In announcing the results, Chairman Martin Richenhagen said 2014 will be challenging for the company because farmers expect lower commodity prices to reduce their income, which means they will cut spending on new farm equipment. Richenhagen expects modest declines in demand for its sprayer, grain storage and other products across most markets.
The chairman said the company, which generated more than $400 million in free cash flow last year, continued to invest heavily to improve plant productivity, to develop new products and to meet emission requirements.
“Our strong cash generation will allow us to continue making strategic investments in improved technology and production capabilities while returning cash to our shareholders,” Richenhagen said.
The company announced $500 million share repurchase program in December. Stock buybacks can influence the value of shares.
For the year, net income was $597.2 million, or $6.01 a share,, compared with $522.1 million, or $5.30 a share. AGCO said sales for the year grew 8 percent to $10.8 billion.
The company expects per-share earnings for 2014 to be about $6 and sales of $10.8 billion to $11 billion. Analysts per-share earnings of $5.76, and sales of $10.48 billion.