AGCO REPORTS FOURTH QUARTER AND 2024 FULL YEAR RESULTS

Core Insights - AGCO reported a significant decline in net sales for Q4 2024, totaling $2.9 billion, a decrease of 24.0% compared to Q4 2023, with a reported net loss of $(3.42) per share [1][2] - For the full year 2024, net sales were approximately $11.7 billion, down 19.1% from 2023, with a reported net loss of $(5.69) per share [2][7] - The company achieved an adjusted operating margin of 9.9% in Q4 2024, despite challenging market conditions and a 33% reduction in production hours [3][6] Financial Performance - Q4 2024 net sales were $2,887.3 million, down from $3,800.7 million in Q4 2023, with a gross profit of $688.7 million [24] - Full-year 2024 net sales were $11,661.9 million, compared to $14,412.4 million in 2023, with a gross profit of $2,899.1 million [25] - The company recorded impairment charges of $364.2 million in Q4 2024, contributing to a loss from operations of $(268.8) million [24][25] Regional Sales Performance - North American net sales decreased by 24.0% in 2024, with significant declines in high-horsepower and mid-range tractor categories [13] - South American net sales fell by 41.1% in 2024, primarily due to lower sales of high-horsepower tractors and combines [14] - Europe/Middle East region saw a 10.9% decrease in net sales for 2024, with declines in mid-range and high-horsepower tractors [15] Market Dynamics - The agricultural market is facing challenges, including fluctuating prices for key crops and geopolitical instability affecting supply chains [6] - North American industry retail tractor sales decreased by 13% in 2024, while combine unit sales dropped by 22% [5][6] - Brazil's tractor sales decreased by 4% in 2024, with mixed market dynamics expected to persist into 2025 [7][9] Strategic Outlook - AGCO plans to continue its Farmer-First strategy in 2025, focusing on cost control and investments in technology to enhance resilience [3][17] - The company anticipates net sales of approximately $9.6 billion for 2025, with earnings per share targeted between $4.00 and $4.50 [17] - Adjusted operating margins are projected to be around 7% - 7.5% in 2025, reflecting ongoing cost control measures [17]