DULUTH, Ga. – AGCO Corporation (NYSE: AGCO), a global leader in the design and manufacturing of agricultural machinery, reported a decrease in first-quarter sales and provided full-year guidance below analyst expectations. The company’s shares fell 1.9% in response to the news.
For the first quarter ended March 31, 2024, AGCO reported net sales of $2.9 billion, down 12.1% from the same period last year and below the consensus estimate of $2.99 billion. Adjusted earnings per share (EPS) for the quarter were $2.32, slightly ahead of the analyst estimate of $2.26 but down from $3.51 YoY.
Eric Hansotia, AGCO’s Chairman, President, and CEO, attributed the sales decline to the global drop in demand for agricultural equipment, leading to significant production cuts. Despite these challenges, Hansotia highlighted the company’s strategic execution, including the completion of the PTx Trimble joint venture and the launch of the PTx brand.
Looking ahead, AGCO forecasted full-year 2024 net sales of approximately $13.5 billion, with adjusted operating margins projected at around 11.3%. The company’s full-year 2024 EPS guidance is set at $12.00, both of which are below the analyst consensus of $13.613 billion in revenue and $12.89 EPS. The lower guidance reflects expected lower sales volumes, adverse foreign currency translation, and modest positive pricing, despite the inclusion of PTx Trimble.
AGCO’s regional performance varied, with sales in Europe/Middle East (EME) growing by 1.5%, while North America, South America, and Asia/Pacific/Africa experienced declines. The company’s EME region saw slight growth despite weaker conditions in Italy, Finland, and the United Kingdom.
The company remains focused on managing costs and working capital to mitigate market pressures while continuing to invest in precision agriculture and digital initiatives. AGCO’s strategic efforts are aimed at enhancing its technology offerings and supporting the development and distribution of next-generation agricultural technologies.
Despite the market’s negative response to the guidance, AGCO is committed to executing its strategy and delivering value to shareholders through dividends and investments in high-margin initiatives.
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