AGCO Reports Improved First Quarter Results

AGCO, Your Agriculture Company (NYSE:AGCO), a worldwide manufacturer and distributor of agricultural equipment, reported net sales of approximately $2.0 billion for the first quarter of 2018, an increase of approximately 23.3% compared to the first quarter of 2017. Reported net income was $0.30 per share for the first quarter of 2018, and adjusted net income, excluding restructuring expenses, was $0.35 per share. These results compare to a reported net loss of $0.13 per share and adjusted net loss, excluding restructuring expenses and a non-cash expense related to waived stock compensation, of $0.02 per share for the first quarter of 2017. Excluding favorable currency translation impacts of approximately 9.4%, net sales in the first quarter of 2018 increased approximately 14.0% compared to the first quarter of 2017.

First Quarter Highlights

• Reported regional sales results⁽¹⁾: North America +31.4%, Europe/Middle East (“EME”) +30.4%, South America (18.0)%, Asia/Pacific/Africa (“APA”) +21.9%
• Constant currency regional sales results⁽¹⁾⁽²⁾: North America +29.6%, EME +14.3%, South America (13.2)%, APA +12.4%
• Regional operating margin performance: North America 5.3%, EME 8.5%, South America (9.1)%, APA 2.9%
• Increased full-year outlook for net sales and net income per share
• Quarterly dividend increased 7% to $0.15, effective first quarter 2018

(1)		As compared to first quarter 2017
(2)		Excludes currency translation impact. See reconciliation in appendix.

“AGCO capitalized on strengthening industry demand and delivered solid results in the first quarter,” stated Martin Richenhagen, Chairman, President and Chief Executive Officer. “Improved market demand in North America and healthy industry conditions in Western Europe supported sales and margin improvement in those regions resulting in better than expected sales and earnings growth for the Company. Our weak results in South America reflect the challenging industry environment and lower levels of production, as well as the transition costs associated with localizing newer product technology into our Brazilian factories. While our focus on cost management to mitigate market pressures continues, we are maintaining a strong level of investment in new products and technologies, as demonstrated by an increase in engineering expenses in 2018 over 2017, both in the first quarter, and the total planned for the full year.”

Market Update

Industry Unit Retail Sales
			Tractors			Combines
Three months ended March 31, 2018			Change from Prior Year Period			Change from Prior Year Period
North America(1)			~Flat			(2)%
South America			(8)%			(11)%
Western Europe(2)			7%			26%
(1) Excludes compact tractors.
(2) Based on company estimates.

“Farmers are facing difficult growing conditions as we start 2018,” continued Mr. Richenhagen. “A dry weather pattern across Argentina and southern Brazil has decreased 2018 crop production expectations in those regions. Cold wet weather across much of the mid-western U.S. is delaying the start of planting and has contributed to modest increases in soft commodity prices. Global farm equipment demand continues on a slow recovery path following the extended period of decline. In North America, the industry has worked through much of the excess used equipment inventory and used equipment pricing has started to improve. Row crop farmers are beginning to replace their equipment after years of weaker demand. North American industry retail sales were relatively flat in the first quarter of 2018 compared to the same period in 2017. Overall, we project industry retail tractor sales to increase modestly in 2018 with retail sales of small tractors expected to be flat compared to last year, while retail sales in the row crop segment are expected to improve. Industry retail sales in Western Europe increased in the first three months of 2018, following a year of improved profitability by the arable farming segment as well as healthy economics for dairy producers. Sales improved across the important markets of Germany, the United Kingdom and France. For the full year of 2018, industry demand in Western Europe is expected to be relatively flat compared to 2017 as the benefit of last year’s improved harvest offsets the impact of projected softening economics in the dairy and livestock sector. Industry retail sales in South America decreased during the first three months of 2018. Industry demand in Brazil softened in advance of expected positive revisions to the government financing program which starts on July 1. In addition, industry sales declined in Argentina in response to a weaker first harvest. Industry demand in South America is expected to improve in the second half of the year and be relatively flat for the full year compared to 2017. Higher retail sales in Brazil are expected to be offset by lower sales in Argentina due to the impact of lower crop production on farm income. Longer term, we are optimistic about the fundamentals supporting commodity prices and farm income as well as healthy growth in our industry.”

Regional Results

AGCO Regional Net Sales (in millions)
Three Months Ended March 31,			2018				2017				% change from 2017				% change from 2017 due to currency translation(1)				% change from 2017 due to acquisitions(1)
North America			$	502.9			$	382.6			31.4	%			1.9	%			17.9	%
South America				182.1				222.2			(18.0	)%			(4.8	)%			1.1	%
Europe/Middle East				1,163.7				892.5			30.4	%			16.1	%			3.8	%
Asia/Pacific/Africa				158.8				130.3			21.9	%			9.4	%			3.4	%
Total			$	2,007.5			$	1,627.6			23.3	%			9.4	%			6.7	%
(1) See appendix for additional disclosures

North America

AGCO’s North American net sales increased 29.6% in the first three months of 2018 compared to the same period of 2017, excluding the positive impact of currency translation. Precision Planting, which was acquired in the fourth quarter of 2017, contributed sales of approximately $61.2 million in its seasonally strong first quarter. Excluding the impact of acquisitions and currency translation, sales grew approximately 11.7% compared to the first quarter of 2017. The largest increases were in mid-range and high horsepower tractors and sprayers. Income from operations for the first three months of 2018 improved approximately $23.8 million compared to the same period in 2017. The benefit of the Precision Planting acquisition and higher sales and production volumes produced most of the increase.

South America

Net sales in the South America region decreased 13.2% in the first three months of 2018 compared to the first three months of 2017, excluding the impact of unfavorable currency translation. Significant sales decreases in Argentina and Brazil produced most of the decline. Income from operations dropped approximately $19.0 million for the first three months of 2018 compared to the same period in 2017. Lower sales and production volumes, the impact of material cost inflation and the costs associated with transitioning to the new products with tier 3 emission technology all contributed to the decrease in income from operations.

Europe/Middle East

AGCO’s EME net sales increased 14.3% in the first three months of 2018 compared to the same period in 2017, excluding favorable currency translation impacts. Acquisitions benefited sales by approximately 3.8% during the first three months compared to the same period last year. Higher sales in Germany, the United Kingdom and France produced most of the increase. Income from operations improved approximately $35.4 million for the first three months of 2018, compared to the same period in 2017, due to the benefit of higher sales and margin improvement partially offset by higher engineering costs.

Asia/Pacific/Africa

Asia/Pacific/Africa net sales increased 12.4%, excluding the positive impact of currency translation, in the first three months of 2018 compared to the same period in 2017. Higher sales in Australia and China produced most of the increase. Acquisitions benefited sales by approximately 3.4% during the first three months of 2018 compared to the same period last year. Income from operations improved approximately $2.6 million in the first three months of 2018, compared to the same period in 2017, due to higher sales and production levels.

Outlook

AGCO’s net sales for 2018 are expected to reach $9.3 billion reflecting improved sales volumes, positive pricing as well as acquisition and foreign exchange impacts. Gross and operating margins are expected to improve from 2017 levels due to higher sales as well as the benefits resulting from the Company’s cost reduction initiatives, partially offset by increased engineering expenses. Based on these assumptions, 2018 earnings per share are targeted at approximately $3.65 on a reported basis, or approximately $3.70 on an adjusted basis, which excludes restructuring expenses.

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AGCO will be hosting a conference call with respect to this earnings announcement at 10:00 a.m. Eastern Time on Tuesday, May 1, 2018. The Company will refer to slides on its conference call. Interested persons can access the conference call and slide presentation via AGCO’s website at www.agcocorp.com in the “Events” section on the “Company/Investors” page of our website. A replay of the conference call will be available approximately two hours after the conclusion of the conference call for twelve months following the call. A copy of this press release will be available on AGCO’s website for at least twelve months following the call.

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Safe Harbor Statement

Statements that are not historical facts, including the projections of earnings per share, sales, industry demand, market conditions, commodity prices, currency translation, farm income levels, margin levels, investments in product and technology development, new product introductions, restructuring and other cost reduction initiatives, production volumes, tax rates and general economic conditions, are forward-looking and subject to risks that could cause actual results to differ materially from those suggested by the statements. The following are among the factors that could cause actual results to differ materially from the results discussed in or implied by the forward-looking statements.

• Our financial results depend entirely upon the agricultural industry, and factors that adversely affect the agricultural industry generally, including declines in the general economy, increases in farm input costs, lower commodity prices, lower farm income and changes in the availability of credit for our retail customers, will adversely affect us.
• A majority of our sales and manufacturing take place outside the United States, and, as a result, we are exposed to risks related to foreign laws, taxes, economic conditions, labor supply and relations, political conditions and governmental policies. These risks may delay or reduce our realization of value from our international operations.
• Most retail sales of the products that we manufacture are financed, either by our joint ventures with Rabobank or by a bank or other private lender. Our joint ventures with Rabobank, which are controlled by Rabobank and are dependent upon Rabobank for financing as well, finance 40% to 50% of the retail sales of our tractors and combines in the markets where the joint ventures operate. Any difficulty by Rabobank to continue to provide that financing, or any business decision by Rabobank as the controlling member not to fund the business or particular aspects of it (for example, a particular country or region), would require the joint ventures to find other sources of financing (which may be difficult to obtain), or us to find another source of retail financing for our customers, or our customers would be required to utilize other retail financing providers. As a result of the recent economic downturn, financing for capital equipment purchases generally has become more difficult in certain regions and in some cases, can be expensive to obtain. To the extent that financing is not available or available only at unattractive prices, our sales would be negatively impacted.
• Both AGCO and our finance joint ventures have substantial account receivables from dealers and end customers, and we would be adversely impacted if the collectability of these receivables was not consistent with historical experience; this collectability is dependent upon the financial strength of the farm industry, which in turn is dependent upon the general economy and commodity prices, as well as several of the other factors listed in this section.
• We have experienced substantial and sustained volatility with respect to currency exchange rate and interest rate changes, including uncertainty associated with the Euro, which can adversely affect our reported results of operations and the competitiveness of our products.
• Our success depends on the introduction of new products, particularly engines that comply with emission requirements, which requires substantial expenditures.
• Our production levels and capacity constraints at our facilities, including those resulting from plant expansions and systems upgrades at our manufacturing facilities, could adversely affect our results.
• Our expansion plans in emerging markets, including establishing a greater manufacturing and marketing presence and growing our use of component suppliers, could entail significant risks.
• We depend on suppliers for components, parts and raw materials for our products, and any failure by our suppliers to provide products as needed, or by us to promptly address supplier issues, will adversely impact our ability to timely and efficiently manufacture and sell products. We also are subject to raw material price fluctuations, which can adversely affect our manufacturing costs.
• We face significant competition, and if we are unable to compete successfully against other agricultural equipment manufacturers, we would lose customers and our net sales and profitability would decline.
• We have a substantial amount of indebtedness, and, as a result, we are subject to certain restrictive covenants and payment obligations that may adversely affect our ability to operate and expand our business.

Further information concerning these and other factors is included in AGCO’s filings with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2017. AGCO disclaims any obligation to update any forward-looking statements except as required by law.

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About AGCO

AGCO (NYSE: AGCO) is a global leader in the design, manufacture and distribution of agricultural solutions and supports more productive farming through its full line of equipment and related services. AGCO products are sold through five core brands, Challenger®, Fendt®, GSI®, Massey Ferguson® and Valtra®, supported by Fuse® precision technologies and farm optimization services. Founded in 1990, AGCO is headquartered in Duluth, GA, USA. In 2017, AGCO had net sales of approximately $8.3 billion. For more information, visit http://www.AGCOcorp.com. For company news, information and events, please follow us on Twitter: @AGCOCorp. For financial news on Twitter, please follow the hashtag #AGCOIR.

Please visit our website at www.agcocorp.com

AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited and in millions)
			March 31, 2018					December 31, 2017
ASSETS
Current Assets:
Cash and cash equivalents			$	348.2				$	367.7
Accounts and notes receivable, net				1,023.6					1,019.4
Inventories, net				2,283.3					1,872.9
Other current assets				406.2					367.7
Total current assets				4,061.3					3,627.7
Property, plant and equipment, net				1,486.9					1,485.3
Investment in affiliates				422.0					409.0
Deferred tax assets				117.9					112.2
Other assets				157.1					147.1
Intangible assets, net				639.9					649.0
Goodwill				1,563.8					1,541.4
Total assets			$	8,448.9				$	7,971.7
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current portion of long-term debt			$	129.7				$	95.4
Accounts payable				990.4					917.5
Accrued expenses				1,325.5					1,407.9
Other current liabilities				269.9					229.8
Total current liabilities				2,715.5					2,650.6
Long-term debt, less current portion and debt issuance costs				1,989.0					1,618.1
Pensions and postretirement health care benefits				243.9					247.3
Deferred tax liabilities				133.2					130.5
Other noncurrent liabilities				247.9					229.9
Total liabilities				5,329.5					4,876.4
Stockholders’ Equity:
AGCO Corporation stockholders’ equity:
Common stock				0.8					0.8
Additional paid-in capital				135.3					136.6
Retained earnings				4,266.6					4,253.8
Accumulated other comprehensive loss				(1,349.8	)				(1,361.6	)
Total AGCO Corporation stockholders’ equity				3,052.9					3,029.6
Noncontrolling interests				66.5					65.7
Total stockholders’ equity				3,119.4					3,095.3
Total liabilities and stockholders’ equity			$	8,448.9				$	7,971.7
See accompanying notes to condensed consolidated financial statements.

AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited and in millions, except per share data)
			Three Months Ended March 31,
			2018					2017
Net sales			$	2,007.5				$	1,627.6
Cost of goods sold				1,579.5					1,297.3
Gross profit				428.0					330.3
Selling, general and administrative expenses				264.6					222.7
Engineering expenses				90.9					73.1
Restructuring expenses				5.9					5.1
Amortization of intangibles				15.7					13.4
Bad debt expense				0.4					0.3
Income from operations				50.5					15.7
Interest expense, net				10.3					10.7
Other expense, net				11.5					13.1
Income (loss) before income taxes and equity in net earnings of affiliates				28.7					(8.1	)
Income tax provision				11.4					11.1
Income (loss) before equity in net earnings of affiliates				17.3					(19.2	)
Equity in net earnings of affiliates				7.7					11.0
Net income (loss)				25.0					(8.2	)
Net income attributable to noncontrolling interests				(0.7	)				(1.9	)
Net income (loss) attributable to AGCO Corporation and subsidiaries			$	24.3				$	(10.1	)
Net income (loss) per common share attributable to AGCO Corporation and subsidiaries:
Basic			$	0.31				$	(0.13	)
Diluted			$	0.30				$	(0.13	)
Cash dividends declared and paid per common share			$	0.15				$	0.14
Weighted average number of common and common equivalent shares outstanding:
Basic				79.6					79.5
Diluted				80.5					79.5
See accompanying notes to condensed consolidated financial statements.

AGCO CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited and in millions)
			Three Months Ended March 31,
			2018					2017
Cash flows from operating activities:
Net income (loss)			$	25.0				$	(8.2	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation				59.2					54.3
Deferred debt issuance cost amortization				0.2					0.2
Amortization of intangibles				15.7					13.4
Stock compensation expense				9.2					12.0
Equity in net earnings of affiliates, net of cash received				(4.3	)				(6.3	)
Deferred income tax benefit				(7.0	)				(1.5	)
Other				(0.1	)				(0.2	)
Changes in operating assets and liabilities:
Accounts and notes receivable, net				6.2					(17.2	)
Inventories, net				(398.2	)				(234.4	)
Other current and noncurrent assets				(36.2	)				(43.3	)
Accounts payable				66.4					63.7
Accrued expenses				(108.4	)				(78.4	)
Other current and noncurrent liabilities				11.0					(5.5	)
Total adjustments				(386.3	)				(243.2	)
Net cash used in operating activities				(361.3	)				(251.4	)
Cash flows from investing activities:
Purchases of property, plant and equipment				(46.1	)				(57.1	)
Proceeds from sale of property, plant and equipment				1.5					0.8
Investment in unconsolidated affiliates				—					(0.8	)
Other				0.4					—
Net cash used in investing activities				(44.2	)				(57.1	)
Cash flows from financing activities:
Proceeds from debt obligations, net				401.5					176.8
Purchases and retirement of common stock				(7.1	)				—
Payment of dividends to stockholders				(11.9	)				(11.1	)
Payment of minimum tax withholdings on stock compensation				(3.2	)				(3.2	)
Investments by noncontrolling interest				—					0.2
Net cash provided by financing activities				379.3					162.7
Effects of exchange rate changes on cash and cash equivalents				6.7					6.0
Decrease in cash and cash equivalents				(19.5	)				(139.8	)
Cash and cash equivalents, beginning of period				367.7					429.7
Cash and cash equivalents, end of period			$	348.2				$	289.9
See accompanying notes to condensed consolidated financial statements.

AGCO CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited, in millions, except share amounts, per share data and employees)

1. STOCK COMPENSATION EXPENSE

The Company recorded stock compensation expense as follows:

			Three Months Ended March 31,
			2018				2017
Cost of goods sold			$	0.8			$	0.6
Selling, general and administrative expenses				8.4				11.4
Total stock compensation expense			$	9.2			$	12.0

2. RESTRUCTURING EXPENSES

From 2014 through 2018, the Company announced and initiated several actions to rationalize employee headcount at various manufacturing facilities and administrative offices located in Europe, South America, China and the United States in order to reduce costs in response to softening global market demand and lower production volumes. The aggregate headcount reduction was approximately 3,370 employees between 2014 and 2017. The Company had approximately $10.9 million of severance and related costs accrued as of December 31, 2017. During the three months ended March 31, 2018, the Company recorded an additional $5.9 million of severance and related costs associated with further rationalizations associated with the termination of approximately 110 employees, and paid approximately $3.7 million of severance and associated costs. The remaining $13.2 million of accrued severance and other related costs as of March 31, 2018, inclusive of approximately $0.1 million of positive foreign currency translation impacts, are expected to be paid primarily during 2018.

3. INDEBTEDNESS

Indebtedness at March 31, 2018 and December 31, 2017 consisted of the following:

			March 31, 2018					December 31, 2017
1.056% Senior term loan due 2020			$	246.5				$	239.8
Credit facility, expires 2020				823.8					471.2
Senior term loans due 2021				123.2					119.9
5⅞% Senior notes due 2021				305.0					305.3
Senior term loans due between 2019 and 2026				462.1					449.7
Other long-term debt				161.8					131.6
Debt issuance costs				(3.7	)				(4.0	)
				2,118.7					1,713.5
Less: Current portion of other long-term debt				(129.7	)				(95.4	)
Total indebtedness, less current portion			$	1,989.0				$	1,618.1

4. INVENTORIES

Inventories at March 31, 2018 and December 31, 2017 were as follows:

			March 31, 2018				December 31, 2017
Finished goods			$	848.9			$	684.1
Repair and replacement parts				652.2				605.9
Work in process				277.9				178.7
Raw materials				504.3				404.2
Inventories, net			$	2,283.3			$	1,872.9

5. ACCOUNTS RECEIVABLE SALES AGREEMENTS

The Company has accounts receivable sales agreements that permit the sale, on an ongoing basis, of a majority of its wholesale receivables in North America, Europe and Brazil to its U.S., Canadian, European and Brazilian finance joint ventures. As of both March 31, 2018 and December 31, 2017, the cash received from receivables sold under the U.S., Canadian, European and Brazilian accounts receivable sales agreements was approximately $1.3 billion.

Losses on sales of receivables associated with the accounts receivable financing facilities discussed above, reflected within “Other expense, net” in the Company’s Condensed Consolidated Statements of Operations, were approximately $7.8 million and $8.3 million during the three months ended March 31, 2018 and 2017, respectively.

The Company’s finance joint ventures in Europe, Brazil and Australia also provide wholesale financing directly to the Company’s dealers. As of March 31, 2018 and December 31, 2017, these finance joint ventures had approximately $47.8 million and $41.6 million, respectively, of outstanding accounts receivable associated with these arrangements. In addition, the Company sells certain trade receivables under factoring arrangements to other financial institutions around the world.

6. NET INCOME PER SHARE

A reconciliation of net income (loss) attributable to AGCO Corporation and subsidiaries and weighted average common shares outstanding for purposes of calculating basic and diluted net income (loss) per share for the three months ended March 31, 2018 and 2017 is as follows:

			Three Months Ended March 31,
			2018				2017
Basic net income (loss) per share:
Net income (loss) attributable to AGCO Corporation and subsidiaries			$	24.3			$	(10.1	)
Weighted average number of common shares outstanding				79.6				79.5
Basic net income (loss) per share attributable to AGCO Corporation and subsidiaries			$	0.31			$	(0.13	)
Diluted net income (loss) per share:
Net income (loss) attributable to AGCO Corporation and subsidiaries			$	24.3			$	(10.1	)
Weighted average number of common shares outstanding				79.6				79.5
Dilutive stock-settled appreciation rights, performance share awards and restricted stock units				0.9				—
Weighted average number of common shares and common share equivalents outstanding for purposes of computing diluted net income (loss) per share				80.5				79.5
Diluted net income (loss) per share attributable to AGCO Corporation and subsidiaries			$	0.30			$	(0.13	)

7. SEGMENT REPORTING

The Company’s four reportable segments distribute 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. The Company’s selling, general and administrative expenses and engineering expenses are charged to each segment based on the region and division where the expenses are incurred. As a result, the components of income from operations for one segment may not be comparable to another segment. Segment results for the three months ended March 31, 2018 and 2017 are as follows:

Three Months Ended March 31,			North America				South America					Europe/ Middle East				Asia/ Pacific/Africa				Consolidated
2018
Net sales			$	502.9			$	182.1				$	1,163.7			$	158.8			$	2,007.5
Income (loss) from operations				26.8				(16.6	)				99.0				4.7				113.9
2017
Net sales			$	382.6			$	222.2				$	892.5			$	130.3			$	1,627.6
Income from operations				3.0				2.4					63.5				2.1				71.0

A reconciliation from the segment information to the consolidated balances for income from operations is set forth below:

			Three Months Ended March 31,
			2018					2017
Segment income from operations			$	113.9				$	71.0
Corporate expenses				(33.4	)				(25.4	)
Stock compensation expense				(8.4	)				(11.4	)
Restructuring expenses				(5.9	)				(5.1	)
Amortization of intangibles				(15.7	)				(13.4	)
Consolidated income from operations			$	50.5				$	15.7

RECONCILIATION OF NON-GAAP MEASURES

This earnings release discloses adjusted income from operations, adjusted net income (loss) and adjusted net income (loss) per share, each of which exclude amounts that are typically included in the most directly comparable measure calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). A reconciliation of each of those measures to the most directly comparable GAAP measure is included below.

The following is a reconciliation of reported income from operations, net income (loss) and net income (loss) per share to adjusted income from operations, net income (loss) and net income (loss) per share for the three months ended March 31, 2018 and 2017 (in millions, except per share data):

			Three Months Ended March 31,
			2018												2017
			Income From Operations				Net Income(1)				Net Income Per Share(1)				Income From Operations				Net Loss(1)					Net Loss Per Share(1)
As reported			$	50.5			$	24.3			$	0.30			$	15.7			$	(10.1	)			$	(0.13	)
Restructuring expenses(2)				5.9				4.2				0.05				5.1				3.8					0.05
Non-cash expense related to waived stock compensation(3)				—				—				—				4.8				4.8					0.06
As adjusted			$	56.4			$	28.5			$	0.35			$	25.6			$	(1.5	)			$	(0.02	)

(1)		Net income (loss) and net income (loss) per share amounts are after tax.
(2)		The restructuring expenses recorded during the three months ended March 31, 2018 and 2017 related primarily to severance costs associated with the Company’s rationalization of certain U.S., European and South American manufacturing operations and various administrative offices.
(3)		The Company recorded approximately $4.8 million of accelerated stock compensation expense during the three months ended March 31, 2017 associated with a waived award declined by the Company’s CEO.

The following is a reconciliation of targeted net income per share to adjusted targeted net income per share for the year ended December 31, 2018:

			Net Income Per Share(1)
As targeted			$	3.65
Restructuring expenses				0.05
As adjusted targeted(2)			$	3.70

(1)		Net income per share amount is after tax.
(2)		The above reconciliation reflects adjustments to full year 2018 targeted net income per share based upon restructuring expenses incurred during the three months ended March 31, 2018. Full year restructuring expenses could differ based on future restructuring activity.

The following tables set forth, for the three months ended March 31, 2018, the impact to net sales of currency translation and recent acquisitions by geographical segment (in millions, except percentages):

			Three Months Ended March 31,												Change due to currency translation									Change due to acquisitions
			2018				2017				% change from 2017				$					%				$				%
North America			$	502.9			$	382.6			31.4	%			$	7.1				1.9	%			$	68.5			17.9	%
South America				182.1				222.2			(18.0	)%				(10.7	)			(4.8	)%				2.5			1.1	%
Europe/Middle East				1,163.7				892.5			30.4	%				143.6				16.1	%				34.0			3.8	%
Asia/Pacific/Africa				158.8				130.3			21.9	%				12.3				9.4	%				4.4			3.4	%
			$	2,007.5			$	1,627.6			23.3	%			$	152.3				9.4	%			$	109.4			6.7	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20180501005876/en/