Slide 1: Fourth Quarter 2012 Financial and Operational Results
Fourth Quarter 2012 Financial and Operational Results
Slide 2: Forward Looking Statements
Forward Looking Statements Forward-looking statements in this presentation, including statements regarding demand for our products and the economic and other factors that drive that demand, product development plans and timing of those plans, acquisitions, expansion and modernization plans and our e
Slide 3: Financial Summary
Financial Summary Q4 12 v YTD YTD 12 vs Q4 12 Q4 11 2012 YTD 11 Net Sales $2,703.4 +7.4% $9,962.2 +13.6% Gross margin 19.5% -130 bps 21.3% +110 bps Adj. operating income* $141.3 -26.2% $715.6 +16.3% Adj. operating margin* 5.2% -240 bps 7.2% +20 bps Adj. diluted EPS* $0.99 -$0.45 $5.25 +$0.77 * Refle
Slide 4: Tractor/Combine Production
Tractor/Combine Production Production Units +5% +12% -2% -4% • Production down 2% in Q4 12 vs. Q4 11 • Full year 2012 production increased ~3% vs. 2011 • Projected 2013 production ~flat vs 2012 Q1 Q2 Q3 Q4 2011 Production 2012 Production 4
Slide 5: Industry Overview
Industry Overview December Year-to-Date Retail Units North America 2012 vs. 2011 Tractors • Industry +10% Combines • Industry ~Flat Western Europe 2012 vs. 2011 Tractors • Industry (3%) Combines • Industry +5% South America 2012 vs. 2011 Tractors • Industry +3% Combines • Industry (1%) 5
Slide 6: Regional Net Sales Results
Regional Net Sales Results YTD 2012 $10.0B Q4 12 vs. Q4 11 Net Sales Excluding Currency Translation* North South America America 26% 19% APAC +49% 4% +30% +4% +8% +11% EAME 51% North EAME South APAC Consol. America America YTD 2011 $8.8B YTD 2012 vs. YTD 2011 Net Sales North America Excluding Curren
Slide 7: Net Sales and Operating Margins
Net Sales and Operating Margins Sales Adj. Op. December YTD $M Margin* 10% $716M $2,500 Sales 8% $615M 7.2% $2,000 Adj. Op. Margin* 7.0% Adj. Op. Margin* 6% $1,500 Adj. Op. Inc.* 4% $1,000 2% $500 $0 0% Q411 Q112 Q212 Q312 Q412 2011 2012 * Reflects adjusted results, which exclude certain non-cash an
Slide 8: GSI Results
GSI Results Sales (YTD Thru December 31, 2012) $728M EAME SA Protein APAC 39% • AGCO acquired GSI in Q4 2011 • GSI sales grew ~3% in 2012 vs 2011* • 2012 EPS accretion of $0.38 NA Grain Storage 61% YTD YTD * Includes pre-acquisition sales for 2011. 8
Slide 9: Capital Expenditures – Investing for Growth
Capital Expenditures – Investing for Growth Continuing to Invest 2013 Capex Components $400- 425M New IT/Other $341M Products Capex Dep. & Amort. $129M Manufacturing 06 07 08 09 10 11 12 13E 9
Slide 10: Free Cash Flow
Free Cash Flow* Free Cash Flow (Year Ended Dec. 31 ) $426M • Strong fourth quarter $326M produced robust full-year $127M of A/R Sales $299M free cash flow • Targeting FCF for 2013 of $125M to $150M after increased CAPEX Note: Free cash flow is defined as net cash provided by operating activities les
Slide 11: Solid Balance Sheet
Solid Balance Sheet Net Debt to Total Capital* 37% • Strong balance sheet 29% • Investing in the business • Returning cash to shareholders 20% 16% 13% 5% 2% 0% 0% 04 05 06 07 08 09 10 11 12 *Net debt to total capital is defined as (total debt less cash) divided by (total debt less cash) + total equi
Slide 12: Returning Cash to Shareholders
Returning Cash to Shareholders Cash to be Returned to Shareholders Influenced by U.S. Cash Flow for tax efficiency Share Repurchase Dividend • $0.10 per share to be paid on • $18M repurchased in 2012 March 15, 2013 12
Slide 13: 2013 Market Outlook
2013 Market Outlook Regional Market Outlook – Industry Unit Retail Tractor Sales (Volume in Units) N. America S. America Western Europe ~210K ~Flat Flat to ~154K down 5% ~73K +5-10% 2012 2013E 2012 2013E 2012 2013E 13
Slide 14: 2013 Outlook Assumptions
2013 Outlook Assumptions • Sales growth from pricing and market share gains – ~+2.5% to 3.0% pricing • 10-15% increase in engineering expense for new product development and tier 4 emission requirements • Gross margin improvement • ~$10 million of start-up expense associated with China operations •
Slide 15: 2013 Outlook
2013 Outlook 2013 Estimates Sales $10.2B to $10.4B Operating margin +~75bps CAPEX $400-$425 Million Free Cash Flow* $125-$150 Million * Free cash flow is defined as net cash provided by operations less capital expenditures. 15
Slide 16: 2013 EPS Outlook
2013 EPS Outlook 2013 Estimates Previous EPS guidance $5.50 to $5.75 Impact of new tax accounting ~($0.40) New EPS Guidance $5.10 to $5.35 16
Slide 17: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation Free Cash Flow $M Year Year ended ended December 31, December 31, 2012 2011 Net cash provided by operating activities $ 666.4 $ 725.9 Less: Capital expenditures (340.5) (300.4) Free cash flow $ 325.9 $ 425.5 Note: Free cash flow is defined as net cash provided by oper
Slide 18: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation $M (except per share amts) Three months ended December 31, 2012 2011 Net Net Income Income Income Income From Net Per From Net Per Operations Income(1) Share(1) Operations Income(1) Share(1) As adjusted $ 141.3 $ 98.0 $ 0.99 $ 191.5 $ 141.7 $ 1.44 Tax adjustments — (2
Slide 19: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation $M (except per share amts) Years ended December 31, 2012 2011 Net Net Income Income Income Income From Net Per From Net Per Operations Income(1) Share(1) Operations Income(1) Share(1) As adjusted $ 715.6 $ 517.6 $ 5.25 $ 615.4 $ 439.3 $ 4.48 Tax adjustments — (26.9) (
Slide 20: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation Net Sales $M Three Months Ended Change due to currency December 31, translation % change 2012 2011 from 2011 $ % North America $ 652.3 $ 598.7 9.0% $ 3.5 0.6 % South America 511.9 448.5 14.1% (71.1) (15.9)% Europe/Africa/Middle East 1,406.5 1,381.6 1.8% (32.2) (2.3)%
Slide 21: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation Net Sales $M Three Months Ended December 31, Change due to acquisitions % change 2012 2011 from 2011 $ % North America $ 652.3 $ 598.7 9.0% $ 61.1 10.2% South America 511.9 448.5 14.1% 9.8 2.2% Europe/Africa/Middle East 1,406.5 1,381.6 1.8% 10.5 0.8% Asia/Pacific 132.