted Net Income of $557 million, with diluted EPS and adjusted diluted EPS of $0.41 Adjusted EBIT of Industrial Activities of $670 million (up $250 million compared to Q3 2021) Net cash provided by operating activities of $272 million and Industrial Free Cash Flow of $202 million Net sales for Industrial Activities expected up 16% to 18% for the full year, despite foreign exchange rates headwinds CNH Industrial will now voluntarily file annual and quarterly reports on Forms 10-K and 10-Q, as used by US domestic filers Financial results presented under U.S. GAAP “The CNH Industrial team delivered another strong quarter, driving record 3rd Quarter consolidated revenues, up nearly 24% over the previous year. A mixture of favorable volume, price realization, outstanding operational execution and supportive product mix permitted us to increase our Industrial Activities Gross and EBIT margins by 260 and 270 basis points respectively, with Agriculture generating a record EBIT margin of 14.8%. While our solid results reflect some sequential improvement in the global supply chain, significant challenges persist, and inflation continues to run hot. Free Cash Flow of Industrial Activities was positive for the quarter, and we continue to target over $1 billion for the full year as we accelerate completion and shipment of inventory in Q4. Order books remain robust as soft commodity prices continue to support global agriculture and many construction end markets sustain their strength. We look forward to sharing our future precision, automation/autonomy, and alternative fuel technologies at our Tech Day in December. With this solid foundation and improving execution we have elevated our full year guidance. The coming quarters will challenge our team, but they have consistently proven their mettle and I remain confident we will continue to support our customers, deliver for our shareholders, and progress our strategic initiatives regardless of the business climate.” Scott W. Wine, Chief Executive Officer 2022 Third Quarter Results (all amounts $ million, comparison vs Q3 2021 continuing operations - unless otherwise stated) US-GAAP Q3 2022 PY(1) Change Change at c.c.(3) Consolidated revenue 5,881 4,746 +23.9% +29% of which Net sales of Industrial Activities 5,396 4,336 +24.4% +30% Net income 559 460 +99 Diluted EPS $ 0.41 0.34 +0.07 Cash flow from operating activities 272 673 (401) Cash and cash equivalents(6) 3,154 2,855 299 Gross profit margin of Industrial Activities 23.0% 20.4% +260 bps NON-GAAP(2) Q3 2022 PY(1) Change Adjusted EBIT of Industrial Activities 670 420 +250 Adjusted EBIT Margin of Industrial Activities 12.4% 9.7% +270 bps Adjusted net income 557 463 +94 Adjusted diluted EPS $ 0.41 0.34 +0.07 Free Cash flow of Industrial Activities 202 (70) +272 Available liquidity(6) 8,645 8,795 (150) Net sales of Industrial Activities of $5,396 million, up 24.4% mainly due to favorable price realization, despite more than 5% adverse currency conversion impacts. Adjusted EBIT of Industrial Activities of $670 million ($420 million in Q3 2021), with both segments up year over year. Agriculture adjusted EBIT margin at record 14.8% and Construction at 2.7%. Net income of $559 million, with diluted earnings per share of $0.41 (net income of $460 million in Q3 2021, with diluted earnings per share of $0.34). Adjusted net income of $557 million, with adjusted diluted earnings per share of $0.41 (adjusted net income of $463 million in Q3 2021, with adjusted diluted earnings per share of $0.34). Gross profit margin of Industrial Activities of 23.0%, (20.4% in Q3 2021) with improvement in Agriculture and Construction despite continued cost pressures. Reported income tax expense of $192 million and adjusted income tax expense(1) of $190 million, with adjusted effective tax rate (adjusted ETR(1)) of 26.2% affected by the jurisdictional mix of pre-tax profits. Free cash flow of Industrial Activities was $202 million. Manufacturing inventories remain at high levels, although reduced from June 2022, amid supply chain constraints, and finished goods inventories continue being lean relative to sales. Total Debt of $20.9 billion at September 30, 2022 ($20.9 billion at December 31, 2021). Industrial Activities Net Debt(1) position at $1.3 billion, an increase of $146 million from December 31, 2021, and Available liquidity at $8,645 million as of September 30, 2022. The Company completed a €100 million share buyback program with 5.3 million common shares purchased during the third quarter. Additionally, 1.4 million common shares were purchased during the third quarter under the first $50 million tranche of the $300 million common share buyback program approved on July 29, 2022. Beginning with the reporting of third quarter 2022 financial results, the Company intends to voluntarily report its financial results under the periodic reporting forms for U.S. domestic filers (i.e., CNH Industrial will now voluntarily file annual and quarterly reports on Forms 10-K and 10-Q). Management determined that following the spin-off of the Iveco Group and the refocus as an agricultural and construction equipment leader with significant presence in the US, reporting according to the standards for US public companies is more consistent with the Company’s operating profile and its investor base. Agriculture Q3 2022 Q3 2021(1) Change Change at c.c.(3) Net sales ($ million) 4,501 3,563 +26% +32% Adjusted EBIT ($ million) 666 415 +251 Adjusted EBIT margin 14.8% 11.6% +320 bps In North America, industry volume was up 9% year over year for the third quarter for tractors over 140 HP and was down 16% for tractors under 140 HP; combines were up 13%. In Europe, Middle East and Africa (EMEA), tractor and combine demand was down 5% and 30%, respectively; combine demand in Europe alone was up 12%. South America tractor demand was up 12% and combine demand was up 20%. Asia Pacific tractor demand was up 8% and combine demand was up 12%. Net sales were up 26%, due to favorable price realization and better mix, mostly driven by North America and South America, partially offset by the negative impact of foreign exchange rates. Gross profit margin was at record 25.0%, with Gross Profit $340 million higher than in Q3 2021, mainly due to better mix and favorable price realization primarily in North America, South America and Asia Pacific regions, partially offset by higher production and raw material costs across all regions. Adjusted EBIT was $666 million ($415 million for Q3 2021), with Adjusted EBIT margin at 14.8%. The $251 million increase was driven by favorable price realization and better mix, partially offset by higher SG&A costs, higher production and raw material costs, and increased R&D spend. Order book in Agriculture was down less than 10% year over year for tractors. Order book for combines was down 21%, with declines in North America and South America offset partially by growth in EMEA. At above 2.5 times the pre-pandemic levels, order books remain strong in all regions and key products and orders are being kept curtailed as the medium-term cost scenario remains unclear. Construction Q3 2022 Q3 2021(1) Change Change at c.c.(3) Net sales ($ million) 895 773 +16% +20% Adjusted EBIT ($ million) 24 21 +3 Adjusted EBIT margin 2.7% 2.7% - Global industry volume for construction equipment decreased in both Heavy and Light sub-segments year over year in the third quarter, with Heavy down 3% and Light down 4%, mostly driven by a 9% decrease in Light and Heavy equipment demand for Asia Pacific, particularly in China. Aggregated demand increased 1% in North America, decreased 5% in EMEA and increased 21% in South America. Net sales were up 16%, driven by favorable price realization and contribution from the Sampierana business acquired in December 2021. Gross profit margin was 12.6%, up 0.4 p.p. compared to Q3 2021, mainly due to higher volumes in North America and favorable price realization, partially offset by higher freight and raw material costs. Adjusted EBIT increased $3 million due to favorable volume and mix and positive price realization, partially offset by higher production, freight and raw material costs and increased SG&A spend. Adjusted EBIT margin at 2.7%. Construction order book up more than 20% year over year in both Heavy and Light sub-segments, with increases in the North America, EMEA and South America regions. Financial Services Q3 2022 Q3 2021(1) Change Change at c.c.(3) Revenue ($ million) 482 405 +19% +21% Net income ($ million) 86 96 (10) Equity at quarter-end ($ million) 2,207 2,157 +50 Retail loan originations ($ million) 2,478 2,357 +5.1% Revenues were up 19% due to favorable volumes in all regions, higher base rates across all regions, mainly in South America, and higher used equipment sales, partially offset by changes in North America product mix. Net income decreased $10 million to $86 million, primarily due to margin compression in North America, increased SG&A costs, specifically labor costs, and normalized risk costs, partially offset by favorable volumes in all regions and higher recoveries on used equipment sales. The managed portfolio (including unconsolidated joint ventures) was $21.2 billion as of September 30, 2022 (of which retail was 70% and wholesale was 30%), up $1.2 billion compared to September 30, 2021 (up $2.4 billion on a constant currency basis). The receivable balance greater than 30 days past due as a percentage of receivables was 1.3% (1.4% as of September 30, 2021). 2022 Outlook The Company is updating the 2022 outlook for its Industrial Activities: Net sales(5) up between 16% and 18% year on year including currency translation effects SG&A expenses lower than 7.5% of net sales Free Cash Flow of Industrial Activities(8) in excess of $1.0 billion R&D expenses and capital expenditures at around $1.4 billion Significant uncertainties remain, including rising inflation, geopolitical instability, the war in Ukraine, and may affect our forecast for the year. RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022 Consolidated revenues of $16,608 million (up 18.5% year on year, up 22% at constant currency), net income of $1,447 million, with adjusted diluted EPS of $1.11, adjusted EBIT of Industrial Activities of $1,753 million, and Industrial Free Cash Flow absorption of $(453) million (Industrial Activities). Results for the Nine Months Ended September 30, 2022 (all amounts $ million, comparison vs Q3 2021 continuing operations - unless otherwise stated) US-GAAP YTD Q3 2022 PY(1) Change Change at c.c.(3) Consolidated revenue 16,608 14,016 +18.5% +22% of which Net sales of Industrial Activities 15,189 12,808 +18.6% +22% Net income 1,447 1,337 +110 Diluted EPS $ 1.06 0.98 +0.08 Cash flow from operating activities (886) 1,474 (2,360) Cash and cash equivalents(7) 3,154 5,044 (1,890) Gross profit margin of Industrial Activities 22.2% 21.4% +80bps NON-GAAP(2) YTD Q3 2022 PY(1) Change Adjusted EBIT of Industrial Activities 1,753 1,385 +368 Adjusted EBIT Margin of Industrial Activities 11.5% 10.8% +70bps Adjusted net income 1,518 1,322 +196 Adjusted diluted EPS $ 1.11 0.97 +0.14 Free Cash flow of Industrial Activities (453) 703 (1,156) Available liquidity(7) 8,645 10,521 (1,876) Adjusted gross margin of Industrial Activities 22.4% 21.4% +100bps Agriculture YTD Q3 2022 YTD Q3 2021(1) Change Change at c.c.(3) Net sales ($ million) 12,600 10,571 +19% +23% Adjusted EBIT ($ million) 1,755 1,396 +359 Adjusted EBIT margin 13.9% 13.2% +70bps Construction YTD Q3 2022 YTD Q3 2021(1) Change Change at c.c.(3) Net sales ($ million) 2,589 2,237 +16% +18% Adjusted EBIT ($ million) 90 70 +20 Adjusted EBIT margin 3.5% 3.1% 40bps Financial Services YTD Q3 2022 YTD Q3 2021(1) Change Change at c.c.(3) Revenues ($ million) 1,419 1,194 +19% +19% Net income ($ million) 263 259 +4 Notes CNH Industrial reports quarterly and annual consolidated financial results under U.S. GAAP and EU-IFRS. The tables and discussion related to the financial results of the Company and its segments shown in this press release are prepared in accordance with U.S. GAAP. Financial results under EU-IFRS are shown in specific tables at the end of this press release. Effective January 1, 2022, the Iveco Group business was separated from CNH Industrial N.V. by way of a demerger under Dutch law to Iveco Group N.V. and Iveco Group became a public listed company independent from CNH Industrial. Accordingly, that business is presented as discontinued operations beginning in the first quarter of 2022. The Company has reclassified the financial results of Iveco Group to Net income (loss) from discontinued operations in the Condensed Consolidated Statements of Operations for all periods presented. The Company has reclassified the related assets and liabilities as Assets held for distribution and Liabilities held for distribution on the Condensed Consolidated Balance Sheets as of December 31, 2021. Cash flows from the Company’s discontinued operations are presented in the Condensed Consolidated Statements of Cash Flows for all periods. All comparative figures shown exclude the results of the discontinued operations. This item is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Information” section of this press release for information regarding non-GAAP financial measures. Refer to the specific table in the “Other Supplemental Financial Information” section of this press release for the reconciliation between the non-GAAP financial measure and the most comparable GAAP financial measure. c.c. means at constant currency. Certain financial information in this report has been presented by geographic area. Our geographical regions are: (1) North America; (2) Europe, Middle East and Africa; (3) South America and (4) Asia Pacific. The geographic designations have the following meanings: North America: United States, Canada, and Mexico; Europe, Middle East, and Africa: member countries of the European Union, European Free Trade Association, the United Kingdom, Ukraine, Balkans, Russia, Turkey, the African continent, and the Middle East; South America: Central and South America, and the Caribbean Islands; and Asia Pacific: Continental Asia (including the Indian subcontinent) and Oceania. Net sales reflecting the exchange rate of 1.05 EUR/USD Comparison vs. June 30, 2022 Comparison vs. December 31, 2021 The Company is unable to provide this reconciliation without unreasonable effort due to the uncertainty and inherent difficulty of predicting the occurrence, the financial impact, and the periods in which the adjustments may be recognized. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results. Non-GAAP Financial Information CNH Industrial monitors its operations through the use of several non-GAAP financial measures. CNH Industrial’s management believes that these non-GAAP financial measures provide useful and relevant information regarding its operating results and enhance the readers’ ability to assess CNH Industrial’s financial performance and financial position. Management uses these non-GAAP measures to identify operational trends, as well as make decisions regarding future spending, resource allocations and other operational decisions as they provide additional transparency with respect to our core operations. These non-GAAP financial measures have no standardized meaning under U.S. GAAP or EU-IFRS and are unlikely to be comparable to other similarly titled measures used by other companies and are not intended to be substitutes for measures of financial performance and financial position as prepared in accordance with U.S. GAAP and/or EU-IFRS. CNH Industrial’s non-GAAP financial measures are defined as follows: Adjusted EBIT of Industrial Activities under U.S. GAAP: is defined as net income (loss) before income taxes, Financial Services’ results, Industrial Activities’ interest expenses, net, foreign exchange gains/losses, finance and non-service component of pension and other post-employment benefit costs, restructuring expenses, and certain non-recurring items. In particular, non-recurring items are specifically disclosed items that management considers rare or discrete events that are infrequent in nature and not reflective of on-going operational activities. Adjusted EBIT of Industrial Activities under EU-IFRS: is defined as profit/(loss) before taxes, Financial Services’ results, Industrial Activities’ financial expenses, restructuring costs, and certain non-recurring items. Adjusted EBIT Margin of Industrial Activities: is computed by dividing Adjusted EBIT of Industrial Activities by Net Sales of Industrial Activities. Adjusted Net Income (Loss): is defined as net income (loss), less restructuring charges and non-recurring items, after tax. Adjusted Diluted EPS: is computed by dividing Adjusted Net Income (loss) attributable to CNH Industrial N.V. by a weighted-average number of common shares outstanding during the period that takes into consideration potential common shares outstanding deriving from the CNH Industrial share-based payment awards, when inclusion is not anti-dilutive. When we provide guidance for adjusted diluted EPS, we do not provide guidance on a earnings per share basis because the GAAP measure will include potentially significant items that have not yet occurred and are difficult to predict with reasonable certainty prior to year-end. Adjusted Income Tax (Expense) Benefit: is defined as income taxes less the tax effect of restructuring expenses and non-recurring items, and non-recurring tax charges or benefits. Adjusted Effective Tax Rate (Adjusted ETR): is computed by dividing a) adjusted income taxes by b) income (loss) before income taxes and equity in income of unconsolidated subsidiaries and affiliates, less restructuring expenses and non-recurring items. Adjusted Gross Profit Margin of Industrial Activities: is computed by dividing Net sales less Cost of goods sold, as adjusted by non-recurring items, by Net sales. Net Cash (Debt) and Net Cash (Debt) of Industrial Activities: Net Cash (Debt) is defined as total debt less intersegment notes receivable, cash and cash equivalents, restricted cash, other current financial assets (primarily current securities, short-term deposits and investments towards high-credit rating counterparties) and derivative hedging debt. CNH Industrial provides the reconciliation of Net Cash (Debt) to Total (Debt), which is the most directly comparable measure included in the consolidated balance sheets. Due to different sources of cash flows used for the repayment of the debt between Industrial Activities and Financial Services (by cash from operations for Industrial Activities and by collection of financing receivables for Financial Services), management separately evaluates the cash flow performance of Industrial Activities using Net Cash (Debt) of Industrial Activities. Free Cash Flow of Industrial Activities (or Industrial Free Cash Flow): refers to Industrial Activities only, and is computed as consolidated cash flow from operating activities less: cash flow from operating activities of Financial Services; investments of Industrial Activities in assets sold under operating leases, property, plant and equipment and intangible assets; change in derivatives hedging debt of Industrial Activities; as well as other changes and intersegment eliminations. Available Liquidity: is defined as cash and cash equivalents plus restricted cash, undrawn medium-term unsecured committed facilities, net receivables/payables with Iveco Group N.V. and other current financial assets (primarily current securities, short-term deposits and investments in instruments of high-credit rating counterparties). Change excl. FX or Constant Currency: CNH Industrial discusses the fluctuations in revenues on a constant currency basis by applying the prior year average exchange rates to current year’s revenues expressed in local currency in order to eliminate the impact of foreign exchange rate fluctuations The tables attached to this press release provide reconciliations of the non-GAAP measures used in this press release to the most directly comparable GAAP measures. Forward-looking statements All statements other than statements of historical fact contained in this earning release, including competitive strengths; business strategy; future financial position or operating results; budgets; projections with respect to revenue, income, earnings (or loss) per share, capital expenditures, dividends, liquidity, capital structure or other financial items; costs; and plans and objectives of management regarding operations and products, are forward-looking statements. Forward looking statements also include statements regarding the future performance of CNH Industrial and its subsidiaries on a standalone basis. These statements may include terminology such as “may”, “will”, “expect”, “could”, “should”, “intend”, “estimate”, “anticipate”, “believe”, “outlook”, “continue”, “remain”, “on track”, “design”, “target”, “objective”, “goal”, “forecast”, “projection”, “prospects”, “plan”, or similar terminology. Forward-looking statements, including those related to the COVID-19 pandemic, are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside our control and are difficult to predict. If any of these risks and uncertainties materialize (or they occur with a degree of severity that the Company is unable to predict) or other assumptions underlying any of the forward-looking statements prove to be incorrect, including any assumptions regarding strategic plans, the actual results or developments may differ materially from any future results or developments expressed or implied by the forward-looking statements. Factors, risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements include, among others: the continued uncertainties related to the unknown duration and economic, operational and financial impacts of the global COVID-19 pandemic and the actions taken or contemplated by governmental authorities or others in connection with the pandemic on our business, our employees, customers and suppliers; supply chain disruptions, including delays caused by mandated shutdowns, industry capacity constraints, material availability, and global logistics delays and constraints; disruption caused by business responses to COVID-19, including remote working arrangements, which may create increased vulnerability to cybersecurity or data privacy incidents; our ability to execute business continuity plans as a result of COVID-19; the many interrelated factors that affect consumer confidence and worldwide demand for capital goods and capital goods-related products, including demand uncertainty caused by COVID-19; general economic conditions in each of our markets, including the significant economic uncertainty and volatility caused by the war in the Ukraine and COVID-19; changes in government policies regarding banking, monetary and fiscal policy; legislation, particularly pertaining to capital goods-related issues such as agriculture, the environment, debt relief and subsidy program policies, trade and commerce and infrastructure development; government policies on international trade and investment, including sanctions, import quotas, capital controls and tariffs; volatility in international trade caused by the imposition of tariffs, sanctions, embargoes, and trade wars; actions of competitors in the various industries in which we compete; development and use of new technologies and technological difficulties; the interpretation of, or adoption of new, compliance requirements with respect to engine emissions, safety or other aspects of our products; production difficulties, including capacity and supply constraints and excess inventory levels; labor relations; interest rates and currency exchange rates; inflation and deflation; energy prices; prices for agricultural commodities; housing starts and other construction activity; our ability to obtain financing or to refinance existing debt; price pressure on new and used equipment; the resolution of pending litigation and investigations on a wide range of topics, including dealer and supplier litigation, intellectual property rights disputes, product warranty and defective product claims, and emissions and/or fuel economy regulatory and contractual issues; security breaches, cybersecurity attacks, technology failures, and other disruptions to the information technology infrastructure of CNH Industrial and its suppliers and dealers; security breaches with respect to our products; our pension plans and other post-employment obligations; political and civil unrest; volatility and deterioration of capital and financial markets, including other pandemics, terrorist attacks in Europe and elsewhere; our ability to realize the anticipated benefits from our business initiatives as part of our strategic plan; our failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures, strategic alliances or divestitures and other similar risks and uncertainties, and our success in managing the risks involved in the foregoing. Forward-looking statements are based upon assumptions relating to the factors described in this earnings release, which are sometimes based upon estimates and data received from third parties. Such estimates and data are often revised. Actual results may differ materially from the forward-looking statements as a result of a number of risks and uncertainties, many of which are outside CNH Industrial’s control. CNH Industrial expressly disclaims any intention or obligation to provide, update or revise any forward-looking statements in this announcement to reflect any change in expectations or any change in events, conditions or circumstances on which these forward-looking statements are based. Further information concerning CNH Industrial, including factors that potentially could materially affect CNH Industrial’s financial results, is included in CNH Industrial’s reports and filings with the U.S. Securities and Exchange Commission (“SEC”), the Autoriteit Financiële Markten (“AFM”) and Commissione Nazionale per le Società e la Borsa (“CONSOB”). All future written and oral forward-looking statements by CNH Industrial or persons acting on the behalf of CNH Industrial are expressly qualified in their entirety by the cautionary statements contained herein or referred to above. Conference Call and Webcast Today, at 3:30 p.m. CET / 2:30 p.m. GMT/ 9:30 a.m. ET, management will hold a conference call to present third quarter 2022 results to financial analysts and institutional investors. The call can be followed live online at https://bit.ly/CNH_Industrial_Q3_2022 and a recording will be available later on the Company’s website www.cnhindustrial.com. A presentation will be made available on the CNH Industrial website prior to the conference call. London, November 8, 2022 CONTACTS Media Inquiries – Laura Overall Tel +44 207 925 1964 or Rebecca Fabian Tel +1 312 515 2249 (Email mediarelations@cnhind.com) Investor Relations – Jason Omerza Tel +1 630 740 8079 or Federico Pavesi Tel +39 345 605 6218 (Email investor.relations@cnhind.com) CNH INDUSTRIAL N.V. Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021 (Unaudited, U.S.-GAAP) Three Months Ended September 30, Nine Months Ended September 30, ($ million) 2022 2021 2022 2021 Revenues Net sales 5,396 4,336 15,189 12,808 Finance, interest and other income 485 410 1,419 1,208 TOTAL REVENUES 5,881 4,746 16,608 14,016 Costs and Expenses Cost of goods sold 4,156 3,452 11,819 10,064 Selling, general and administrative expenses 422 349 1,224 1,023 Research and development expenses 213 157 609 453 Restructuring expenses 11 15 19 21 Interest expense 190 127 490 417 Other, net 159 124 490 422 TOTAL COSTS AND EXPENSES 5,151 4,224 14,651 12,400 INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES 730 522 1,957 1,616 Income tax (expense) benefit (192) (79) (579) (347) Equity in income (loss) of unconsolidated subsidiaries and affiliates 21 17 69 68 Net income (loss) from continuing operations 559 460 1,447 1,337 Net income (loss) from discontinued operations — (131) — 116 NET INCOME (LOSS) 559 329 1,447 1,453 Net income attributable to noncontrolling interests 3 6 10 32 NET INCOME (LOSS) ATTRIBUTABLE TO CNH INDUSTRIAL N.V. 556 323 1,437 1,421 Basic earnings (loss) per share attributable to common shareholders (in $) Continuing operations 0.41 0.34 1.06 0.98 Discontinued operations — (0.10) — 0.07 Basic earnings per share attributable to CNH Industrial N.V. 0.41 0.24 1.06 1.05 Diluted earnings (loss) per share attributable to common shareholders (in $) Continuing operations 0.41 0.34 1.06 0.98 Discontinued operations — (0.10) — 0.06 Diluted earnings per share attributable to CNH Industrial N.V. 0.41 0.24 1.06 1.04 Average shares outstanding (in millions) Basic 1,350 1,354 1,354 1,354 Diluted 1,355 1,361 1,359 1,360 Cash dividends declared per common share — — 0.302 0.132 These Condensed Consolidated Statements of Operations should be read in conjunction with the Company’s Audited Consolidated Financial Statements and Notes for the year ended December 31, 2021 included in the Annual Report on Form 20-F. These Condensed Consolidated Statements of Operations represent the consolidation of all CNH Industrial N.V. subsidiaries. CNH INDUSTRIAL N.V. Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021 (Unaudited, U.S.-GAAP) ($ million) September 30, 2022 December 31, 2021 ASSETS Cash and cash equivalents 3,154 5,044 Restricted cash 660 801 Financing receivables, net 16,901 15,376 Receivables from Iveco Group N.V. 224 — Inventories, net 5,362 4,216 Property, plant and equipment, net and equipment under operating lease 2,944 3,213 Intangible assets, net 4,391 4,417 Other receivables and assets 2,208 2,803 Assets held for distribution — 13,546 TOTAL ASSETS 35,844 49,416 LIABILITIES AND EQUITY Debt 20,922 20,897 Payables to Iveco Group N.V. 95 502 Other payables and liabilities 8,418 9,272 Liabilities held for distribution — 11,892 Total Liabilities 29,435 42,563 Redeemable noncontrolling interest 52 45 Equity 6,357 6,808 TOTAL LIABILITIES AND EQUITY 35,844 49,416 These Condensed Consolidated Balance Sheets should be read in conjunction with the Company’s Audited Consolidated Financial Statements and Notes for the year ended December 31, 2021, included in the Annual Report on Form 20-F. These Condensed Consolidated Balance Sheets represent the consolidation of all CNH Industrial N.V. subsidiaries. CNH INDUSTRIAL N.V. Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2022 and 2021 (Unaudited, U.S.-GAAP) Nine Months Ended September 30, ($ million) 2022 2021 Net income (loss) 1,447 1,453 Less: Net income (loss) of Discontinued Operations — 116 Net income (loss) of Continuing Operations 1,447 1,337 Adjustments to reconcile net income (loss) from Continuing Operations to net cash provided by (used in) operating activities from Continuing Operations: (2,333) 137 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS (886) 1,474 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS — 418 TOTAL NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (886) 1,892 NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM CONTINUING OPERATIONS (1,590) (1,720) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS — 134 TOTAL NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (1,590) (1,586) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS 802 (1,242) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS — (450) TOTAL NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 802 (1,692) Effect of foreign exchange rate changes on cash and cash equivalents and restricted cash (357) (329) DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (2,031) (1,715) CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF YEAR 5,845 9,629 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD 3,814 7,914 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (Discontinued Operations) — 720 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (Continuing Operations) 3,814 7,194 These Condensed Consolidated Statements of Cash Flows should be read in conjunction with the Company’s Audited Consolidated Financial Statements and Notes for the year ended December 31, 2021 included in the Annual Report on Form 20-F. These Condensed Consolidated Statements of Cash Flows represent the consolidation of all CNH Industrial N.V. subsidiaries. CNH INDUSTRIAL N.V. Supplemental Statements of Operations for the three months ended September 30, 2022 and 2021 (Unaudited, U.S.-GAAP) Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 ($ million) Industrial Activities(1) Financial Services Eliminations Consolidated Industrial Activities(1) Financial Services Eliminations Consolidated Revenues Net sales 5,396 — — 5,396 4,336 — — 4,336 Finance, interest and other income 27 482 (24) (2) 485 16 405 (11) (2) 410 TOTAL REVENUES 5,423 482 (24) 5,881 4,352 405 (11) 4,746 Costs and Expenses Cost of goods sold 4,156 — — 4,156 3,452 — — 3,452 Selling, general and administrative expenses 377 45 — 422 317 32 — 349 Research and development expenses 213 — — 213 157 — — 157 Restructuring expenses 11 — — 11 15 — — 15 Interest expense 54 160 (24) (3) 190 37 101 (11) (3) 127 Other, net (3) 162 — 159 (24) 148 — 124 TOTAL COSTS AND EXPENSES 4,808 367 (24) 5,151 3,954 281 (11) 4,224 INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES 615 115 — 730 398 124 — 522 Income tax (expense) benefit (160) (32) — (192) (48) (31) — (79) Equity in income (loss) of unconsolidated subsidiaries and affiliates 18 3 — 21 14 3 — 17 NET INCOME (LOSS) Continuing Operations 473 86 — 559 364 96 — 460 NET INCOME (LOSS) Discontinued Operations — — — — (153) 22 — (131) NET INCOME (LOSS) 473 86 — 559 211 118 — 329 (1) Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services. (2) Elimination of Financial Services’ interest income earned from Industrial Activities. (3) Elimination of Industrial Activities’ interest expense to Financial Services. CNH INDUSTRIAL N.V. Supplemental Statements of Operations for the nine months ended September 30, 2022 and 2021 (Unaudited, U.S.-GAAP) Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 ($ million) Industrial Activities(1) Financial Services Eliminations Consolidated Industrial Activities(1) Financial Services Eliminations Consolidated Revenues Net sales 15,189 — — 15,189 12,808 — — 12,808 Finance, interest and other income 52 1,419 (52) (2) 1,419 43 1,194 (29) (2) 1,208 TOTAL REVENUES 15,241 1,419 (52) 16,608 12,851 1,194 (29) 14,016 Costs and Expenses Cost of goods sold 11,819 — — 11,819 10,064 — — 10,064 Selling, general and administrative expenses 1,087 137 — 1,224 936 87 — 1,023 Research and development expenses 609 — — 609 453 — — 453 Restructuring expenses 19 — — 19 21 — — 21 Interest expense 149 393 (52) (3) 490 135 311 (29) (3) 417 Other, net (41) 531 — 490 (41) 463 — 422 TOTAL COSTS AND EXPENSES 13,642 1,061 (52) 14,651 11,568 861 (29) 12,400 INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED SUBSIDIARIES AND AFFILIATES 1,599 358 — 1,957 1,283 333 — 1,616 Income tax (expense) benefit (473) (106) — (579) (264) (83) — (347) Equity in income (loss) of unconsolidated subsidiaries and affiliates 58 11 — 69 59 9 — 68 NET INCOME (LOSS) Continuing Operations 1,184 263 — 1,447 1,078 259 — 1,337 NET INCOME (LOSS) Discontinued Operations — — — — 67 49 — 116 NET INCOME (LOSS) 1,184 263 — 1,447 1,145 308 — 1,453 (1) Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services. (2) Elimination of Financial Services’ interest income earned from Industrial Activities. (3) Elimination of Industrial Activities’ interest expense to Financial Services. CNH INDUSTRIAL N.V. Supplemental Balance Sheets as of September 30, 2022 and December 31, 2021 (Unaudited, U.S.-GAAP) September 30, 2022 December 31, 2021 ($ million) Industrial Activities(1) Financial Services Eliminations Consolidated Industrial Activities(1) Financial Services Eliminations Consolidated ASSETS Cash and cash equivalents 2,736 418 — 3,154 4,386 658 — 5,044 Restricted cash 131 529 — 660 128 673 — 801 Financing receivables, net 601 17,068 (768) (2) 16,901 199 15,508 (331) (2) 15,376 Receivables from Iveco Group N.V. 151 73 — 224 — — — — Inventories, net 5,344 18 — 5,362 4,187 29 — 4,216 Property, plant and equipment, net and equipment on operating lease 1,434 1,510 — 2,944 1,504 1,709 — 3,213 Intangible assets, net 4,231 160 — 4,391 4,255 162 — 4,417 Other receivables and assets 1,957 437 (186) (3) 2,208 2,656 345 (198) (3) 2,803 Assets held for distribution — — — — 9,814 4,543 (811) 13,546 TOTAL ASSETS 16,585 20,213 (954) 35,844 27,129 23,627 (1,340) 49,416 LIABILITIES AND EQUITY Debt 4,827 16,863 (768) (2) 20,922 5,485 15,743 (331) (2) 20,897 Payables to Iveco Group N.V. 6 89 — 95 334 168 — 502 Other payables and liabilities 7,550 1,054 (186) (3) 8,418 8,426 1,044 (198) (3) 9,272 Liabilities held for distribution — — — — 8,985 3,718 (811) 11,892 Total Liabilities 12,383 18,006 (954) 29,435 23,230 20,673 (1,340) 42,563 Redeemable noncontrolling interest 52 — — 52 45 — — 45 Equity 4,150 2,207 — 6,357 3,854 2,954 — 6,808 TOTAL LIABILITIES AND EQUITY 16,585 20,213 (954) 35,844 27,129 23,627 (1,340) 49,416 (1) Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services. (2) This item includes the elimination of receivables/payables between Industrial Activities and Financial Services. (3) This item primarily represents the reclassification of deferred tax assets/liabilities in the same taxing jurisdiction and elimination of intercompany activity between Industrial Activities and Financial Services. CNH INDUSTRIAL N.V. Supplemental Statements of Cash Flows for the nine months ended September 30, 2022 and 2021 (Unaudited, U.S.-GAAP) Nine months ended September 30, 2022 Nine months ended September 30, 2021 ($ million) Industrial Activities(1) Financial Services Eliminations (3) Consolidated Industrial Activities(1) Financial Services Eliminations (3) Consolidated Net income (loss) 1,184 263 — 1,447 1,145 308 — 1,453 Less: Net income (loss) of Discontinued Operations — — — — 67 49 — 116 Net income (loss) of Continuing Operations 1,184 263 — 1,447 1,078 259 — 1,337 Adjustments to reconcile net income (loss) from Continuing Operations to net cash provided by (used in) operating activities from Continuing Operations: (1,366) (852) (115) (2) (2,333) (152) 449 (160) 137 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS (182) (589) (115) (886) 926 708 (160) 1,474 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS — — — — (103) 523 (2) 418 TOTAL NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (182) (589) (115) (886) 823 1,231 (162) 1,892 NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM CONTINUING OPERATIONS (656) (955) 21 (1,590) (940) (791) 11 (1,720) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS — — — — 113 19 2 134 TOTAL NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (656) (955) 21 (1,590) (827) (772) 13 (1,586) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS (471) 1,179 94 802 (1,447) 56 149 (1,242) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS — — — — (10) (440) - (450) TOTAL NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES (471) 1,179 94 (4) 802 (1,457) (384) 149 (1,692) Effect of foreign exchange rate changes on cash and cash equivalents and restricted cash (338) (19) — (357) (300) (29) — (329) DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (1,647) (384) — (2,031) (1,761) 46 — (1,715) CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF YEAR 4,514 1,331 — 5,845 8,116 1,513 — 9,629 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD 2,867 947 — 3,814 6,355 1,559 — 7,914 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (DISCONTINUED OPERATIONS) — — — — 510 210 — 720 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (CONTINUING OPERATIONS) 2,867 947 — 3,814 5,845 1,349 — 7,194 (1) Industrial Activities represents the enterprise without Financial Services. Industrial Activities includes the Company’s Agriculture and Construction segments, and other corporate assets, liabilities, revenues and expenses not reflected within Financial Services. (2) This item includes the elimination of dividends from Financial Services to Industrial Activities, which are included in Industrial Activities net cash used in operating activities. (3) This item includes the elimination of certain minor activities between Industrial Activities and Financial Services. (4) This item includes the elimination of paid in capital from Industrial Activities to Financial Services. Other Supplemental Financial Information (Unaudited) Reconciliation of Consolidated Net Income to Adjusted EBIT of Industrial Activities by segment under U.S.-GAAP ($ million) Three Months ended September 30, 2022 Agriculture Construction Unallocated items, eliminations and other Total Consolidated Net income 559 Less: Consolidated Income tax (expense) benefit (192) Consolidated Income before taxes 751 Less: Financial Services Financial Services Net income 86 Financial Services Income taxes 32 Add back of the following Industrial Activities items: Interest expenses, net of interest income and eliminations 27 Foreign exchange (gains) losses, net 14 Finance and non-service component of Pension and other post-employment benefit costs(1) (35) Adjustments for the following Industrial Activities items: Restructuring expenses 11 — — 11 Other discrete items(2) — — 20 20 Adjusted EBIT of Industrial Activities 666 24 (20) 670 Three Months ended September 30, 2021 Agriculture Construction Unallocated items, eliminations and other Total Consolidated Net income 329 Less: Consolidated Net Income (loss) of Discontinued Operations (131) Consolidated Net income (loss) of Continuing Operations 460 Less: Consolidated Income tax (expense) benefit (79) Consolidated Income (loss) before taxes (continuing operations) 539 Less: Financial Services Financial Services Net income 96 Financial Services Income taxes 31 Add back of the following Industrial Activities items: Interest expenses, net of interest income and eliminations 21 Foreign exchange (gains) losses, net (21) Finance and non-service component of Pension and other post-employment benefit costs(1) (33) Adjustments for the following Industrial Activities items: Restructuring expenses 4 11 — 15 Other discrete items(2) — — 26 26 Adjusted EBIT of Industrial Activities 415 21 (16) 420 (1) In the three months ended September 30, 2022, this item includes the pre-tax gain of $30 million as a result of the amortization over approximately 4.5 years of the $527 million positive impact from the 2018 modification of a healthcare plan in the U.S. and a pre-tax gain of $6 million as a result of the amortization over the 4 years of the $101 million positive impact from the 2021 modifications of a healthcare plan in the U.S. In the three months ended September 30, 2021, this item includes the pre-tax gain of $30 million as a result of the 2018 modification. (2) In the three months ended September 30, 2022, this item included $7 million of separation costs incurred in connection with our spin-off of the Iveco Group Business and $14 million of costs related to the activity of the Raven segments held for sale, including the loss on the sale of the Aerostar division. In the three months ended September 30, 2021, this item included $24 million separation costs in connection with the spin-off of the Iveco Group business. Other Supplemental Financial Information (Unaudited) Reconciliation of Consolidated Net Income to Adjusted EBIT of Industrial Activities by segment under US-GAAP ($ million) Nine Months ended September 30, 2022 Agriculture Construction Unallocated items, eliminations and other Total Consolidated Net income 1,447 Less: Consolidated Income tax (expense) benefit (579) Consolidated Income before taxes 2,026 Less: Financial Services Financial Services Net income 263 Financial Services Income taxes 106 Add back of the following Industrial Activities items: Interest expenses, net of interest income and eliminations 97 Foreign exchange (gains) losses, net 14 Finance and non-service component of Pension and other post-employment benefit costs(1) (112) Adjustments for the following Industrial Activities items: Restructuring expenses 16 3 — 19 Other discrete items(2) — — 78 78 Adjusted EBIT of Industrial Activities 1,755 90 (92) 1,753 Nine Months ended September 30, 2021 Agriculture Construction Unallocated items, eliminations and other Total Consolidated Net income 1,453 Less: Consolidated Net Income (loss) of Discontinued Operations 116 Consolidated Net income (loss) of Continuing Operations 1,337 Less: Consolidated Income tax (expense) benefit (347) Consolidated Income (loss) before taxes (continuing operations) 1,684 Less: Financial Services Financial Services Net income 259 Financial Services Income taxes 83 Add back of the following Industrial Activities items: Interest expenses, net of interest income and eliminations 92 Foreign exchange (gains) losses, net (6) Finance and non-service component of Pension and other post-employment benefit costs(1) (102) Adjustments for the following Industrial Activities items: Restructuring expenses 8 13 — 21 Other discrete items(2) — — 38 38 Adjusted EBIT of Industrial Activities 1,396 70 (81) 1,385 (1) In the nine months ended September 30, 2022, this item includes the pre-tax gain of $90 million as a result of the amortization over approximately 4.5 years of the $527 million positive impact from the 2018 modification of a healthcare plan in the U.S. and a pre-tax gain of $18 million as a result of the amortization over the 4 years of the $101 million positive impact from the 2021 modifications of a healthcare plan in the U.S. In the nine months ended September 30, 2021, this item includes the pre-tax gain of $90 million as a result of the 2018 modification. (2) In the nine months ended September 30, 2022, this item included $43 million of asset write-downs, $13 million of separation costs incurred in a connection with our spin-off of the Iveco Group Business and $22 million of costs related to the activity of the Raven segments held for sale, including the loss on the sale of the Engineered Films and Aerostar divisions. In the nine months ended September 30, 2021, this item included $32 million separation costs in connection with the spin-off of the Iveco Group business. Other Supplemental Financial Information (Unaudited) Reconciliation of Total (Debt) to Net Cash (Debt) under US-GAAP ($ million) Consolidated Industrial Services Financial Services September 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021 Third party (debt) (20,922) (20,897) (4,644) (5,335) (16,278) (15,562) Intersegment notes payable — — (183) (150) (585) (181) Payable to Iveco Group N.V.(4) (95) (3,986) (6) (3,764) (89) (222) Total (Debt)(1) (21,017) (24,883) (4,833) (9,249) (16,952) (15,965) Cash and cash equivalents 3,154 5,044 2,736 4,386 418 658 Restricted cash 660 801 131 128 529 673 Intersegment notes receivable — — 585 181 183 150 Receivables from Iveco Group N.V.(4) 224 3,484 151 3,430 73 54 Other current financial assets(2) 2 1 2 1 — — Derivatives hedging debt (44) (3) (44) (3) — — Net Cash (Debt)(3) (17,021) (15,556) (1,272) (1,126) (15,749) (14,430) (1) Total (Debt) of Industrial Activities includes Intersegment notes payable to Financial Services of $183 million and $150 million as of September 30, 2022 and December 31, 2021, respectively. Total (Debt) of Financial Services includes Intersegment notes payable to Industrial Activities of $585 million and $181 million as of September 30, 2022 and December 31, 2021, respectively. (2) This item includes short-term deposits and investments towards high-credit rating counterparties. (3) The net intersegment receivable/(payable) balance recorded by Financial Services relating to Industrial Activities was ($402) million and ($31) million as of September 30, 2022 and December 31, 2021, respectively. (4) For December 31, 2021, this item is shown net on the CNH Industrial balance sheet. Reconciliation of Cash and cash equivalents to Available liquidity under US-GAAP ($ million) September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021 Cash and cash equivalents 3,154 2,855 3,219 5,044 Restricted cash 660 729 842 801 Undrawn committed facilities 4,700 5,002 5,087 5,177 Receivables from Iveco Group N.V. 224 281 297 3,484 Payables to Iveco Group N.V. (95) (73) (47) (3,986) Other current financial assets(1) 2 1 1 1 Available liquidity 8,645 8,795 9,399 10,521 (1) This item includes short-term deposits and investments towards high-credit rating counterparties. Other Supplemental Financial Information (Unaudited) Change in Net Cash (Debt) of Industrial Activities under US-GAAP Nine Months ended September 30, Three Months ended September 30, 2022 2021 ($ million) 2022 2021 (1,126) (893) Net Cash (Debt) of Industrial Activities at beginning of period (1,564) (148) 1,753 1,385 Adjusted EBIT of Industrial Activities 670 420 250 217 Depreciation and Amortization 84 71 2 1 Depreciation of assets under operating leases 1 — (511) (308) Cash interest and taxes (195) (129) 294 261 Changes in provisions and similar(1) 194 117 (1,967) (656) Change in working capital (417) (445) (243) (195) Investments in property, plant and equipment, and intangible assets (106) (90) (31) (2) Other changes (29) (14) (453) 703 Free cash flow of Industrial Activities – Continuing operations 202 (70) (532) (184) Capital increases and dividends(3) (77) (1) 839 249 Currency translation differences and other(2) 167 94 (146) 768 Change in Net Cash (Debt) of Industrial Activities – Continuing operations 292 23 (1,272) (125) Net Cash (Debt) of Industrial Activities at end of period (1,272) (125) (1) Including other cash flow items related to operating lease. (2) In the nine months ended September 30, 2022 this item also includes the proceed of Raven Engineered Films Division for $350 million. In the nine months ended September 30, 2021, this item also includes the charge of $8 million related to the repurchase of notes. (3) In the three and nine months ended September 30, 2022, this item also includes share buy-back transactions. Reconciliation of Net cash provided by (used in) Operating Activities to Free cash flow of Industrial Activities under US-GAAP Nine Months ended September 30, Three Months ended September 30, 2022 2021 ($ million) 2022 2021 (886) 1,474 Net cash provided by (used in) Operating Activities (Continuing Operations) 272 673 704 (548) Cash flows from Operating Activities of Financial Services net of eliminations 27 (628) 17 (8) Change in derivatives hedging debt of Industrial Activities and other 46 (1) (14) (18) Investments in assets sold under operating lease assets of Industrial Activities (8) (10) (243) (195) Investments in property, plant and equipment, and intangible assets of Industrial Activities (106) (90) (31) (2) Other changes(1) (29) (14) (453) 703 Free cash flow of Industrial Activities 202 (70) (1) This item primarily includes change in intersegment financial receivables and capital increases in intersegment investments. Other Supplemental Financial Information (Unaudited) Reconciliation of Adjusted net income and Adjusted income tax (expense) benefit to Net income (loss) and Income tax (expense) benefit and calculation of Adjusted diluted EPS and Adjusted ETR under US-GAAP Nine Months ended September 30, Three Months ended September 30, 2022 2021 ($ million) 2022 2021 1,447 1,337 Net income (loss) – Continuing Operations 559 460 5 (23) Adjustments impacting Income (loss) before income tax (expense) benefit and equity in income of unconsolidated subsidiaries and affiliates (a) (4) 11 66 8 Adjustments impacting Income tax (expense) benefit (b) 2 (8) 1,518 1,322 Adjusted net income (loss) 557 463 1,508 1,315 Adjusted net income (loss) attributable to CNH Industrial N.V. 554 460 1,359 1,360 Weighted average shares outstanding – diluted (million) 1,355 1,361 1.11 0.97 Adjusted diluted EPS ($) 0.41 0.34 1,957 1,616 Income (loss) from continuing operations before income tax (expense) benefit and equity in income of unconsolidated subsidiaries and affiliates 730 522 5 (23) Adjustments impacting Income (loss) before income tax (expense) benefit and equity in income of unconsolidated subsidiaries and affiliates (a) (4) 11 1,962 1,593 Adjusted income (loss) from continuing operations before income tax (expense) benefit and equity in income of unconsolidated subsidiaries and affiliates (A) 726 533 (579) (347) Income tax (expense) benefit (192) (79) 66 8 Adjustments impacting Income tax (expense) benefit (b) 2 (8) (513) (339) Adjusted income tax (expense) benefit (B) (190) (87) 26.1% 21.3% Adjusted Effective Tax Rate (Adjusted ETR) (C=B/A) 26.2% 16.3% 23.2% a) Adjustments impacting Income (loss) from continuing operations before income tax (expense) benefit and equity in income of unconsolidated subsidiaries and affiliates 19 21 Restructuring expenses 11 15 — 8 Loss on repurchase of notes — — (90) (90) Pre-tax gain related to the 2018 modification of a healthcare plan in the U.S. (30) (30) (18) — Pre-tax gain related to the 2021 modification of a healthcare plan in the U.S. (6) — 43 — Asset write-down: Industrial Activities, Russia Operations (1) — 16 — Asset write-down: Financial Services, Russia Operations 1 — 13 32 Spin related costs 7 24 — 6 Other discrete items — 2 22 — Activity of the Raven Segments held for sale, including loss on sale of the Aerostar and Engineered Films Division 14 — 5 (23) Total (4) 11 b) Adjustments impacting Income tax (expense) benefit 66 13 Tax effect of adjustments impacting Income (loss) before income tax (expense) benefit and equity in income of unconsolidated subsidiaries and affiliates(1) 5 (1) — (5) Other (3) (7) 66 8 Total 2 (8) (1) Includes $12 million of increase to the valuation allowances on historical deferred tax assets as a result of the suspension of operations in Russia. Other Supplemental Financial Information (Unaudited) Reconciliation of Adjusted gross profit to gross profit under US-GAAP Nine Months ended September 30, Three Months ended September 30, 2022 2021 ($ million) 2022 2021 15,189 12,808 Net Sales (A) 5,396 4,336 11,819 10,064 Cost of goods sold 4,156 3,452 3,370 2,744 Gross profit (B) 1,240 884 34 — Asset write down (Russia operations) — — 3,404 2,744 Adjusted gross profit (C) 1,240 884 22.2% 21.4% Gross profit margin (B ÷ A) 23.0% 20.4% 22.4% 21.4% Adjusted gross profit margin (C ÷ A) 23.0% 20.4% Revenues by Segment under EU-IFRS Nine Months ended September 30, Three Months ended September 30, 2022 2021 % Change ($ million) 2022 2021 % Change 12,600 10,586 19.0% Agriculture 4,501 3,568 26.1% 2,589 2,237 15.7% Construction 895 773 15.8% — — — Eliminations and other — 1 n.m. 15,189 12,823 18.5% Total Industrial Activities of Continuing Operations 5,396 4,342 24.3% 1,411 1,188 18.8% Financial Services 478 402 18.9% (33) (19) n.m. Eliminations and other (14) (7) n.m. 16,567 13,992 18.4% Total of Continuing Operations 5,860 4,737 23.7% Adjusted EBIT of Industrial Activities(1) by Segment under EU-IFRS Three Months ended September 30, 2022 2021 $ Change 2022 adjusted EBIT margin 2021 adjusted EBIT margin Agriculture 661 406 255 14.7% 11.4% Construction 20 17 3 2.2% 2.2% Unallocated items, eliminations and other (21) (20) (1) — — Adjusted EBIT of Industrial Activities of Continuing Operations 660 403 257 12.2% 9.3% (1) This item is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Information” section of this press release for information regarding non-GAAP financial measures. Adjusted EBIT of Industrial Activities(1) by Segment under EU-IFRS Nine Months ended September 30, 2022 2021 $ Change 2022 adjusted EBIT margin 2021 adjusted EBIT margin Agriculture 1,744 1,369 375 13.8% 12.9% Construction 81 64 17 3.1% 2.9% Unallocated items, eliminations and other (94) (91) (3) — — Adjusted EBIT of Industrial Activities of Continuing Operations 1,731 1,342 389 11.4% 10.5% (1) This item is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Information” section of this press release for information regarding non-GAAP financial measures. Other Supplemental Financial Information (Unaudited) Other key data under EU-IFRS September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021 Total Assets 36,579 36,403 37,272 51,122 Total Equity 6,965 6,428 6,258 8,426 Equity attributable to CNH Industrial N.V. 6,962 6,421 6,251 8,393 Net Cash (Debt) of Continuing Operations (17,392) (17,422) (17,454) (15,840) Net Cash (Debt) of Discontinued Operations — — — (1,480) Net Cash (Debt) of CNH Industrial (17,392) (17,422) (17,454) (17,320) of which Net Cash (Debt) of Industrial Activities(1) of Continuing Operations (1,571) (1,892) (2,452) (1,374) of which Net Cash (Debt) of Industrial Activities(1) of Discontinued Operations — — — 1,204 of which Net Cash (Debt) of Industrial Activities(1) (1,571) (1,892) (2,452) (170) Net Income of Financial Services of Continuing Operations 240 159 73 357 Net Income of Financial Services of Discontinued Operations — — — 71 (1) This item is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Information” section of this press release for information regarding non-GAAP financial measures. Net income (loss) reconciliation US-GAAP to EU-IFRS Nine Months ended September 30, Three Months ended September 30, 2022 2021 ($ million) 2022 2021 1,447 1,337 Net income (loss) in accordance with U.S. GAAP 559 460 Adjustments to conform with EU-IFRS: (23) (34) Development costs (12) (14) (137) (104) Other adjustments(1) (29) (38) 20 30 Tax impact on adjustments and other income tax differences (2) 14 (140) (108) Total adjustments (43) (38) 1,307 1,229 Profit (loss) in accordance with EU-IFRS 516 422 (1) This item also includes the different accounting impacts from the modifications of a healthcare plan in the U.S. Total Equity reconciliation US-GAAP to EU-IFRS September 30, 2022 June 30, 2022 March 30, 2022 December 31, 2021 Total Equity under U.S. GAAP 6,357 5,794 5,609 6,808 Adjustments to conform with EU-IFRS: Development costs 719 751 783 2,058 Other adjustments 59 45 41 28 Tax impact on adjustments and other income tax differences (170) (162) (175) (468) Total adjustments 608 634 649 1,618 Total Equity under EU-IFRS 6,965 6,428 6,258 8,426 Other Supplemental Financial Information (Unaudited) Translation of financial statements denominated in a currency other than the U.S. dollar The principal exchange rates used to translate into U.S. dollars the financial statements prepared in currencies other than the U.S. dollar were as follows: Nine months Ended September 30, 2022 Nine months Ended September 30, 2021 Average At September 30 At December 31, 2021 Average At September 30, Euro 0.940 1.026 0.883 0.836 0.864 Pound sterling 0.796 0.906 0.742 0.722 0.743 Swiss franc 0.951 0.981 0.912 0.912 0.935 Polish zloty 4.393 4.996 4.059 3.801 3.990 Brazilian real 5.134 5.426 5.571 5.330 5.409 Canadian dollar 1.282 1.375 1.271 1.251 1.274 Turkish lira 15.867 18.625 13.450 8.118 8.894 Condensed Consolidated Income Statement for the three and nine months ended September 30, 2022 and 2021 (Unaudited, EU-IFRS) Three Months Ended September 30, Nine Months Ended September 30, ($ million) 2022 2021 2022 2021 Net revenues 5,860 4,737 16,567 13,992 Cost of sales 4,473 3,704 12,767 10,838 Selling, general and administrative costs 408 342 1,180 1,006 Research and development costs 225 171 637 490 Result from investments: Share of the profit/(loss) of investees accounted for using the equity method 22 16 72 69 Restructuring costs 11 16 19 24 Other income/(expenses) (24) (1) (63) (46) Financial income/(expenses) (31) (32) (107) (111) PROFIT/(LOSS) BEFORE TAXES 710 487 1,866 1,546 Income tax (expense) benefit (194) (65) (559) (317) PROFIT/(LOSS) FROM CONTINUING OPERATIONS 516 422 1,307 1,229 PROFIT/(LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX — 28 — 200 PROFIT/(LOSS) FOR THE PERIOD 516 450 1,307 1,429 PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS ATTRIBUTABLE TO: Owners of the parent 513 419 1,297 1,222 Non-controlling interests 3 3 10 7 (in $) BASIC EARNINGS/(LOSS) PER COMMON SHARE 0.38 0.33 0.96 1.03 Basic earnings/(loss) per common share from continuing operations — 0.31 — 0.90 DILUTED EARNINGS/(LOSS) PER COMMON SHARE 0.38 0.33 0.95 1.03 Diluted earnings/(loss) per common share from continuing operations — 0.31 — 0.90 Other Supplemental Financial Information (Unaudited) Condensed Consolidated Statement of Financial Position as of September 30, 2022 and December 31, 2021 (Unaudited, EU-IFRS) ($ million) September 30, 2022 December 31, 2021 ASSETS Intangible assets 5,064 5,159 Property, plant and equipment and Leased assets 3,182 3,435 Inventories 5,433 4,228 Receivables from financing activities 17,180 15,443 Cash and cash equivalents 3,814 5,845 Other receivables and assets 1,906 2,535 Assets held for distribution(*) — 14,477 TOTAL ASSETS 36,579 51,122 EQUITY AND LIABILITIES Issued capital and reserves attributable to owners of the parent 6,962 8,393 Non-controlling interests 3 33 Total Equity 6,965 8,426 Debt 21,301 21,689 Other payables and liabilities 8,313 9,148 Liabilities held for distribution(*) — 11,859 Total Liabilities 29,614 42,696 TOTAL EQUITY AND LIABILITIES 36,579 51,122 Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2022 and 2021 (Unaudited, EU-IFRS) ($ million) September 30, 2022 September 30, 2021 CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 5,845 9,629 Profit/(loss) from Continuing Operations 1,307 1,229 Adjustment to reconcile profit/(loss) from Continuing Operation to cash flows from/(used in) operating activities from Continuing Operations (1,094) 119 CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS 213 1,348 CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS — (262) TOTAL 213 1,086 CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES FROM CONTINUING OPERATIONS (2,741) (1,522) CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS — 859 TOTAL (2,741) (663) CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS 857 (1,314) CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS — (492) TOTAL 857 (1,806) Translation exchange differences (360) (332) TOTAL CHANGE IN CASH AND CASH EQUIVALENTS (2,031) (1,715) Less: CASH AND EQUIVALENTS AT END OF THE PERIOD – INCLUDED WITHIN ASSETS HELD FOR DISTRIBUTION AT THE END OF THE PERIOD — 720 CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 3,814 7,194 Notes: (*) The 2021 data have been re-presented following the classification of the Iveco Group Business as Discontinued Operations for the quarter ended September 30, 2021, as requested by the IFRS 5 - Non-current assets held for sale and discontinued operations.
Robust performance in challenging markets; volumes stabilising ZURICH, Nov. 5, 2024 /PRNewswire/ -- Revenues -5% yoy organic TDA, -3% yoy organic, a solid result given market conditions, high comparison base; volumes stabilising By GBU, Adecco -5%, with good results across Asia, Iberia, EEMENA, LatAm outweighed by challenging markets, particularly in France, US; Akkodis -5%, with Consulting +2%; LHH -7%, with Recruitment Solutions stable qoq Resilient 19.4% gross margin, sequentially flat, reflecting lower volumes, current business mix, firm pricing SG&A expenses improved to €925 million, -5% yoy, with G&A -10% yoy and at 3.2% of revenues Robust 3.3% EBITA margin, reflecting strong G&A savings, selective protection of sales and delivery capacity Operating income €162 million; Net income €99 million; Basic EPS €0.59; Adjusted EPS €0.68 Operating cash flow +€121 million, weighed by timing differences; Free cash flow +€117 million YTD, higher yoy Continued delivery of Simplify-Execute-Grow agenda: G&A savings run-rate end-24 lifted to €171 million Reprioritised IT/digital plan: accelerating AI adoption, expanding Global Delivery to improve fill rates, time-to-fill Strong track record of market share gains; relative revenue growth, reported, +850 bps since introduction of Simplify-Execute-Grow (Q3 22), and +290 bps YTD Denis Machuel, Adecco Group CEO, commented: "We continue to successfully deliver on our Simplify, Execute, Grow plan and third quarter performance was robust, against a high comparison base. The macroeconomic environment remains challenging, but I am encouraged to see that volume trends have stabilised. We made further G&A savings in the quarter, allowing us to lift the year-end run-rate. We have reprioritised our IT/digital plans to accelerate AI adoption, and to expand Global Delivery to our top 25 customers. This will boost recruiter productivity and improve fill rates and time-to-fill, supporting profitable growth. We remain focused on capturing market share, building on strong progress over the last two years, and have positioned resources to capture growth opportunities as the market recovers." Full Press Release Webcast Details | Investors & Analysts Investor Relationsinvestor.relations@adeccogroup.com+41 (0)44 878 88 88
DUBAI, UAE, Nov. 21, 2023 /PRNewswire/ -- Yalla Group Limited ("Yalla" or the "Company") (NYSE: YALA), the largest Middle East and North Africa (MENA)-based online social networking and gaming company, today announced its unaudited financial results for the third quarter ended September 30, 2023. Third Quarter 2023 Financial and Operating Highlights Revenues were US$85.2 million in the third quarter of 2023, representing an increase of 6.4% from the third quarter of 2022. Revenues generated from chatting services in the third quarter of 2023 were US$53.9 million. Revenues generated from games services in the third quarter of 2023 were US$31.2 million. Net income was US$35.2 million in the third quarter of 2023, a 44.3% increase from US$24.4 million in the third quarter of 2022. Net margin[1] was 41.4% in the third quarter of 2023. Non-GAAP net income[2] was US$38.3 million in the third quarter of 2023, a 30.3% increase from US$29.4 million in the third quarter of 2022. Non-GAAP net margin[3] was 44.9% in the third quarter of 2023. Average MAUs[4] increased by 13.6% to 35.1 million in the third quarter of 2023 from 30.9 million in the third quarter of 2022. The number of paying users[5] on our platform decreased by 2.6% to 11.2 million in the third quarter of 2023 from 11.5 million in the third quarter of 2022 due to a near-term game mechanism adjustment. Key Operating Data For the three months ended September 30, 2022 September 30, 2023 Average MAUs (in thousands) 30,896 35,096 Paying users (in thousands) 11,541 11,236 [1] Net margin is net income as a percentage of revenues. [2] Non-GAAP net income represents net income excluding share-based compensation. Non-GAAP net income is a non-GAAP financial measure. See the sections entitled "Non-GAAP Financial Measures" and "Reconciliations of GAAP and Non-GAAP Results" for more information about the non-GAAP measures referred to in this press release. [3] Non-GAAP net margin is non-GAAP net income as a percentage of revenues. [4] "Average MAUs" refers to the average monthly active users in a given period calculated by dividing (i) the sum of active users for each month of such period, by (ii) the number of months in such period. "Active users" refers to registered users who accessed any of our main mobile applications at least once during a given period. Yalla, Yalla Ludo and Yalla Parchis have been our main mobile applications for the periods presented herein; YallaChat and 101 Okey Yalla have been our main mobile applications since the fourth quarter of 2022; WeMuslim has been our main mobile application since the second quarter of 2023; and Ludo Royal has been our main mobile application since the third quarter of 2023. [5] "Paying users" refers to registered users who played a game or purchased our virtual items or upgrade services using virtual currencies on our main mobile applications at least once in a given period, except for users who received all of their virtual currencies directly or indirectly from us for free; YallaChat and WeMuslim do not involve the usage of virtual currencies, and the metrics of "paying users" and "ARPPU" do not reflect user activities on YallaChat and WeMuslim. "Registered users" refers to users who have registered accounts on our main mobile applications as of a given time; a registered user is not necessarily a unique user, as an individual may register multiple accounts on our main mobile applications. "We were pleased to achieve strong results in the third quarter of 2023," said Mr. Yang Tao, Founder, Chairman and CEO of Yalla. "We recorded all-time high revenues of US$85.2 million in the third quarter of 2023, beating the upper end of our guidance, while year-over-year revenue growth from games services exceeded 30% once again. Notably, our net income increased by 44.3% year over year to US$35.2 million during the quarter. Our robust quarterly results demonstrate our operational success in refining processes, enhancing the gamification of our flagship applications, improving our gaming mechanics and optimizing user acquisition. These efforts have empowered us to build a more engaged community of users, reflected by a 13.6% year-over-year increase in our group's average MAUs to 35.1 million. Our high-value users also exhibited a great willingness to spend on enhanced gamification features, driving the ARPPU[6] up to US$7.35 in the third quarter of 2023, compared with US$6.89 in the third quarter of 2022. "Thanks to our consistent game iterations and engagement of our existing Yalla user community, our two hard-core games have gained traction in the MENA region. We see immense room for growth in this sector and as such, we are determined to gradually increase our investment in the mid-core and hard-core game business, unleashing our growth potential in this flourishing market," Mr. Yang added. "Moving forward, we remain confident in the growth opportunities presented by MENA's increasingly pivotal role on the global stage and the region's rapid digital transformation. As the largest MENA-based online social networking and gaming company, we are dedicated to building relationships locally and globally to broaden our business horizons and fulfill local users' evolving online social networking and entertainment needs." Ms. Karen Hu, CFO of Yalla, commented, "We delivered a robust third quarter performance, highlighted by our record-high revenues and impressive net margin enhancement. Our relentless efforts to streamline costs as well as our enhanced, ROI-focused marketing strategy continued to yield positive outcomes, enabling us to elevate our overall efficiency. As a result, we improved our net margin to 41.4% and non-GAAP net margin to 44.9% in the third quarter of 2023. As we head into the fourth quarter, we will continue to execute our high-quality growth strategy with focus on efficiency and profitability enhancement. We believe our solid fundamentals and strong cash position will support us well to capture future opportunities as we strive to create sustainable value for our shareholders in the long run." Third Quarter 2023 Financial Results Revenues Our revenues were US$85.2 million in the third quarter of 2023, a 6.4% increase from US$80.1 million in the third quarter of 2022. The increase was primarily driven by the broadening of our user base and our enhanced monetization capability. Our average MAUs increased by 13.6% from 30.9 million in the third quarter of 2022 to 35.1 million in the third quarter of 2023. Our solid revenue growth was also partially attributable to the significant increase in ARPPU, which grew from US$6.89 in the third quarter of 2022 to US$7.35 in the third quarter of 2023. In the third quarter of 2023, our revenues generated from chatting services were US$53.9 million, and revenues from games services were US$31.2 million. Costs and expenses Our total costs and expenses were US$52.8 million in the third quarter of 2023, a 5.0% decrease from US$55.6 million in the third quarter of 2022. Our cost of revenues was US$27.8 million in the third quarter of 2023, a 6.1% decrease from US$29.6 million in the same period last year, primarily due to lower technical service fees resulting from more disciplined management. Cost of revenues as a percentage of our total revenues decreased to 32.6% in the third quarter of 2023, compared with 36.9% in the third quarter of 2022. Our selling and marketing expenses were US$11.3 million in the third quarter of 2023, a 5.5% decrease from US$12.0 million in the same period last year, primarily driven by lower share-based compensation expenses recognized in the third quarter of 2023. Selling and marketing expenses as a percentage of our total revenues decreased from 14.9% in the third quarter of 2022 to 13.3% in the third quarter of 2023. Our general and administrative expenses were US$7.3 million in the third quarter of 2023, a 14.5% decrease from US$8.6 million in the same period last year, primarily driven by lower share-based compensation expenses recognized in the third quarter of 2023. General and administrative expenses as a percentage of our total revenues decreased from 10.7% in the third quarter of 2022 to 8.6% in the third quarter of 2023. Our technology and product development expenses were US$6.4 million in the third quarter of 2023, a 16.6% increase from US$5.5 million in the same period last year, primarily due to an increase in salaries and benefits for our technology and product development staff to support the development of new businesses and expansion of our product portfolio. Technology and product development expenses as a percentage of our total revenues increased from 6.9% in the third quarter of 2022 to 7.5% in the third quarter of 2023. Operating income Operating income was US$32.4 million in the third quarter of 2023, a 32.3% increase from US$24.5 million in the third quarter of 2022. Non-GAAP operating income[7] Non-GAAP operating income in the third quarter of 2023 was US$35.4 million, a 20.4% increase from US$29.5 million in the same period last year. Interest income Our interest income was US$5.6 million in the third quarter of 2023, compared with US$0.8 million in the third quarter of 2022, primarily due to a significant increase in interest rates applicable to the Company's bank deposits and a continued increase in the Company's cash position. Income tax expense Our income tax expense was US$0.71 million in the third quarter of 2023, a 10.2% decrease from US$0.79 million in the third quarter of 2022. Net income As a result of the foregoing, our net income was US$35.2 million in the third quarter of 2023, a 44.3% increase from US$24.4 million in the third quarter of 2022. Non-GAAP net income Non-GAAP net income in the third quarter of 2023 was US$38.3 million, a 30.3% increase from US$29.4 million in the same period last year. Earnings per ordinary share Basic and diluted earnings per ordinary share were US$0.23 and US$0.20, respectively, in the third quarter of 2023, while basic and diluted earnings per ordinary share were US$0.16 and US$0.14, respectively, in the same period of 2022. Non-GAAP earnings per ordinary share[8] Non-GAAP basic and diluted earnings per ordinary share were US$0.24 and US$0.21, respectively, in the third quarter of 2023, compared with US$0.19 and US$0.17, respectively, in the same period of 2022. Cash and cash equivalents, restricted cash, term deposits and short-term investments As of September 30, 2023, we had cash and cash equivalents, restricted cash, term deposits and short-term investments of US$545.1 million, compared with US$453.0 million as of December 31, 2022. [6] "ARPPU" refers to average revenues per paying user in a given period, which is calculated by dividing (i) revenues for such period, by (ii) the number of paying users for such period. When calculating the ARPPU, we include revenues generated from Yalla, Yalla Ludo, Yalla Parchis, 101 Okey Yalla (since the fourth quarter of 2022) and Ludo Royal (since the third quarter of 2023) in a given period. [7] Non-GAAP operating income represents operating income excluding share-based compensation. Non-GAAP operating income is a non-GAAP financial measure. See the sections entitled "Non-GAAP Financial Measures" and "Reconciliations of GAAP and Non-GAAP Results" for more information about the non-GAAP measures referred to in this press release. [8] Non-GAAP earnings per ordinary share is non-GAAP net income attributable to Yalla Group Limited's shareholders, divided by weighted average number of basic and diluted shares outstanding. Non-GAAP net income attributable to Yalla Group Limited's shareholders represents net income attributable to Yalla Group Limited's shareholders, excluding share-based compensation. Non-GAAP earnings per ordinary share and non-GAAP net income attributable to Yalla Group Limited's shareholders are non-GAAP financial measures. See the sections entitled "Non-GAAP Financial Measures" and "Reconciliations of GAAP and Non-GAAP Results" for more information about the non-GAAP measures referred to in this press release. Share repurchase program Pursuant to the Company's share repurchase program beginning on May 21, 2021, with an extended expiration date of May 21, 2024, in the third quarter of 2023, the Company repurchased 1,670,735 American depositary shares ("ADSs") representing 1,670,735 Class A ordinary shares from the open market with cash for an aggregate amount of approximately US$8.5 million. Cumulatively, the Company completed cash repurchases in the open market of 3,972,876 ADSs, representing 3,972,876 Class A ordinary shares, for an aggregate amount of approximately US$35.5 million, as of September 30, 2023. The aggregate value of ADSs and/or Class A ordinary shares that remain available for purchase under the current share repurchase program was US$114.5 million as of September 30, 2023. Outlook For the fourth quarter of 2023, Yalla currently expects revenues to be between US$73.0 million and US$80.0 million. The above outlook is based on current market conditions and reflects the Company management's current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change. Conference Call The Company's management will host an earnings conference call on Monday, November 20, 2023, at 8:00 PM U.S. Eastern Time, Tuesday, November 21, 2023, at 5:00 AM Dubai Time, or Tuesday, November 21, 2023, at 9:00 AM Beijing/Hong Kong time. Dial-in details for the earnings conference call are as follows: United States Toll Free: +1-888-317-6003 International: +1-412-317-6061 United Arab Emirates Toll Free: 80-003-570-3589 Mainland China Toll Free: 400-120-6115 Hong Kong Toll Free: 800-963-976 Access Code: 9043914 Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at https://ir.yalla.com. A replay of the conference call will be accessible until November 27, 2023, by dialing the following telephone numbers: United States Toll Free: +1-877-344-7529 International: +1-412-317-0088 Access Code: 5229914 Non-GAAP Financial Measures To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States, or GAAP, this press release presents non-GAAP financial measures, namely non-GAAP operating income, non-GAAP net income, non-GAAP net margin and non-GAAP basic and diluted earnings per ordinary share, as supplemental measures to review and assess the Company's operating performance. The presentation of the non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define non-GAAP operating income as operating income excluding share-based compensation. We define non-GAAP net income as net income excluding share-based compensation. We define non-GAAP net margin as non-GAAP net income as a percentage of revenues. We define non-GAAP net income attributable to Yalla Group Limited's shareholders as net income attributable to Yalla Group Limited's shareholders, excluding share-based compensation. We define non-GAAP earnings per ordinary share as non-GAAP net income attributable to Yalla Group Limited's shareholders, divided by the weighted average number of basic and diluted shares outstanding. By excluding the impact of share-based compensation expenses, which are non-cash charges, the Company believes that the non-GAAP financial measures help identify underlying trends in its business and enhance the overall understanding of the Company's past performance and future prospects. Investors can better understand the Company's operating and financial performance, compare business trends among different reporting periods on a consistent basis and assess its core operating results, as they exclude share-based compensation expenses, which are not expected to result in cash payments. The Company also believes that the non-GAAP financial measures allow for greater visibility with respect to key metrics used by the Company's management in its financial and operational decision-making. The non-GAAP financial measure is not defined under U.S. GAAP and is not presented in accordance with U.S. GAAP. The non-GAAP financial measure has limitations as analytical tools. One of the key limitations of using the non-GAAP financial measures is that they do not reflect all items of income and expense that affect the Company's operations. Share-based compensation has been and may continue to be incurred in the Company's business and is not reflected in the presentation of non-GAAP financial measures. Further, the non-GAAP financial measure may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited. The Company compensates for these limitations by providing the relevant disclosure of its non-GAAP financial measures in the reconciliations to the nearest U.S. GAAP performance measures, all of which should be considered when evaluating its performance. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure. Reconciliations of GAAP and non-GAAP results are set forth at the end of this press release. About Yalla Group Limited Yalla Group Limited is the largest MENA-based online social networking and gaming company, in terms of revenue in 2022. The Company operates two flagship mobile applications, Yalla, a voice-centric group chat platform, and Yalla Ludo, a casual gaming application featuring online versions of board games, popular in MENA, with in-game voice chat and localized Majlis functionality. Building on the success of Yalla and Yalla Ludo, the Company continues to add engaging new content, creating a regionally-focused, integrated ecosystem dedicated to fulfilling MENA users' evolving online social networking and gaming needs. Through its holding subsidiary, Yalla Game Limited, the Company has expanded its capabilities in mid-core and hard-core games in the MENA region, leveraging its local expertise to bring innovative gaming content to its users. In addition, the growing Yalla ecosystem includes YallaChat, an IM product tailored for Arabic users and casual games such as Yalla Baloot and 101 Okey Yalla, developed to sustain vibrant local gaming communities in MENA. Yalla is also actively exploring outside of MENA with Yalla Parchis, a Ludo game designed for the South American markets. Yalla's mobile applications deliver a seamless experience that fosters a sense of loyalty and belonging, establishing highly devoted and engaged user communities through close attention to detail and localized appeal that profoundly resonates with users. For more information, please visit: https://ir.yalla.com. Safe Harbor Statement This press release contains statements that may constitute "forward-looking" statements pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "aims," "future," "intends," "plans," "believes," "estimates," "likely to" and similar statements. Statements that are not historical facts, including statements about Yalla Group Limited's beliefs, plans and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in Yalla Group Limited's filings with the SEC. All information provided in this press release is as of the date of this press release, and Yalla Group Limited does not undertake any obligation to update any forward-looking statement, except as required under applicable law. For investor and media inquiries, please contact: Yalla Group LimitedInvestor RelationsKerry Gao - IR DirectorTel: +86-571-8980-7962Email: ir@yalla.com Piacente Financial CommunicationsJenny CaiTel: +86-10-6508-0677Email: yalla@tpg-ir.com In the United States: Piacente Financial CommunicationsBrandi PiacenteTel: +1-212-481-2050Email: yalla@tpg-ir.com YALLA GROUP LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS As of December 31, 2022 September 30,2023 US$ US$ ASSETS Current assets Cash and cash equivalents 407,256,837 267,454,622 Restricted cash — 417,839 Term deposits 20,000,000 236,761,209 Short-term investments 25,788,304 40,476,760 Amounts due from a related party — 111,665 Prepayments and other current assets 28,652,840 33,453,298 Total current assets 481,697,981 578,675,393 Non-current assets Property and equipment, net 2,121,613 1,952,303 Intangible asset, net 1,328,470 1,198,768 Operating lease right-of-use assets 1,950,364 2,993,403 Long-term investments 3,833,750 1,328,491 Other assets 15,406,078 15,080,531 Total non-current assets 24,640,275 22,553,496 Total assets 506,338,256 601,228,889 LIABILITIES Current liabilities Accounts payable 5,382,276 1,147,827 Deferred revenue 35,957,485 44,468,280 Operating lease liabilities, current 858,452 1,286,661 Accrued expenses and other current liabilities 22,821,168 24,017,537 Total current liabilities 65,019,381 70,920,305 Non-current liabilities Operating lease liabilities, non-current 744,612 1,118,285 Amounts due to a related party 709,789 616,904 Total non-current liabilities 1,454,401 1,735,189 Total liabilities 66,473,782 72,655,494 EQUITY Shareholders' equity of Yalla Group Limited Class A Ordinary Shares 13,356 13,726 Class B Ordinary Shares 2,473 2,473 Additional paid-in capital 294,406,395 309,383,994 Treasury stock (27,014,697) (35,527,305) Accumulated other comprehensive loss (1,701,111) (2,862,193) Retained earnings 174,880,748 261,038,063 Total shareholders' equity of Yalla Group Limited 440,587,164 532,048,758 Non-controlling interests (722,690) (3,475,363) Total equity 439,864,474 528,573,395 Total liabilities and equity 506,338,256 601,228,889 YALLA GROUP LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended Nine Months Ended September 30,2022 June 30,2023 September 30,2023 September 30,2022 September 30,2023 US$ US$ US$ US$ US$ Revenues 80,061,650 79,246,363 85,187,360 228,489,731 237,952,336 Costs and expenses Cost of revenues (29,568,306) (28,330,815) (27,772,226) (86,368,643) (83,955,518) Selling and marketing expenses (11,951,117) (12,378,490) (11,292,732) (35,685,652) (35,026,197) General and administrative expenses (8,567,865) (8,018,573) (7,325,451) (23,541,724) (25,508,418) Technology and product development expenses (5,487,884) (6,586,078) (6,396,426) (19,199,167) (20,393,692) Total costs and expenses (55,575,172) (55,313,956) (52,786,835) (164,795,186) (164,883,825) Operating income 24,486,478 23,932,407 32,400,525 63,694,545 73,068,511 Interest income 777,581 4,623,275 5,612,861 1,005,132 13,354,425 Government grants 51,483 4,560 228 212,015 182,447 Investment (loss) income (104,944) 529,308 435,545 (255,715) 1,456,742 Impairment loss of investments — — (2,509,480) — (2,509,480) Income before income taxes 25,210,598 29,089,550 35,939,679 64,655,977 85,552,645 Income tax expense (788,985) (821,149) (708,673) (2,182,641) (2,146,180) Net income 24,421,613 28,268,401 35,231,006 62,473,336 83,406,465 Net loss attributable to non-controlling interests 206,347 1,202,160 994,099 520,944 2,750,850 Net income attributable to Yalla Group Limited's shareholders 24,627,960 29,470,561 36,225,105 62,994,280 86,157,315 Earnings per ordinary share ——Basic 0.16 0.19 0.23 0.41 0.54 ——Diluted 0.14 0.16 0.20 0.36 0.47 Weighted average number of shares outstanding used in computing earnings per ordinary share ——Basic 155,190,724 158,871,859 160,554,831 152,244,358 159,134,347 ——Diluted 177,347,900 180,752,549 183,111,650 176,347,667 181,460,639 Share-based compensation was allocated in cost of revenues, selling and marketing expenses, general and administrative expenses and technology and product development expenses as follows: Three Months Ended Nine Months Ended September 30,2022 June 30,2023 September 30,2023 September 30,2022 September 30,2023 US$ US$ US$ US$ US$ Cost of revenues 1,065,549 923,513 627,760 3,914,210 2,581,522 Selling and marketing expenses 1,059,009 1,014,371 532,001 4,755,921 2,517,707 General and administrative expenses 2,462,675 3,242,981 1,633,262 11,788,894 8,121,521 Technology and product development expenses 379,994 315,173 255,677 1,048,923 920,127 Total share-based compensation expenses 4,967,227 5,496,038 3,048,700 21,507,948 14,140,877 YALLA GROUP LIMITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS Three Months Ended Nine Months Ended September 30,2022 June 30,2023 September 30,2023 September 30,2022 September 30,2023 US$ US$ US$ US$ US$ Operating income 24,486,478 23,932,407 32,400,525 63,694,545 73,068,511 Share-based compensation expenses 4,967,227 5,496,038 3,048,700 21,507,948 14,140,877 Non-GAAP operating income 29,453,705 29,428,445 35,449,225 85,202,493 87,209,388 Net income 24,421,613 28,268,401 35,231,006 62,473,336 83,406,465 Share-based compensation expenses, net of tax effect of nil 4,967,227 5,496,038 3,048,700 21,507,948 14,140,877 Non-GAAP net income 29,388,840 33,764,439 38,279,706 83,981,284 97,547,342 Net income attributable to Yalla Group Limited's shareholders 24,627,960 29,470,561 36,225,105 62,994,280 86,157,315 Share-based compensation expenses, net of tax effect of nil 4,967,227 5,496,038 3,048,700 21,507,948 14,140,877 Non-GAAP net income attributable to Yalla Group Limited's shareholders 29,595,187 34,966,599 39,273,805 84,502,228 100,298,192 Non-GAAP earnings per ordinary share ——Basic 0.19 0.22 0.24 0.56 0.63 ——Diluted 0.17 0.19 0.21 0.48 0.55 Weighted average number of shares outstanding used in computing earnings per ordinary share ——Basic 155,190,724 158,871,859 160,554,831 152,244,358 159,134,347 ——Diluted 177,347,900 180,752,549 183,111,650 176,347,667 181,460,639
BEIJING, Oct. 26, 2023 /PRNewswire/ -- NaaS Technology Inc. ("NaaS" or the "Company") (Nasdaq: NAAS), the first U.S. listed EV charging service company in China, today announced its unaudited financial results for the third quarter ended September 30, 2023. Third Quarter 2023 Financial Highlights: Revenues1 grew by 536% year over year to a record setting RMB170.9 million (US$23.4 million) in the third quarter of 2023. Gross margin increased from 6.1% to 27.4% year over year in the third quarter of 2023. Gross profit grew 28 times year over year to RMB46.8 million (US$6.4 million) in the third quarter of 2023. Non-IFRS2 net loss attributable to ordinary shareholders was RMB175.7 million (US$24.1 million) in the third quarter of 2023 and non-IFRS net margin attributable to ordinary shareholders improved from negative 359% to negative 103%. Third Quarter 2023 Operational Highlights: Charging volume transacted through NaaS' network reached 1,383 GWh in the third quarter of 2023, representing an increase of 66% year over year. Gross transaction value transacted through NaaS' network reached RMB1.3 billion (US$178.8 million) in the third quarter of 2023, representing an increase of 58% year over year. Number of orders transacted through NaaS' network reached 59.2 million in the third quarter of 2023, representing an increase of 58% year over year. As of September 30, 2023, NaaS' network had connected 767,611 EV chargers covering 73,710 charging stations, up by 76% from 436,296 and 65% from 44,767 as of September 30, 2022, respectively. 1 Effective as of the third quarter of 2023, the Company has changed its income statement presentation and retrospectively recast prior periods' income statement to conform to the current period presentation. The Company is now reporting revenues under Charging Services, Energy Solutions and New Initiatives, which management believes better reflects NaaS' expanded business offerings. See "Change in presentation of income statement" in this press release for additional information. 2 Non-IFRS net loss was arrived at after excluding share-based compensation expenses, equity-settled listing costs, fair value changes of instruments convertible to shares of the Company, and fair value changes of financial assets at fair value through profit or loss. Non-IFRS net margin was calculated by dividing non-IFRS net loss by total revenue. Please refer to the section titled "Unaudited reconciliations of IFRS and non-IFRS results" for details. Recent Developments Became the First Batch of Strategic Enterprises of OASES in Hong Kong In October 2023, the Company formed a partnership with the Hong Kong S.A.R. Office for Attracting Strategic Enterprises ("OASES"), becoming one of its inaugural strategic enterprises. OASES will assist NaaS to set up, develop, and operate in Hong Kong, where the Company will focus on energy data analytics R&D. The Company expects to establish a research center in the Hong Kong Science Park by the end of 2023 and to provide algorithm support for its global energy assets' operations, leveraging local R&D and academic resources in Hong Kong. Won Bid for Leading Integrated "PV-storage-charging-swapping" Project In September 2023, the Company won a RMB67.18 million contract for the initial phase of the Anji Green and Low-carbon Supply Chain Construction Project located at Anshan Station. The Company will provide one-stop PV-storage-charging-swapping solutions, including supply, procurement, installation, and grid connection of charging systems, battery swapping systems, PV systems, and energy storage systems. The project entails the installation of 458 DCFC chargers, a 4,205.4 kW distributed photovoltaic system, 36 energy storage and charging cabinets, and two leading domestic heavy-duty truck battery swapping stations. The Company will leverage its "Comprehensive Energy Management Platform" and "battery detection technology" to achieve seamless energy operations. Upon completion, the project will provide charging services for 1,800 heavy-duty trucks and small EVs in the Anji County. Established Strategic Collaborations with ZSY, China Construction Bank, CIID and Tengzhou Municipal Government, Shandong In September 2023, the Company entered into diverse strategic collaborations with ZSY Financial Services ("ZSY"), China Construction Bank ("CCB"), Hubei Provincial Communications Investment Industrial Development ("CIID"), and the People's Government of Tengzhou City, Shandong Province. In partnership with ZSY and CCB, the Company will help advance the integration of financial services with the domestic and global new energy sectors. With CIID, the Company will contribute to the construction of expressway service areas and energy supply infrastructure, accelerating the establishment of a comprehensive energy supply network for expressways. With the People's Government of Tengzhou City, the Company will drive innovation and promote digitalized energy management to support the transportation energy transformation in Tengzhou City. Conversion of LMR Convertible Notes The Company issued a US$30 million convertible note and a US$40 million convertible note to LMR Multi-Strategy Master Fund Limited, an affiliate of LMR Partners Limited, in July and September 2023, respectively. Up to date, an aggregate principal amount of US$33 million under these notes has been converted into our American depositary shares, each representing ten Class A ordinary shares, and the remaining principal amount of the notes totals US$37 million. "Our exceptional third quarter operating and financial results reflect the significant expansion of our business. Led by our increasing capabilities in energy management and storage solutions, our total revenues increased six-fold year-over-year and tripled quarter-over-quarter," said Ms. Yang Wang, NaaS' CEO. "We have fortified our local footprint by extending our partnership networks and winning new, important contracts in energy storage, including securing the leading integrated 'PV-storage-charging-swapping' project in Anji. Meanwhile, our expansion beyond mainland China has already yielded fruitful result and contributed 32.7% of total revenues this quarter. The consistent recognition we've received for our integrated energy infrastructure solutions, both domestically and internationally, underscores our commitment to the global energy transition across the key drivers of renewables, electrification, and energy storage improvements. As we further advance, sustainable, clean energy solutions on a global scale, we endeavor to become a leading integrated new energy asset management and services provider." "We're pleased with our stellar third-quarter performance fueled by the significant growth in our energy solutions business, which contributed 81% of our revenues in the quarter," added Mr. Alex Wu, NaaS' president and chief financial officer. "With our expansion and high-growth profile, our profitability trajectory has become much more visible, as evidenced by the significant jump in our third-quarter gross margin to 27.4% from 6.1% in the same period last year. Furthermore, our focus on achieving economies of scale affords us increased operating leverage and sustainable growth. We maintain our previous guidance, anticipating full-year 2023 revenues between RMB500 million (US$69 million) and RMB600 million (US$82 million), marking a notable year over year increase of five to six fold. As we continue to grow our business, both in domestic and international markets, we remain dedicated to providing sustainable new energy solutions while exploring diverse opportunities that drive the industry forward." Third Quarter 2023 Financial Results: Revenues Total revenues reached RMB170.9 million (US$23.4 million) in the third quarter of 2023, representing an increase of 536% year over year. The rapid increase was mainly attributable to strong execution and delivery in the Company's energy solutions projects throughout the third quarter of 2023. Charging services revenues contributed RMB31.5 million (US$4.3 million) in the third quarter of 2023, with a growth rate of 23% year over year. The increase was primarily attributable to an overall increase in charging volume completed through NaaS' EV Charging network. The Company offered platform-based incentives to end-users to boost the use of its network. Costs associated with end-user incentives and recorded as reductions to total revenues totaled RMB82.9 million (US$11.4 million) and RMB61.3 million for the third quarter of 2023 and 2022, respectively. Energy solutions revenues increased from RMB0.3 million year over year to RMB138.8 million (US$19.0 million) in the third quarter of 2023. The increase was primarily driven by revenues from the on-going delivery of energy solution projects to provide renewable energy generation, energy management and storage solutions. New initiatives revenues were RMB0.6 million (US$0.1 million) in the third quarter of 2023, as the Company continued to launch new initiatives to expand its market offerings. Cost of revenues, gross profit and margin Total cost of revenues increased 392% year over year to RMB124.1 million (US$17.0 million) as the Company made significant progress in delivering various energy solution projects in mainland China and international markets. Total gross profit increased 28 times year over year from RMB1.6 million to RMB46.8 million (US$6.4 million), benefiting from solid revenue growth and significant year over year improvement in gross margin to 27.4% from 6.1%. Gross margin improved as the Company started to reap benefits from its know-how and capabilities in delivering and executing energy solution projects of different scales. Operating expenses Total operating expenses were RMB285.3 million (US$39.1 million) in the third quarter of 2023. Operating expenses as a percentage of revenues improved year over year from 385% to 167%, demonstrating the Company's increased operating leverage. Selling and marketing expenses increased from RMB67.7 million to RMB160.2 million (US$22.0 million) in the third quarter of 2023. The increase in selling and marketing expenses was mainly attributable to higher incentives to end-users and sales and marketing efforts relating to the energy solutions business. Costs associated with excess incentives to end-users included in selling and marketing expenses were RMB78.0 million (US$10.7 million) in the third quarter of 2023, compared with RMB38.6 million in the same period of 2022. Administrative expenses increased from RMB25.5 million to RMB107.7 million (US$14.8 million) in the third quarter of 2023. The increase in administrative expenses was largely due to an increase in headcount and professional service fees to support the Company's domestic and international business expansion. Research and development expenses increased from RMB10.3 million to RMB17.4 million (US$2.4 million) in the third quarter of 2023. The increase in research and development expenses was primarily due to the continued expansion of the Company's research and development team to enhance the Company's charging services and energy solutions business. Finance costs Finance costs were RMB8.5 million (US$1.2 million) for the third quarter of 2023, compared with finance costs of RMB9.8 million for the same period of 2022. Income tax expenses NaaS' income tax expenses were RMB2.2 million (US$0.3 million) for the third quarter of 2023, compared with income tax expenses of RMB3.8 million for the same period of 2022. Net loss and non-IFRS net loss attributable to ordinary shareholders; Net margin and non-IFRS net margin Net loss attributable to ordinary shareholders was RMB366.9 million (US$50.3 million) for the third quarter of 2023, compared with a net loss attributable to ordinary shareholders of RMB109.1 million for the same period of 2022. Non-IFRS net loss attributable to ordinary shareholders was RMB175.7 million (US$24.1 million) for the third quarter of 2023, compared with non-IFRS net loss attributable to ordinary shareholders of RMB96.5 million for the same period of 2022. Net margin improved from negative 406% to negative 214%, whereas non-IFRS net margin improved from negative 359% to negative 103%. Please refer to the section titled "Unaudited reconciliations of IFRS and non-IFRS results" for details. Outlook Based on preliminary assessment of the current market conditions, the Company reaffirms its previous guidance and expects its full-year 2023 revenues to be between RMB500 million (US$69 million) and RMB600 million (US$82 million), representing a year over year increase of 5 to 6 times. The Company expects its full-year 2024 revenues to be between RMB2 billion (US$274 million) and RMB3 billion (US$411 million). The foregoing is the current and preliminary view of NaaS' management and is subject to changes and uncertainties. Conference Call Information The Company's management will host an earnings conference call at 8:00 AM U.S. Eastern time on October 26, 2023 (8:00 PM Beijing/Hong Kong time on October 26, 2023). Participants who wish to join the conference call should register online at:https://s1.c-conf.com/diamondpass/10034495-gsp92v.html Once registration is completed, participants will receive the dial-in information for the conference call. Participants joining the conference call should dial-in at least 10 minutes before the scheduled start time. Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at http://ir.enaas.com. A replay of the conference call will be accessible approximately two hours after the conclusion of the live call until November 2, 2023, by dialing the following telephone numbers: United States: 1 855 883 1031China: 400 1209 216Replay Access Code: 10034495 Exchange Rate This press release contains translations of certain RMB amounts into USD at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB7.2960 to US$1.00, the noon buying rate in effect on September 29, 2023, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release. Change in presentation of income statement Effective as of the third quarter of 2023, the Company implemented certain changes to align its income statement presentation more closely with the manner in which the Company's management currently receives and uses financial information to evaluate business performance following the Company's expansion of business lines, extension of its services to a broader range of energy asset owners, including EV charging stations, PV and energy asset owners, and recent acquisitions. The Company now reports its revenues under three primary categories: Charging services revenue, which includes income from the provision of mobility connectivity solutions to EV charging stations and the provision of charging services at charging stations that NaaS operates under its full station operation model. NaaS' mobility connectivity solutions include mobility services delivered in conjunction with Kuaidian, its partnered platform that is operated by a third-party service provider, and SaaS products that optimize the marketing, operations and energy efficiency of charging stations connected to NaaS' network. Energy solutions revenue, which includes income from the provision of integrated charging facilities and energy storage solutions that cover the planning, deployment, production and optimization of EV charging, renewable energy and energy storage systems for energy asset owners. New initiatives revenue, which includes income from electricity procurement services and other services that aim to enhance the efficiency and profitability of energy assets including charging stations, PV and energy storage assets. The Company retrospectively recast prior periods' income statement information to conform to the current period presentation. The recasting involved the recategorization of revenues from mobility connectivity services and from full station operation model to charging services revenue; the inclusion of revenues from EPC services, hardware procurement, station upgrade and maintenance services to energy solutions revenue; and the reclassification of income from electricity procurement, non-charging services such as food and beverage and online advertising, virtual power plant and charging robots to new initiatives revenue. These changes have no material impact on NaaS' previously reported consolidated net revenues, net income or net income per share. Non-IFRS Financial Measure The Company uses non-IFRS net profit/loss and non-IFRS net margin for the period, which are non-IFRS financial measures, in evaluating its operating results and for financial and operational decision-making purposes. NaaS believes that non-IFRS net profit/loss and non-IFRS net margin help identify underlying trends in the Company's business that could otherwise be distorted by the effect of certain expenses that the Company includes in its results for the period. NaaS believes that non-IFRS net profit/loss and non-IFRS net margin for the period provide useful information about its results of operations, enhances the overall understanding of its past performance and future prospects and allow for greater visibility with respect to key metrics used by its management in its financial and operational decision-making. Non-IFRS net profit/loss and non-IFRS net margin for the period should not be considered in isolation or construed as an alternative to operating profit or net profit for the period or any other measure of performance or as an indicator of its operating performance. Investors are encouraged to review non-IFRS net profit/loss and IFRS net margin for the period and the reconciliation to their most directly comparable IFRS measures. Non-IFRS net profit/loss and non-IFRS net margin for the period presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company's data. NaaS encourages investors and others to review its financial information in its entirety and not rely on a single financial measure. Non-IFRS net profit/loss for the period represents profit/loss for the period excluding share-based compensation expenses, equity-settled listing costs, fair value changes of convertible and redeemable preferred shares, and fair value changes of financial assets at fair value through profit or loss. Non-IFRS margin for the period is calculated by dividing non-IFRS net loss for the period by total revenue for the period. Merger Transactions On June 10, 2022, RISE Education Cayman Ltd, the Company's predecessor, completed the merger and other related transactions (the "Merger Transactions") with Dada Auto Inc. ("Dada"), as a result of which Dada became a wholly-owned subsidiary of the Company and the Company assumed and began conducting the principal business of Dada. The name of the Company was changed from "RISE Education Cayman Ltd" to "NaaS Technology Inc." and its ticker was changed from "REDU" to "NAAS." About NaaS Technology Inc. NaaS Technology Inc.(Nasdaq: NAAS) is the first U.S. listed EV charging service company in China. The Company is a subsidiary of Newlinks Technology Limited, a leading energy digitalization group in China. The Company provides one-stop solutions to energy asset owners comprising charging services, energy solutions and new initiatives, supporting every stage of energy asset's lifecycle and facilitating energy transition. As of September 30, 2023, NaaS had connected 767,611 chargers covering 73,710 charging stations, representing 41.6% and 50.0% of China's public charging market share respectively. Safe Harbor Statement This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as "will," "expects," "believes," "anticipates," "intends," "estimates" and similar statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. All information provided in this press release is as of the date hereof, and the Company undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: NaaS' goals and strategies; its future business development, financial conditions and results of operations; its ability to continuously develop new technology, services and products and keep up with changes in the industries in which it operates; growth of China's EV charging industry and EV charging service industry and NaaS' future business development; demand for and market acceptance of NaaS' products and services; NaaS' ability to protect and enforce its intellectual property rights; NaaS' ability to attract and retain qualified executives and personnel; the COVID-19 pandemic and the effects of government and other measures that have been or will be taken in connection therewith; U.S.-China trade war and its effect on NaaS' operation, fluctuations of the RMB exchange rate, and NaaS' ability to obtain adequate financing for its planned capital expenditure requirements; NaaS' relationships with end-users, customers, suppliers and other business partners; competition in the industry; relevant government policies and regulations related to the industry; and fluctuations in general economic and business conditions in China and globally. Further information regarding these and other risks is included in NaaS' filings with the SEC. For investor and media inquiries, please contact: Investor RelationsNaaS Technology Inc.E-mail: ir@enaas.comMedia inquiries:E-mail: pr@enaas.com NAAS TECHNOLOGY INC. UNAUDITED CONSOLIDATED STATEMENTS OF LOSS AND OTHER COMPREHENSIVE LOSS For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2023 September 30, 2022 September 30, 2023 (In thousands, except for share and per share and per ADS data) RMB RMB US$ RMB RMB US$ Charging services revenues 25,519 31,506 4,318 60,323 81,516 11,173 Energy solutions revenues 265 138,795 19,023 1,492 171,099 23,451 New initiatives revenues 1,087 643 88 1,544 3,104 425 Revenues 26,871 170,944 23,429 63,359 255,719 35,049 Cost of revenues (25,233) (124,115) (17,011) (64,377) (183,667) (25,174) Gross profit 1,638 46,829 6,418 (1,018) 72,052 9,875 Other gains, net 6,346 4,965 681 8,954 11,926 1,635 Operating expenses Selling and marketing expenses (67,713) (160,199) (21,957) (170,154) (312,684) (42,857) Administrative expenses (25,486) (107,668) (14,757) (2,149,647) (414,974) (56,877) Research and development expenses (10,256) (17,418) (2,387) (25,361) (36,431) (4,993) Total operating expenses (103,455) (285,285) (39,101) (2,345,162) (764,089) (104,727) Operating loss (95,471) (233,491) (32,002) (2,337,226) (680,111) (93,217) Finance costs (9,819) (8,539) (1,170) (10,081) (22,842) (3,131) Fair value changes of convertible and redeemable preferred shares — — — (3,158,498) — — Fair value changes of financial instruments at fair value through profit or loss — (120,985) (16,582) 1,753 (105,854) (14,508) Loss before income tax (105,290) (363,015) (49,754) (5,504,052) (808,807) (110,856) Income tax expenses (3,760) (2,178) (298) (6,457) (415) (57) Net loss (109,050) (365,193) (50,052) (5,510,509) (809,222) (110,913) Net loss attributable to: Equity holders of the company (109,050) (366,863) (50,281) (5,510,509) (811,183) (111,182) Non-controlling interests — 1,670 229 — 1,961 269 (109,050) (365,193) (50,052) (5,510,509) (809,222) (110,913) NAAS TECHNOLOGY INC. UNAUDITED CONSOLIDATED STATEMENTS OF LOSS AND OTHER COMPREHENSIVE LOSS For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2023 September 30, 2022 September 30, 2023 (In thousands, except for share and per share and per ADS data) RMB RMB US$ RMB RMB US$ Basic and diluted loss per share for loss attributable to the ordinary shareholders of the Company (Expressed in RMB per share) Basic (0.05) (0.16) (0.02) (2.97) (0.37) (0.05) Diluted (0.05) (0.16) (0.02) (2.97) (0.37) (0.05) Basic and diluted loss per ADS for loss attributable to the ordinary shareholders of the Company (Expressed in RMB per ADS) Basic (0.51) (1.63) (0.22) (29.74) (3.66) (0.50) Diluted (0.51) (1.63) (0.22) (29.74) (3.66) (0.50) Weighted average number of ordinary shares outstanding-basic 2,137,608,219 2,249,586,003 2,249,586,003 1,852,683,306 2,218,815,732 2,218,815,732 Weighted average number of ordinary shares outstanding-diluted 2,137,608,219 2,249,586,003 2,249,586,003 1,852,683,306 2,218,815,732 2,218,815,732 Net loss (109,050) (365,193) (50,052) (5,510,509) (809,222) (110,913) Other comprehensive loss that will not be reclassified to profitor loss in subsequent period: Fair value changes on equity investment designated at fair value through other comprehensive loss, net of tax — (4,363) (602) — (25,979) (3,583) Currency translation differences 17,222 (1,258) (173) 16,638 (1,583) (218) Other comprehensive loss, net of tax 17,222 (5,621) (775) 16,638 (27,562) (3,801) Total comprehensive loss (91,828) (370,814) (50,827) (5,493,871) (836,784) (114,714) Total comprehensive loss attributable to: Equity holders of the company (91,828) (372,484) (51,056) (5,493,871) (838,745) (114,983) Non-controlling interests — 1,670 229 — 1,961 269 (91,828) (370,814) (50,827) (5,493,871) (836,784) (114,714) NAAS TECHNOLOGY INC. UNAUDITED RECONCILIATIONS OF IFRS AND NON-IFRS RESULTS For the Three Months Ended For the Nine Months Ended September 30, 2022 September 30, 2023 September 30, 2022 September 30, 2023 (In thousands, except for share and per share and per ADS data) RMB RMB US$ RMB RMB US$ Reconciliation of Adjusted net loss attributable to ordinary shareholders of the Company to Net loss attributable to ordinary shareholders of the Company Net loss attributable to ordinary shareholders of the Company (109,050) (366,863) (50,281) (5,510,509) (811,183) (111,182) Add: Share-based compensation expenses 12,521 70,160 9,616 198,781 319,348 43,770 Equity-settled listing costs — — — 1,912,693 — — Fair value changes of instruments convertible to shares of the Company 120,400 16,502 120,400 16,502 Fair value changes of convertible and redeemable preferred shares — — — 3,158,498 — — Fair value changes of financial assets at fair value through profit or loss — 585 80 (1,753) (14,546) (1,994) Adjusted net loss attributable to ordinary shareholders of the Company (96,529) (175,718) (24,083) (242,290) (385,981) (52,904) Adjusted net basic and diluted loss per share for loss attributable to the ordinary shareholders of the Company (Expressed in RMB per share) Basic (0.05) (0.08) (0.01) (0.13) (0.17) (0.02) Diluted (0.05) (0.08) (0.01) (0.13) (0.17) (0.02) Adjusted net basic and diluted loss per ADS for loss attributable to the ordinary shareholders of the Company (Expressed in RMB per ADS) Basic (0.45) (0.78) (0.11) (1.31) (1.74) (0.24) Diluted (0.45) (0.78) (0.11) (1.31) (1.74) (0.24) Weighted average number of ordinary shares outstanding-basic 2,137,608,219 2,249,586,003 2,249,586,003 1,852,683,306 2,218,815,732 2,218,815,732 Weighted average number of ordinary shares outstanding-diluted 2,137,608,219 2,249,586,003 2,249,586,003 1,852,683,306 2,218,815,732 2,218,815,732 NAAS TECHNOLOGY INC. UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION As of December 31, 2022 September 30, 2023 (In thousands) RMB RMB US$ ASSETS Current assets Cash and cash equivalents 513,351 396,072 54,286 Trade receivables 130,004 233,704 32,032 Contract assets — 100,263 13,742 Financial assets at fair value through profit or loss — 178,146 24,417 Inventories — 18,852 2,584 Prepayments, other receivables and other assets 287,435 555,699 76,165 Other financial assets — 129,079 17,692 Total current assets 930,790 1,611,815 220,918 Non-current assets Right-of-use assets 17,030 12,984 1,780 Financial assets at fair value through profit or loss 11,753 16,260 2,229 Financial assets at fair value through other comprehensive income 129,060 103,081 14,128 Investments accounted for using equity method — 160 22 Property, plant and equipment 2,600 4,263 584 Other non-current assets 13,869 9,221 1,264 Intangible assets 833 11,572 1,586 Goodwill — 40,590 5,563 Total non-current assets 175,145 198,131 27,156 Total assets 1,105,935 1,809,946 248,074 LIABILITIES AND EQUITY Current liabilities Interest-bearing bank borrowings 38,000 149,582 20,502 Current lease liabilities 6,853 6,567 900 Trade payables 49,239 181,061 24,816 Income tax payables 16,214 16,258 2,228 Convertible bonds — 503,888 69,064 Other payables and accruals 81,835 218,660 29,971 Total current liabilities 192,141 1,076,016 147,481 Non-current liabilities Non-current lease liabilities 9,327 5,854 802 Interest-bearing bank borrowings 465,155 555,191 76,095 Deferred tax liabilities 438 2,344 321 Total non-current liabilities 474,920 563,389 77,218 Total liabilities 667,061 1,639,405 224,699 EQUITY Share capital 146,730 151,598 20,778 Additional paid in capital 6,358,600 6,919,111 948,343 Accumulated losses (6,031,255) (6,842,438) (937,834) Other reserves (35,201) (62,763) (8,602) Non-controlling interests — 5,033 690 Total equity 438,874 170,541 23,375 Total equity and liabilities 1,105,935 1,809,946 248,074
A12 藝術空間
third quarter performance
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