Agco reports Q2 adjusted EPS $2.53, consensus $2.90

Reports Q2 revenue $3.2B, consensus $3.48B. “While we continue to successfully execute our Farmer-first strategy, second quarter results were influenced by weakening market conditions and significant production cuts aimed at reducing our Company and dealer inventories,” said Eric Hansotia, AGCO‘s Chairman, President and Chief Executive Officer. “Declines in commodity prices and lower projected farm income in 2024 have negatively affected farmer sentiment, further dampening global industry demand. Given the current environment, we are taking aggressive actions, including our recently announced restructuring program, to control expenses, reduce production levels and lower investments in working capital. We are balancing these near-term cost reductions with continued investment in our longer-term high-margin growth initiatives that will help deliver more sustainable results through the economic cycles.” “On July 25, we announced an agreement to divest the Grain & Protein business,” continued Hansotia. “The divestiture of this business supports our strategic transformation, recently accelerated by the PTx Trimble joint venture. Divesting allows us to streamline and sharpen our focus on AGCO’s portfolio of award-winning agricultural machinery and precision ag technology products. Going forward, we will be better positioned for long-term growth in our higher margin and higher free cash flow generating businesses. Simultaneously, it will raise our profitability through the cycle as Grain & Protein has historically been a below average margin business.”