MILAN (Reuters) -Italian-American vehicle maker CNH Industrial on Tuesday gave guidance for a total revenue growth of up to 24% through 2024 as it presented a new business plan after spinning off its truck, bus and engine units.
In a bid to focus on its higher-margin agriculture and construction machine businesses, where data content, autonomous technologies and alternative fuels are increasingly at core, CNH Industrial at the beginning of this year completed the spin-off of its truck, bus and engine operations, now separately listed as Iveco Group,
In slides prepared for the strategy presentation the group, which is controlled by Exor NV, the holding company of Italy’s Agnelli family, forecast net sales of between $20 billion and $22 billion in 2024, up from $17.8 billion last year.
CNH, which houses brands such as Case and New Holland, also guided for a margin on its adjusted operating profit (EBIT) of between 12% and 13% in 2024 from 9.9% in 2021, with that of its agriculture unit increasing to between 14.5% and 15.5% from 12.3% over the same period.
New York-listed shares in CNH Industrial hit a day low after details of its business plan were released and were down 5.4% by 1815 GMT.
After buying Raven Industries last year for $2.1 billion to bolster its position in precision agriculture and autonomy, CNH will now focus on “disciplined” M&A activity, it added.
“We’re not buying to get bigger, our dollars are going to go towards driving organic growth,” Chief Executive Scott Wine told analysts during the plan presentation.
“Disciplined M&A will be a key part of our strategy going forward.”
The company added it was seeing strong buyer’s interest for Raven’s engineered films and aerostar units, the two non-core business it plans to sell.
Chief Digital Officer Parag Garg said CNH was well placed to be leaders in autonomy and help customers throughout the entire farming cycle.
“Automation is a key strength for CNH Industrials tech strategy, already bringing benefits to farmers across the world across the whole cycle and helping build a backbone for it to deliver an autonomous future,” he told analysts.
Reporting by Giulio Piovaccari in Milan and Bianca Flowers in New York; editing by Agnieszka Flak and Jonathan Oatis