AGCO, Your Agriculture Company (NYSE: AGCO), a worldwide
manufacturer and distributor of agricultural equipment and
solutions, reported its results for the first quarter ended March
31, 2021. Net sales for the first quarter were approximately $2.4
billion, an increase of approximately 23.4% compared to the first
quarter of 2020. Reported net income was $1.99 per share for the
first quarter of 2021, and adjusted net income(3), which excludes
restructuring expenses, was $2.00 per share. These results compare
to reported net income of $0.85 per share, and adjusted net income,
excluding restructuring expenses, of $0.86 per share for the first
quarter of 2020. Excluding favorable currency translation impacts
of approximately 3.5%, net sales in the first quarter of 2021
increased approximately 19.8% compared to the first quarter of
2020.
Highlights
- Reported regional sales results(1): Europe/Middle East (“EME”)
19.2%, North America 10.7%, South America 56.3%,
Asia/Pacific/Africa (“APA”) 83.1%
- Constant currency regional sales results(1)(2)(3): EME 11.5%,
North America 9.7%, South America 83.8%, APA 65.9%
- Regional operating margin performance: EME 10.9%, North America
12.3%, South America 6.7%, APA 10.5%
- Increased quarterly dividend by 25% and declared variable
special dividend of $4.00 per share
- Raised full-year outlook for net sales and net income per
share
(1)
As compared to first quarter 2020.
(2)
Excludes currency translation impact.
(3)
See reconciliation of Non-GAAP measures in
appendix.
“AGCO continued its strong operational performance in the first
quarter and set records for first quarter operating income and
earnings per share,” stated Eric Hansotia, AGCO’s Chairman,
President and Chief Executive Officer. “Favorable market demand and
positive market response to our technology-focused products helped
produce sales growth and margin expansion across all regions.
Outstanding execution from our team allowed us to minimize the
impact of ongoing supply constraints, and an improved pricing
environment helped offset material and freight cost inflation.
Healthy farm fundamentals are driving robust replacement demand and
our order boards remain well ahead of last year. With increased
visibility for the coming quarters, we have raised our net sales
and earnings forecast for 2021 while enabling continued investment
in our premium technology, smart farming solutions and enhanced
digital capabilities.”
Market Update
Industry Unit Retail
Sales
Tractors
Combines
Three Months Ended March 31, 2021
Change from Prior Year Period
Change from Prior Year Period
North America(1)
31%
17%
South America
33%
26%
Western Europe(2)
23%
16%
(1)
Excludes compact tractors.
(2)
Based on Company estimates.
“The ongoing economic recovery from the COVID-19 pandemic is
putting pressure on global grain inventories which are well below
last year’s levels,” stated Mr. Hansotia. “As a result, prices of
soft commodity are supporting more favorable farm economics as well
as increased demand for machinery. These improved conditions are
expected to generate industry growth across all the major markets
in 2021.”
“North American industry retail sales increased in the first
three months of 2021 compared to the same period in 2020,”
continued Mr. Hansotia. “Sales of low horsepower tractors moved
above prior peak levels while demand for high horsepower tractors
also improved. With the fleet age remaining extended, industry
retail sales of North America large agricultural equipment grew
approximately 12% in the first quarter. Industry retail sales in
Western Europe also increased in the first quarter of 2021 with
growth across nearly all major markets. With higher wheat, dairy
and livestock prices projecting favorable farm economics, farmer
sentiment is expected to remain strong in Western Europe,
supporting increased equipment demand in 2021. In South America,
industry sales increased during the first three months of 2021
driven by improved demand in both Brazil and Argentina as well as
recovery in the smaller export markets. A healthy first crop as
well as favorable exchange rates are supporting positive economic
conditions for farmers who continue to replace an aged fleet. Our
long-term global view remains positive. Increasing demand for
commodities, driven by the growing world population, as well as
rising emerging market protein consumption and biofuel use, are
expected to support elevated farm income and healthy conditions in
our industry.”
Regional Results
AGCO Regional Net Sales (in millions)
Three Months Ended March 31,
2021
2020
% change from 2020
% change from 2020 due to
currency translation(1)
% change excluding currency
translation
North America
$
611.1
$
551.9
10.7
%
1.0
%
9.7
%
South America
240.5
153.9
56.3
%
(27.6
)%
83.8
%
Europe/Middle East
1,327.2
1,113.3
19.2
%
7.8
%
11.5
%
Asia/Pacific/Africa
199.9
109.2
83.1
%
17.1
%
65.9
%
Total
$
2,378.7
$
1,928.3
23.4
%
3.5
%
19.8
%
(1)
See Footnotes for additional
disclosures.
North America
AGCO’s North American net sales increased 9.7% in the first
three months of 2021 compared to the same period of 2020, excluding
the positive impact of currency translation. Increased sales of
tractors, parts, grain and protein equipment and Precision Planting
products generated most of the increase. Income from operations for
the first three months of 2021 grew approximately $14.0 million
compared to the same period in 2020 and operating margins reached
12.3%. Higher sales and production as well as the benefit of
favorable pricing contributed to the improvement.
South America
Net sales in the South American region increased 83.8% in the
first three months of 2021 compared to the same period of 2020,
excluding the impact of unfavorable currency translation. Sales
grew across all markets with the largest increases in Brazil and
Argentina. Income from operations in the first three months of 2021
increased by approximately $25.0 million compared to the same
period in 2020. The improved South America results reflect the
benefit of higher sales and production, in addition to a richer
sales mix with improved pricing offsetting material cost
inflation.
Europe/Middle East
AGCO’s Europe/Middle East net sales increased 11.5% in the first
three months of 2021 compared to the same period in 2020, excluding
favorable currency translation impacts. Sales growth was achieved
in all major markets with high horsepower tractors and parts
showing the largest increases. Income from operations increased
approximately $42.0 million in the first three months of 2021,
compared to the same period in 2020, due to higher net sales and
production volumes.
Asia/Pacific/Africa
Net sales in Asia/Pacific/Africa increased 65.9%, excluding the
positive impact of currency translation, in the first three months
of 2021 compared to the same period in 2020. Higher sales in China,
Australia as well as Africa produced most of the increase. Income
from operations improved by approximately $22.3 million in the
first three months of 2021, compared to the same period in
2020.
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 $10.6
billion to $10.8 billion, reflecting improved sales volumes,
pricing and positive foreign currency translation. Gross and
operating margins are projected to improve from 2020 levels,
reflecting the impact of higher sales and production volumes as
well as margin improvement initiatives. These improvements are
planned to fund increases in engineering and other technology
investments to support AGCO’s precision agriculture and digital
initiatives. Based on these assumptions, 2021 earnings per share is
targeted in a range from $8.40 to $8.60.
* * * * *
AGCO will host a conference call with respect to this earnings
announcement at 10:00 a.m. Eastern Time on Thursday, April 29,
2021. 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 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,
2020. 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 over $9.1 billion in 2020. For more information, visit
http://www.agcocorp.com. For company news, information and events,
please follow us on Twitter: @AGCOCorp. For financial news on
Twitter, please follow the hashtag #AGCOIR.
# # # # #
Please visit our website at www.agcocorp.com
AGCO CORPORATION AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited and in millions)
March 31, 2021
December 31, 2020
ASSETS
Current Assets:
Cash and cash equivalents
$
453.7
$
1,119.1
Accounts and notes receivable, net
1,048.2
856.0
Inventories, net
2,360.3
1,974.4
Other current assets
436.1
418.9
Total current assets
4,298.3
4,368.4
Property, plant and equipment, net
1,448.3
1,508.5
Right-of-use lease assets
158.5
165.1
Investment in affiliates
444.1
442.7
Deferred tax assets
70.8
77.6
Other assets
184.0
179.8
Intangible assets, net
431.5
455.6
Goodwill
1,276.8
1,306.5
Total assets
$
8,312.3
$
8,504.2
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current Liabilities:
Current portion of long-term debt
$
311.9
$
325.9
Short-term borrowings
51.8
33.8
Accounts payable
1,097.5
855.1
Accrued expenses
1,685.1
1,916.7
Other current liabilities
268.3
231.3
Total current liabilities
3,414.6
3,362.8
Long-term debt, less current portion and
debt issuance costs
936.6
1,256.7
Operating lease liabilities
119.6
125.9
Pension and postretirement health care
benefits
216.2
253.4
Deferred tax liabilities
109.1
112.4
Other noncurrent liabilities
391.5
375.0
Total liabilities
5,187.6
5,486.2
Stockholders’ Equity:
AGCO Corporation stockholders’ equity:
Common stock
0.8
0.8
Additional paid-in capital
5.7
30.9
Retained earnings
4,897.9
4,759.1
Accumulated other comprehensive loss
(1,817.9
)
(1,810.8
)
Total AGCO Corporation stockholders’
equity
3,086.5
2,980.0
Noncontrolling interests
38.2
38.0
Total stockholders’ equity
3,124.7
3,018.0
Total liabilities and stockholders’
equity
$
8,312.3
$
8,504.2
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 March 31,
2021
2020
Net sales
$
2,378.7
$
1,928.3
Cost of goods sold
1,808.2
1,477.8
Gross profit
570.5
450.5
Selling, general and administrative
expenses
260.6
247.6
Engineering expenses
96.3
84.9
Amortization of intangibles
17.5
15.0
Restructuring expenses
1.3
0.8
Bad debt (credit) expense
(0.4
)
1.8
Income from operations
195.2
100.4
Interest expense, net
3.4
3.4
Other expense, net
11.5
12.5
Income before income taxes and equity in
net earnings of affiliates
180.3
84.5
Income tax provision
43.6
29.4
Income before equity in net earnings of
affiliates
136.7
55.1
Equity in net earnings of affiliates
14.7
11.2
Net income
151.4
66.3
Net income attributable to noncontrolling
interests
(0.6
)
(1.6
)
Net income attributable to AGCO
Corporation and subsidiaries
$
150.8
$
64.7
Net income per common share attributable
to AGCO Corporation and subsidiaries:
Basic
$
2.00
$
0.86
Diluted
$
1.99
$
0.85
Cash dividends declared and paid per
common share
$
0.16
$
0.16
Weighted average number of common and
common equivalent shares outstanding:
Basic
75.3
75.3
Diluted
75.9
75.9
See accompanying notes to
condensed consolidated financial statements.
AGCO CORPORATION AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
(unaudited and in millions)
Three Months Ended March 31,
2021
2020
Cash flows from operating activities:
Net income
$
151.4
$
66.3
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation
54.8
51.6
Amortization of intangibles
17.5
15.0
Stock compensation expense
6.8
2.6
Equity in net earnings of affiliates, net
of cash received
(14.7
)
(11.2
)
Deferred income tax provision
4.1
3.8
Other
1.9
4.1
Changes in operating assets and
liabilities:
Accounts and notes receivable, net
(232.3
)
(109.6
)
Inventories, net
(466.1
)
(252.1
)
Other current and noncurrent assets
(45.8
)
(65.4
)
Accounts payable
296.7
(32.7
)
Accrued expenses
(175.7
)
(206.7
)
Other current and noncurrent
liabilities
86.1
99.0
Total adjustments
(466.7
)
(501.6
)
Net cash used in operating activities
(315.3
)
(435.3
)
Cash flows from investing activities:
Purchases of property, plant and
equipment
(63.5
)
(60.6
)
Proceeds from sale of property, plant and
equipment
0.1
0.4
Investment in unconsolidated
affiliates
(0.1
)
(2.5
)
Purchase of businesses, net of cash
acquired
(0.8
)
—
Other
(2.5
)
—
Net cash used in investing activities
(66.8
)
(62.7
)
Cash flows from financing activities:
Proceeds from indebtedness, net
(221.5
)
559.8
Purchases and retirement of common
stock
—
(55.0
)
Payment of dividends to stockholders
(12.0
)
(12.1
)
Payment of minimum tax withholdings on
stock compensation
(26.5
)
(16.0
)
Net cash (used in) provided by financing
activities
(260.0
)
476.7
Effects of exchange rate changes on cash,
cash equivalents and restricted cash
(23.3
)
(24.8
)
Decrease in cash, cash equivalents and
restricted cash
(665.4
)
(46.1
)
Cash, cash equivalents and restricted
cash, beginning of period
1,119.1
432.8
Cash, cash equivalents and restricted
cash, end of period
$
453.7
$
386.7
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 March 31,
2021
2020
Cost of goods sold
$
0.3
$
0.1
Selling, general and administrative
expenses
6.5
2.5
Total stock compensation expense
$
6.8
$
2.6
2. RESTRUCTURING EXPENSES
In recent years, the Company has announced and initiated several
actions to rationalize employee headcount in 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. The Company also has
undertaken rationalizations of its grain and protein business
during 2019 and 2020. As of December 31, 2020, the Company had
approximately $16.8 million of accrued severance, facility closure
and other costs related to such rationalizations. During the three
months ended March 31, 2021, the Company recorded an additional
$1.3 million of severance and related costs associated with further
rationalizations, and paid approximately $6.2 million of severance
and facility closure costs. The remaining $11.6 million of
severance, facility closure and other related costs as of March 31,
2021, inclusive of approximately $0.3 million of negative foreign
currency translation impacts, are expected to be paid primarily
during 2021.
3. INDEBTEDNESS
Long-term debt at March 31, 2021 and December 31, 2020 consisted
of the following (in millions):
March 31, 2021
December 31, 2020
Senior term loan due 2022
$
176.1
$
184.0
Credit facility, expires 2023
—
277.9
1.002% Senior term loan due 2025
293.4
306.7
Senior term loans due between 2021 and
2028
771.1
806.0
Other long-term debt
10.0
10.5
Debt issuance costs
(2.1
)
(2.5
)
1,248.5
1,582.6
Less:
Senior term loans due 2021, net of debt
issuance costs
(309.7
)
(323.6
)
Current portion of other long-term
debt
(2.2
)
(2.3
)
Total long-term indebtedness, less current
portion
$
936.6
$
1,256.7
As of March 31, 2021 and December 31, 2020, the Company had
short-term borrowings due within one year of approximately $51.8
million and $33.8 million, respectively.
4. INVENTORIES
Inventories at March 31, 2021 and December 31, 2020 were as
follows (in millions):
March 31, 2021
December 31, 2020
Finished goods
$
768.9
$
641.3
Repair and replacement parts
684.8
652.3
Work in process
317.0
175.1
Raw materials
589.6
505.7
Inventories, net
$
2,360.3
$
1,974.4
5. ACCOUNTS RECEIVABLE SALES AGREEMENTS
The Company has 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
March 31, 2021 and December 31, 2020, the cash received from
receivables sold under the U.S., Canadian, European and Brazilian
accounts receivable sales agreements was approximately $1.3 billion
and $1.5 billion, respectively.
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 $4.6 million and $8.1
million, respectively, during the three months ended March 31, 2021
and 2020.
The Company’s finance joint ventures in Europe, Brazil and
Australia also provide wholesale financing directly to the
Company’s dealers. As of March 31, 2021 and December 31, 2020,
these finance joint ventures had approximately $80.7 million and
$85.2 million, respectively, of outstanding accounts receivable
associated with these arrangements. In addition, the Company sells
certain trade receivables under factoring arrangements to other
financial institutions around the world.
6. NET INCOME PER SHARE
A reconciliation of net income attributable to AGCO Corporation
and subsidiaries and weighted average common shares outstanding for
purposes of calculating basic and diluted net income per share for
the three months ended March 31, 2021 and 2020 is as follows (in
millions, except per share data):
Three Months Ended March 31,
2021
2020
Basic net income per share:
Net income attributable to AGCO
Corporation and subsidiaries
$
150.8
$
64.7
Weighted average number of common shares
outstanding
75.3
75.3
Basic net income per share attributable to
AGCO Corporation and subsidiaries
$
2.00
$
0.86
Diluted net income per share:
Net income attributable to AGCO
Corporation and subsidiaries
$
150.8
$
64.7
Weighted average number of common shares
outstanding
75.3
75.3
Dilutive stock-settled appreciation
rights, performance share awards and restricted stock units
0.6
0.6
Weighted average number of common shares
and common share equivalents outstanding for purposes of computing
diluted net income per share
75.9
75.9
Diluted net income per share attributable
to AGCO Corporation and subsidiaries
$
1.99
$
0.85
7. SEGMENT REPORTING
The Company’s four reportable segments distribute a full range
of agricultural equipment and related replacement parts. The
Company evaluates segment performance primarily based on income
from operations. Sales for each segment are based on the location
of the third-party customer. The Company’s selling, general and
administrative expenses and engineering expenses are generally
charged to each segment based on the region and division where the
expenses are incurred. As a result, the components of income from
operations for one segment may not be comparable to another
segment. Segment results for the three months ended March 31, 2021
and 2020 are as follows (in millions):
Three Months Ended March 31,
North America
South America
Europe/Middle East
Asia/Pacific/Africa
Consolidated
2021
Net sales
$
611.1
$
240.5
$
1,327.2
$
199.9
$
2,378.7
Income from operations
74.9
16.2
144.3
21.0
256.4
2020
Net sales
$
551.9
$
153.9
$
1,113.3
$
109.2
$
1,928.3
Income (loss) from operations
60.9
(8.8
)
102.3
(1.3
)
153.1
A reconciliation from the segment information to the
consolidated balances for income from operations is set forth below
(in millions):
Three Months Ended March 31,
2021
2020
Segment income from operations
$
256.4
$
153.1
Corporate expenses
(35.9
)
(34.4
)
Amortization of intangibles
(17.5
)
(15.0
)
Stock compensation expense
(6.5
)
(2.5
)
Restructuring expenses
(1.3
)
(0.8
)
Consolidated income from operations
$
195.2
$
100.4
RECONCILIATION OF NON-GAAP MEASURES
This earnings release discloses adjusted income from operations,
adjusted net income, adjusted net income per share, and net sales
on a constant currency basis, each of which exclude amounts that
are typically included in the most directly comparable measure
calculated in accordance with U.S. generally accepted accounting
principles (“GAAP”). A reconciliation of each of those measures to
the most directly comparable GAAP measure is included below.
The following is a reconciliation of reported income from
operations, net income and net income per share to adjusted income
from operations, adjusted net income and adjusted net income per
share for the three months ended March 31, 2021 and 2020 (in
millions, except per share data):
Three Months Ended March 31,
2021
2020
Income From Operations
Net Income(1)
Net Income Per Share(1)(2)
Income From Operations
Net Income(1)(2)
Net Income Per Share(1)
As reported
$
195.2
$
150.8
$
1.99
$
100.4
$
64.7
$
0.85
Restructuring expenses(3)
1.3
1.3
0.02
0.8
0.7
0.01
As adjusted
$
196.5
$
152.1
$
2.00
$
101.2
$
65.5
$
0.86
(1)
Net income and net income per share
amounts are after tax.
(2)
Rounding may impact summation of
amounts.
(3)
The restructuring expenses recorded during
the three months ended March 31, 2021 and 2020 related primarily to
severance and other related costs associated with the Company’s
rationalization of certain U.S., European and South American
manufacturing operations and various administrative offices,
including costs associated with the Company’s rationalization of
its grain and protein business.
The following table sets forth, for the three months ended March
31, 2021 and 2020, the impact to net sales of currency translation
by geographical segment (in millions, except percentages):
Three Months Ended March 31,
Change due to currency
translation
2021
2020
% change from 2020
$
%
North America
$
611.1
$
551.9
10.7
%
$
5.7
1.0
%
South America
240.5
153.9
56.3
%
(42.4
)
(27.6
)%
Europe/Middle East
1,327.2
1,113.3
19.2
%
86.4
7.8
%
Asia/Pacific/Africa
199.9
109.2
83.1
%
18.7
17.1
%
$
2,378.7
$
1,928.3
23.4
%
$
68.4
3.5
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210429005288/en/
Greg Peterson Vice President, Investor Relations 770-232-8229
greg.peterson@agcocorp.com
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