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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from _________ to _________
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Delaware
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58-1960019
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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4205 River Green Parkway
Duluth, Georgia
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30096
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(Address of principal executive offices)
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(Zip Code)
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(770) 813-9200
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x
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Large accelerated filer
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o
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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o
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Emerging growth company
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(Do not check if a smaller reporting company)
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Page
Numbers
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 6.
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PART I.
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FINANCIAL INFORMATION
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ITEM 1.
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FINANCIAL STATEMENTS
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September 30, 2017
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December 31, 2016
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||||
ASSETS
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|||||||
Current Assets:
|
|
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Cash and cash equivalents
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$
|
312.7
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$
|
429.7
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Accounts and notes receivable, net
|
1,047.4
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890.4
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Inventories, net
|
2,065.2
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1,514.8
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Other current assets
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413.9
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330.8
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Total current assets
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3,839.2
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3,165.7
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Property, plant and equipment, net
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1,439.6
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1,361.3
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Investment in affiliates
|
465.5
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414.9
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Deferred tax assets
|
98.7
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99.7
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|
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Other assets
|
163.3
|
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|
143.1
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|
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Intangible assets, net
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653.4
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607.3
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|
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Goodwill
|
1,514.7
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1,376.4
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Total assets
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$
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8,174.4
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$
|
7,168.4
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LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current Liabilities:
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Current portion of long-term debt
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$
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107.9
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$
|
85.4
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Accounts payable
|
869.4
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722.6
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Accrued expenses
|
1,311.4
|
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1,160.8
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|
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Other current liabilities
|
259.1
|
|
|
176.1
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|
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Total current liabilities
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2,547.8
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2,144.9
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Long-term debt, less current portion and debt issuance costs
|
1,950.3
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1,610.0
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Pensions and postretirement health care benefits
|
264.2
|
|
|
270.0
|
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Deferred tax liabilities
|
122.5
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112.4
|
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Other noncurrent liabilities
|
196.6
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193.9
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Total liabilities
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5,081.4
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4,331.2
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Commitments and contingencies (Note 17)
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Stockholders’ Equity:
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AGCO Corporation stockholders’ equity:
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Preferred stock; $0.01 par value, 1,000,000 shares authorized, no shares issued or outstanding in 2017 and 2016
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—
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—
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Common stock; $0.01 par value, 150,000,000 shares authorized, 79,549,113 and 79,465,393 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively
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0.8
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0.8
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Additional paid-in capital
|
129.8
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103.3
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Retained earnings
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4,220.6
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4,113.6
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Accumulated other comprehensive loss
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(1,323.0
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)
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(1,441.6
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)
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Total AGCO Corporation stockholders’ equity
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3,028.2
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2,776.1
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Noncontrolling interests
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64.8
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61.1
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Total stockholders’ equity
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3,093.0
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2,837.2
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Total liabilities and stockholders’ equity
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$
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8,174.4
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$
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7,168.4
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Three Months Ended September 30,
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||||||
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2017
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2016
|
||||
Net sales
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$
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1,986.3
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$
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1,761.6
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Cost of goods sold
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1,557.7
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1,408.1
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Gross profit
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428.6
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353.5
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Selling, general and administrative expenses
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234.3
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214.1
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Engineering expenses
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80.0
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66.0
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Restructuring expenses
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3.0
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1.5
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Amortization of intangibles
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14.3
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12.9
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Income from operations
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97.0
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59.0
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Interest expense, net
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11.6
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12.1
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Other expense (income), net
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18.4
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(0.2
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)
|
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Income before income taxes and equity in net earnings of affiliates
|
67.0
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47.1
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|
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Income tax provision
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16.9
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19.5
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Income before equity in net earnings of affiliates
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50.1
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27.6
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|
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Equity in net earnings of affiliates
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10.7
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11.8
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Net income
|
60.8
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39.4
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Net (income) loss attributable to noncontrolling interests
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(0.1
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)
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0.6
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Net income attributable to AGCO Corporation and subsidiaries
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$
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60.7
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$
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40.0
|
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Net income per common share attributable to AGCO Corporation and subsidiaries:
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Basic
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$
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0.76
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$
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0.50
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Diluted
|
$
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0.76
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$
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0.50
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Cash dividends declared and paid per common share
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$
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0.14
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$
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0.13
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Weighted average number of common and common equivalent shares outstanding:
|
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|
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Basic
|
79.5
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80.7
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|
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Diluted
|
80.2
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80.8
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Nine Months Ended September 30,
|
||||||
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2017
|
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2016
|
||||
Net sales
|
$
|
5,779.1
|
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$
|
5,316.5
|
|
Cost of goods sold
|
4,544.8
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4,221.3
|
|
||
Gross profit
|
1,234.3
|
|
|
1,095.2
|
|
||
Selling, general and administrative expenses
|
693.6
|
|
|
643.1
|
|
||
Engineering expenses
|
229.7
|
|
|
214.3
|
|
||
Restructuring expenses
|
8.5
|
|
|
5.5
|
|
||
Amortization of intangibles
|
41.5
|
|
|
35.3
|
|
||
Income from operations
|
261.0
|
|
|
197.0
|
|
||
Interest expense, net
|
33.6
|
|
|
34.5
|
|
||
Other expense, net
|
49.1
|
|
|
27.1
|
|
||
Income before income taxes and equity in net earnings of affiliates
|
178.3
|
|
|
135.4
|
|
||
Income tax provision
|
64.9
|
|
|
73.9
|
|
||
Income before equity in net earnings of affiliates
|
113.4
|
|
|
61.5
|
|
||
Equity in net earnings of affiliates
|
30.8
|
|
|
37.5
|
|
||
Net income
|
144.2
|
|
|
99.0
|
|
||
Net income attributable to noncontrolling interests
|
(2.1
|
)
|
|
(0.9
|
)
|
||
Net income attributable to AGCO Corporation and subsidiaries
|
$
|
142.1
|
|
|
$
|
98.1
|
|
Net income per common share attributable to AGCO Corporation and subsidiaries:
|
|
|
|
|
|
||
Basic
|
$
|
1.79
|
|
|
$
|
1.20
|
|
Diluted
|
$
|
1.77
|
|
|
$
|
1.20
|
|
Cash dividends declared and paid per common share
|
$
|
0.42
|
|
|
$
|
0.39
|
|
Weighted average number of common and common equivalent shares outstanding:
|
|
|
|
|
|
||
Basic
|
79.5
|
|
|
81.9
|
|
||
Diluted
|
80.1
|
|
|
82.0
|
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Net income
|
$
|
60.8
|
|
|
$
|
39.4
|
|
Other comprehensive income (loss), net of reclassification adjustments:
|
|
|
|
||||
Foreign currency translation adjustments
|
64.5
|
|
|
(12.5
|
)
|
||
Defined benefit pension plans, net of tax
|
3.1
|
|
|
2.4
|
|
||
Unrealized (loss) gain on derivatives, net of tax
|
(1.8
|
)
|
|
1.7
|
|
||
Other comprehensive income (loss), net of reclassification adjustments
|
65.8
|
|
|
(8.4
|
)
|
||
Comprehensive income
|
126.6
|
|
|
31.0
|
|
||
Comprehensive (income) loss attributable to noncontrolling interests
|
(0.6
|
)
|
|
0.3
|
|
||
Comprehensive income attributable to AGCO Corporation and subsidiaries
|
$
|
126.0
|
|
|
$
|
31.3
|
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Net income
|
$
|
144.2
|
|
|
$
|
99.0
|
|
Other comprehensive income, net of reclassification adjustments:
|
|
|
|
||||
Foreign currency translation adjustments
|
106.5
|
|
|
149.1
|
|
||
Defined benefit pension plans, net of tax
|
8.9
|
|
|
7.5
|
|
||
Unrealized gain (loss) on derivatives, net of tax
|
4.3
|
|
|
(5.1
|
)
|
||
Other comprehensive income, net of reclassification adjustments
|
119.7
|
|
|
151.5
|
|
||
Comprehensive income
|
263.9
|
|
|
250.5
|
|
||
Comprehensive income attributable to noncontrolling interests
|
(3.2
|
)
|
|
(2.0
|
)
|
||
Comprehensive income attributable to AGCO Corporation and subsidiaries
|
$
|
260.7
|
|
|
$
|
248.5
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Cash flows from operating activities:
|
|
|
|
|
|
||
Net income
|
$
|
144.2
|
|
|
$
|
99.0
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
|
|
||
Depreciation
|
165.2
|
|
|
167.0
|
|
||
Deferred debt issuance cost amortization
|
0.5
|
|
|
0.8
|
|
||
Amortization of intangibles
|
41.5
|
|
|
35.3
|
|
||
Stock compensation expense
|
31.3
|
|
|
19.3
|
|
||
Proceeds from termination of hedging instrument
|
—
|
|
|
7.3
|
|
||
Equity in net earnings of affiliates, net of cash received
|
(15.4
|
)
|
|
(13.3
|
)
|
||
Deferred income tax provision
|
0.7
|
|
|
13.6
|
|
||
Other
|
1.8
|
|
|
(0.1
|
)
|
||
Changes in operating assets and liabilities, net of effects from purchase of businesses:
|
|
|
|
|
|
||
Accounts and notes receivable, net
|
(81.2
|
)
|
|
(132.2
|
)
|
||
Inventories, net
|
(424.9
|
)
|
|
(251.3
|
)
|
||
Other current and noncurrent assets
|
(92.4
|
)
|
|
(57.2
|
)
|
||
Accounts payable
|
100.0
|
|
|
(11.0
|
)
|
||
Accrued expenses
|
67.9
|
|
|
(4.8
|
)
|
||
Other current and noncurrent liabilities
|
31.6
|
|
|
0.2
|
|
||
Total adjustments
|
(173.4
|
)
|
|
(226.4
|
)
|
||
Net cash used in operating activities
|
(29.2
|
)
|
|
(127.4
|
)
|
||
Cash flows from investing activities:
|
|
|
|
|
|
||
Purchases of property, plant and equipment
|
(139.4
|
)
|
|
(132.8
|
)
|
||
Proceeds from sale of property, plant and equipment
|
3.3
|
|
|
1.3
|
|
||
Purchase of businesses, net of cash acquired
|
(188.4
|
)
|
|
(383.6
|
)
|
||
Investment in consolidated affiliates, net of cash acquired
|
—
|
|
|
(11.8
|
)
|
||
Investments in unconsolidated affiliates
|
(0.8
|
)
|
|
(1.7
|
)
|
||
Restricted cash
|
—
|
|
|
0.4
|
|
||
Net cash used in investing activities
|
(325.3
|
)
|
|
(528.2
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
||
Proceeds from debt obligations
|
2,752.9
|
|
|
2,235.2
|
|
||
Repayments of debt obligations
|
(2,502.5
|
)
|
|
(1,518.9
|
)
|
||
Purchases and retirement of common stock
|
—
|
|
|
(170.0
|
)
|
||
Payment of dividends to stockholders
|
(33.4
|
)
|
|
(32.1
|
)
|
||
Payment of minimum tax withholdings on stock compensation
|
(6.7
|
)
|
|
(1.9
|
)
|
||
Investments by noncontrolling interest
|
0.5
|
|
|
—
|
|
||
Payment of debt issuance costs
|
—
|
|
|
(0.5
|
)
|
||
Net cash provided by financing activities
|
210.8
|
|
|
511.8
|
|
||
Effects of exchange rate changes on cash and cash equivalents
|
26.7
|
|
|
14.9
|
|
||
Decrease in cash and cash equivalents
|
(117.0
|
)
|
|
(128.9
|
)
|
||
Cash and cash equivalents, beginning of period
|
429.7
|
|
|
426.7
|
|
||
Cash and cash equivalents, end of period
|
$
|
312.7
|
|
|
$
|
297.8
|
|
Current assets
|
$
|
52.8
|
|
Property, plant and equipment
|
20.7
|
|
|
Intangible assets
|
64.4
|
|
|
Goodwill
|
64.3
|
|
|
Total assets acquired
|
202.2
|
|
|
|
|
||
Current liabilities
|
12.2
|
|
|
Total liabilities assumed
|
12.2
|
|
|
Net assets acquired
|
$
|
190.0
|
|
Intangible Asset
|
|
Amount
|
|
Weighted-Average Useful Life
|
|||
Customer relationships
|
|
$
|
21.4
|
|
|
14
|
years
|
Technology
|
|
25.1
|
|
|
10
|
years
|
|
Trademarks
|
|
17.9
|
|
|
20
|
years
|
|
|
|
$
|
64.4
|
|
|
|
|
|
Write-down of Property, Plant
and Equipment
|
|
Employee Severance
|
|
Facility Closure Costs
|
|
Total
|
||||||||
Balance as of December 31, 2016
|
$
|
—
|
|
|
$
|
14.5
|
|
|
$
|
0.8
|
|
|
$
|
15.3
|
|
First quarter 2017 provision
|
0.2
|
|
|
4.9
|
|
|
—
|
|
|
5.1
|
|
||||
Less: Non-cash expense
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
||||
Cash expense
|
—
|
|
|
4.9
|
|
|
—
|
|
|
4.9
|
|
||||
First quarter 2017 cash activity
|
—
|
|
|
(5.0
|
)
|
|
(0.8
|
)
|
|
(5.8
|
)
|
||||
Foreign currency translation
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
||||
Balance as of March 31, 2017
|
—
|
|
|
14.6
|
|
|
—
|
|
|
14.6
|
|
||||
Second quarter 2017 provision
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
||||
Second quarter 2017 cash activity
|
—
|
|
|
(2.5
|
)
|
|
—
|
|
|
(2.5
|
)
|
||||
Foreign currency translation
|
—
|
|
|
0.9
|
|
|
—
|
|
|
0.9
|
|
||||
Balance as of June 30, 2017
|
$
|
—
|
|
|
$
|
13.4
|
|
|
$
|
—
|
|
|
$
|
13.4
|
|
Third quarter 2017 provision
|
—
|
|
|
3.0
|
|
|
—
|
|
|
3.0
|
|
||||
Third quarter 2017 cash activity
|
—
|
|
|
(3.1
|
)
|
|
—
|
|
|
(3.1
|
)
|
||||
Foreign currency translation
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
||||
Balance as of September 30, 2017
|
$
|
—
|
|
|
$
|
13.5
|
|
|
$
|
—
|
|
|
$
|
13.5
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Cost of goods sold
|
|
$
|
0.8
|
|
|
$
|
0.7
|
|
|
$
|
2.4
|
|
|
$
|
1.6
|
|
Selling, general and administrative expenses
|
|
7.9
|
|
|
7.2
|
|
|
29.1
|
|
|
18.0
|
|
||||
Total stock compensation expense
|
|
$
|
8.7
|
|
|
$
|
7.9
|
|
|
$
|
31.5
|
|
|
$
|
19.6
|
|
SSARs outstanding at January 1
|
|
1,458,611
|
|
SSARs granted
|
|
286,200
|
|
SSARs exercised
|
|
(645,744
|
)
|
SSARs canceled or forfeited
|
|
(13,850
|
)
|
SSARs outstanding at September 30
|
|
1,085,217
|
|
|
Trademarks and
Tradenames
|
|
Customer
Relationships
|
|
Patents and
Technology
|
|
Land Use Rights
|
|
Total
|
||||||||||
Gross carrying amounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance as of December 31, 2016
|
$
|
179.2
|
|
|
$
|
558.0
|
|
|
$
|
122.1
|
|
|
$
|
8.5
|
|
|
$
|
867.8
|
|
Acquisition
|
17.9
|
|
|
21.4
|
|
|
25.1
|
|
|
—
|
|
|
64.4
|
|
|||||
Foreign currency translation
|
8.3
|
|
|
16.7
|
|
|
8.6
|
|
|
0.4
|
|
|
34.0
|
|
|||||
Balance as of September 30, 2017
|
$
|
205.4
|
|
|
$
|
596.1
|
|
|
$
|
155.8
|
|
|
$
|
8.9
|
|
|
$
|
966.2
|
|
|
Trademarks and
Tradenames
|
|
Customer
Relationships
|
|
Patents and
Technology
|
|
Land Use Rights
|
|
Total
|
||||||||||
Accumulated amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance as of December 31, 2016
|
$
|
49.7
|
|
|
$
|
233.0
|
|
|
$
|
59.5
|
|
|
$
|
2.7
|
|
|
$
|
344.9
|
|
Amortization expense
|
7.5
|
|
|
28.4
|
|
|
5.5
|
|
|
0.1
|
|
|
41.5
|
|
|||||
Foreign currency translation
|
1.0
|
|
|
8.2
|
|
|
5.1
|
|
|
0.1
|
|
|
14.4
|
|
|||||
Balance as of September 30, 2017
|
$
|
58.2
|
|
|
$
|
269.6
|
|
|
$
|
70.1
|
|
|
$
|
2.9
|
|
|
$
|
400.8
|
|
|
Trademarks and
Tradenames
|
||
Indefinite-lived intangible assets:
|
|
|
|
Balance as of December 31, 2016
|
$
|
84.4
|
|
Foreign currency translation
|
3.6
|
|
|
Balance as of September 30, 2017
|
$
|
88.0
|
|
|
North
America
|
|
South
America
|
|
Europe/Middle East
|
|
Asia/
Pacific/Africa
|
|
Consolidated
|
||||||||||
Balance as of December 31, 2016
|
$
|
543.9
|
|
|
$
|
138.8
|
|
|
$
|
581.9
|
|
|
$
|
111.8
|
|
|
$
|
1,376.4
|
|
Acquisition
|
64.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
64.3
|
|
|||||
Foreign currency translation
|
—
|
|
|
3.7
|
|
|
61.8
|
|
|
8.5
|
|
|
74.0
|
|
|||||
Balance as of September 30, 2017
|
$
|
608.2
|
|
|
$
|
142.5
|
|
|
$
|
643.7
|
|
|
$
|
120.3
|
|
|
$
|
1,514.7
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
1.056% Senior term loan due 2020
|
$
|
235.9
|
|
|
$
|
211.0
|
|
Credit facility, expiring 2020
|
587.4
|
|
|
329.2
|
|
||
Senior term loans due 2021
|
353.9
|
|
|
316.5
|
|
||
5
7
/
8
% Senior notes due 2021
|
305.6
|
|
|
306.6
|
|
||
Senior term loans due between 2019 and 2026
|
442.4
|
|
|
395.6
|
|
||
Other long-term debt
|
137.5
|
|
|
141.6
|
|
||
Debt issuance costs
|
(4.5
|
)
|
|
(5.1
|
)
|
||
|
2,058.2
|
|
|
1,695.4
|
|
||
Less: Current portion of other long-term debt
|
(107.9
|
)
|
|
(85.4
|
)
|
||
Total indebtedness, less current portion
|
$
|
1,950.3
|
|
|
$
|
1,610.0
|
|
Maturity Date
|
|
Floating or Fixed Interest Rate
|
|
Interest Rate
|
|
Interest Payment
|
|
Term Loan Amount
|
||
October 19, 2019
|
|
Floating
|
|
EURIBOR + 0.75%
|
|
Semi-Annually
|
|
€
|
1.0
|
|
October 19, 2019
|
|
Fixed
|
|
0.75%
|
|
Annually
|
|
55.0
|
|
|
October 19, 2021
|
|
Floating
|
|
EURIBOR + 1.00%
|
|
Semi-Annually
|
|
25.5
|
|
|
October 19, 2021
|
|
Fixed
|
|
1.00%
|
|
Annually
|
|
166.5
|
|
|
October 19, 2023
|
|
Floating
|
|
EURIBOR + 1.25%
|
|
Semi-Annually
|
|
1.0
|
|
|
October 19, 2023
|
|
Fixed
|
|
1.33%
|
|
Annually
|
|
73.5
|
|
|
October 19, 2026
|
|
Fixed
|
|
1.98%
|
|
Annually
|
|
52.5
|
|
|
|
|
|
|
|
|
|
|
€
|
375.0
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Finished goods
|
$
|
815.0
|
|
|
$
|
589.3
|
|
Repair and replacement parts
|
599.0
|
|
|
532.5
|
|
||
Work in process
|
215.3
|
|
|
113.8
|
|
||
Raw materials
|
435.9
|
|
|
279.2
|
|
||
Inventories, net
|
$
|
2,065.2
|
|
|
$
|
1,514.8
|
|
|
Three Months Ended September 30,
|
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
||||||||
Balance at beginning of period
|
$
|
296.9
|
|
|
$
|
240.6
|
|
|
|
$
|
255.6
|
|
|
$
|
230.3
|
|
Acquisitions
|
2.1
|
|
|
3.1
|
|
|
|
2.1
|
|
|
3.7
|
|
||||
Accruals for warranties issued during the period
|
47.7
|
|
|
43.3
|
|
|
|
152.6
|
|
|
138.7
|
|
||||
Settlements made (in cash or in kind) during the period
|
(49.3
|
)
|
|
(40.1
|
)
|
|
|
(127.4
|
)
|
|
(128.3
|
)
|
||||
Foreign currency translation
|
6.2
|
|
|
2.0
|
|
|
|
20.7
|
|
|
4.5
|
|
||||
Balance at September 30
|
$
|
303.6
|
|
|
$
|
248.9
|
|
|
|
$
|
303.6
|
|
|
$
|
248.9
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Basic net income per share:
|
|
|
|
|
|
|
|
|
|
||||||
Net income attributable to AGCO Corporation and subsidiaries
|
$
|
60.7
|
|
|
$
|
40.0
|
|
|
$
|
142.1
|
|
|
$
|
98.1
|
|
Weighted average number of common shares outstanding
|
79.5
|
|
|
80.7
|
|
|
79.5
|
|
|
81.9
|
|
||||
Basic net income per share attributable to AGCO Corporation and subsidiaries
|
$
|
0.76
|
|
|
$
|
0.50
|
|
|
$
|
1.79
|
|
|
$
|
1.20
|
|
Diluted net income per share:
|
|
|
|
|
|
|
|
|
|
||||||
Net income attributable to AGCO Corporation and subsidiaries
|
$
|
60.7
|
|
|
$
|
40.0
|
|
|
$
|
142.1
|
|
|
$
|
98.1
|
|
Weighted average number of common shares outstanding
|
79.5
|
|
|
80.7
|
|
|
79.5
|
|
|
81.9
|
|
||||
Dilutive SSARs, performance share awards and RSUs
|
0.7
|
|
|
0.1
|
|
|
0.6
|
|
|
0.1
|
|
||||
Weighted average number of common shares and common share equivalents outstanding for purposes of computing diluted net income per share
|
80.2
|
|
|
80.8
|
|
|
80.1
|
|
|
82.0
|
|
||||
Diluted net income per share attributable to AGCO Corporation and subsidiaries
|
$
|
0.76
|
|
|
$
|
0.50
|
|
|
$
|
1.77
|
|
|
$
|
1.20
|
|
|
|
|
Recognized in Net Income
|
||||||
Three Months Ended September 30,
|
Gain (Loss) Recognized in Accumulated
Other Comprehensive Loss |
|
Classification
of Gain (Loss)
|
|
Gain (Loss) Reclassified from Accumulated
Other Comprehensive Loss into Income
|
||||
2017
|
|
|
|
|
|
||||
Foreign currency contracts
(1)
|
$
|
(0.3
|
)
|
|
Cost of goods sold
|
|
$
|
1.1
|
|
Interest rate contract
|
(1.0
|
)
|
|
Interest expense, net
|
|
(0.6
|
)
|
||
Total
|
$
|
(1.3
|
)
|
|
|
|
$
|
0.5
|
|
2016
|
|
|
|
|
|
||||
Foreign currency contracts
|
$
|
1.5
|
|
|
Cost of goods sold
|
|
$
|
0.2
|
|
Interest rate contract
|
(0.1
|
)
|
|
Interest expense, net
|
|
(0.5
|
)
|
||
Total
|
$
|
1.4
|
|
|
|
|
$
|
(0.3
|
)
|
|
|
|
Recognized in Net Income
|
||||||
Nine Months Ended September 30,
|
Gain (Loss) Recognized in Accumulated
Other Comprehensive Loss |
|
Classification
of Gain (Loss)
|
|
Gain (Loss) Reclassified from Accumulated
Other Comprehensive Loss into Income
|
||||
2017
|
|
|
|
|
|
||||
Foreign currency contracts
(1)
|
$
|
2.9
|
|
|
Cost of goods sold
|
|
$
|
(0.3
|
)
|
Interest rate contract
|
(0.6
|
)
|
|
Interest expense, net
|
|
(1.7
|
)
|
||
Total
|
$
|
2.3
|
|
|
|
|
$
|
(2.0
|
)
|
2016
|
|
|
|
|
|
||||
Foreign currency contracts
|
$
|
1.2
|
|
|
Cost of goods sold
|
|
$
|
0.2
|
|
Interest rate contract
|
(7.5
|
)
|
|
Interest expense, net
|
|
(1.4
|
)
|
||
Total
|
$
|
(6.3
|
)
|
|
|
|
$
|
(1.2
|
)
|
|
|
Before-Tax
Amount
|
|
Income
Tax
|
|
After-Tax
Amount
|
||||||
Accumulated derivative net losses as of December 31, 2016
|
|
$
|
(10.1
|
)
|
|
$
|
(1.4
|
)
|
|
$
|
(8.7
|
)
|
Net changes in fair value of derivatives
|
|
2.2
|
|
|
(0.1
|
)
|
|
2.3
|
|
|||
Net losses reclassified from accumulated other comprehensive loss into income
|
|
2.3
|
|
|
0.3
|
|
|
2.0
|
|
|||
Accumulated derivative net losses as of September 30, 2017
|
|
$
|
(5.6
|
)
|
|
$
|
(1.2
|
)
|
|
$
|
(4.4
|
)
|
|
Notional Amount as of
|
||||||
|
September 30, 2017
|
|
December 31, 2016
|
||||
Foreign currency denominated debt
|
$
|
368.1
|
|
|
$
|
329.2
|
|
|
(Loss) Gain Recognized in Accumulated
Other Comprehensive Loss for the Three Months Ended
|
|
(Loss) Gain Recognized in Accumulated
Other Comprehensive Loss for the Nine Months Ended
|
||||||||||||
|
September 30, 2017
|
|
September 30, 2016
|
|
September 30, 2017
|
|
September 30, 2016
|
||||||||
Foreign currency denominated debt
|
$
|
(11.8
|
)
|
|
$
|
(4.8
|
)
|
|
$
|
(38.9
|
)
|
|
$
|
(8.9
|
)
|
|
|
|
For the Three Months Ended
|
|
For the Nine Months Ended
|
||||||||||||
|
Classification of Gain
|
|
September 30, 2017
|
|
September 30, 2016
|
|
September 30, 2017
|
|
September 30, 2016
|
||||||||
Foreign currency contracts
|
Other expense, net
|
|
$
|
13.9
|
|
|
$
|
—
|
|
|
$
|
35.8
|
|
|
$
|
14.3
|
|
|
Asset Derivatives as of
September 30, 2017 |
|
Liability Derivatives as of
September 30, 2017 |
||||||||
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivative instruments designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||
Foreign currency contracts
|
Other current assets
|
|
$
|
1.4
|
|
|
Other current liabilities
|
|
$
|
1.7
|
|
Interest rate contract
|
Other noncurrent assets
|
|
—
|
|
|
Other noncurrent liabilities
|
|
5.3
|
|
||
Derivative instruments not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign currency contracts
|
Other current assets
|
|
5.1
|
|
|
Other current liabilities
|
|
4.1
|
|
||
Total derivative instruments
|
|
|
$
|
6.5
|
|
|
|
|
$
|
11.1
|
|
|
Asset Derivatives as of
December 31, 2016
|
|
Liability Derivatives as of
December 31, 2016
|
||||||||
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivative instruments designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||
Foreign currency contracts
|
Other current assets
|
|
$
|
0.2
|
|
|
Other current liabilities
|
|
$
|
3.8
|
|
Interest rate contract
|
Other noncurrent assets
|
|
—
|
|
|
Other noncurrent liabilities
|
|
6.4
|
|
||
Derivative instruments not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign currency contracts
|
Other current assets
|
|
6.3
|
|
|
Other current liabilities
|
|
3.2
|
|
||
Total derivative instruments
|
|
|
$
|
6.5
|
|
|
|
|
$
|
13.4
|
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Noncontrolling
Interests
|
|
Total Stockholders’
Equity
|
||||||||||||
Balance, December 31, 2016
|
$
|
0.8
|
|
|
$
|
103.3
|
|
|
$
|
4,113.6
|
|
|
$
|
(1,441.6
|
)
|
|
$
|
61.1
|
|
|
$
|
2,837.2
|
|
Stock compensation
|
—
|
|
|
33.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33.0
|
|
||||||
Issuance of stock awards
|
—
|
|
|
(2.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.2
|
)
|
||||||
SSARs exercised
|
—
|
|
|
(4.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4.3
|
)
|
||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
—
|
|
|
—
|
|
|
142.1
|
|
|
—
|
|
|
2.1
|
|
|
144.2
|
|
||||||
Other comprehensive income, net of reclassification adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
105.4
|
|
|
1.1
|
|
|
106.5
|
|
||||||
Defined benefit pension plans, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
|
—
|
|
|
8.9
|
|
||||||
Unrealized gain on derivatives, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
4.3
|
|
|
—
|
|
|
4.3
|
|
||||||
Payment of dividends to stockholders
|
—
|
|
|
—
|
|
|
(33.4
|
)
|
|
—
|
|
|
—
|
|
|
(33.4
|
)
|
||||||
Investments by noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
||||||
Adjustment related to the adoption of ASU 2016-09
|
—
|
|
|
—
|
|
|
(1.7
|
)
|
|
—
|
|
|
—
|
|
|
(1.7
|
)
|
||||||
Balance, September 30, 2017
|
$
|
0.8
|
|
|
$
|
129.8
|
|
|
$
|
4,220.6
|
|
|
$
|
(1,323.0
|
)
|
|
$
|
64.8
|
|
|
$
|
3,093.0
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net income (loss)
|
$
|
0.1
|
|
|
$
|
(0.6
|
)
|
|
$
|
2.1
|
|
|
$
|
0.9
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
0.5
|
|
|
0.3
|
|
|
1.1
|
|
|
1.1
|
|
||||
Total comprehensive income (loss)
|
$
|
0.6
|
|
|
$
|
(0.3
|
)
|
|
$
|
3.2
|
|
|
$
|
2.0
|
|
|
Defined Benefit Pension Plans
|
|
Deferred Net (Losses) Gains on Derivatives
|
|
Cumulative Translation Adjustment
|
|
Total
|
||||||||
Accumulated other comprehensive loss, December 31, 2016
|
$
|
(304.5
|
)
|
|
$
|
(8.7
|
)
|
|
$
|
(1,128.4
|
)
|
|
$
|
(1,441.6
|
)
|
Other comprehensive income before reclassifications
|
—
|
|
|
2.3
|
|
|
105.4
|
|
|
107.7
|
|
||||
Net losses reclassified from accumulated other comprehensive loss
|
8.9
|
|
|
2.0
|
|
|
—
|
|
|
10.9
|
|
||||
Other comprehensive income, net of reclassification adjustments
|
8.9
|
|
|
4.3
|
|
|
105.4
|
|
|
118.6
|
|
||||
Accumulated other comprehensive loss, September 30, 2017
|
$
|
(295.6
|
)
|
|
$
|
(4.4
|
)
|
|
$
|
(1,023.0
|
)
|
|
$
|
(1,323.0
|
)
|
|
|
Amount Reclassified from Accumulated Other Comprehensive Loss
|
Affected Line Item within the Condensed Consolidated
Statements of Operations
|
||||||
Details about Accumulated Other Comprehensive Loss Components
|
|
Three Months Ended September 30, 2017
(1)
|
|
Three Months Ended September 30, 2016
(1)
|
|||||
Derivatives:
|
|
|
|
|
|
||||
Net gains on foreign currency contracts
|
|
$
|
(0.9
|
)
|
|
$
|
(0.3
|
)
|
Cost of goods sold
|
Net losses on interest rate contract
|
|
0.6
|
|
|
0.5
|
|
Interest expense, net
|
||
Reclassification before tax
|
|
(0.3
|
)
|
|
0.2
|
|
|
||
|
|
(0.2
|
)
|
|
0.1
|
|
Income tax (provision) benefit
|
||
Reclassification net of tax
|
|
$
|
(0.5
|
)
|
|
$
|
0.3
|
|
|
|
|
|
|
|
|
||||
Defined benefit pension plans:
|
|
|
|
|
|
||||
Amortization of net actuarial losses
|
|
$
|
3.2
|
|
|
$
|
2.5
|
|
(2)
|
Amortization of prior service cost
|
|
0.3
|
|
|
0.3
|
|
(2)
|
||
Reclassification before tax
|
|
3.5
|
|
|
2.8
|
|
|
||
|
|
(0.4
|
)
|
|
(0.4
|
)
|
Income tax provision
|
||
Reclassification net of tax
|
|
$
|
3.1
|
|
|
$
|
2.4
|
|
|
|
|
|
|
|
|
||||
Net losses reclassified from accumulated other comprehensive loss
|
|
$
|
2.6
|
|
|
$
|
2.7
|
|
|
|
|
|
|
|
|
||||
|
|
Amount Reclassified from Accumulated Other Comprehensive Loss
|
Affected Line Item within the Condensed Consolidated
Statements of Operations
|
||||||
Details about Accumulated Other Comprehensive Loss Components
|
|
Nine months ended September 30, 2017
(1)
|
|
Nine months ended September 30, 2016
(1)
|
|||||
Derivatives:
|
|
|
|
|
|
||||
Net losses (gains) on foreign currency contracts
|
|
$
|
0.6
|
|
|
$
|
(0.3
|
)
|
Cost of goods sold
|
Net losses on interest rate contract
|
|
1.7
|
|
|
1.4
|
|
Interest expense, net
|
||
Reclassification before tax
|
|
2.3
|
|
|
1.1
|
|
|
||
|
|
(0.3
|
)
|
|
0.1
|
|
Income tax (provision) benefit
|
||
Reclassification net of tax
|
|
$
|
2.0
|
|
|
$
|
1.2
|
|
|
|
|
|
|
|
|
||||
Defined benefit pension plans:
|
|
|
|
|
|
||||
Amortization of net actuarial losses
|
|
$
|
9.3
|
|
|
$
|
7.8
|
|
(2)
|
Amortization of prior service cost
|
|
1.0
|
|
|
0.9
|
|
(2)
|
||
Reclassification before tax
|
|
10.3
|
|
|
8.7
|
|
|
||
|
|
(1.4
|
)
|
|
(1.2
|
)
|
Income tax provision
|
||
Reclassification net of tax
|
|
$
|
8.9
|
|
|
$
|
7.5
|
|
|
|
|
|
|
|
|
||||
Net losses reclassified from accumulated other comprehensive loss
|
|
$
|
10.9
|
|
|
$
|
8.7
|
|
|
|
|
Three Months Ended September 30,
|
||||||
Pension benefits
|
|
2017
|
|
2016
|
||||
Service cost
|
|
$
|
4.2
|
|
|
$
|
4.1
|
|
Interest cost
|
|
5.1
|
|
|
6.2
|
|
||
Expected return on plan assets
|
|
(8.9
|
)
|
|
(9.8
|
)
|
||
Amortization of net actuarial losses
|
|
3.2
|
|
|
2.5
|
|
||
Amortization of prior service cost
|
|
0.3
|
|
|
0.3
|
|
||
Net periodic pension cost
|
|
$
|
3.9
|
|
|
$
|
3.3
|
|
|
|
Three Months Ended September 30,
|
||||||
Postretirement benefits
|
|
2017
|
|
2016
|
||||
Interest cost
|
|
$
|
0.4
|
|
|
$
|
0.3
|
|
Net periodic postretirement benefit cost
|
|
$
|
0.4
|
|
|
$
|
0.3
|
|
|
|
Nine Months Ended September 30,
|
||||||
Pension benefits
|
|
2017
|
|
2016
|
||||
Service cost
|
|
$
|
12.8
|
|
|
$
|
12.3
|
|
Interest cost
|
|
15.3
|
|
|
19.0
|
|
||
Expected return on plan assets
|
|
(26.7
|
)
|
|
(30.2
|
)
|
||
Amortization of net actuarial losses
|
|
9.3
|
|
|
7.8
|
|
||
Amortization of prior service cost
|
|
0.9
|
|
|
0.8
|
|
||
Net periodic pension cost
|
|
$
|
11.6
|
|
|
$
|
9.7
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
||||||
Postretirement benefits
|
|
2017
|
|
2016
|
||||
Service cost
|
|
$
|
0.1
|
|
|
$
|
—
|
|
Interest cost
|
|
1.2
|
|
|
1.1
|
|
||
Amortization of prior service cost
|
|
0.1
|
|
|
0.1
|
|
||
Net periodic postretirement benefit cost
|
|
$
|
1.4
|
|
|
$
|
1.2
|
|
|
|
|
|
|
|
|
Before-Tax
Amount
|
|
Income
Tax
|
|
After-Tax
Amount
|
||||||
Accumulated other comprehensive loss as of December 31, 2016
|
|
$
|
(404.8
|
)
|
|
$
|
(100.3
|
)
|
|
$
|
(304.5
|
)
|
Amortization of net actuarial losses
|
|
9.3
|
|
|
1.4
|
|
|
7.9
|
|
|||
Amortization of prior service cost
|
|
1.0
|
|
|
—
|
|
|
1.0
|
|
|||
Accumulated other comprehensive loss as of September 30, 2017
|
|
$
|
(394.5
|
)
|
|
$
|
(98.9
|
)
|
|
$
|
(295.6
|
)
|
|
As of September 30, 2017
|
|||||||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
Derivative assets
|
$
|
—
|
|
$
|
6.5
|
|
$
|
—
|
|
$
|
6.5
|
|
Derivative liabilities
|
$
|
—
|
|
$
|
11.1
|
|
$
|
—
|
|
$
|
11.1
|
|
|
As of December 31, 2016
|
|||||||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
Derivative assets
|
$
|
—
|
|
$
|
6.5
|
|
$
|
—
|
|
$
|
6.5
|
|
Derivative liabilities
|
$
|
—
|
|
$
|
13.4
|
|
$
|
—
|
|
$
|
13.4
|
|
Three Months Ended September 30,
|
|
North
America |
|
South
America |
|
Europe/
Middle East |
|
Asia/
Pacific/Africa |
|
Consolidated
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net sales
|
|
$
|
483.5
|
|
|
$
|
273.5
|
|
|
$
|
1,017.7
|
|
|
$
|
211.6
|
|
|
$
|
1,986.3
|
|
Income from operations
|
|
27.2
|
|
|
9.0
|
|
|
98.9
|
|
|
15.4
|
|
|
150.5
|
|
|||||
Depreciation
|
|
15.5
|
|
|
8.0
|
|
|
26.7
|
|
|
6.1
|
|
|
56.3
|
|
|||||
Capital expenditures
|
|
12.1
|
|
|
10.9
|
|
|
22.8
|
|
|
1.3
|
|
|
47.1
|
|
|||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net sales
|
|
$
|
453.0
|
|
|
$
|
261.8
|
|
|
$
|
883.3
|
|
|
$
|
163.5
|
|
|
$
|
1,761.6
|
|
Income from operations
|
|
21.1
|
|
|
5.9
|
|
|
75.8
|
|
|
7.1
|
|
|
109.9
|
|
|||||
Depreciation
|
|
14.4
|
|
|
6.2
|
|
|
29.5
|
|
|
5.0
|
|
|
55.1
|
|
|||||
Capital expenditures
|
|
11.3
|
|
|
26.7
|
|
|
22.8
|
|
|
—
|
|
|
60.8
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Nine Months Ended September 30,
|
|
North
America
|
|
South
America
|
|
Europe/
Middle East
|
|
Asia/
Pacific/Africa
|
|
Consolidated
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net sales
|
|
$
|
1,344.9
|
|
|
$
|
747.6
|
|
|
$
|
3,179.7
|
|
|
$
|
506.9
|
|
|
$
|
5,779.1
|
|
Income from operations
|
|
52.7
|
|
|
13.8
|
|
|
336.6
|
|
|
23.2
|
|
|
426.3
|
|
|||||
Depreciation
|
|
45.4
|
|
|
22.7
|
|
|
83.4
|
|
|
13.7
|
|
|
165.2
|
|
|||||
Capital expenditures
|
|
43.2
|
|
|
31.0
|
|
|
59.3
|
|
|
5.9
|
|
|
139.4
|
|
|||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net sales
|
|
$
|
1,360.3
|
|
|
$
|
609.4
|
|
|
$
|
2,950.4
|
|
|
$
|
396.4
|
|
|
$
|
5,316.5
|
|
Income from operations
|
|
44.0
|
|
|
6.3
|
|
|
287.4
|
|
|
8.4
|
|
|
346.1
|
|
|||||
Depreciation
|
|
46.5
|
|
|
16.1
|
|
|
90.7
|
|
|
13.7
|
|
|
167.0
|
|
|||||
Capital expenditures
|
|
31.1
|
|
|
41.1
|
|
|
56.4
|
|
|
4.2
|
|
|
132.8
|
|
|||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As of September 30, 2017
|
|
$
|
1,083.6
|
|
|
$
|
875.9
|
|
|
$
|
2,093.4
|
|
|
$
|
511.0
|
|
|
$
|
4,563.9
|
|
As of December 31, 2016
|
|
$
|
978.5
|
|
|
$
|
739.4
|
|
|
$
|
1,635.2
|
|
|
$
|
426.3
|
|
|
$
|
3,779.4
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Segment income from operations
|
$
|
150.5
|
|
|
$
|
109.9
|
|
|
$
|
426.3
|
|
|
$
|
346.1
|
|
Corporate expenses
|
(28.3
|
)
|
|
(29.3
|
)
|
|
(86.2
|
)
|
|
(90.3
|
)
|
||||
Stock compensation expense
|
(7.9
|
)
|
|
(7.2
|
)
|
|
(29.1
|
)
|
|
(18.0
|
)
|
||||
Restructuring expenses
|
(3.0
|
)
|
|
(1.5
|
)
|
|
(8.5
|
)
|
|
(5.5
|
)
|
||||
Amortization of intangibles
|
(14.3
|
)
|
|
(12.9
|
)
|
|
(41.5
|
)
|
|
(35.3
|
)
|
||||
Consolidated income from operations
|
$
|
97.0
|
|
|
$
|
59.0
|
|
|
$
|
261.0
|
|
|
$
|
197.0
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Segment assets
|
$
|
4,563.9
|
|
|
$
|
3,779.4
|
|
Cash and cash equivalents
|
312.7
|
|
|
429.7
|
|
||
Investments in affiliates
|
465.5
|
|
|
414.9
|
|
||
Deferred tax assets, other current and noncurrent assets
|
664.2
|
|
|
560.7
|
|
||
Intangible assets, net
|
653.4
|
|
|
607.3
|
|
||
Goodwill
|
1,514.7
|
|
|
1,376.4
|
|
||
Consolidated total assets
|
$
|
8,174.4
|
|
|
$
|
7,168.4
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
Three Months Ended September 30,
|
|
Change
|
|
Change Due to Currency Translation
|
|
Change Due to Acquisitions
|
|||||||||||||||||||||
|
2017
|
|
2016
|
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|||||||||||||
North America
|
$
|
483.5
|
|
|
$
|
453.0
|
|
|
$
|
30.5
|
|
|
6.7
|
%
|
|
$
|
4.4
|
|
|
1.0
|
%
|
|
$
|
10.0
|
|
|
2.2
|
%
|
South America
|
273.5
|
|
|
261.8
|
|
|
11.7
|
|
|
4.5
|
%
|
|
(0.9
|
)
|
|
(0.3
|
)%
|
|
0.7
|
|
|
0.3
|
%
|
|||||
Europe/Middle East
(1)
|
1,017.7
|
|
|
883.3
|
|
|
134.4
|
|
|
15.2
|
%
|
|
38.4
|
|
|
4.3
|
%
|
|
25.4
|
|
|
2.9
|
%
|
|||||
Asia/Pacific/Africa
(1)
|
211.6
|
|
|
163.5
|
|
|
48.1
|
|
|
29.4
|
%
|
|
5.7
|
|
|
3.5
|
%
|
|
3.8
|
|
|
2.3
|
%
|
|||||
|
$
|
1,986.3
|
|
|
$
|
1,761.6
|
|
|
$
|
224.7
|
|
|
12.8
|
%
|
|
$
|
47.6
|
|
|
2.7
|
%
|
|
$
|
39.9
|
|
|
2.3
|
%
|
|
Nine Months Ended September 30,
|
|
Change
|
|
Change Due to Currency Translation
|
|
Change Due to Acquisitions
|
|||||||||||||||||||||
|
2017
|
|
2016
|
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|||||||||||||
North America
|
$
|
1,344.9
|
|
|
$
|
1,360.3
|
|
|
$
|
(15.4
|
)
|
|
(1.1
|
)%
|
|
$
|
(1.9
|
)
|
|
(0.1
|
)%
|
|
$
|
19.4
|
|
|
1.4
|
%
|
South America
|
747.6
|
|
|
609.4
|
|
|
138.2
|
|
|
22.7
|
%
|
|
43.4
|
|
|
7.1
|
%
|
|
2.5
|
|
|
0.4
|
%
|
|||||
Europe/Middle East
(1)
|
3,179.7
|
|
|
2,950.4
|
|
|
229.3
|
|
|
7.8
|
%
|
|
(49.1
|
)
|
|
(1.7
|
)%
|
|
93.7
|
|
|
3.2
|
%
|
|||||
Asia/Pacific/Africa
(1)
|
506.9
|
|
|
396.4
|
|
|
110.5
|
|
|
27.9
|
%
|
|
1.5
|
|
|
0.4
|
%
|
|
15.0
|
|
|
3.8
|
%
|
|||||
|
$
|
5,779.1
|
|
|
$
|
5,316.5
|
|
|
$
|
462.6
|
|
|
8.7
|
%
|
|
$
|
(6.1
|
)
|
|
(0.1
|
)%
|
|
$
|
130.6
|
|
|
2.5
|
%
|
|
|
Three Months Ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
||||||||||
|
|
$
|
|
% of
Net Sales
|
|
$
|
|
% of
Net Sales
(1)
|
||||||
Gross profit
|
|
$
|
428.6
|
|
|
21.6
|
%
|
|
$
|
353.5
|
|
|
20.1
|
%
|
Selling, general and administrative expenses
|
|
234.3
|
|
|
11.8
|
%
|
|
214.1
|
|
|
12.2
|
%
|
||
Engineering expenses
|
|
80.0
|
|
|
4.0
|
%
|
|
66.0
|
|
|
3.7
|
%
|
||
Restructuring expenses
|
|
3.0
|
|
|
0.2
|
%
|
|
1.5
|
|
|
0.1
|
%
|
||
Amortization of intangibles
|
|
14.3
|
|
|
0.7
|
%
|
|
12.9
|
|
|
0.7
|
%
|
||
Income from operations
|
|
$
|
97.0
|
|
|
4.9
|
%
|
|
$
|
59.0
|
|
|
3.3
|
%
|
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
||||||||||
|
|
$
|
|
% of
Net Sales (1) |
|
$
|
|
% of
Net Sales
|
||||||
Gross profit
|
|
$
|
1,234.3
|
|
|
21.4
|
%
|
|
$
|
1,095.2
|
|
|
20.6
|
%
|
Selling, general and administrative expenses
|
|
693.6
|
|
|
12.0
|
%
|
|
643.1
|
|
|
12.1
|
%
|
||
Engineering expenses
|
|
229.7
|
|
|
4.0
|
%
|
|
214.3
|
|
|
4.0
|
%
|
||
Restructuring expenses
|
|
8.5
|
|
|
0.1
|
%
|
|
5.5
|
|
|
0.1
|
%
|
||
Amortization of intangibles
|
|
41.5
|
|
|
0.7
|
%
|
|
35.3
|
|
|
0.7
|
%
|
||
Income from operations
|
|
$
|
261.0
|
|
|
4.5
|
%
|
|
$
|
197.0
|
|
|
3.7
|
%
|
(1)
|
Rounding may impact summation of amounts.
|
|
September 30, 2017
|
||
1.056% Senior term loan due 2020
|
$
|
235.9
|
|
Credit facility, expiring 2020
|
587.4
|
|
|
Senior term loans due 2021
|
353.9
|
|
|
5
7
/
8
% Senior notes due 2021
|
305.6
|
|
|
Senior term loans due between 2019 and 2026
|
442.4
|
|
|
Other long-term debt
|
137.5
|
|
|
Debt issuance costs
|
(4.5
|
)
|
|
|
$
|
2,058.2
|
|
•
|
general economic and capital market conditions;
|
•
|
availability of credit to our retail customers;
|
•
|
the worldwide demand for agricultural products;
|
•
|
grain stock levels and the levels of new and used field inventories;
|
•
|
government policies and subsidies;
|
•
|
weather conditions;
|
•
|
interest and foreign currency exchange rates;
|
•
|
pricing and product actions taken by competitors;
|
•
|
commodity prices, acreage planted and crop yields;
|
•
|
farm income, land values, debt levels and access to credit;
|
•
|
pervasive livestock diseases;
|
•
|
production disruptions;
|
•
|
production levels and capacity constraints at our facilities, including those resulting from plant expansions and systems upgrades;
|
•
|
integration of recent and future acquisitions;
|
•
|
our expansion plans in emerging markets;
|
•
|
supply constraints;
|
•
|
our cost reduction and control initiatives;
|
•
|
our research and development efforts;
|
•
|
dealer and distributor actions;
|
•
|
regulations affecting privacy and data protection;
|
•
|
technological difficulties; and
|
•
|
political and economic uncertainty in various areas of the world.
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
PART II.
|
OTHER INFORMATION
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 6.
|
EXHIBITS
|
Exhibit
Number
|
|
Description of Exhibit
|
|
The filings referenced for
incorporation by reference are
AGCO Corporation
|
|
|
|
|
|
|
|
July 27, 2017, Form 8-K, Exhibit 10.1
|
||
|
|
|
|
|
|
|
July 27, 2017, Form 8-K, Exhibit 10.2
|
||
|
|
|
|
|
|
|
July 27, 2017, Form 8-K, Exhibit 10.3
|
||
|
|
|
|
|
|
|
July 27, 2017, Form 8-K, Exhibit 10.4
|
||
|
|
|
|
|
|
|
Filed herewith
|
||
|
|
|
|
|
|
|
Filed herewith
|
||
|
|
|
||
|
|
Filed herewith
|
||
|
|
|
||
|
|
Furnished herewith
|
||
|
|
|
||
|
|
Filed herewith
|
||
|
|
|
||
|
|
Filed herewith
|
||
|
|
|
||
|
|
Filed herewith
|
||
|
|
|
||
|
|
Filed herewith
|
||
|
|
|
|
|
|
|
Filed herewith
|
||
|
|
|
||
|
|
Filed herewith
|
|
|
|
|
Date:
|
November 8, 2017
|
|
AGCO CORPORATION
Registrant
/s/ Andrew H. Beck
|
|
|
|
Andrew H. Beck
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weakness in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated:
|
November 8, 2017
|
|
|
|
|
|
|
/s/ Martin Richenhagen
|
|
|
Martin Richenhagen
|
|
|
Chairman of the Board, President and Chief Executive Officer
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weakness in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated:
|
November 8, 2017
|
|
|
|
|
|
|
/s/ Andrew H. Beck
|
|
|
Andrew H. Beck
|
|
|
Senior Vice President and Chief Financial Officer
|
|
/s/ Martin Richenhagen
|
|
|
Martin Richenhagen
|
|
|
Chairman of the Board, President and Chief Executive Officer
|
|
|
November 8, 2017
|
|
|
|
|
|
/s/Andrew H. Beck
|
|
|
Andrew H. Beck
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
November 8, 2017
|
|