Slide 1: Fourth Quarter 2011 Financial and Operational Results
Fourth Quarter 2011 Financial and Operational Results February 7, 2012
Slide 2: Forward Looking Statements
Forward Looking Statements Statements that are not historical facts, including the projections of earnings per share, sales, market conditions, margin and productivity improvements, commodity prices, farmer income, harvests, weather, market share, industry demand, the impacts of currency translation
Slide 3: Financial Summary
Financial Summary Q4 11 vs YTD YTD11 vs Q4 11 2011 Q4 10 YTD10 Net Sales 2,517.8 +16.1% 8,773.2 +27.2% Gross margin 20.8% +194 bps 20.2% +199 bps Adj. op. income* 191.5 +33.4% 615.4 +87.3% Adj. op. margin* 7.6% +99 bps 7.0% +225 bps Adj. diluted EPS* $1.44 +$0.56 $4.48 +$2.16 * Reflects adjusted res
Slide 4: Tractor/Combine Production
Tractor/Combine Production Production Units +8% Flat +8% +23% • Full year production up 9% in 2011 vs. 2010 • Q4 increases in EAME and NA partially offset by decrease in SA • Full year 2012 production projected to increase ~5% vs. Q1 Q2 Q3 Q4 2011 2010 Production 2011 Production 4
Slide 5: Industry Overview
Industry Overview December 2011 Full Year Retail Units North America 2011 vs. 2010 Tractors • Industry +2% Combines • Industry (4%) Western Europe 2011 vs. 2010 Tractors • Industry +12% Combines • Industry +35% South America 2011 vs. 2010 Tractors • Industry (3%) Combines • Industry +20% 5
Slide 6: Regional Net Sales Results
Regional Net Sales Results 2011 $8.8B Q411 vs. Q410 Net Sales Excluding Currency Translation* North America South America 20% ROW 21% 5% +54% +30% +18% +15% +8% EAME 54% EAME South ROW North Consol. America America 2010 $6.9B Full Year 2011 vs. Full Year 2010 Net Sales North Excluding Currency Trans
Slide 7: Net Sales and Operating Margins
Net Sales and Operating Margins Sales Adj. Op. December YTD $M Margin* $2,500 $615M Sales 8% $2,000 7.0% Adj. Op. Margin* 6% Adj. Op. Margin* $1,500 $329M 4% 4.8% Adj. Op. Inc.* $1,000 2% $500 $0 0% Q410 Q111 Q211 Q311 Q411 2010 2011 * Reflects adjusted results, which exclude restructuring and GSI a
Slide 8: Improved North American Profitability
Improved North American Profitability North American Sales and Margins $1.8B $1.8B $1.5B $1.4B $1.5B • Significant progress over last 5 years 5.1% • Consistent margin improvement despite 3.3% volatile sales 1.5% • Progress driven by: – new products 0.5% – stronger dealer network – factory productivi
Slide 9: Capital Expenditures – Investing for Growth
Capital Expenditures – Investing for Growth Continuing to Invest 2012 Capex Components $325- 350M $300M New $251M Products Capex $207M $167M $141M Dep. & Amort. $129M IT/Other $78M $88M Manufacturing 04 05 06 07 08 09 10 11 12E 9
Slide 10: Free Cash Flow
Free Cash Flow* Free Cash Flow (Year Ended Dec. 31 ) $426M • Strong fourth quarter produced robust full $127M of A/R Sales $299M year free cash flow $272M • Targeting FCF for 2012 of $200M+ after increased CAPEX Note: Free cash flow is defined as net cash provided by operating activities less capita
Slide 11: 2012 Market Outlook
2012 Market Outlook Regional Market Outlook – Industry Unit Retail Tractor Sales (Volume in Units) North America South America Western Europe Flat to 192K Up 5% 158K Flat Flat to Down 71K 5% 2011 2012E 2011 2012E 2011 2012E 11
Slide 12: 2012 Forecast Assumptions – Summary
2012 Forecast Assumptions – Summary • Sales growth from pricing, GSI acquisition and market share gains partially offset by negative impact of currency – ~+3.5% pricing – ~ (7.0%) negative impact of currency translation • 10-15% increase in engineering expense for new product development and tier 4
Slide 13: 2012 Outlook
2012 Outlook 2012 Estimates Sales $10.0B+ Operating margin +50-75 bps EPS ~$5.00 CAPEX $325-$350 Million Free Cash Flow* $200 Million+ * Free cash flow is defined as cash provided by operating activities less capital expenditures. Please see the reconciliations to GAAP metrics in the appendix. 13
Slide 14: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation Free Cash Flow $M Year Year ended ended December 31, December 31, 2011 2010 Net cash provided by operating activities $ 725.9 $ 438.7 Less: Capital expenditures (300.4) (167.1) Free cash flow $ 425.5 $ 271.6 Note: Free cash flow is defined as net cash provided by oper
Slide 15: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation $M (except per share amts) Three months ended December 31, 2011 2010 Income Earnings Income Earnings From Net Per From Net Per Operations Income(1) Share(1) Operations Income(1) Share(1) As adjusted $ 191.5 $ 141.7 $ 1.44 $ 143.5 $ 85.9 $ 0.88 Restructuring and other
Slide 16: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation $M (except per share amts) Years ended December 31, 2011 2010 Income Earnings Income Earnings From Net Per From Net Per Operations Income(1) Share(1) Operations Income(1) Share(1) As adjusted $ 615.4 $ 439.3 $ 4.48 $ 328.6 $ 223.6 $ 2.32 Restructuring and other infreq
Slide 17: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation AGCO Regional Net Sales (in millions) % change from 2010 due to % change currency Net sales from 2010 translation(1) Three months ended December 31, 2011 North America $ 598.7 29.3% (0.8%) South America 448.5 1.9% (6.1%) Europe/Africa/Middle East 1,347.3 13.6% (1.4%)
Slide 18: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation Net Sales $M Three Months Ended December 31, % change from 2010 2011 at Actual 2011 at Adjusted due to currency (1) Exchange Rates Exchange Rates translation North America $598.7 $602.3 (0.8)% South America 448.5 475.4 (6.1)% Europe/Africa/Middle East 1,347.3 1,363.9
Slide 19: Non-GAAP To GAAP Reconciliation
Non-GAAP To GAAP Reconciliation Net Sales $M Year Ended December 31, % change from 2010 2011 at Actual 2011 at Adjusted due to currency (1) Exchange Rates Exchange Rates translation North America $1,770.6 $1,757.9 0.9% South America 1,871.5 1,789.8 4.7% Europe/Africa/Middle East 4,681.7 4,462.5 6.5%