1
EXHIBIT 99.2
AGCO CORPORATION AND SUBSIDIARIES
INDEX
The following financial statements of AGCO and its subsidiaries for the
three months ended March 31, 2001 are included herein.
Page
Numbers
-------
Condensed Consolidated Balance
Sheets - March 31, 2001 and
December 31, 2000.................................. 1
Condensed Consolidated Statements
of Operations for the Three Months
Ended March 31, 2001 and 2000...................... 2
Condensed Consolidated Statements
of Cash Flows for the Three Months
Ended March 31, 2001 and 2000...................... 3
Notes to Condensed Consolidated
Financial Statements............................... 4
2
AGCO CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN MILLIONS, EXCEPT SHARE DATA)
MARCH 31, DECEMBER 31,
2001 2000
--------- ------------
(UNAUDITED)
ASSETS
Current Assets:
Cash and cash equivalents ........................................ $ 5.4 $ 13.3
Accounts and notes receivable, net ............................... 569.1 602.9
Inventories, net ................................................. 586.7 531.1
Other current assets ............................................. 92.7 93.0
-------- --------
Total current assets ........................................... 1,253.9 1,240.3
Property, plant and equipment, net ................................. 291.3 316.2
Investment in affiliates ........................................... 87.3 85.3
Other assets ....................................................... 190.2 176.0
Intangible assets, net ............................................. 270.7 286.4
-------- --------
Total assets ................................................... $2,093.4 $2,104.2
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable ................................................. $ 220.5 $ 244.4
Accrued expenses ................................................. 339.2 357.6
Other current liabilities ........................................ 40.1 34.4
-------- --------
Total current liabilities ...................................... 599.8 636.4
Long-term debt ..................................................... 645.8 570.2
Postretirement health care benefits ................................ 27.6 27.5
Other noncurrent liabilities ....................................... 77.6 80.2
-------- --------
Total liabilities .............................................. 1,350.8 1,314.3
-------- --------
Stockholders' Equity:
Preferred stock: $0.01 par value, 1,000,000 shares authorized,
555 and 0 shares issued and outstanding at March 31, 2001
and December 31, 2000, respectively .............................. -- --
Common stock: $0.01 par value, 150,000,000 shares authorized,
59,591,928 and 59,589,428 shares issued and outstanding
at March 31, 2001 and December 31, 2000, respectively ............ 0.6 0.6
Additional paid-in capital ....................................... 432.4 427.1
Retained earnings ................................................ 616.6 622.9
Unearned compensation ............................................ (0.9) (1.4)
Accumulated other comprehensive loss ............................. (306.1) (259.3)
-------- --------
Total stockholders' equity ..................................... 742.6 789.9
-------- --------
Total liabilities and stockholders' equity ..................... $2,093.4 $2,104.2
======== ========
See accompanying notes to condensed consolidated financial statements.
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AGCO CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED AND IN MILLIONS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED MARCH 31,
----------------------------
2001 2000
------- -------
Net sales ............................................. $ 532.1 $ 534.8
Cost of goods sold .................................... 449.6 457.7
------- -------
Gross profit ........................................ 82.5 77.1
Selling, general and administrative expenses .......... 56.7 58.9
Engineering expenses .................................. 11.9 10.5
Restructuring and other infrequent expenses ........... 2.3 1.9
Amortization of intangibles ........................... 3.9 3.8
------- -------
Income from operations .............................. 7.7 2.0
Interest expense, net ................................. 13.9 11.4
Other expense, net .................................... 7.6 12.3
------- -------
Loss before income taxes and equity in net earnings
of affiliates ....................................... (13.8) (21.7)
Income tax benefit .................................... (5.2) (8.7)
------- -------
Loss before equity in net earnings of affiliates ...... (8.6) (13.0)
Equity in net earnings of affiliates .................. 2.8 2.3
------- -------
Net loss .............................................. $ (5.8) $ (10.7)
======= =======
Net loss per common share:
Basic ............................................... $ (0.10) $ (0.18)
======= =======
Diluted ............................................. $ (0.10) $ (0.18)
======= =======
Weighted average number of common and common
equivalent shares outstanding:
Basic ............................................... 59.3 58.9
======= =======
Diluted ............................................. 59.3 58.9
======= =======
Dividends declared per common share ................... $ 0.01 $ 0.01
======= =======
See accompanying notes to condensed consolidated financial statements.
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4
AGCO CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED AND IN MILLIONS)
THREE MONTHS ENDED MARCH 31,
----------------------------
2001 2000
------ -------
Cash flows from operating activities:
Net loss .............................................................. $ (5.8) $ (10.7)
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities:
Depreciation and amortization ....................................... 12.6 13.7
Amortization of intangibles ......................................... 3.9 3.8
Amortization of unearned compensation ............................... 0.5 1.5
Equity in net earnings of affiliates,
net of cash received .............................................. (2.1) (2.3)
Deferred income tax benefit ......................................... (14.4) (14.8)
Changes in operating assets and liabilities:
Accounts and notes receivable, net ................................ 0.8 142.2
Inventories, net .................................................. (77.9) (46.5)
Other current and noncurrent assets ............................... (6.5) (7.1)
Accounts payable .................................................. (3.5) 20.4
Accrued expenses .................................................. (3.9) (16.0)
Other current and noncurrent liabilities .......................... (1.0) 8.0
------ -------
Total adjustments ............................................... (91.5) 102.9
------ -------
Net cash provided by (used in) operating activities ............. (97.3) 92.2
------ -------
Cash flows from investing activities:
Purchase of property, plant and equipment ........................... (4.5) (7.5)
Investment in unconsolidated affiliates ............................. (0.5) (1.2)
------ -------
Net cash used for investing activities .......................... (5.0) (8.7)
------ -------
Cash flows from financing activities:
Proceeds from (repayments of) long-term debt, net ................... 89.3 (93.4)
Proceeds from issuance of preferred stock ........................... 5.3 --
Dividends paid on common stock ...................................... (0.6) (0.6)
------ -------
Net cash provided by (used in) financing activities ............. 94.0 (94.0)
------ -------
Effect of exchange rate changes on cash and cash equivalents ........ 0.4 1.3
------ -------
Decrease in cash and cash equivalents ............................... (7.9) (9.2)
Cash and cash equivalents, beginning of period ...................... 13.3 19.6
------ -------
Cash and cash equivalents, end of period ............................ $ 5.4 $ 10.4
====== =======
See accompanying notes to condensed consolidated financial statements.
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AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The condensed consolidated financial statements of AGCO Corporation and
subsidiaries (the "Company" or "AGCO") included herein have been prepared in
accordance with generally accepted accounting principles for interim financial
information and the rules and regulations of the Securities and Exchange
Commission. In the opinion of management, the accompanying unaudited condensed
consolidated financial statements reflect all adjustments, which are of a normal
recurring nature, necessary to present fairly the Company's financial position,
results of operations and cash flows at the dates and for the periods presented.
These condensed consolidated financial statements should be read in conjunction
with the Company's audited financial statements and notes thereto included in
the Company's Annual Report on Form 10-K for the year ended December 31, 2000.
Interim results of operations are not necessarily indicative of results to be
expected for the fiscal year. Certain reclassifications of previously reported
financial information were made to conform to the current presentation.
2. RESTRUCTURING AND OTHER INFREQUENT EXPENSES
In 2000, the Company permanently closed its combine manufacturing
facility in Independence, Missouri and its Lockney, Texas and Noetinger,
Argentina implement manufacturing facilities. In 1999, the Company permanently
closed its Coldwater, Ohio manufacturing facility. The majority of production in
these facilities has been relocated to existing Company facilities or outsourced
to third parties.
In connection with these facility closures, the Company recorded
restructuring and other infrequent expenses of $2.3 million in the first quarter
of 2001. The components of the restructuring and other infrequent expenses are
summarized in the following table (in millions):
Reserve Balance Reserve Balance
at December 31, 2001 Amount at March 31,
2000 Expense Incurred 2001
--------------- ------- -------- ---------------
Employee severance ................... $1.9 $ -- $ 0.3 $1.6
Facility closure costs ............... 3.9 -- 1.5 2.4
Write-down of property plant
and equipment, net of recoveries ... -- (0.7) (0.7) --
Production transition costs .......... -- 3.0 3.0 --
---- ----- ----- ----
$5.8 $ 2.3 $ 4.1 $4.0
==== ===== ===== ====
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AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
3. LONG-TERM DEBT
Long-term debt consisted of the following at March 31, 2001 and
December 31, 2000 (in millions):
March 31, December 31,
2001 2000
--------- ------------
Revolving credit facility ................... $390.4 $314.2
8 1/2% Senior Subordinated Notes due 2006 ... 248.7 248.6
Other long-term debt ........................ 6.7 7.4
------ ------
$645.8 $570.2
====== ======
In March 2001, the Company was issued a notice of default by the
trustee of its $250 million 8 1/2% Senior Subordinated Notes due 2006 (the
"Notes") regarding the violation of a covenant restricting the payment of
dividends during periods in 1999, 2000 and 2001 when an interest coverage ratio
was not met. During those periods, the Company paid approximately $4.8 million
in dividends based upon its interpretation that it did not need to meet the
interest coverage ratio but, instead, an alternative total debt test. The
Company subsequently received sufficient waivers from the holders of the Notes
for any violations of the covenant that might have resulted from the dividend
payments. In connection with the solicitation of waivers, the Company incurred
costs of approximately $2.6 million, which were expensed in the first quarter of
2001. Currently, the Company is prohibited from paying dividends until such time
as the interest coverage ratio in the indenture is met.
4. INVENTORIES
Inventory balances at March 31, 2001 and December 31, 2000 were as
follows (in millions):
March 31, December 31,
2001 2000
--------- ------------
Finished goods ........................................ $ 258.0 $ 233.0
Repair and replacement parts .......................... 226.8 222.2
Work in process, production parts and raw materials ... 166.3 143.6
------- -------
Gross inventories ................................... 651.1 598.8
Allowance for surplus and obsolete inventories ........ (64.4) (67.7)
------- -------
Inventories, net .................................... $ 586.7 $ 531.1
======= =======
5. NET INCOME PER COMMON SHARE
The computation, presentation and disclosure requirements for earnings
per share are presented in accordance with Statement of Financial Accounting
Standards ("SFAS") No. 128, "Earnings Per Share." Basic earnings per common
share is computed by dividing net income by the weighted average number of
common shares outstanding during each period. Diluted earnings per common share
assumes exercise of outstanding stock options and vesting of restricted stock
when the effects of such assumptions are dilutive.
A reconciliation of net loss and the weighted average number of common
shares outstanding used to calculate basic and diluted net loss per common share
for the three months
5
7
AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
ended March 31, 2001 and 2000 is as follows (in millions, except per share
data):
Three Months Ended
March 31,
-----------------------
2001 2000
------ ------
BASIC AND DILUTED EARNINGS PER SHARE
Weighted average number of common shares outstanding ... 59.3 58.9
====== ======
Net loss ............................................... $ (5.8) $(10.7)
====== ======
Net loss per common share .............................. $(0.10) $(0.18)
====== ======
For the three months ended March 31, 2001, approximately 1.4 million
shares were excluded from the calculation of diluted earnings per share because
such shares would be anti-dilutive.
6. COMPREHENSIVE LOSS
Total comprehensive loss for the three months ended March 31, 2001 and 2000 was
as follows (in millions):
Three Months Ended
March 31,
-----------------------
2001 2000
------ ------
Net loss ..................................... $ (5.8) $(10.7)
Other comprehensive loss:
Foreign currency translation adjustments ... $(45.4) $(17.3)
Unrealized loss on derivatives ............. (1.4) --
------ ------
Total comprehensive loss ....... $(52.6) $(28.0)
====== ======
7. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
Effective January 1, 2001, the Company adopted SFAS No. 133 "Accounting
for Derivative Instruments and Hedging Activities," as amended by SFAS No. 138.
The cumulative effect for adopting this standard as of January 1, 2001 resulted
in a fair value asset, net of taxes of approximately $0.5 million, which is
expected to be reclassified to earnings over the next twelve months. All
derivatives are recognized on the balance sheet at fair value. On the date the
derivative contract is entered, the Company designates the derivative as either
(1) a fair value hedge of a recognized liability, (2) a cash flow hedge of a
forecasted transaction, (3) a hedge of a net investment in a foreign operation,
or (4) a non-designated derivative instrument. The Company currently engages in
derivatives that are classified as cash flow hedges and non-designated
derivative instruments. Changes in the fair value of a derivative that is
designated as a cash flow hedge are recorded in other comprehensive income until
reclassified into earnings at the time of settlement of the forecasted
transaction. Changes in the fair value of non-designated derivative contracts
and the ineffective portion of designated derivative instruments are reported in
current earnings.
The Company formally documents all relationships between hedging
instruments and hedged items, as well as the risk management objectives and
strategy for undertaking various
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AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
hedge transactions. The Company formally assesses, both at the hedge's inception
and on an ongoing basis, whether the derivatives that are used in hedging
transactions are highly effective in offsetting changes in fair values or cash
flow of hedged items. When it is determined that a derivative is no longer
highly effective as a hedge, hedge accounting is discontinued on a prospective
basis.
Foreign Currency Risk
The Company has significant manufacturing operations in the United
States, the United Kingdom, France, Germany, Denmark and Brazil, and it
purchases a portion of its tractors, combines and components from third party
foreign suppliers, primarily in various European countries and in Japan. The
Company also sells products in over 140 countries throughout the world. The
Company's most significant transactional foreign currency exposures are the
British pound in relation to the Euro and the U.S. dollar, the Euro and the
Canadian dollar in relation to the U.S. dollar.
The Company attempts to manage its transactional foreign exchange
exposure by hedging identifiable foreign currency cash flow commitments arising
from receivables, payables, and expected purchases and sales. Where naturally
offsetting currency positions do not occur, the Company hedges certain of its
exposures through the use of foreign currency forward contracts.
The Company uses foreign currency forward contracts to hedge
receivables and payables on the Company's balance sheet that are denominated in
foreign currencies other than the functional currency. These forward contracts
are classified as non-designated derivatives instruments. For the quarter ended
March 31, 2001, the Company recorded losses of approximately $6.8 million
included in current earnings under the caption of other expense, net. These
losses were substantially offset by gains on the remeasurement of the underlying
asset or liability being hedged.
The Company uses foreign currency forward contracts to hedge forecasted
foreign currency inflows and outflows resulting from purchases and sales. The
Company currently has hedged anticipated foreign currency cash flows up to
twelve months in the future. As of March 31, 2001, the Company had deferred
losses, net of taxes, of $1.6 million included in stockholders' equity as a
component of accumulated other comprehensive loss. The deferred loss is expected
to be reclassified to earnings during the next twelve months. The Company
recorded no gain or loss resulting from a forward contract's ineffectiveness or
discontinuance as a cash flow hedge.
Interest Rate Risk
The Company uses interest rate swap agreements to manage its exposure
to interest rate changes. Currently, the Company has an interest rate swap which
matures in December 2001 that has the effect of converting a portion of the
Company's floating rate debt to a fixed rate. The Company has designated this
swap agreement as a cash flow hedge. As of March 31, 2001, the Company had a
deferred gain, net of tax, of approximately $0.2 million included in
stockholders' equity as a component of accumulated other comprehensive loss.
This deferred loss is expected to be reclassified to current earnings over the
next twelve months. The Company had no material gain or loss resulting from the
interest rate swap agreement's ineffectiveness as a cash flow
7
9
AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
hedge. In addition, no portion of the swap agreement was discontinued as a cash
flow hedge.
The Company's senior management establishes the Company's foreign
currency and interest rate risk management policies. This policy is reviewed
periodically by the Audit Committee of the Board of Directors. The policy allows
for the use of derivative instruments to hedge exposures to movements in foreign
currency and interest rates. The Company's policy prohibits the use of
derivative instruments for speculative purposes.
8. SEGMENT REPORTING
The Company has four geographic reportable segments: North America;
South America; Europe/Africa/Middle East; and Asia/Pacific. Each segment
distributes a full range of agricultural equipment and related replacement
parts. The Company evaluates segment performance primarily based on income from
operations. Sales for each segment are based on the location of the third-party
customer. All intercompany transactions between the segments have been
eliminated. The Company's selling, general and administrative expenses and
engineering expenses are charged to each segment based on the region where the
expenses are incurred. As a result, the components of operating income for one
segment may not be comparable to another segment. Segment results for the three
months ended March 31, 2001 and 2000 are as follows (in millions):
North South Europe/Africa/
America America Middle East Asia/Pacific Consolidated
------- ------- -------------- ------------ ------------
2001
Net sales $ 150.6 $ 61.5 $296.9 $23.1 $532.1
Income (loss) from operations (12.3) 4.2 18.9 3.8 14.6
2000
Net sales $ 140.7 $ 49.9 $318.5 $25.7 $534.8
Income (loss) from operations (11.4) (0.5) 17.5 3.7 9.3
A reconciliation from the segment information to the consolidated
balances for income from operations is set forth below (in millions):
Three Months Ended
March 31,
----------------------
2001 2000
------ -----
Segment income from operations .......... $ 14.6 $ 9.3
Restricted stock compensation expense ... (0.7) (1.6)
Restructuring and infrequent expenses ... (2.3) (1.9)
Amortization of intangibles ............. (3.9) (3.8)
------ -----
Consolidated income from operations ..... $ 7.7 $ 2.0
====== =====
9. PREFERRED STOCK
On March 23, 2001 the Company issued 555 non-voting preferred shares,
which are convertible into shares of AGCO common stock (1 preferred share per
1,000 common shares) in a private placement with net proceeds of approximately
$5.3 million. The amount of the net proceeds exceeds the aggregate amount of
common stock dividends in 1999, 2000 and 2001 which were paid in violation of a
restricted payments covenant contained in the Indenture governing the Notes.
8
10
AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
10. SUBSEQUENT EVENTS
Recent Acquisition - Ag-Chem
On April 16, 2001, the Company completed the acquisition of Ag-Chem
Equipment Co., Inc. ("Ag-Chem"), a leading manufacturer and distributor of
self-propelled fertilizer and chemical sprayers for pre-emergent and
post-emergent applications. Ag-Chem shareholders received total consideration of
$247.2 million consisting of approximately 11.8 million AGCO common shares and
$147.5 million of cash. The funding of the cash component of the purchase price
was made through borrowings under the Company's existing revolving credit
facility.
Refinancings
On April 17, 2001 the Company issued $250.0 million of 9 1/2% Senior
Notes due 2008 (the "Senior Notes"). The Senior Notes are unsecured obligations
of the Company and are redeemable at the option of the Company, in whole or in
part, commencing May 1, 2005 initially at 104.75% of their principal amount,
plus accrued interest, declining to 100% of their principal amount plus accrued
interest on or after May 1, 2007. The indenture governing the Senior Notes
requires the Company to offer to repurchase the Senior Notes at 101% of their
principal amount, plus accrued interest to the date of the repurchase in the
event of a change in control. The indenture also contains certain covenants
that, among other things, limits the Company's ability (and that of its
restricted subsidiaries) to incur additional indebtedness; make restricted
payments (including dividends and share repurchases); make investments;
guarantee indebtedness; create liens; and sell assets. The proceeds were used to
repay borrowings outstanding under the Company's existing revolving credit
facility.
On April 17, 2001 the Company entered into a $350.0 million
multi-currency revolving credit facility with Rabobank that will mature October
2005. The facility is secured by a majority of the Company's U.S., Canadian and
U.K.-based assets and a pledge of the stock of the Company's domestic and
material foreign subsidiaries. Interest will accrue on borrowings outstanding
under the facility, at the Company's option, at either (1) LIBOR plus a margin
based on a ratio of the Company's senior debt to EBITDA, as adjusted, or (2) the
administrative agent's base lending rate or the federal funds rate plus a margin
ranging between .625% and 1.5%, whichever is higher. The facility contains
covenants, including covenants restricting the incurrence of indebtedness and
the making of restrictive payments, including dividends. In addition, the
Company must fulfill financial covenants including, among others, a total debt
to EBITDA ratio, a senior debt to EBITDA ratio and a fixed charge coverage
ratio, as defined in the facility. The proceeds were used to repay borrowings
outstanding under the Company's existing revolving credit facility.
New European Securitization Facility
On April 17, 2001 the Company entered into a new $100.0 million
securitization facility with Rabobank whereby certain European wholesale
accounts receivable from the Company's operations in France, Germany and Spain
may be sold to a third party on a revolving basis through a wholly-owned special
purpose subsidiary. The Company used the $100.0 million proceeds from the
European securitization facility to reduce outstanding borrowings under its new
revolving credit facility.
11. SUPPLEMENTAL GUARANTOR/NON-GUARANTOR FINANCIAL INFORMATION
On April 17, 2001, AGCO issued $250 million of 9 1/2% Senior Notes due
2008. The Senior Notes are fully and unconditionally guaranteed by the following
U.S. subsidiaries of AGCO Corporation: AGCO Ventures LLC, Hesston Ventures
Corporation, Hay and Forage Industries ("HFI"), Ag-Chem Equipment Co., Inc.,
Ag-Chem Manufacturing Co., Inc., Ag-Chem Sales Co., Inc., Ag-Chem Equipment
International, Inc., Lor*Al Products, Inc. and Ag-Chem Equipment Canada, Ltd.
(the "Guarantor Subsidiaries"). The following financial information presents
condensed consolidating balance sheets, statements of operations and cash flows
of (i) the parent company as if it accounted for its subsidiaries on the equity
method, (ii) the Guarantor Subsidiaries on a combined basis, and (iii) the
non-guarantor subsidiaries on a combined basis. Certain Guarantor Subsidiaries,
AGCO Ventures LLC, Hesston Ventures Corporation and HFI represent AGCO's
ownership in HFI. AGCO acquired the remaining 50% interest in HFI in May 2000.
Accordingly, HFI is reflected on the equity method of accounting for periods
prior to May 2000 and is consolidated with the Company's financial statements
subsequent to May 2000. In addition, the remaining Guarantor Subsidiaries, not
associated with HFI, were acquired on April 16, 2001 as part of the acquisition
of Ag-Chem Equipment Company, Inc., and accordingly, are not included in the
following historical financial information.
9
11
AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2001
(IN MILLIONS)
PARENT GUARANTOR NON-GUARANTOR ELIMINATING
COMPANY SUBSIDIARIES SUBSIDIARIES ENTRIES CONSOLIDATED
------- ------------ -------------- ----------- ------------
Net sales $137.5 $ 41.4 $447.4 $(94.2) $532.1
Cost of goods sold 124.4 44.2 375.2 (94.2) 449.6
------ ------ ------ ------ ------
Gross profit 13.1 (2.8) 72.2 -- 82.5
Selling, general and administrative expenses 22.3 1.3 33.1 -- 56.7
Engineering expenses 0.6 2.7 8.6 -- 11.9
Restructuring and other infrequent expenses (0.4) 2.7 -- -- 2.3
Amortization of intangibles 1.7 -- 2.2 -- 3.9
------ ------ ------ ------ ------
Income (loss) from operations (11.1) (9.5) 28.3 -- 7.7
Interest expense, net 10.0 -- 3.9 -- 13.9
Other expense, net 5.4 -- 2.2 -- 7.6
------ ------ ------ ------ ------
Income (loss) before income taxes and equity in net earnings
of unconsolidated subsidiaries and affiliates (26.5) (9.5) 22.2 -- (13.8)
Income tax provision (benefit) (8.6) (3.8) 7.2 -- (5.2)
------ ------ ------ ------ ------
Income (loss) before equity in net earnings of unconsolidated
subsidiaries and affiliates (17.9) (5.7) 15.0 -- (8.6)
Equity in net earnings of unconsolidated subsidiaries
and affiliates 12.1 -- 1.6 (10.9) 2.8
------ ------ ------ ------ ------
Net income (loss) $ (5.8) $ (5.7) $ 16.6 $(10.9) $ (5.8)
====== ====== ====== ====== ======
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2000
(IN MILLIONS)
PARENT GUARANTOR NON-GUARANTOR ELIMINATING
COMPANY SUBSIDIARIES SUBSIDIARIES ENTRIES CONSOLIDATED
------- ------------ -------------- ----------- ------------
Net sales $139.1 $ -- $445.4 $(49.7) $534.8
Cost of goods sold 127.0 -- 380.4 (49.7) 457.7
------ ---- ------ ------ ------
Gross profit 12.1 -- 65.0 -- 77.1
Selling, general and administrative expenses 23.5 -- 35.4 -- 58.9
Engineering expenses 2.4 -- 8.1 -- 10.5
Restructuring and other infrequent expenses 3.1 -- (1.2) -- 1.9
Amortization of intangibles 1.5 -- 2.3 -- 3.8
------ ---- ------ ------ ------
Income (loss) from operations (18.4) -- 20.4 -- 2.0
Interest expense, net 7.3 -- 4.1 -- 11.4
Other expense, net 9.7 -- 2.6 -- 12.3
------ ---- ------ ------ ------
Income (loss) before income taxes and equity in net earnings
of unconsolidated subsidiaries and affiliates (35.4) -- 13.7 -- (21.7)
Income tax provision (benefit) (14.5) -- 5.8 -- (8.7)
------ ---- ------ ------ ------
Income (loss) before equity in net earnings of unconsolidated
subsidiaries and affiliates (20.9) -- 7.9 -- (13.0)
Equity in net earnings of unconsolidated subsidiaries and affiliates 10.2 -- 1.1 (9.0) 2.3
------ ---- ------ ------ ------
Net income (loss) $(10.7) $ -- $ 9.0 $ (9.0) $(10.7)
====== ==== ====== ====== ======
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AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF MARCH 31, 2001
(IN MILLIONS)
PARENT GUARANTOR NON-GUARANTOR ELIMINATING
COMPANY SUBSIDIARIES SUBSIDIARIES ENTRIES CONSOLIDATED
-------- ---------- -------------- ----------- ------------
ASSETS
Current Assets:
Cash and cash equivalents $ -- $ (2.5) $ 7.9 $ -- $ 5.4
Accounts and notes receivables, net 118.3 4.8 436.2 -- 559.3
Receivables from subsidiaries and affiliates 185.0 -- 171.6 (346.8) 9.8
Inventories, net 211.3 36.2 348.5 (9.3) 586.7
Other current assets 46.7 2.1 43.9 -- 92.7
-------- ------ -------- --------- --------
Total current assets 561.3 40.6 1,008.1 (356.1) 1,253.9
Property, plant and equipment, net 18.2 39.8 233.3 -- 291.3
Investment in unconsolidated subsidiaries and affiliates 716.5 -- 86.6 (715.8) 87.3
Other assets 114.2 8.1 67.9 -- 190.2
Intangible assets, net 36.3 -- 234.4 -- 270.7
-------- ------ -------- --------- --------
Total assets $1,446.5 $ 88.5 $1,630.3 $(1,071.9) $2,093.4
======== ====== ======== ========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 46.2 $ 13.7 $ 157.7 $ -- $ 217.6
Payables to subsidiaries and affiliates 149.5 60.6 139.6 (346.8) 2.9
Accrued expenses 86.6 8.9 243.7 -- 339.2
Other current liabilities 4.5 -- 35.6 -- 40.1
-------- ------ -------- --------- --------
Total current liabilities 286.8 83.2 576.6 (346.8) 599.8
Long-term debt 376.7 0.8 268.3 -- 645.8
Postretirement health care benefits 24.0 3.6 -- -- 27.6
Other noncurrent liabilities 16.4 -- 61.2 -- 77.6
-------- ------ -------- --------- --------
Total liabilities 703.9 87.6 906.1 (346.8) 1,350.8
Total stockholders' equity 742.6 0.9 724.2 (725.1) 742.6
-------- ------ -------- --------- --------
Total liabilities and stockholders' equity $1,446.5 $ 88.5 $1,630.3 $(1,071.9) $2,093.4
======== ====== ======== ========= ========
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2001
(IN MILLIONS)
PARENT GUARANTOR NON-GUARANTOR ELIMINATING
COMPANY SUBSIDIARIES SUBSIDIARIES ENTRIES CONSOLIDATED
------- ------------ -------------- ----------- ------------
Net cash used for operating activities: (59.8) (16.1) (21.4) -- (97.3)
------ ----- ------ ------ ------
Cash flows from investing activities:
Purchase of property, plant & equipment (0.2) (2.0) (2.3) -- (4.5)
Investment in unconsolidated subsidiary (0.5) -- -- -- (0.5)
------ ----- ------ ------ ------
Net cash used for investing activities: (0.7) (2.0) (2.3) -- (5.0)
------ ----- ------ ------ ------
Cash flows from financing activities:
Proceeds on long-term debt 74.4 -- 14.9 -- 89.3
Proceeds (payments) from intercompany loans (18.6) 15.5 3.1 -- --
Proceeds from issuance of common stock 5.3 -- -- -- 5.3
Dividends paid on common stock (0.6) -- -- -- (0.6)
------ ----- ------ ------ ------
Net cash provided by financing activities: 60.5 15.5 18.0 -- 94.0
------ ----- ------ ------ ------
Effect of exchange rate changes on cash & cash equivalents -- -- 0.4 -- 0.4
Decrease in cash & cash equivalents -- (2.6) (5.3) -- (7.9)
Cash and cash equivalents, beginning of period -- 0.1 13.2 -- 13.3
------ ----- ------ ------ ------
Cash and cash equivalents, end of period $ -- $(2.5) $ 7.9 $ -- $ 5.4
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11
13
AGCO CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2000
(IN MILLIONS)
PARENT GUARANTOR NON-GUARANTOR ELIMINATING
COMPANY SUBSIDIARIES SUBSIDIARIES ENTRIES CONSOLIDATED
------- ------------- -------------- ----------- ------------
Net cash provided by (used for) operating activities: 105.8 -- (13.6) -- 92.2
------ ---- ------ ---- ------
Cash flows from investing activities:
Purchase of property, plant & equipment (6.0) -- (1.5) -- (7.5)
Investment in unconsolidated subsidiary -- -- (1.2) -- (1.2)
------ ---- ------ ---- ------
Net cash used for investing activities: (6.0) -- (2.7) -- (8.7)
------ ---- ------ ---- ------
Cash flows from financing activities:
Proceeds (payments) on long-term debt (94.0) -- 0.6 -- (93.4)
Proceeds (payments) from intercompany loans (5.2) -- 5.2 -- --
Dividends paid on common stock (0.6) -- -- -- (0.6)
------ ---- ------ ---- ------
Net cash provided by (used for) financing activities: (99.8) -- 5.8 -- (94.0)
------ ---- ------ ---- ------
Effect of exchange rate changes on cash & cash equivalents -- -- 1.3 -- 1.3
Decrease in cash & cash equivalents -- -- (9.2) -- (9.2)
Cash and cash equivalents, beginning of period -- -- 19.6 -- 19.6
------ ---- ------ ---- ------
Cash and cash equivalents, end of period $ -- $ -- $ 10.4 $ -- $ 10.4
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