AGCO Reports Fourth Quarter Results
AGCO reported net sales of approximately $2.7 billion for Q4 2020, marking a 8.1% increase from Q4 2019. Net income was $1.78 per share, compared to a loss of $1.17 per share in Q4 2019. For the full year 2020, net sales reached $9.1 billion, up 1.2% from 2019. Regional sales showed strong growth in South America (21.1%) and Europe/Middle East (13.7%). AGCO forecasts 2021 earnings per share between $7.00 and $7.25. The company continues to focus on technology investment and sustainable farming solutions.
- Net sales increased 8.1% in Q4 2020 compared to Q4 2019.
- Net income improved to $1.78 per share from a loss of $1.17 in Q4 2019.
- Full-year net sales for 2020 reached $9.1 billion, a 1.2% increase compared to 2019.
- Strong growth in South America with a 21.1% increase in Q4 sales.
- 2021 earnings per share forecasted between $7.00 and $7.25.
- Net sales in North America decreased 10.2% in Q4 2020 compared to Q4 2019.
- Reported a decline in operating income by approximately $52.9 million in Europe/Middle East for 2020.
- Full-year sales in North America were flat, showing a 0.8% decrease compared to 2019.
AGCO, Your Agriculture Company (NYSE: AGCO), a worldwide manufacturer and distributor of agricultural equipment and solutions, reported net sales of approximately
Net sales for the full year of 2020 were approximately
Fourth Quarter Highlights
-
Reported fourth quarter regional sales results(1): Europe/Middle East (“EME”)
13.7% , North America (10.2)%, South America21.1% , Asia/Pacific/Africa (“APA”)2.1% -
Constant currency fourth quarter regional sales results(1)(2)(3): EME
7.7% , North America (10.3)%, South America52.7% , APA (3.8)% -
Fourth quarter regional operating margin performance: EME
11.9% , North America2.0% , South America5.9% , APA10.6% -
Full-year adjusted operating margins(3) improved to
7.0% in 2020 compared to5.9% in 2019 -
Generated approximately
$896.5 million in cash flow from operations and approximately$626.6 million in free cash flow(3) in 2020 -
Full-year earnings forecast for 2021 in a range from
$7.00 t o$7.25 per share
(1)As compared to fourth quarter 2019.
(2)Excludes currency translation impact.
(3)See reconciliation of Non-GAAP measures in appendix.
“The AGCO team delivered strong operational results leveraging improving markets to produce sales and earnings growth in the fourth quarter,” stated Eric Hansotia, AGCO’s Chairman, President and Chief Executive Officer. “Our focused execution allowed us to overcome supply chain difficulties and maintain production levels, while reducing company and dealer inventories, which contributed to significant cash flow generation. I would like to thank all our employees for their extraordinary efforts to support our dealers and customers under challenging conditions. Our improved results allowed us to maintain our investments in premium technology, sustainable smart farming solutions and enhanced digital capabilities. AGCO’s exceptional product line continues to be well-received by our customers as evidenced by a strong year-end order board. Looking forward to 2021, we are forecasting sales and earnings growth as industry conditions trend positively and we position AGCO for future success.”
Market Update
|
|
Industry Unit Retail Sales |
||
|
|
Tractors |
|
Combines |
Year ended December 31, 2020 |
|
Change from
|
|
Change from
|
North America(1) |
|
|
|
—% |
South America |
|
|
|
|
Western Europe(2) |
|
(1)% |
|
|
(1) Excludes compact tractors. (2) Based on Company estimates. |
||||
“Increased grain consumption, driven by economic recovery and higher export demand, helped to offset a solid year of global crop production leaving year-end grain inventories lower than anticipated,” stated Mr. Hansotia. “Reduced grain stocks supported a rally in soft commodity prices, lifted farmer sentiment and supported higher demand for agricultural equipment during the fourth quarter.”
“Full year global industry retail sales of farm equipment in 2020 were mixed across AGCO’s key markets with fourth quarter industry retail sales significantly higher than the prior year across the major regions,” continued Mr. Hansotia. “Industry retail tractor sales in North America increased during the full year of 2020 compared to 2019. Strong growth in the sales of lower horsepower tractors drove most of the increase. The fleet age for large equipment in North America remains extended and stronger replacement demand was evident in the fourth quarter. Higher commodity prices and improved farmer sentiment are also expected to drive higher North American industry sales in 2021. In Western Europe, industry demand improved in the fourth quarter, but remained down for the full year of 2020 compared to 2019. Market demand was weakest in the United Kingdom and Scandinavia, and was partially offset by growth in Germany, which benefited from tax incentives during 2020. We expect 2021 industry demand in Western Europe to be flat to modestly higher from 2020 levels. South America industry retail tractor sales increased during 2020, with robust recovery in Brazil and Argentina partially offset by weaker demand in the smaller South America markets. Healthy crop production and favorable exchange rates in Brazil and Argentina are supporting farm profitability. We expect farm economics to remain supportive in 2021 in South America with replacement demand resulting in higher industry sales compared to 2020. Our long-term global view remains positive. Increasing demand for commodities, driven by the growing world population, rising emerging market protein consumption and biofuel use, are expected to support healthy conditions in our industry.”
Regional Results
AGCO Regional Net Sales (in millions)
Three Months Ended December 31, |
|
2020 |
|
2019 |
|
% change
|
|
% change from
|
|
% change
|
||||
North America |
|
$ |
485.1 |
|
|
$ |
540.5 |
|
|
(10.2)% |
|
|
|
(10.3)% |
South America |
|
267.5 |
|
|
220.9 |
|
|
|
|
(31.6)% |
|
|
||
EME |
|
1,722.7 |
|
|
1,515.3 |
|
|
|
|
|
|
|
||
APA |
|
241.8 |
|
|
236.9 |
|
|
|
|
|
|
(3.8)% |
||
Total |
|
$ |
2,717.1 |
|
|
$ |
2,513.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Year Ended December 31, |
|
2020 |
|
2019 |
|
% change
|
|
% change from
|
|
% change
|
||||
North America |
|
$ |
2,175.0 |
|
|
$ |
2,191.8 |
|
|
(0.8)% |
|
(0.5)% |
|
(0.2)% |
South America |
|
873.8 |
|
|
802.2 |
|
|
|
|
(27.6)% |
|
|
||
EME |
|
5,366.9 |
|
|
5,328.8 |
|
|
|
|
|
|
(0.4)% |
||
APA |
|
734.0 |
|
|
718.6 |
|
|
|
|
|
|
|
||
Total |
|
$ |
9,149.7 |
|
|
$ |
9,041.4 |
|
|
|
|
(1.8)% |
|
|
(1) See Footnotes for additional disclosures. |
|
|
|
|
|
|
|
|
|
|
||||
North America
Net sales in the North American region were flat for the full year of 2020 compared to 2019, excluding the negative impact of currency translation. Increased sales of Precision Planting equipment, high horsepower tractors and parts were offset by lower sales of grain and protein production equipment as well as sprayers. Income from operations for the full year of 2020 improved approximately
South America
AGCO’s South American net sales increased
Europe/Middle East
AGCO’s Europe/Middle East net sales were flat for the full year of 2020 compared to 2019, excluding favorable currency translation impacts. Sales improved significantly in the second half of the year compared to 2019, offsetting a weak second quarter which was impacted by COVID-19-related production interruptions. Declines in France, Scandinavia and Central Europe were mostly offset by growth in Germany and Eastern Europe. Income from operations decreased approximately
Asia/Pacific/Africa
Asia/Pacific/Africa net sales increased
Outlook
The health, safety and well-being of all AGCO employees, dealers and farmer customers continues to be AGCO’s top priority during the COVID-19 pandemic. The following outlook does not contemplate any further sales or production disruptions caused by the pandemic.
AGCO’s net sales for 2021 are expected to range from
* * * * *
AGCO will host a conference call with respect to this earnings announcement at 10:00 a.m. Eastern Time on Thursday, February 4th. The Company will refer to slides on its conference call. Interested persons can access the conference call and slide presentation via AGCO’s website at www.agcocorp.com in the “Events” section on the “Company/Investors” page of our website. A replay of the conference call will be available approximately two hours after the conclusion of the conference call for twelve months following the call. A copy of this press release will be available on AGCO’s website for at least twelve months following the call.
* * * * *
Safe Harbor Statement
Statements that are not historical facts, including the projections of earnings per share, sales, industry demand, market conditions, commodity prices, currency translation, farm income levels, margin levels, investments in product and technology development, new product introductions, restructuring and other cost reduction initiatives, production volumes, tax rates and general economic conditions, are forward-looking and subject to risks that could cause actual results to differ materially from those suggested by the statements. The following are among the factors that could cause actual results to differ materially from the results discussed in or implied by the forward-looking statements.
- The Company is uncertain of the impact of the coronavirus (“COVID-19”) pandemic due to increased volatility in global economic and political environments, market demand for its products, supply chain disruptions, workforce availability, exchange rate and commodity price volatility and availability of financing, and their impact to the Company’s net sales, production volumes, costs and overall financial condition and liquidity. The Company may be required to record significant impairment charges in the future with respect to certain noncurrent assets such as goodwill and other intangible assets and equity method investments, whose fair values may be negatively affected by the COVID-19 pandemic. The Company also may be required to write-down obsolete inventory due to decreased customer demand and sales orders. Additionally, the Company is closely monitoring the collection of accounts receivable, as well as the operating results of it finance joint ventures around the world. If economic conditions around the world continue to deteriorate, the Company may not be able to sufficiently collect accounts receivable, and the operating results of its finance joint ventures may be negatively impacted, thus negatively impacting the Company’s results of operations and financial condition. The Company is also closely assessing its compliance with debt covenants, the recognition of any future applicable insurance recoveries, cash flow hedging forecasts as compared to actual transactions, the fair value of pension assets, accounting for incentive and stock compensation accruals, revenue recognition and discount reserve setting and the realization of deferred tax assets in light of the COVID-19 pandemic.
- Our financial results depend entirely upon the agricultural industry, and factors that adversely affect the agricultural industry generally, including declines in the general economy, adverse weather, tariffs, increases in farm input costs, lower commodity prices, lower farm income and changes in the availability of credit for our retail customers, will adversely affect us.
- A majority of our sales and manufacturing takes place outside the United States, and, many of our sales involve products that are manufactured in one country and sold in a different country, and as a result, we are exposed to risks related to foreign laws, taxes and tariffs, trade restrictions, economic conditions, labor supply and relations, political conditions and governmental policies. These risks may delay or reduce our realization of value from our international operations. Among these risks are the uncertain consequences of Brexit, Russian sanctions and tariffs imposed on exports to and imports from China.
-
Most retail sales of the products that we manufacture are financed, either by our joint ventures with Rabobank or by a bank or other private lender. Our joint ventures with Rabobank, which are controlled by Rabobank and are dependent upon Rabobank for financing as well, finance over
50% of the retail sales of our tractors and combines in the markets where the joint ventures operate. Any difficulty by Rabobank to continue to provide that financing, or any business decision by Rabobank as the controlling member not to fund the business or particular aspects of it (for example, a particular country or region), would require the joint ventures to find other sources of financing (which may be difficult to obtain), or us to find another source of retail financing for our customers, or our customers would be required to utilize other retail financing providers. As a result of the recent economic downturn, financing for capital equipment purchases generally has become more difficult in certain regions and in some cases, can be expensive to obtain. To the extent that financing is not available or available only at unattractive prices, our sales would be negatively impacted. - Both AGCO and our finance joint ventures have substantial accounts receivable from dealers and end customers, and we would be adversely impacted if the collectability of these receivables was not consistent with historical experience; this collectability is dependent upon the financial strength of the farm industry, which in turn is dependent upon the general economy and commodity prices, as well as several of the other factors listed in this section.
- We have experienced substantial and sustained volatility with respect to currency exchange rate and interest rate changes, which can adversely affect our reported results of operations and the competitiveness of our products.
- Our success depends on the introduction of new products, particularly engines that comply with emission requirements and sustainable smart farming technology, which requires substantial expenditures; there is no certainty that we can develop the necessary technology or that the technology that we develop will be attractive to farmers or available at competitive prices.
- Our production levels and capacity constraints at our facilities, including those resulting from plant expansions and systems upgrades at our manufacturing facilities, could adversely affect our results.
- Our expansion plans in emerging markets, including establishing a greater manufacturing and marketing presence and growing our use of component suppliers, could entail significant risks.
- Our business increasingly is subject to regulations relating to privacy and data protection, and if we violate any of those regulations or otherwise are the victim of a cyber attack, we could incur significant losses and liability.
- We depend on suppliers for components, parts and raw materials for our products, and any failure by our suppliers to provide products as needed, or by us to promptly address supplier issues, will adversely impact our ability to timely and efficiently manufacture and sell products. It remains unclear, how, if at all, the recent outbreak of the coronavirus will impact the agricultural industry, our suppliers, or our global operations.
- We are subject to raw material price fluctuations, which can adversely affect our manufacturing costs.
- We face significant competition, and if we are unable to compete successfully against other agricultural equipment manufacturers, we would lose customers and our net sales and profitability would decline.
- We have a substantial amount of indebtedness, and, as a result, we are subject to certain restrictive covenants and payment obligations that may adversely affect our ability to operate and expand our business.
Further information concerning these and other factors is included in AGCO’s filings with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2019 and subsequent Form 10-Qs. AGCO disclaims any obligation to update any forward-looking statements except as required by law.
* * * * *
About AGCO
AGCO (NYSE: AGCO) is a global leader in the design, manufacture and distribution of agricultural solutions and delivers high-tech solutions for farmers feeding the world through its full line of equipment and related services. AGCO products are sold through five core brands, Challenger®, Fendt®, GSI®, Massey Ferguson® and Valtra®, supported by Fuse® smart farming solutions. Founded in 1990 and headquartered in Duluth, Georgia, USA, AGCO had net sales of
# # # # #
Please visit our website at www.agcocorp.com
AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited and in millions) |
|||||||
|
December 31, 2020 |
|
December 31, 2019 |
||||
ASSETS |
|
|
|
||||
Current Assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
1,119.1 |
|
|
$ |
432.8 |
|
Accounts and notes receivable, net |
856.0 |
|
|
800.5 |
|
||
Inventories, net |
1,974.4 |
|
|
2,078.7 |
|
||
Other current assets |
418.9 |
|
|
417.1 |
|
||
Total current assets |
4,368.4 |
|
|
3,729.1 |
|
||
Property, plant and equipment, net |
1,508.5 |
|
|
1,416.3 |
|
||
Right-of-use lease assets |
165.1 |
|
|
187.3 |
|
||
Investment in affiliates |
442.7 |
|
|
380.2 |
|
||
Deferred tax assets |
77.6 |
|
|
93.8 |
|
||
Other assets |
179.8 |
|
|
153.0 |
|
||
Intangible assets, net |
455.6 |
|
|
501.7 |
|
||
Goodwill |
1,306.5 |
|
|
1,298.3 |
|
||
Total assets |
$ |
8,504.2 |
|
|
$ |
7,759.7 |
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current Liabilities: |
|
|
|
||||
Current portion of long-term debt |
$ |
325.9 |
|
|
$ |
2.9 |
|
Short-term borrowings |
33.8 |
|
|
150.5 |
|
||
Accounts payable |
855.1 |
|
|
914.8 |
|
||
Accrued expenses |
1,916.7 |
|
|
1,654.2 |
|
||
Other current liabilities |
231.3 |
|
|
162.1 |
|
||
Total current liabilities |
3,362.8 |
|
|
2,884.5 |
|
||
Long-term debt, less current portion and debt issuance costs |
1,256.7 |
|
|
1,191.8 |
|
||
Operating lease liabilities |
125.9 |
|
|
148.6 |
|
||
Pension and postretirement health care benefits |
253.4 |
|
|
232.1 |
|
||
Deferred tax liabilities |
112.4 |
|
|
107.0 |
|
||
Other noncurrent liabilities |
375.0 |
|
|
288.7 |
|
||
Total liabilities |
5,486.2 |
|
|
4,852.7 |
|
||
|
|
|
|
||||
Stockholders’ Equity: |
|
|
|
||||
AGCO Corporation stockholders’ equity: |
|
|
|
||||
Common stock |
0.8 |
|
|
0.8 |
|
||
Additional paid-in capital |
30.9 |
|
|
4.7 |
|
||
Retained earnings |
4,759.1 |
|
|
4,443.5 |
|
||
Accumulated other comprehensive loss |
(1,810.8) |
|
|
(1,595.2) |
|
||
Total AGCO Corporation stockholders’ equity |
2,980.0 |
|
|
2,853.8 |
|
||
Noncontrolling interests |
38.0 |
|
|
53.2 |
|
||
Total stockholders’ equity |
3,018.0 |
|
|
2,907.0 |
|
||
Total liabilities and stockholders’ equity |
$ |
8,504.2 |
|
|
$ |
7,759.7 |
|
See accompanying notes to condensed consolidated financial statements.
AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited and in millions, except per share data) |
|||||||
|
Three Months Ended December 31, |
||||||
|
2020 |
|
2019 |
||||
Net sales |
$ |
2,717.1 |
|
|
$ |
2,513.6 |
|
Cost of goods sold |
2,121.5 |
|
|
2,000.1 |
|
||
Gross profit |
595.6 |
|
|
513.5 |
|
||
Selling, general and administrative expenses |
283.1 |
|
|
272.4 |
|
||
Engineering expenses |
99.9 |
|
|
89.1 |
|
||
Amortization of intangibles |
14.8 |
|
|
15.5 |
|
||
Impairment charges |
— |
|
|
176.6 |
|
||
Restructuring expenses |
14.3 |
|
|
6.0 |
|
||
Bad debt expense |
5.5 |
|
|
3.7 |
|
||
Income (loss) from operations |
178.0 |
|
|
(49.8) |
|
||
Interest expense, net |
1.9 |
|
|
4.0 |
|
||
Other (income) expense, net |
(15.1) |
|
|
20.1 |
|
||
Income (loss) before income taxes and equity in net earnings of affiliates |
191.2 |
|
|
(73.9) |
|
||
Income tax provision |
69.8 |
|
|
25.0 |
|
||
Income (loss) before equity in net earnings of affiliates |
121.4 |
|
|
(98.9) |
|
||
Equity in net earnings of affiliates |
14.0 |
|
|
9.3 |
|
||
Net income (loss) |
135.4 |
|
|
(89.6) |
|
||
Net loss attributable to noncontrolling interests |
— |
|
|
1.3 |
|
||
Net income (loss) attributable to AGCO Corporation and subsidiaries |
$ |
135.4 |
|
|
$ |
(88.3) |
|
Net income (loss) per common share attributable to AGCO Corporation and subsidiaries: |
|
|
|||||
Basic |
$ |
1.81 |
|
|
$ |
(1.17) |
|
Diluted |
$ |
1.78 |
|
|
$ |
(1.17) |
|
Cash dividends declared and paid per common share |
$ |
0.16 |
|
|
$ |
0.16 |
|
Weighted average number of common and common equivalent shares outstanding: |
|
|
|
||||
Basic |
74.9 |
|
75.6 |
||||
Diluted |
75.9 |
|
75.6 |
||||
See accompanying notes to condensed consolidated financial statements.
AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited and in millions, except per share data) |
|||||||
|
Years Ended December 31, |
||||||
|
2020 |
|
2019 |
||||
Net sales |
$ |
9,149.7 |
|
|
$ |
9,041.4 |
|
Cost of goods sold |
7,092.2 |
|
|
7,057.1 |
|
||
Gross profit |
2,057.5 |
|
|
1,984.3 |
|
||
Selling, general and administrative expenses |
1,001.5 |
|
|
1,040.3 |
|
||
Engineering expenses |
342.6 |
|
|
343.4 |
|
||
Amortization of intangibles |
59.5 |
|
|
61.1 |
|
||
Impairment charges |
20.0 |
|
|
176.6 |
|
||
Restructuring expenses |
19.7 |
|
|
9.0 |
|
||
Bad debt expense |
14.5 |
|
|
5.8 |
|
||
Income from operations |
599.7 |
|
|
348.1 |
|
||
Interest expense, net |
15.0 |
|
|
19.9 |
|
||
Other expense, net |
22.7 |
|
|
67.1 |
|
||
Income before income taxes and equity in net earnings of affiliates |
562.0 |
|
|
261.1 |
|
||
Income tax provision |
187.7 |
|
|
180.8 |
|
||
Income before equity in net earnings of affiliates |
374.3 |
|
|
80.3 |
|
||
Equity in net earnings of affiliates |
45.5 |
|
|
42.5 |
|
||
Net income |
419.8 |
|
|
122.8 |
|
||
Net loss attributable to noncontrolling interests |
7.3 |
|
|
2.4 |
|
||
Net income attributable to AGCO Corporation and subsidiaries |
$ |
427.1 |
|
|
$ |
125.2 |
|
Net income per common share attributable to AGCO Corporation and subsidiaries: |
|
|
|
||||
Basic |
$ |
5.69 |
|
|
$ |
1.64 |
|
Diluted |
$ |
5.65 |
|
|
$ |
1.63 |
|
Cash dividends declared and paid per common share |
$ |
0.63 |
|
|
$ |
0.63 |
|
Weighted average number of common and common equivalent shares outstanding: |
|
|
|
||||
Basic |
75.0 |
|
|
76.2 |
|
||
Diluted |
75.6 |
|
|
77.0 |
|
||
See accompanying notes to condensed consolidated financial statements.
AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited and in millions) |
|||||||
|
Years Ended December 31, |
||||||
|
2020 |
|
2019 |
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
419.8 |
|
|
$ |
122.8 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation |
212.5 |
|
|
210.9 |
|
||
Impairment charges |
20.0 |
|
|
176.6 |
|
||
Amortization of intangibles |
59.5 |
|
|
61.1 |
|
||
Stock compensation expense |
37.6 |
|
|
41.3 |
|
||
Equity in net earnings of affiliates, net of cash received |
(43.7) |
|
|
— |
|
||
Deferred income tax provision |
3.4 |
|
|
15.1 |
|
||
Other |
(7.4) |
|
|
6.9 |
|
||
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts and notes receivable, net |
(90.5) |
|
|
63.8 |
|
||
Inventories, net |
119.7 |
|
|
(216.3) |
|
||
Other current and noncurrent assets |
(49.8) |
|
|
(14.4) |
|
||
Accounts payable |
(59.1) |
|
|
35.7 |
|
||
Accrued expenses |
185.3 |
|
|
114.5 |
|
||
Other current and noncurrent liabilities |
89.2 |
|
|
77.9 |
|
||
Total adjustments |
476.7 |
|
|
573.1 |
|
||
Net cash provided by operating activities |
896.5 |
|
|
695.9 |
|
||
Cash flows from investing activities: |
|
|
|
||||
Purchases of property, plant and equipment |
(269.9) |
|
|
(273.4) |
|
||
Proceeds from sale of property, plant and equipment |
1.9 |
|
|
4.9 |
|
||
Purchase of businesses, net of cash acquired |
(2.8) |
|
|
— |
|
||
Sale of (investments in) unconsolidated affiliates, net |
29.1 |
|
|
(3.1) |
|
||
Net cash used in investing activities |
(241.7) |
|
|
(271.6) |
|
||
Cash flows from financing activities: |
|
|
|
||||
Proceeds from (repayments of) indebtedness, net |
150.0 |
|
|
(108.4) |
|
||
Purchases and retirement of common stock |
(55.0) |
|
|
(130.0) |
|
||
Payment of dividends to stockholders |
(48.0) |
|
|
(48.0) |
|
||
Payment of minimum tax withholdings on stock compensation |
(19.8) |
|
|
(28.1) |
|
||
Payment of debt issuance costs |
(1.4) |
|
|
(0.5) |
|
||
(Distributions to) investments by noncontrolling interests, net |
(3.1) |
|
|
1.6 |
|
||
Net cash provided by (used in) financing activities |
22.7 |
|
|
(313.4) |
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
8.8 |
|
|
(4.2) |
|
||
Increase in cash, cash equivalents and restricted cash |
686.3 |
|
|
106.7 |
|
||
Cash, cash equivalents and restricted cash, beginning of year |
432.8 |
|
|
326.1 |
|
||
Cash, cash equivalents and restricted cash, end of year |
$ |
1,119.1 |
|
|
$ |
432.8 |
|
See accompanying notes to condensed consolidated financial statements.
AGCO CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited, in millions, except share amounts, per share data and employees)
1. STOCK COMPENSATION EXPENSE
The Company recorded stock compensation expense as follows (in millions):
|
Three Months Ended December 31, |
|
Years Ended December 31, |
||||||||||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
||||||||
Cost of goods sold |
$ |
0.2 |
|
|
$ |
0.4 |
|
|
$ |
1.1 |
|
|
$ |
1.7 |
|
Selling, general and administrative expenses |
10.5 |
|
|
8.0 |
|
|
36.8 |
|
|
40.0 |
|
||||
Total stock compensation expense |
$ |
10.7 |
|
|
$ |
8.4 |
|
|
$ |
37.9 |
|
|
$ |
41.7 |
|
2. RESTRUCTURING EXPENSES
From 2014 through 2020, the Company announced and initiated several actions to rationalize employee headcount at various manufacturing facilities and administrative offices located in the U.S., Europe, South America, Africa and China in order to reduce costs in response to softening global market demand and lower production volumes. The aggregate headcount reduction was approximately 4,160 employees for the years 2014 to 2019. The Company had approximately
3. GOODWILL AND OTHER INTANGIBLES IMPAIRMENT CHARGES
Goodwill is tested for impairment on an annual basis and more often if indications of impairment exist. The Company conducts its annual impairment analyses as of October 1 each fiscal year. The COVID-19 pandemic has adversely impacted the global economy as a whole. Based on current macroeconomic conditions, the Company assessed its goodwill and other intangible assets for indications of impairment as of March 31, 2020, June 30, 2020 and September 30, 2020. As of June 30, 2020, the Company concluded there were indicators of impairment during the three months ended June 30, 2020 related to one of its smaller reporting units, which is a
During the three months ended December 31, 2019, the Company recorded a non-cash impairment charge of approximately
During the three months ended December 31, 2019, the Company also recorded a non-cash impairment charge of approximately
4. INDEBTEDNESS
Long-term debt at December 31, 2020 and 2019 consisted of the following (in millions):
|
December 31, 2020 |
|
December 31, 2019 |
||||
Senior term loan due 2022 |
$ |
184.0 |
|
|
$ |
168.1 |
|
Credit facility, expires 2023 |
277.9 |
|
|
— |
|
||
|
306.7 |
|
|
280.2 |
|
||
Senior term loans due between 2021 and 2028 |
806.0 |
|
|
736.2 |
|
||
Other long-term debt |
10.5 |
|
|
12.5 |
|
||
Debt issuance costs |
(2.5) |
|
|
(2.3) |
|
||
|
1,582.6 |
|
|
1,194.7 |
|
||
Less: |
|
|
|
||||
Senior term loans due 2021, net of debt issuance costs |
(323.6) |
|
|
— |
|
||
Current portion of other long-term debt |
(2.3) |
|
|
(2.9) |
|
||
Total long-term indebtedness, less current portion |
$ |
1,256.7 |
|
|
$ |
1,191.8 |
|
As of December 31, 2020 and 2019, the Company had short-term borrowings due within one year of approximately
On April 9, 2020, the Company entered into an amendment to its
5. INVENTORIES
Inventories at December 31, 2020 and 2019 were as follows (in millions):
|
December 31, 2020 |
|
December 31, 2019 |
||||
Finished goods |
$ |
641.3 |
|
|
$ |
780.1 |
|
Repair and replacement parts |
652.3 |
|
|
611.5 |
|
||
Work in process |
175.1 |
|
|
213.4 |
|
||
Raw materials |
505.7 |
|
|
473.7 |
|
||
Inventories, net |
$ |
1,974.4 |
|
|
$ |
2,078.7 |
|
6. ACCOUNTS RECEIVABLE SALES AGREEMENTS
The Company had accounts receivable sales agreements that permit the sale, on an ongoing basis, of a majority of its wholesale receivables in North America, Europe and Brazil to its U.S., Canadian, European and Brazilian finance joint ventures. As of December 31, 2020 and 2019, the cash received from receivables sold under the U.S., Canadian, European and Brazilian accounts receivable sales agreements was approximately
Losses on sales of receivables associated with the accounts receivable financing facilities discussed above, reflected within “Other expense, net” in the Company’s Condensed Consolidated Statements of Operations, were approximately
The Company’s finance joint ventures in Europe, Brazil and Australia also provide wholesale financing directly to the Company’s dealers. As of December 31, 2020 and 2019, these finance joint ventures had approximately
7. NET INCOME PER SHARE
A reconciliation of net income (loss) attributable to AGCO Corporation and subsidiaries and weighted average common shares outstanding for purposes of calculating basic and diluted net income (loss) per share for the three months and years ended December 31, 2020 and 2019 is as follows (in millions, except per share data):
|
Three Months Ended December 31, |
|
Years Ended December 31, |
||||||||||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
||||||||
Basic net income (loss) per share: |
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to AGCO Corporation and subsidiaries |
$ |
135.4 |
|
|
$ |
(88.3) |
|
|
$ |
427.1 |
|
|
$ |
125.2 |
|
Weighted average number of common shares outstanding |
74.9 |
|
|
75.6 |
|
|
75.0 |
|
|
76.2 |
|
||||
Basic net income (loss) per share attributable to AGCO Corporation and subsidiaries |
$ |
1.81 |
|
|
$ |
(1.17) |
|
|
$ |
5.69 |
|
|
$ |
1.64 |
|
Diluted net income (loss) per share: |
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to AGCO Corporation and subsidiaries |
$ |
135.4 |
|
|
$ |
(88.3) |
|
|
$ |
427.1 |
|
|
$ |
125.2 |
|
Weighted average number of common shares outstanding |
74.9 |
|
|
75.6 |
|
{
"@context": "https://schema.org",
"@type": "FAQPage",
"name": "AGCO Reports Fourth Quarter Results FAQs",
"mainEntity": [
{
"@type": "Question",
"name": "What were AGCO's fourth quarter 2020 net sales?",
"acceptedAnswer": {
"@type": "Answer",
"text": "AGCO reported net sales of approximately <b>$2.7 billion</b> for Q4 2020."
}
},
{
"@type": "Question",
"name": "How much was AGCO's net income per share for the fourth quarter of 2020?",
"acceptedAnswer": {
"@type": "Answer",
"text": "AGCO's net income was <b>$1.78</b> per share for Q4 2020."
}
},
{
"@type": "Question",
"name": "What is AGCO's earnings forecast for 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "AGCO forecasts 2021 earnings per share in the range of <b>$7.00</b> to <b>$7.25</b>."
}
},
{
"@type": "Question",
"name": "How did AGCO's sales perform in South America for the fourth quarter of 2020?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Sales in South America increased by <b>21.1%</b> in Q4 2020 compared to Q4 2019."
}
},
{
"@type": "Question",
"name": "What was AGCO's overall performance for the full year 2020?",
"acceptedAnswer": {
"@type": "Answer",
"text": "For the full year 2020, AGCO reported net sales of approximately <b>$9.1 billion</b>, up <b>1.2%</b> from 2019."
}
}
]
}
FAQ
What were AGCO's fourth quarter 2020 net sales?
AGCO reported net sales of approximately $2.7 billion for Q4 2020.
How much was AGCO's net income per share for the fourth quarter of 2020?
AGCO's net income was $1.78 per share for Q4 2020.
What is AGCO's earnings forecast for 2021?
AGCO forecasts 2021 earnings per share in the range of $7.00 to $7.25.
How did AGCO's sales perform in South America for the fourth quarter of 2020?
Sales in South America increased by 21.1% in Q4 2020 compared to Q4 2019.
What was AGCO's overall performance for the full year 2020?
For the full year 2020, AGCO reported net sales of approximately $9.1 billion, up 1.2% from 2019.
AGCO Corporation
NYSE:AGCOAGCO RankingsAGCO Latest NewsAGCO Stock Data
6.99B
62.05M
16.88%
85.61%
6.13%
Farm & Heavy Construction Machinery
Farm Machinery & Equipment
United States of America
DULUTH
| |||||||||