AGCO Corporation reported net sales of approximately $1.4 billion for the third quarter of 2009, a decrease of approximately 32.7% compared to net sales of approximately $2.1 billion for the third quarter of 2008. Excluding unfavorable currency translation impacts of approximately 5%, net sales in the third quarter of 2009 decreased approximately 27.7% compared to the same period in 2008.
Net sales for the first nine months of 2009 were approximately $4.8 billion, a decrease of approximately 23.8% compared to the same period in 2008. Excluding the unfavorable impact of currency translation of approximately 9.9%, net sales for the first nine months of 2009 decreased approximately 13.8% compared to the same period in 2008.
The company says there is softening market demand in Western Europe and North America, which is partially offset by stabilizing markets in South America. The priority for the remainder of the year continues to be lowering their investment in working capital in order to better align with current market demand.
Further progress was made with inventory reduction efforts and cost reduction initiatives during the third quarter. Company and dealer inventories were reduced by approximately $165 million from June 30, 2009 levels by cutting production approximately 31%
in the third quarter compared to the third quarter of 2008. The company will continue to consolidate brands and in the future will only have Massey Ferguson and Challenger brands in North America.
In the North American region, sales in the third quarter declined approximately 31.9% on a constant currency basis compared to the same period in 2008. Lower sales of tractors under 100 horsepower and hay products tied to the dairy and cattle sectors, in addition to dealer inventory reductions resulted in the decline in North American sales. Unit production of tractors and combines for the third quarter of 2009 was approximately 31% below comparable 2008 levels.
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