AGCO, a worldwide manufacturer and distributor of agricultural equipment, has reported net sales of approximately US$1.6 billion for the first quarter of 2016. Source: AFDJ eNews
This is a decrease of approximately 8.4% compared with net sales of approximately US$1.7 billion for the first quarter of 2015.
First Quarter Highlights
- Regional sales results: North America (11.6)%, Europe/Africa/Middle East (“EAME”) +4.2%, South America (21.2)%, Asia/Pacific (“APAC”) +19.4%
- Regional operating margin performance: EAME 7.6%, North America (0.2)%, South America 0.3%, APAC (3.5)%
“AGCO’s first quarter results reflect the cyclicality and seasonality of our industry,” Martin Richenhagen, AGCO’s Chairman, President and Chief Executive Officer said. “As anticipated, global market conditions continued to weaken, impacting our revenue and margin performance.
“In addition, our first quarter results reflect the impact of lower production to manage dealer and company inventory levels in advance of the spring selling season.
“At the end of March, inventory levels at AGCO were approximately US$110 million below prior year levels on a constant currency basis, and we continue to make progress reducing dealer inventory as well.”
He said that while the focus was on cost management to mitigate market pressures continues, the company was maintaining a strong level of investment in new products and technologies, as demonstrated by an increase in engineering expense planned for 2016 compared with 2015.
According to Mr Richenhagen the company was confident that these investments along with initiatives in market development, factory efficiency and improved service levels would drive long-term benefits for AGCO.