Agricultural equipment manufacturer AGCO Corp. Friday reduced its outlook for 2006 net sales and adjusted earnings per share, citing softer market conditions and weaker margins.
The company now expects sales to decline 2 to 3 percent versus 2005, and 2006 adjusted earnings per share to be approximately $1.00. Sales and operating income in AGCO’s North American operations are now expected to be lower than previously forecasted due to continued efforts to reduce dealer inventories, softening market conditions, and lower than anticipated margins.
Weaker-than-expected market conditions in the East Asia Pacific region also contributed to the reduced sales and earnings outlook, the company said.
Third quarter 2006 sales are now expected to be approximately 6 percent below third quarter 2005 levels, and third quarter 2006 net income is now expected to be break-even to a slight loss.