US giants experience contrasting fortunes

10 May 2002

US giants experience contrasting fortunes

By Andy Collings

FIRST quarter financial results have been released by CNH Global and Agco.

For CNH, a strong retail performance resulted in market share gains in the agricultural and construction equipment businesses. However, the bottom line figure of a $46m loss is unchanged from the first quarter of 2001.

Revenues were down slightly when compared with the same period last year – from $2454bn to $2389bn. This was put down to planned dealer destocking in construction and unfavourable exchange rates.

But this was partially offset by stronger sales of agricultural equipment. Sales of agricultural machinery totalled $1552bn, up from $1518bn in 2001 – even though industry sales were essentially flat on a global scale.

Looking ahead, CNH says that the growing strength of its global agricultural business will contribute significantly to the companys bottom line – particularly in the fourth quarter.

Agcos first quarter operating income is reported to be $39.2m, compared with $10.7m in 2001. This improvement, says the company, was primarily the result of sales growth and gross margin expansion.

Net sales increased by 16.3% due largely to the addition of Ag-Chem to the business. First quarter gross margins are reported to have improved from 15.5% in 2001 to 18.8% this year – again due in part to high margin Ag-Chem sales. &#42

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