AGCO Corp Earnings Beat Estimates in Q4, Sales Decrease 24% Y/Y

Core Viewpoint - AGCO Corp. reported a significant decline in earnings and sales for the fourth quarter of 2024, with adjusted EPS of $1.97, down from$3.78 in the prior year, although it exceeded the Zacks Consensus Estimate of $1.80 [1][2]. Financial Performance - The company posted a loss of$5.69 including one-time items, compared to an EPS of $15.63 in 2023 [2][10]. - Net sales decreased by 24$2.89 billion, missing the Zacks Consensus Estimate of $3.16 billion [2][10]. - Excluding unfavorable currency impacts, net sales fell by 22.2$2.2 billion, while gross profit fell by 29.9% to $689 million, resulting in a gross margin of 23.9$323 million from $417 million year over year [4]. - Adjusted income from operations fell by 29.6$285 million, with an operating margin of 9.9%, down from 10.7% in the previous year [4]. Segment Performance - North America segment sales dropped by 38.7% to $547 million, missing estimates, with operating income falling to$4 million from $80.5 million [5]. - South America segment sales decreased by 31.6$282 million, with operating profit increasing to $30 million from$15.7 million [6]. - EME segment sales were $1.88 billion, down from$2.26 billion, with operating income of $271 million compared to$367 million in the prior year [7]. - Asia/Pacific segment sales fell by 26.2% to $176 million, with operating profit down 72.3$5.3 million [8]. Cash Flow and Guidance - Cash and cash equivalents increased to $613 million at the end of 2024 from$596 million at the end of 2023, while net cash from operating activities decreased to $0.69 billion from$1.10 billion [9]. - For 2025, AGCO expects net sales of $9.6 billion and projects an EPS of$4.00-$4.50, anticipating lower sales volumes and unfavorable currency translation impacts [12]. Stock Performance - AGCO's shares have declined by 13.6% over the past year, contrasting with the industry's growth of 20.8% [13].