CNH Global to Post $20 Million 1Q Charge Because of Health Overhaul

DOW JONES NEWSWIRES

CNH Global NV (CNH) said it would post a $20 million charge in the first quarter because of tax changes in recently enacted federal health-care legislation.

The farm- and construction-machinery maker is the latest of a slew of firms to reveal special charges tied to retiree prescription costs since President Barack Obama signed the health-care overhaul into law.

CNH, the world's No. 2 farm-equipment company behind Deere & Co. (DE), reported a fourth-quarter profit of $28 million on $3.21 billion in revenue in January.

Majority owned by Fiat SpA (FIATY, F.MI), CNH said the $20 million charge reflects the costs of subsidies it receives from the government for providing retirees with prescription-drug benefits losing tax-deductible status under the new law.

CNH shares were down 0.6% at $32.96 in after-hours trading. The stock has more than doubled in the last year, though it was trading at an all-time low a little more than a year ago.