AGCO and CNH facing headwinds
AGCO and CNH Industrial reported their financial results over the third quarter of 2024. Both companies experienced a significant downturn, mainly caused by high expenses, low commodity prices and the current global geopolitical situation. AGCO reported net sales of $2.6 billion for the third quarter ended September 30, 2024, a decrease of 24.8% compared to […]
AGCO and CNH Industrial reported their financial results over the third quarter of 2024. Both companies experienced a significant downturn, mainly caused by high expenses, low commodity prices and the current global geopolitical situation.
AGCO reported net sales of $2.6 billion for the third quarter ended September 30, 2024, a decrease of 24.8% compared to the third quarter of 2023. Excluding unfavorable foreign currency translation of 0.6%, net sales in the third quarter of 2024 decreased 24.2% compared to the third quarter of 2023.
Net sales for the first nine months of 2024 were approximately $8.8 billion, which is a decrease of 17.3% compared to the same period in 2023. For the first nine months of 2024, reported net loss was $(2.27) per share, which includes the estimated loss on the Grain & Protein business held for sale, and adjusted net income(1) was $5.53 per share. These results compare to reported net income of $11.10 per share and adjusted net income(1) of $11.77 per share for the same period in 2023. Excluding unfavorable foreign currency translation of 0.2%, net sales in the first nine months of 2024 decreased 17.1% compared to the same period in 2023.
“We continue to execute against our Farmer-First strategy focused on enhancing profitability through the cycle with our three high-margin initiatives, recent portfolio moves and aggressive actions to control expenses including our ongoing restructuring program,” said Eric Hansotia, AGCO’s Chairman, President and Chief Executive Officer. “The reaffirmation of our full-year adjusted operating margin outlook of 9% underscores this transformation, especially considering the significant market downturn in the third quarter. Low commodity prices and high input costs led to increased conservatism from our dealers and farmers resulting in ongoing production cuts to help reduce AGCO and dealer inventories.”
Hansotia continued, “A key pillar of our Farmer-First strategy is growing our precision ag business through our new PTx portfolio of brands. AGCO is making progress toward our long-term ambition of full autonomy across the crop cycle by 2030. In August, PTx Trimble introduced OutRun, the autonomous retrofit grain cart solution in the market, and the latest offering that demonstrates our commitment to retrofit-first and mixed-fleets. We believe these types of innovations, along with the completed divestiture of the Grain & Protein business, will allow us to focus on delivering higher margin products and better position AGCO for an upturn in the cycle.”
Over the same first nine months of 2024, CNH Industrial reported net income of $310 million and diluted earnings per share of $0.24 compared with net income of $540 million and diluted earnings per share of $0.40. Consolidated revenues were $4.65 billion (down 22% compared to Q3 2023) and Net sales of Industrial Activities were $4.00 billion (down 25% compared to Q3 2023). Net cash provided by operating activities was $791 million and Industrial Free Cash Flow absorption was $180 million in Q3 2024.
“With the current challenging market conditions facing farmers across the globe, CNH is implementing decisions to advance our transformation journey”, says CEO Gerrit Marx. “We have focused on making the company’s operations more efficient and on being more responsive to our customers’ needs. But dealer inventories remain elevated and will require additional efforts to align with retail demand. As we further adjust production levels while making investments in technology and quality-improving processes, we are positioning ourselves for the long term and cementing our leading position in the industry. We look forward to sharing more details of our strategy at our investor day on May 8, 2025.”
