TABLE OF CONTENTS
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Part I--Financial Information
Case Credit Corporation and Subsidiaries
Balance Sheets........................................................ 2
Statements of Income.................................................. 3
Statements of Cash Flows.............................................. 4
Statement of Changes in Shareholder's Equity.......................... 5
Notes to Financial Statements......................................... 6
Management's Discussion and Analysis of Financial Condition and
Results of Operations................................................ 7
Part II--Other Information
Item 1. Legal Proceedings............................................... *
Item 2. Changes in Securities........................................... *
Item 3. Defaults Upon Senior Securities................................. *
Item 4. Submission of Matters to a Vote of Security Holders............. *
Item 5. Other Information............................................... *
Item 6. Exhibits and Reports on Form 8-K................................ 8
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*No response to this item is included herein for the reason that it is
inapplicable or the answer to such item is negative.
1
PART I--FINANCIAL INFORMATION
CASE CREDIT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 1996 AND DECEMBER 31, 1995
(IN MILLIONS, EXCEPT SHARE DATA)
(UNAUDITED)
MARCH 31, DECEMBER 31,
ASSETS 1996 1995
------ --------- ------------
Cash and cash equivalents............................... $ 12 $ 15
Retail notes and finance leases......................... 728 829
Due from Trusts......................................... 275 262
------ ------
Total receivables................................... 1,003 1,091
Allowance for credit losses (31) (32)
------ ------
Total receivables--net.............................. 972 1,059
Other receivables....................................... -- 1
Affiliated receivables.................................. 5 16
Equipment on operating leases........................... 47 36
Other assets............................................ 27 26
------ ------
Total............................................... $1,063 $1,153
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LIABILITIES AND EQUITY
----------------------
Short-term debt......................................... $ 538 $ 908
Accounts payable and other accrued liabilities.......... 28 33
Deposits withheld from dealers.......................... 18 19
Long-term debt.......................................... 278 --
------ ------
Total liabilities................................... 862 960
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Shareholder's equity
Common stock, $5 par value, 200 shares authorized,
issued and outstanding............................... -- --
Paid-in capital....................................... 199 199
Cumulative translation adjustment..................... (6) (8)
Retained earnings..................................... 8 2
------ ------
Total shareholder's equity.......................... 201 193
------ ------
Total............................................... $1,063 $1,153
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The accompanying notes to financial statements are an integral part of these
Balance Sheets.
2
CASE CREDIT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1996, AND 1995
(IN MILLIONS)
(UNAUDITED)
THREE MONTHS
ENDED
MARCH 31,
-------------
1996 1995
------ ------
Revenues:
Finance income earned on retail notes and finance leases........ $12 $ 8
Interest income from Case Corporation........................... 5 9
Net gain on retail notes sold................................... 29 18
Securitization and servicing fee income......................... 16 15
Other income.................................................... 4 1
--- ---
Total revenues.............................................. 66 51
Expenses:
Interest expense................................................ 17 10
Operating expenses:
Fees charged by Case Corporation.............................. 5 4
Administrative and operating expenses......................... 3 1
Provision (credit) for credit losses.......................... (1) --
Other......................................................... -- 1
--- ---
Total operating expenses.................................... 7 6
--- ---
Total expenses.............................................. 24 16
--- ---
Income before taxes............................................... 42 35
Income tax provision.............................................. 16 14
--- ---
Net income........................................................ $26 $21
=== ===
The accompanying notes to financial statements are an integral part of these
Statements of Income.
3
CASE CREDIT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(IN MILLIONS)
(UNAUDITED)
THREE
MONTHS
ENDED
MARCH 31,
------------
1996 1995
----- -----
Operating activities:
Net income..................................................... $ 26 $ 21
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation of equipment on operating leases................ 2 --
Net gain on retail notes sold................................ (29) (18)
Changes in components of working capital:
(Increase) decrease in other assets........................ 8 --
(Decrease) increase in accounts payables and other accrued
liabilities............................................... (6) --
Other, net................................................... 2 3
----- -----
Net cash provided by operating activities................ 3 6
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Investing activities:
Cost of receivables acquired................................... (434) (446)
Collections of receivables..................................... 74 31
Proceeds from sales of receivables............................. 484 351
Purchase of equipment on operating leases...................... (13) (9)
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Net cash provided (used) by investing activities......... 111 (73)
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Financing activities:
Proceeds from issuance of long-term debt....................... 200 --
Increase (decrease) in revolving credit facilities............. (297) 87
Dividends paid................................................. (20) (18)
----- -----
Net cash provided (used) by financing activities......... (117) 69
----- -----
Net increase (decrease) in cash and cash equivalents............. (3) 2
Cash and cash equivalents, beginning of period................... 15 4
----- -----
Cash and cash equivalents, end of period......................... $ 12 $ 6
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Cash paid during the period for interest......................... $ 15 $ 11
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Cash paid during the period for taxes............................ $ 24 $ 14
===== =====
The accompanying notes to financial statements are an integral part of these
Statements of Cash Flows.
4
CASE CREDIT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(IN MILLIONS)
CUMULATIVE
COMMON PAID IN TRANSLATION RETAINED
STOCK CAPITAL ADJUSTMENT EARNINGS TOTAL
------ ------- ----------- -------- -----
Balance, December 31, 1994........... $-- $194 $(8) $ 1 $187
Net income......................... -- -- -- 94 94
Dividends declared................. -- -- -- (93) (93)
Capital contributions from Case
Corporation....................... -- 5 -- -- 5
---- ---- --- ---- ----
Balance, December 31, 1995........... -- 199 (8) 2 193
Net income (unaudited)............. -- -- -- 26 26
Dividends declared (unaudited)..... -- -- -- (20) (20)
Translation adjustment (unaudited). -- -- 2 -- 2
---- ---- --- ---- ----
Balance, March 31, 1996 (unaudited).. $-- $199 $(6) $ 8 $201
==== ==== === ==== ====
The accompanying notes to financial statements are an integral part of these
Statements of Changes in Shareholder's Equity.
5
CASE CREDIT CORPORATION AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 1--BASIS OF PRESENTATION
The accompanying financial statements reflect the consolidated results of
Case Credit Corporation and its subsidiaries ("Case Credit" or the "Company").
All significant intercompany transactions have been eliminated in
consolidation.
In the opinion of management, the accompanying unaudited financial
statements of Case Credit contain all adjustments which are of a normal
recurring nature necessary to present fairly the financial position as of
March 31, 1996, and the results of operations, changes in shareholder's equity
and cash flows for the periods indicated. Interim financial statements are not
necessarily indicative of operating results for an entire year.
NOTE 2--ASSET-BACKED SECURITIZATIONS
In the first quarter of 1996, Case Credit issued $625 million of asset-
backed securities through a limited-purpose business trust to outside
investors, of which $234 million was prefunded. The Company will sell the
remaining retail notes to the trust as new receivables are acquired; as of
March 31, 1996, $139 million of new receivables remains to be acquired. The
proceeds from the sale of the notes were used to repay outstanding debt and to
finance additional receivables. In the first quarter of 1995, the Company
completed a $600 million asset-backed securitization ("ABS") transaction, of
which $247 million was prefunded.
NOTE 3--LONG-TERM DEBT
A summary of long-term debt is set forth in the following table (in
millions):
MARCH 31, DECEMBER 31,
1996 1995
--------- ------------
Case Credit Corporation
Notes, payable in 2003, interest rate of 6.125%. $ 200 $ --
Case Credit Australia Pty., Ltd.
Long-term portion of borrowings on a line of
credit, average interest rate of 7.4%.......... 78 --
----- -----
Total long-term debt.......................... $ 278 $ --
===== =====
In the first quarter of 1996, the Company sold $200 million aggregate
principal amount of its 6.125% unsecured and unsubordinated notes due 2003
pursuant to a $300 million shelf registration statement filed with the
Securities and Exchange Commission in December 1995. The net proceeds from the
offering were used to repay indebtedness and finance Case Credit's growing
portfolio of receivables. Case Corporation has guaranteed the obligations of
the Company under these notes and Case Corporation will be released from its
obligations under the guarantee upon the occurrence of certain events.
The Company has classified $78 million of borrowings on Case Credit
Australia's line of credit as long-term as the lender does not require payment
within twelve months, nor does Case Credit Australia intend to reduce the
long-term portion of the revolver within twelve months.
6
CASE CREDIT CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
First Quarter 1996 vs. First Quarter 1995
NET INCOME
Net income for the first quarter of 1996 was $26 million, an increase of $5
million compared to the first quarter of 1995. This increase resulted
primarily from finance income from a higher average receivable balance and the
1996 ABS transaction occurring in February as compared to the 1995 ABS
transaction which occurred in March. Due to this timing difference, more
income and transaction gains were realized in 1996 than in 1995.
REVENUES
Case Credit reported total revenues of $66 million for the first quarter of
1996, up $15 million from the first quarter of 1995. This increase is
primarily attributable to the net gain on ABS transactions. The increase of
$11 million in net gain on retail notes sold was primarily the result of the
margin between the portfolio yield and the investors' yield requirements. The
increase in finance income earned from retail notes and finance leases was
offset by a decrease in interest income from Case Corporation, resulting from
lower payments for below-market interest rate financing programs.
EXPENSES
Interest expense for the first quarter of 1996 was $17 million compared to
$10 million in 1995. The $7 million increase in interest expense is primarily
due to higher average debt levels required to finance the average retail note
and finance lease portfolios.
SERVICED PORTFOLIO
Case Credit's serviced portfolio increased 14% to $3.8 billion. New
equipment acquisitions in the first quarter of 1996 were up 6% versus the
comparable period last year. Portfolio losses for the total serviced portfolio
were $0.7 million versus $0.1 million during the first quarter of 1995. This
represents a loss to liquidation ratio of 0.14% in the first quarter of 1996
versus 0.04% in the first quarter of 1995.
LIQUIDITY AND CAPITAL RESOURCES
On February 14, 1996, the Company issued $200 million aggregate principal
amount of 6.125% unsecured and unsubordinated notes due 2003 pursuant to a
$300 million shelf registration statement filed with the Securities and
Exchange Commission in December 1995. The net proceeds from the offering were
used to repay indebtedness and finance Case Credit's growing portfolio of
receivables. Case Corporation has guaranteed the obligations of Case Credit
under these notes and Case Corporation will be released from its obligations
under the guarantee upon the occurrence of certain events. Proceeds from the
sale of receivables improved $133 million in 1996 over 1995, primarily as a
result of the timing of the ABS transaction. The decrease in the revolving
credit facilities resulted from the use of the ABS proceeds to pay down this
debt.
FUTURE LIQUIDITY AND CAPITAL RESOURCES
The Company has various sources of future liquidity: the ABS markets, public
debt offerings and other available lines of credit. The Company anticipates
that it will continue to pool retail receivables and issue asset-backed
securities in the United States and Canada depending upon the availability of
the ABS market. The Company may also issue additional debt securities of up to
$100 million in aggregate principal amount under the shelf registration
statement previously mentioned. The Company has $1,167 million of revolving
credit facility and a $600 million commercial paper liquidity facility.
7
PART II--OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
4.1--Indenture between Case Credit Corporation, Case Corporation and The
Bank of New York, dated as of February 1, 1996
4.2--6 1/8% Note Due 2003 of Case Credit Corporation issued pursuant to
the Indenture
4.3--Resolutions of the Board of Directors of Case Credit Corporation
authorizing the public offering of debt securities of Case Credit
Corporation in an aggregate principal amount of up to $300,000,000
(Incorporated by reference herein to the Company's Registration
Statement No. 33-80775)
4.4--Resolutions of the Board of Directors of Case Corporation
authorizing the Support Agreement and/or $300,000,000 Guarantee for
Case Credit Corporation debt offering (Incorporated by reference
herein to the Company's Registration Statement No. 33-80775)
4.5--Actions of Authorized Officers of Case Credit Corporation
authorizing the issuance of $200,000,000 aggregate principal amount
of 6 1/8% Notes Due 2003
4.6--Officers' Certificate and Company Order of Case Credit Corporation
for the issuance of $200,000,000 aggregate principal amount of 6
1/8% Notes due 2003
4.7--Actions of Authorized Officers of Case Corporation authorizing the
Guarantee of $200,000,000 of 6 1/8% Notes Due 2003 of Case Credit
Corporation
12 --Computation of Ratio of Earnings to Fixed Charges.
27 --Financial Data Schedule.
(b) Reports on Form 8-K.
Case Credit Corporation did not file any reports on Form 8-K during the
quarter ended March 31, 1996.
8
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
CASE CREDIT CORPORATION
/s/ Robert A. Wegner
By __________________________________
Robert A. Wegner
Vice President,
Chief Financial Officer and
Treasurer
(Principal Financial Officer and
Authorized Signatory for Case
Credit Corporation)
Date: May 10, 1996