Thank you, Leon. Good afternoon everyone. We would like to welcome you to the CNH Industrial Second Quarter and First Half 2014 Results Webcast Conference Call. CNH Industrial Group CEO Rich Tobin and Max Chiara Group CFO will hold today's call. They will use the material you should have downloaded from our website www.cnhindustrial.com. After introductory remarks, we will be available to answer the question you may have. Before moving ahead, let me just remind you that any forward-looking statement we might be making during today's call are subject to the risk and uncertainties mentioned in the Safe Harbor statement, including the presentation material. I will now turn the call over to Mr. Rich Tobin.

Thank you. Good morning and good afternoon everyone. Overall, we've had a good performance for the quarter despite some challenging market conditions in LATAM in the Commercial Vehicles and Agricultural segments, and negative mix in Ag High Horsepower in NAFTA. We were able to offset these headwinds with improvements in operating performance in the Construction and Powertrain segments. Commercial pricing actions, improved industrial efficiency, and through the implementation of some substantial cost controls to improve the quarter EPS by 12%. In summary, we achieved net sales of industrial operations of $8.6 billion, flat to prior year holding operating margin at 7.9%, while EPS ex-restructuring improved 12% year-over-year to $0.28 per share. After reviewing the following slides, we expect trading conditions in the agricultural sector to be challenging for the balance of the year in most of the groups operating geographies. We'll be taking appropriate actions to align production plans to accommodate this as we have successfully executed in the past. We'll be taking action to align our cost structure for the projected business environment in the second semester. As you've seen from the press release this morning, we have instituted a group efficiency program with particular emphasis in the commercial vehicles and construction equipment segments of the business with the aim of improving operational performance, which will be outlined later in the presentation. So overall, good performance despite the headwinds, flat revenue with margins holding at 7.9%, which is giving us the ability to confirm full your guidance for the year. I'll handover the presentation to Max, he will take you through the financial slides and I'll come back to you when we get to the business later in the presentation. Max?

Thank you, Rich. I am on Slide 5, financial highlight. In summary, the company posted consolidated revenues of $8.9 billion, up 1% versus last year in the quarter, while revenue was $16.5 billion for the first half of 2014. Consolidated net income was $358 million for the second quarter. Net income before restructuring and other exceptional items was $382 million for the second quarter or $0.28 per share. EPS before restructuring and other exceptional items for the first half was $0.41 per share. Available liquidity at June end was $7.7 billion, inclusive of $2.3 billion in undrawn committed facilities, compared to $8.1 billion at March end. The company posted net sales of Industrial activities of $8.6 billion for the quarter, flat versus last year, and up $15.8 billion for the first half. In the quarter, net sales increased in the Powertrain segment offsetting declines in net sales in Agricultural Equipment, primarily in LATAM and in NAFTA, a slight decrease in Construction Equipment and Commercial Vehicles compared to second quarter of last year. First half operating profit stood at $1.1 billion with margin at 6.9%, inline with full-year guidance. Net industrial debt of $3.7 billion at June 30, 2014 was $300 million lower than at March 31, 2014. Net industrial cash flow was positive at $600 million plus in the quarter as cash flow generated from operation activities, including a positive change in working capital of $0.3 billion more than offset CapEx and was partially offset by the dividend payment of $0.4 billion performed in April to deliver a net industrial debt reduction in the quarter of $300 million. On Slide 6, we have the usual reconciliation from consolidated operating profit to net income for the second quarter compared to prior year. Consolidated operating profit at $736 million, down $14 million…

Agricultural equipment operating performance variants for the quarter. Operating profits of $632 million, operating margin stood at 14.2% with negative volume in LATAM and NAFTA and negative mix in NAFTA being offset by pricing improvements, improvements in industrial performance cost control actions to cover Tier 4B content, inflation and adverse exchange movements. Next slide. Industry volumes for ag worldwide, agricultural equipment industry unit sales were down during the second quarter of 2014, with global demand for tractors and combines down approximately 12%. Industry volume weakens is experienced across all of the regions with exception of low horse power tractors in NAFTA. The 12% reduction in tractors equates to a reduction of 60,000 tractors, the majority of which were an APAC, which is not material to CNH. Worldwide equipment's market share performance was mainly flat for tractors with the exception of LATAM. And combines was down with the exception of NAFTA but we expect to fully recover that in the second half of the year. In combines, the outlook for the year is not expected to improve from the quarter to trend with further deterioration expected in APAC for the balance of the year, offset by some improvement in LATAM from very low levels in Q2 where the industry was down 30%. With the announcement of the recent motor FOTA program in Brazil, we are going to expect to have a disruption between PSI 2014 and the start of PSI 2015 as we experienced in the fourth quarter of 2013. Next slide. Worldwide production of agricultural equipment was 6% above retail sales for the quarter to support normal seasonality and anticipation of summer facility shutdown schedule. The company now expects to under produce retail in the second half of the year, particularly in NAFTA in light of the outward trend as…

Thank you, Mr. Tobin. Now, we are ready to start the Q&A session. Leon, please take the first question.

(Operator Instructions) We will now take your first question from Rob Wertheimer from Vertical Research Partners. Please go ahead, sir.

Hi, good morning everybody. First question, Rich, you did go into this and really helpful detail in the inventory side. I'm just curious if you can add to it what you think about used channel inventory particularly in North American ag? We have written it, it looked like you are managing it pretty well but I think it's going to be tough to stay ahead of. Maybe you can give a little contacts around one of the normal seasonal first half to second half combine production decline with the (inaudible) great that you did (inaudible) normally a second half slide anyway. Are you starting to see tractors come off in the similar magnitude? Thank you.

Yes, I mean look part of the drag that we see in terms of other than the forecast to decline in farmer net income which is I think forecast to be down by 30% as a result of the commodity price declines there -- that is putting a drag on new which is always going to have a subsequent drag in terms of use. So we are trying to balance with our dealer network to make sure that we are not exasperating problem. So as I mentioned in terms of what our actions are, we have got some significant reductions in terms of production performance. Now, we have done that, if you go back and look at our results on a quarter by quarter basis, in the past. So we have scheduled shutdowns every year in the month of August. So by and large that's always going to be somewhat of reduction. We're going to be taking further actions this year because we are trying to manage the entire chain. The good news among they used is despite the fact that it's taking longer for it to be liquidated so the aging of the used is stringing out somewhat which is putting a drag on new wholesales. The pricing has held up reasonably well. So and that's largely as a result of significant portion of the use being pre Tier 4 products so there still is quite the gap or the value in used equipment. So I mean, we are watching it closely. I think that we are trying to set ourselves up for 2015. I mean I will deal with the question about outlook of 2015 since I'm sure that somebody is going to ask it. I mean, we're really we don't have a concrete view to call the market of 2015 yet, I mean, we'll open up for writing for 2015 shortly in the late August beginning September timeframe. At that point I think by the end of Q3 we will have a much better idea, but I think right now when you got reductions that I said before in terms of reduction in terms of combine performance it’s that same quantum or reduction maybe a little bit less so in four wheel drive tractors semester to semester. So we're taking actions where we need to take it. I think that we have been planning appropriately so that we are not running into a hard stop where we not always lose the gross margin on the mix that we go in terms of that we get the negative in terms of fixed cost absorption so we are taking appropriate action to align our production system. It's going to be some heavy lifting but I think that we have got the plan in place and what we have right now is reflected in the full year guidance.

Okay. That is helpful. Can you -- the production cuts you are taking in combines as you mentioned four wheel drive would that typically flow through the P&L this year or would it be you are cutting a lot of 4Q and see it more next year? And I will stop there. Thank you.

Yes, I think it's more of a this year issue than anything else. I mean, our expectation in order to meet our working capital objectives of the year is to have -- I mean, we don't expect to go in with large levels of company inventory at the end of the year and take the volume leverage or the absorption benefit this year and only get the gross margin on the wholesale next year. I think as I was trying to articulate, we're trying to manage the issue of not losing it on mix in terms of the wholesale basis and then losing it on the industrial level, I think that as we have shown in the past. I think that there is one thing that we can do we can kind of, we can manage the industrial machine. So unless that we see a further deterioration from where we are right now and we have given an idea of what we expect for the full year, I think that we have the plans in place to execute.

Thanks.

We will now take our next question from David Raso from ISI Group. Please go ahead.

Hello, at the analyst meeting you gave guidance for revenues by segment and I was just curious. Is the conformation of the guidance also incorporating maintaining the business segment guidances like, for example, agricultural sales for the year at $15.8 billion?

I think that the guide -- David, the guidance is what the guidance is. I mean, I don’t think that we have to get that granular in total I mean it’s still we are going to maximize the portfolio and its entirety. So we make it up and understand that there is somewhat of a difference in terms of the margin and totality, but what you have in terms of the guidance is the aggravation of the top-line of the different segments at the margins of those businesses we're able to deliver. But I mean in terms of giving segments guidance on a full year basis I mean I think it's a little better. I mean I think that that's cutting the quick too close.

Yes, I mean just trying a picture think about the puts and takes since the analyst meeting because again just taken that sales guidance for ag if we maintain it, it implies the second half of the year sales in ag are only down 6% sequentially and even last year we had a 3% decline. So I just would have figured what the combine commentary you just gave that there is probably a little more sequential decline I would expect in ag, if that's the case where is the offset? What do you think sort of is above what we are thinking at the investor day on the revenues?

I think that right now that the -- what's changed since the investor day but we are talking two months ago as I think that the mix in terms of the backlog, and, the commercial vehicle segment is improved.

Okay. I will see that you also pretend that the revenue guide for commercial, if you are giving it, that's a little bit of bump up maybe a little bump down in ag and how are you viewing construction equipment from previous start for the revenues?

Yes, the construction equipment business our expectation is that the trajectory of EMEA and NAFTA will follow a similar pattern that it is on right now. I think that the one that we are going to have to watch is we have had relatively difficult market conditions in LATAM and construction equipment there is a difference in terms of the PSI rates between the two. I mean, if we get any help there we could see some kind of bounce back in LATAM that we have seen up into this point but I mean I think it's little bit too early to tell. So our expectations on the construction equipment segment is improved performance largely driven by NAFTA and EMEA.

Yes, but (inaudible) I'm just trying to figure out how much upside are you thinking through on commercial vehicle? Because again the ag sequential decline looks maybe a little optimistic again down to 6% if it was down to 3% in the back half even last year and construction equipment if you keep the old segment guidance is implying the second half has to grow 22% after the first half was barely up at all. So I'm just trying to think if you look at those numbers and say maybe they are little optimistic from the investor day on the revenues how much can I model in where commercial is feeling better. In fact, the commercial loss this quarter is a little better than I thought but I am talking strictly of revenues. Is there that much more momentum versus what you saw in commercial vehicle to take my concerns on ag and construction revenues in sight? It's what it is its moving pieces. You feel better about trough you feel little worse about the reds on the other two from the investor day.

Yes, I think that if you are talking about sequential performance semester to semester I think that the upside is on the commercial.

I'm talking full year. The full year guidance what has changed?

No, I understand what your question is, but I mean we have taken the position we are right now, right, versus what we had in terms of the investor day. So if there is any headwind, it would be in NAFTA ag. As I mentioned before during the call, I think that our expectation in LATAM ag is improved performance in the second half of the year vis-à-vis the first half, so offsetting some of the headwind down on the NAFTA piece.

And last question on commercial vehicle, again, the loss was a little less than I was looking for. So it was encouraging. When we think about the profitability in the back half of commercial, I mean, or you just want to talk full year, I think folks are trying to figure out what kind of run rate can be leaving the year on truck and then starting to think through next year where maybe have Brazil back up on an easy comp, let's -- North America is still growing a bit, and then, Europe, would you care to talk a little bit about your truck margins kind of exiting the year and how do you think about next year?

Sure, I mean, in one word I think that there is two different drivers and I think that we are intervening in terms of the cost structure which is largely in Europe. Right now, we are running at a 3% growth year-to-date in European commercial vehicles and I think we are forecasting flat to 5% so really midrange at the end of the day. So the pick up in commercial vehicles from a European point of view is as a result of higher revs in the second half of the year at a much improved mix. As I said before, we've got a variety of things that are going to be improved in terms of the cost structure, we're going to get to the follow on effect of the full year of us intervening in terms of the cost structure, you got improve mix by not having a launch cost that we have had in H1 largely as a result of Euro VI transition on the bus segment and the launch of the new Daily. So those are largely behind us. I think we have got some runway left on buses to complete that large in Q3, and then you have got improved mix for the balance year. So right now, we have been matching revenue and production through if you look at the Q2 we were saying that we are going to move up in revs in the second half of the year. So we're moving production up. So we'll get improved production performance and the richness of the mix is there. Our forecast for the full year in terms of profitability, commercial vehicles is I think around where we were at the investor day. So we are not coming off that and we are forecasting a profit for the full year. I think going forward and what we are expecting from the following year I would ask that let's deliver the next couple of quarters, let's realize the befits of the actions that we are taking, and then I would not expect LATAM to perform again in 2015 like it's performing right now. I mean all of the improvement which wasn’t immaterial that we made in EMEA quarter to quarter, unfortunately, was offset by LATAM. LATAM, we will take action there in terms of the cost base, but one would and we would be stocking in LATAM right now, one would expect that those conditions will improve.

We will now take our next question from Alexander Virgo from Berenberg. Please go ahead.

Hi, good afternoon, good morning. Just wondering if you could make a comment please on ag, I guess you over-produced in Q1 by close to 30% and again in Q2, and then you are saying that you have talked about this sequential adjustment in production to the tune of 40% in the second half. I mean that it seems like a fairly volatile approach. I'm wondering why you didn't under produce in Q2 given that as we have established the signs from I mean even the Capital Markets Day where that the retail sales were falling away particularly in after but obviously in LATAM too? And then second question I guess is a follow on to that. You mentioned incremental margins in your prepared notes. I mean, should we be thinking all 25%, 30% drop through on the production adjustment in the second half? And then last one just as an observation, is there any chance we can have the results a little bit earlier next time? Thank you.

Okay. Yes, on the last question, yes, and I know I said that last quarter but this time I mean it. So we'll correct that the next time around. The question about why we didn't moderate production in Q2 and then back and loaded. I mean, I think you got to go back and look at the performance of the ag quarter by quarter for the past several years. I mean, we have historically produced less in the second half for a couple of reasons. Number one, we have go scheduled shutdowns in August at the industrial level that's just by in nature is going to drop it. Number two is there is purely a question of you make a call in terms of how much product that you need available, you need to have it available. I mean at lead times associated with ramping up production of some of the bigger most sophisticated products when you are talking about drive lines transmissions is not short chain. So it's not as if let's cut production in Q2 and then if we need to we can catch up in Q4, it just doesn't work like that because we are trying to maximize our profitability at the industrial level. So for us it's much better to have the product available for what were the projected market demand is and then to adjust in the second half when a), we can manage it from an industrial point of view and we can manage the decrementals as it relates to the absorption was and we have got the product available to the extent that the demands there, it's not as if we can just turn the machine back on if we get it wrong in Q4.

Right, but I guess the issue is where you got wrong in Q2, right? Because I mean if I look back over the last four years, you under produced in Q2 of 2012, 2011, you were only a couple of percent ahead in 2010. I guess there is a more positive environment form an ag perspective. I think we are probably in a more negative environment now. I'm just wondering why you didn't take actions earlier rather than going to 27, 6 and then minus 40 and it sort of seems quite aggressive. That's all.

Yes, I think what I have explained to your before, I don't think that we have got it wrong, right. At the end of the day market conditions haven't been improving through the year for sure, but there is a cost associated with turning on and off production that there is a big ticket number that we tried to avoid. So that the extent that we have only produced in Q2 by 6% to moderate that cost. If I was to try to take action on that in the quarter there is a cost associated with that. It's far more efficient for me to take it out of the back half.

Okay. And then if I may just follow up in terms of what gives you the confidence that you are going retake that market share in the second half? Thanks.

Yes, I mean that I think that when we -- if you breakdown those market share declines in units we are talking about, I can do it at the top off my head, I think it's 99 units in combines in all of Europe if the market share decline. So we are not taking, it's not like the commercial vehicle segment where you got to make up thousands of units, we are talking about discrete volumes here.

All right. Thank you very much.

We will now take our last question from Ann Duignan from JPMorgan. Please go ahead.

Thank you, this is actually Tom (inaudible) in for Ann. Just one question. Do you still believe agricultural fundamentals in North America will be flat through 2018?

Yes, without any additional knowledge we answer it, yes.

Okay. Thank you.

Leon, is there anybody else on the queue?

We have another question from Ashik Kurian from Goldman Sachs.

Hello, I have just one follow up question on the truck side. There has been some talk on the efficiency of the different talk makers on the new Euro VI technology. So could you just give us an update on how the new Euro VI is looking for you and where you rank amongst in terms of total cost and ownership and also in terms of efficiency compared to your peers?

I think that we are confident in terms of the powertrain solution that we have across the commercial vehicle segment. I mean, without getting into segment by segment. I think that what we have in terms of what we have delivered of the core technology that comes out of FPT I think that is as competitive as anything that's available in the marketplace.

Okay. Have your pricing improved on the back of this or is there still more pricing actions to be taken over the due course of the year --

Yes, now I got it. We are clearly not the price leader in the commercial vehicle segment. We have begun to claw back on the Euro VI side but any help the market can give us, and I think that that applies to everybody in European commercial vehicles, we are more than happy to take price where we can get it. I think that if you look at some of the segmental information that we have there I think that we have demonstrated in a variety of different market conditions in a variety of different market positions across the segment that we have been disciplined in terms of pricing. So it's up to the market to a certain extent but we are more than happy to get to the point of full recapture on Euro VI cost.

Thank you.

That will conclude the question and answer session. I would now like to turn the call back over to Federico for any additional or closing remarks.

Thank you, Leon. We would like to thank everyone for attending to this call with us. Have a good evening.