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AGCO Reports Second Quarter Results

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About AGCO

AGCO, Your Agriculture Company, (NYSE: AGCO), is a global leader focused on the design, manufacture and distribution of agricultural machinery. AGCO supports more productive farming through a full line of tractors, combines, hay tools, sprayers, forage equipment, tillage, implements, grain storage and protein production systems, as well as related replacement parts. AGCO products are sold through five core machinery brands, Challenger®, Fendt®, Massey Ferguson®, Valtra® and GSI®, and are distributed globally through 3,150 independent dealers and distributors in more than 140 countries worldwide. Retail financing is available through AGCO Finance for qualified purchasers. Founded in 1990, AGCO is headquartered in Duluth, Georgia, USA. In 2012, AGCO had net sales of $10.0 billion. For more information, see http://www.agcocorp.com

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Please visit our website at www.agcocorp.com

AGCO CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited and in millions)
       
June 30, 2013 December 31, 2012
ASSETS
Current Assets:
Cash and cash equivalents $ 680.6 $ 781.3
Accounts and notes receivable, net 1,286.1 924.6
Inventories, net 2,043.0 1,703.1
Deferred tax assets 211.5 243.5
Other current assets 295.8   302.2  
Total current assets 4,517.0 3,954.7
Property, plant and equipment, net 1,410.9 1,406.1
Investment in affiliates 391.4 390.3
Deferred tax assets 41.1 40.0
Other assets 121.6 131.2
Intangible assets, net 589.4 607.1
Goodwill 1,163.6   1,192.4  
Total assets $ 8,235.0   $ 7,721.8  
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current portion of long-term debt $ 88.1 $ 59.1
Convertible senior subordinated notes 196.7 192.1
Accounts payable 1,063.8 888.3
Accrued expenses 1,286.8 1,226.5
Other current liabilities 139.7   98.8  
Total current liabilities 2,775.1 2,464.8
Long-term debt, less current portion 1,077.5 1,035.6
Pensions and postretirement health care benefits 309.8 331.6
Deferred tax liabilities 237.9 242.7
Other noncurrent liabilities 157.1   149.1  
Total liabilities 4,557.4   4,223.8  
 
Temporary Equity 7.3 16.5
 
Stockholders’ Equity:
AGCO Corporation stockholders’ equity:
Common stock 1.0 1.0
Additional paid-in capital 1,098.3 1,082.9
Retained earnings 3,156.0 2,843.7
Accumulated other comprehensive loss (619.1 ) (479.4 )
Total AGCO Corporation stockholders’ equity 3,636.2 3,448.2
Noncontrolling interests 34.1   33.3  
Total stockholders’ equity 3,670.3   3,481.5  
Total liabilities, temporary equity and stockholders’ equity $ 8,235.0   $ 7,721.8  
 

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 June 30,
2013

2012
Net sales $ 3,048.2 $ 2,690.1
Cost of goods sold 2,337.9   2,078.7
Gross profit 710.3 611.4
 
Selling, general and administrative expenses 279.7 255.0
Engineering expenses 91.4 79.0
Amortization of intangibles 12.1   12.5
 
Income from operations 327.1 264.9
 
Interest expense, net 13.5 14.7
Other expense, net 10.2   6.1
 
Income before income taxes and equity in net earnings of affiliates 303.4 244.1
 
Income tax provision 104.4   57.3
 

Income before equity in net earnings of affiliates
199.0 186.8
 

Equity in net earnings of affiliates
14.1   15.3
 
Net income 213.1 202.1
 
Net loss attributable to noncontrolling interests 0.6   2.8
 
Net income attributable to AGCO Corporation and subsidiaries $ 213.7   $ 204.9
 
Net income per common share attributable to AGCO Corporation and subsidiaries:
Basic $ 2.20   $ 2.11
Diluted $ 2.15   $ 2.08
Cash dividends declared and paid per common share $ 0.10   $
 
Weighted average number of common and common equivalent shares outstanding:
Basic 97.3   97.2
Diluted 99.3   98.4
 

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)
     
Six Months Ended June 30,
2013 2012
Net sales $ 5,451.3 $ 4,963.8
Cost of goods sold 4,207.9   3,859.4
Gross profit 1,243.4 1,104.4
 
Selling, general and administrative expenses 535.4 493.9
Engineering expenses 179.4 151.1
Amortization of intangibles 24.1   24.7
 
Income from operations 504.5 434.7
 
Interest expense, net 26.1 27.7
Other expense, net 13.9   10.5
 

Income before income taxes and equity in net earnings of affiliates
464.5 396.5
 
Income tax provision 157.3   100.5
 
Income before equity in net earnings of affiliates 307.2 296.0
 
Equity in net earnings of affiliates 23.0   27.3
 
Net income 330.2 323.3
 
Net loss attributable to noncontrolling interests 1.5   1.8
 
Net income attributable to AGCO Corporation and subsidiaries $ 331.7   $ 325.1
 
Net income per common share attributable to AGCO Corporation and subsidiaries:
Basic $ 3.41   $ 3.35
Diluted $ 3.34   $ 3.29
Cash dividends declared and paid per common share $ 0.20   $
 
Weighted average number of common and common equivalent shares outstanding:
Basic 97.2   97.1
Diluted 99.2   98.8
 

See accompanying notes to condensed consolidated financial statements.
 

AGCO CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in millions)
   
Six Months Ended June 30,
2013   2012
Cash flows from operating activities:
Net income $ 330.2   $ 323.3  
Adjustments to reconcile net income to net cash provided by (used in) operating

activities:
Depreciation 101.4 85.7
Deferred debt issuance cost amortization 1.8 1.7
Amortization of intangibles 24.1 24.7
Amortization of debt discount 4.6 4.3
Stock compensation 28.1 19.2
Equity in net earnings of affiliates, net of cash received (12.2 ) (18.5 )
Deferred income tax provision 27.7 2.4
Other 0.1 (0.2 )
Changes in operating assets and liabilities, net of effects from purchase of

businesses:
Accounts and notes receivable, net (389.8 ) (248.2 )
Inventories, net (404.7 ) (508.1 )
Other current and noncurrent assets 2.9 (35.4 )
Accounts payable 214.9 91.7
Accrued expenses 107.4 42.2
Other current and noncurrent liabilities 28.5   27.0  
Total adjustments (265.2 ) (511.5 )
Net cash provided by (used in) operating activities 65.0   (188.2 )
Cash flows from investing activities:
Purchases of property, plant and equipment (174.2 ) (151.1 )
Proceeds from sale of property, plant and equipment 2.2 0.2
Purchase of businesses, net of cash acquired (0.1 ) (2.4 )
Investments in consolidated affiliates, net of cash acquired (20.1 )
Investments in unconsolidated affiliates, net (7.9 )
Restricted cash and other   (2.0 )
Net cash used in investing activities (172.1 ) (183.3 )
Cash flows from financing activities:
Proceeds from debt obligations, net 91.7 42.8
Payment of debt issuance costs (0.1 )
Payment of minimum tax withholdings on stock compensation (15.9 )
Payment of dividends to stockholders (19.4 )
Purchases and retirement of common stock (1.0 )
(Distribution to) investment by noncontrolling interests (2.1 ) (0.3 )
Net cash provided by financing activities 53.3   42.4  
Effects of exchange rate changes on cash and cash equivalents (46.9 ) (1.9 )
Decrease in cash and cash equivalents (100.7 ) (331.0 )
Cash and cash equivalents, beginning of period 781.3   724.4  
Cash and cash equivalents, end of period $ 680.6   $ 393.4  
 

See accompanying notes to condensed consolidated financial statements.
 

AGCO CORPORATION AND SUBSIDIARIES

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