CNH Industrial NV (CNHI) 2023 Q3 法說會逐字稿

Hello, and welcome to the CNH Industrial Third Quarter Conference Call. Please note, this conference is being recorded. (Operator Instructions) I will now hand you over to your host, Jason Omerza, Vice President of Investor Relations, to begin today's conference.

您好，歡迎參加凱斯紐荷蘭工業集團第三季​​電話會議。請注意，本次會議正在錄製中。 （操作員指示）我現在將把您交給主持人投資者關係副總裁 Jason Omerza，開始今天的會議。

Thank you, Francois. Good morning and good afternoon to everyone. We would like to welcome you to the webcast and conference call for CNH Industrial's third quarter results for the period ending September 30, 2023. This call is being broadcast live on our website and is copyrighted by CNH Industrial. Any other use, recording or transmission of any portion of this broadcast without the express written consent of CNH Industrial is strictly prohibited.

謝謝你，弗朗索瓦。大家早安，下午好。歡迎您參加凱斯紐荷蘭工業集團截至2023 年9 月30 日的第三季業績的網路廣播和電話會議。本次電話會議將在我們的網站上進行現場直播，版權歸凱斯紐荷蘭工業集團所有。未經凱斯紐荷蘭工業集團明確書面同意，嚴禁以任何其他方式使用、錄製或傳輸本廣播的任何部分。

Hosting today's call are CNH's CEO, Scott Wine; and CFO, Oddone Rocchetta. They will use the material available for download from the CNH website. Please note that any forward-looking statements that we might make during today's call, are subject to the risks and uncertainties mentioned in the safe harbor statement included in the presentation material.

今天的電話會議由 CNH 執行長 Scott Wine 主持。財務長奧多內‧羅切塔 (Oddone Rocchetta)。他們將使用可從 CNH 網站下載的資料。請注意，我們在今天的電話會議中可能做出的任何前瞻性陳述均受到演示材料中安全港聲明中提到的風險和不確定性的影響。

Additional information pertaining to factors that could cause actual results to differ materially is contained in the company's most recent annual report on Form 10-K, as well as other periodic reports and filings with the U.S. Securities and Exchange Commission and the equivalent reports and filings with authorities in the Netherlands and Italy. The company presentation includes certain non-GAAP financial measures. Additional information, including reconciliations to the most directly comparable U.S. GAAP financial measures is included in the presentation material. I will now turn the call over to Scott.

有關可能導致實際結果出現重大差異的因素的更多資​​訊包含在公司最新的10-K 表格年度報告、其他定期報告和向美國證券交易委員會提交的文件以及向美國證券交易委員會提交的同等報告和文件中。荷蘭和義大利當局。公司簡報包括某些非公認會計準則財務指標。演示材料中還包含其他信息，包括與最直接可比較的美國公認會計準則財務指標的調節。我現在將把電話轉給斯科特。

Thank you, Jason. And thanks, everyone, for joining our call. Our third quarter results were disappointing, but they also reflect the earnings power of CNH, as we dealt with the challenging market environment in South America. The sustained strength of our North American row crop and construction equipment demand, continues to be helpful offset to slowing demand in Brazil and Continental Europe.

謝謝你，傑森。感謝大家加入我們的電話會議。我們第三季的業績令人失望，但這也反映了離岸人民幣的獲利能力，因為我們正在應對南美洲充滿挑戰的市場環境。北美行作物和建築設備需求的持續強勁，繼續有助於抵消巴西和歐洲大陸需求放緩的影響。

Better efficiency with operational improvements, supply chain, normalization and productivity gains from our many CNH business system initiatives helped drive record third quarter EBIT margins in both Agriculture and Construction. Our tech evolution is accelerating the development of innovative, customer-driven solutions. With key acquisitions, strategic investments and a deep and talented team, we are largely in possession of the in-house capabilities to build out our tech stack and fulfill customers' precision needs.

我們的許多離岸人民幣業務系統計劃透過營運改善、供應鏈、標準化和生產力提高提高了效率，幫助推動農業和建築業第三季息稅前利潤率創歷史新高。我們的技術發展正在加速創新、客戶驅動的解決方案的開發。憑藉關鍵收購、策略性投資和一支深厚且才華橫溢的團隊，我們在很大程度上擁有建立技術堆疊並滿足客戶精準需求的內部能力。

I am pleased to welcome the employees of Hemisphere, who joined the CNH family in early October. We are redoubling our efforts on cost savings and working capital efficiency. Concurrent with the spinoff of Iveco in 2022, we streamlined our corporate structure and eliminated about 20% of the managerial positions. After almost 2 years of operating is an ag and construction pure play, we understand how to further optimize in support of our customers and dealers.

我很高興地歡迎 Hemisphere 的員工在 10 月初加入 CNH 大家庭。我們正在加倍努力節省成本和提高營運資金效率。在 2022 年分拆依維柯的同時，我們精簡了公司架構，裁減了約 20% 的管理職。經過近兩年的純農業和建築業務運營，我們了解如何進一步優化以支援我們的客戶和經銷商。

Today, we are initiating an immediate restructuring program to achieve a 5% reduction in salaried workforce costs to be substantially completed by year-end. This will be coupled with a comprehensive rightsizing of the company's cost structure to be implemented early next year. We expect these 2 initiatives to deliver a run rate reduction of 10% to 15% of total labor and non-labor SG&A expenses.

今天，我們正在啟動一項立即重組計劃，以實現帶薪勞動成本削減 5%，並在年底前基本完成。這將與明年初實施的公司成本結構全面調整相結合。我們預計這兩項措施將使勞動力和非勞動力 SG&A 費用總額的運作率降低 10% 至 15%。

Additionally, we've announced today that we have formally applied to delist from Milan exchange, which Oddone will discuss in more detail. Company revenues for the third quarter were up 2% to $6 billion, driven by higher volumes in construction and higher interest revenues in financial services, offsetting lower Agriculture sales.

此外，我們今天也宣布，我們已正式申請從米蘭交易所退市，Oddone 將對此進行更詳細的討論。由於建築量增加和金融服務利息收入增加，該公司第三季營收成長 2%，達到 60 億美元，抵銷了農業銷售額的下降。

Positive price realization contributed 2% to 3% of the top line in both Industrial segments. Industrial net sales were down 1% as lower ag shipments offset 6% sales growth in Construction. Adjusted EBIT margin, including corporate costs, was 12.3%, essentially flat compared to last year. Net income came in at $570 million and EPS was up $0.01 to $0.42. South American markets, primarily Brazil, were weaker than expected in the quarter. With industry-wide retail deliveries down 16% year-over-year in tractors, 46% in combines and 27% in Construction equipment.

積極的價格實現為兩個工業領域的收入貢獻了 2% 至 3%。工業淨銷售額下降 1%，因為農業出貨量下降抵消了建築業 6% 的銷售成長。包括企業成本在內的調整後息稅前利潤率為 12.3%，與去年基本持平。淨利潤為 5.7 億美元，每股收益成長 0.01 美元至 0.42 美元。南美市場（主要是巴西）本季的表現弱於預期。全行業拖拉機零售量較去年同期下降 16%，聯合收割機較去年同期下降 46%，建築設備較去年同期下降 27%。

I was with our team in Brazil last month, speaking with dealers and farmers who are reluctant to engage with a steep year-over-year declines in soft commodity prices. We are working closely with our dealers to maximize their retail sales, while also responding prudently with production and wholesale shipment cuts. Very purposely, we did not sequentially increase dealer inventories in Brazil. It's worth noting, that we are also comping record harvest and results in the region last year. We remain bullish on the long-term growth prospects for South American market, which is an increasingly important part of the global ag economy and our strongest market position.

上個月，我與我們在巴西的團隊一起與不願接受軟商品價格同比大幅下跌的經銷商和農民進行了交談。我們正在與經銷商密切合作，以最大限度地提高他們的零售額，同時也謹慎地應對產量和批發出貨量的削減。我們非常有意地沒有連續增加巴西經銷商的庫存。值得注意的是，我們也比較了去年該地區創紀錄的收成和成果。我們仍然看好南美市場的長期成長前景，該市場是全球農業經濟日益重要的組成部分，也是我們最強大的市場地位。

We are pleased with the EBIT margin expansion for both of our industrial segments and will show later in our presentation how this is indicative of improved through-the-cycle margin performance. Derek Neilson and his team are executing well and remain focused on driving benefits for our dealers and customers. Through an expanding product lineup, innovative technology solutions, improving product quality and productivity gains, they are expanding margins and maintaining our market share. I look forward to being in Hanover next week with our team, as we showcase our Case IH, New Holland and Steyr brands at Agritechnica.

我們對兩個工業領域的息稅前利潤率擴張感到滿意，並將在稍後的演示中展示這如何表明整個週期利潤率表現的改善。德里克·尼爾森 (Derek Neilson) 和他的團隊執行得很好，並繼續專注於為我們的經銷商和客戶帶來利益。透過擴大產品陣容、創新技術解決方案、提高產品品質和提高生產力，他們正在擴大利潤並保持我們的市場份額。我期待下週與我們的團隊一起前往漢諾威，屆時我們將在 Agritechnica 展會上展示我們的 Case IH、New Holland 和 Steyr 品牌。

Collectively, we have won 5 innovation awards for the show, including the shows only gold medal for New Holland's Twin Rotor combine harvester concept. Our Construction segment had a record-breaking quarter, driven by new product launches and solid retail sales growth in North America. Revenue was up 6% year-over-year with notable expansion of gross profit margins. North American demand for our equipment has been strong on the back of public infrastructure spending, and Stefano Pampalone and his team are doing an impressive job moving the business forward and delivering significant value to customers.

我們總共贏得了展會的 5 項創新獎，其中包括紐荷蘭雙轉子聯合收割機概念的展會唯一金獎。在新產品推出和北美零售銷售穩健成長的推動下，我們的建築業務季度取得了破紀錄的業績。營收年增6%，毛利率顯著擴大。在公共基礎設施支出的支持下，北美地區對我們設備的需求一直強勁，Stefano Pampalone 和他的團隊在推動業務向前發展並為客戶提供巨大價值方面所做的工作令人印象深刻。

Dealer inventories have been normalizing for most products in most markets as supply availability recoveries. We are judiciously balancing wholesale shipments with retail improvement to improve inventory levels by year-end. Our company strategy remains centered with 5 key pillars: customer-inspired innovation, technology leadership, brand and dealer strength, operational excellence and sustained stewardship.

隨著供應恢復，大多數市場中大多數產品的經銷商庫存已經正常化。我們正在明智地平衡批發發貨與零售改善，以在年底前提高庫存水準。我們的公司策略仍然以 5 個關鍵支柱為中心：以客戶為靈感的創新、技術領先、品牌和經銷商實力、卓越營運和持續管理。

Today, we will focus on advances in technology leadership. Over the past quarter, we bolstered our precision technology offerings with 3 key product innovations. All these solutions automate guidance and steering, enhance operator efficiency and are first available as aftermarket solutions. We commercially launched our Raven AutoCart solution with hands-on demo at Farm Progress in August. Early orders indicate strong demand for this solution that automatically syncs a grain cart to a combine, thereby eliminating operator strain, decreasing spillage and enabling -- operational by less skilled workers.

今天，我們將重點放在技術領先地位的進步。在過去的季度中，我們透過 3 項關鍵產品創新增強了我們的精密技術產品。所有這些解決方案可實現引導和轉向自動化，提高操作員效率，並首先作為售後解決方案提供。我們於 8 月在 Farm Progress 上商業化推出了 Raven AutoCart 解決方案，並進行了實際示範。早期訂單顯示對這種解決方案的強烈需求，該解決方案可自動將穀物車與聯合收割機同步，從而消除操作員的壓力，減少溢出並允許技術水平較低的工人進行操作。

By optimizing the harvest process, Raven Cart Automation maximizes yield and farmer profits. Raven DirecSteer provides precision automated electric steering, which is backwards compatible across a wide range of brands, including other OEMs equipment. DirecSteer outperforms other similar steering mechanisms, and for Case IH and New Holland tractors, replaces third-party technology with a superior in-house solution.

透過優化收穫過程，Raven Cart Automation 最大限度地提高了產量和農民利潤。 Raven DirecSteer 提供精確的自動電動轉向系統，可向後相容於多種品牌，包括其他 OEM 設備。 DirecSteer 的性能優於其他類似的轉向機構，對於 Case IH 和 New Holland 拖拉機，它用卓越的內部解決方案取代了第三方技術。

We additionally previewed guidance and positioning kits that enable customers to replicate the factory-fit displays and features from newer CNH machines on their existing fleet. These internally developed automated driving advancement boost customers' productivity and profitability. We are reducing our reliance on third-party solutions and optimizing our products to meet customer needs.

我們還預覽了引導和定位套件，使客戶能夠在其現有機隊上的新型 CNH 機器上複製工廠安裝的顯示器和功能。這些內部開發的自動駕駛進步提高了客戶的生產力和獲利能力。我們正在減少對第三方解決方案的依賴並優化我們的產品以滿足客戶需求。

The innovative technology we are developing and launching, reinforces my confidence in our strategy to transition to in-house solutions. We started this effort nearly 4 years ago, accelerated it with the Raven acquisition and have been aggressively pursuing the strategy ever since. Recent developments in our industry will not change the course we set out years ago. In fact, we think they validate our direction.

我們正在開發和推出的創新技術增強了我對我們向內部解決方案過渡的策略的信心。我們大約 4 年前就開始了這項工作，並透過收購 Raven 加速了這項工作，從那時起我們就一直積極推行這項策略。我們行業的最新發展不會改變我們多年前製定的方針。事實上，我們認為它們驗證了我們的方向。

You can see from the graph, that our tech stack hit an inflection point in 2023, with the integration of Raven and the contribution of some of our recent acquisitions. This activity allowed us to bypass years of organic development in key areas such as autonomy, vision and guidance. Which we further expedited by rapidly scaling our own tech talent. This steep increase in this ownership curve is no accident, and it is the manifestation of our strategy to take control of our tech offerings.

從圖中可以看出，隨著 Raven 的整合以及我們最近的一些收購的貢獻，我們的技術堆疊在 2023 年遇到了轉折點。這項活動使我們能夠繞過多年來在自主、願景和指導等關鍵領域的有機發展。我們透過快速擴展我們自己的技術人才進一步加快了這一進程。所有權曲線的急劇成長並非偶然，而是我們控制技術產品策略的體現。

Earlier this year, we announced the acquisition of Hemisphere and are excited to have finally closed the purchase in October. This is another highly strategic acquisition for us. Not only does Hemisphere have the most accurate position in heading technology in the business, but they also design and manufacture their complete positioning engine all the way down to the chipset. This acquisition allows CNH to create a seamless system to deliver optimal customer performance and experience.

今年早些時候，我們宣布收購 Hemisphere，並很高興最終在 10 月完成了收購。這是我們的另一項高度策略性的收購。 Hemisphere 不僅在業界擁有最準確的定位技術，還設計和製造完整的定位引擎，一直到晶片組。此次收購使 CNH 能夠創建一個無縫系統，以提供最佳的客戶績效和體驗。

With Hemisphere, we own the foundation for positioning and guidance, that powers all aspects of automation and autonomy. This vertical integration facilitates faster development times and gives us full control over future performance and cost. Hemisphere adds to our comprehensive portfolio of high-tech companies that are expediting the advancement of full autonomy, throughout our product offerings. In conjunction with Raven's expertise in autonomous technology and augment as unique sensing solutions, Hemisphere's capabilities significantly advanced our ability to improve customer productivity. We'll now turn the call over to Oddone to take us through the financial results.

借助 Hemisphere，我們擁有定位和引導的基礎，為自動化和自主的各個方面提供動力。這種垂直整合有助於縮短開發時間，並使我們能夠完全控制未來的效能和成本。 Hemisphere 增加了我們全面的高科技公司組合，這些公司正在加快我們整個產品系列的完全自主性的發展。結合 Raven 在自主技術和增強獨特感測解決方案方面的專業知識，Hemisphere 的功能顯著提高了我們提高客戶生產力的能力。現在，我們將把電話轉給 Oddone，讓他向我們介紹財務表現。

Thank you, Scott, and good morning, good afternoon to everyone on the call. Third quarter net sales of industrial activities of $5.3 billion, were down about 3% at constant currency year-over-year. This was mainly due to lower industry demand in the Agricultural segment, especially in South America, partially compensated by carryover price realizations in both segments.

謝謝你，史考特，祝所有參加電話會議的人早安、下午好。第三季工業活動淨銷售額為 53 億美元，以固定匯率計算年減約 3%。這主要是由於農業領域的產業需求下降，特別是在南美洲，這部分被兩個領域的結轉價格實現所補償。

As demand slowed, we produce around 20% fewer low horsepower tractors in Q3 2023 globally, compared to a year ago. While on our high horsepower tractors, production was up 13% and on combines, was up 8%. With only South America plants down double digits for the 3 categories. Construction machine production schedules were up 20% globally, except for South America, where we reduced assemblies in view of the slowing demand.

隨著需求放緩，我們 2023 年第三季全球低馬力拖拉機的產量比一年前減少了約 20%。在我們的大馬力拖拉機上，產量增加了 13%，在聯合收割機上，產量增加了 8%。只有南美洲工廠在這 3 個類別的產量下降了兩位數。全球工程機械生產計劃增長了 20%，但南美洲除外，鑑於需求放緩，我們減少了南美地區的組裝。

Low EBIT margin in both segments were up year-over-year. Industrial EBIT margin for CNH was slightly down in the quarter. Our unallocated costs were higher in 2023, due to inflationary impacts on support expenses and nonrecurring favorable items in 2022. Adjusted net income for the quarter was $570 million, with adjusted diluted earnings per share of $0.42, up $0.01 versus last year. Free cash flow from Industrial Activities was an outflow of $127 million, consistent with the seasonality of working capital in the third quarter.

兩個細分市場的息稅前利潤率均較低，但較去年同期有所上升。本季離岸人民幣工業息稅前利潤率略有下降。由於2022年支援費用和非經常性優惠項目的通貨膨脹影響，我們的未分配成本在2023年更高。該季度調整後淨利潤為5.7億美元，調整後攤薄每股收益為0.42美元，比去年增加0.01美元。工業活動自由現金流流出 1.27 億美元，與第三季營運資金的季節性相符。

The September year-to-date figure of $440 million outflow is $39 million better than the $453 million outflow from the first 9 months of 2022. Agricultural net sales were down 4% in constant currency this quarter, driven in large part by pullbacks in demands in South America. We have reacted with lower production and lower deliveries to our dealers. Gross margin was 25.6%, a 60 basis point improvement compared to last year, as price realization continues to more than compensate for the long tail of inflation in our material cost.

今年9 月迄今的流出量為4.4 億美元，比2022 年前9 個月的4.53 億美元流出量高出3,900 萬美元。以固定匯率計算，本季農業淨銷售額下降了4%，這在很大程度是由於需求回落在南美洲。我們的反應是降低產量和減少向經銷商的交付。毛利率為 25.6%，比去年提高了 60 個基點，因為價格實現繼續超過了我們材料成本通膨的長尾效應。

SG&A cost was also slightly lower in Q3, than last year and sequentially lower than in the second quarter of this year. In the end, Agriculture's adjusted EBIT increased by $6 million to $672 million with higher (inaudible) income in Turkey, here included in FX and other categories, offsetting higher R&D investments. All in all, despite the lower sales level, the higher gross margin carried to the bottom line with an EBIT margin of 50 basis points higher than last year's record Q3 EBIT margin.

第三季的銷售、行政管理成本也略低於去年，較上季低於今年第二季。最終，農業調整後的息稅前利潤增加了 600 萬美元，達到 6.72 億美元，土耳其的收入增加（聽不清楚），這裡包括外匯和其他類別，抵消了研發投資的增加。總而言之，儘管銷售水準較低，但毛利率較高，息稅前利潤率比去年創紀錄的第三季息稅前利潤率高出 50 個基點。

Turning to Construction. Net sales were up 4% at constant currency, driven by demand in North America, mainly for heavy equipment. Demand was weaker in Europe and South America, a bit mounting economic uncertainties. Gross margin improved to about 16%, over 300 basis points higher year-over-year. In the quarter, we started shipping new models for the U.S. market, and therefore, we have increased their inventories. Construction EBIT margin came in at 6.3%, with a year-over-year improvement largely driven by favorable pricing with some help from lower SG&A.

轉向建築業。受北美需求（主要是重型設備）的推動，以固定匯率計算，淨銷售額成長了 4%。歐洲和南美洲的需求疲軟，經濟不確定性增加。毛利率提高至約16%，較去年同期高出300多個基點。本季度，我們開始向美國市場發貨新型號，因此我們增加了庫存。建築業息稅前利潤率為 6.3%，年比改善主要是由於有利的定價以及較低的銷售管理費用 (SG&A) 的幫助。

For our Financial Services business, net income was flat year-over-year at $86 million. Credit portfolios grew in all regions, generating higher interest revenues, partially offset by higher risk cost and margin compression because of the steep increase in interest rates in the last few quarters. Retail originations were $3 billion, up about $600 million compared to 2022. As more customers are using the captive company to finance their equipment investments, which highlights the strategic importance of running a healthy and nimble financial services operation.

我們的金融服務業務的淨利潤與去年同期持平，為 8,600 萬美元。所有地區的信貸投資組合均有所增長，產生了更高的利息收入，但由於過去幾個季度利率急劇上升，風險成本上升和利潤率壓縮，部分抵消了這一影響。零售起源為 30 億美元，比 2022 年增加約 6 億美元。隨著越來越多的客戶利用自保公司為其設備投資融資，凸顯了營運健康、靈活的金融服務營運的戰略重要性。

The managed portfolio for the third quarter was nearly $27 million, up $5.6 billion compared to the prior year. Delinquencies on book, which saw a seasonal spike last quarter, were down sequentially to 1.6%, while still higher year-over-year, this low level of delinquencies reflects the strong nature of Agriculture equipment financing.

第三季管理的投資組合接近 2,700 萬美元，比上年增加 56 億美元。帳面拖欠率上季度出現季節性飆升，環比下降至 1.6%，但同比仍較高，如此低的拖欠率反映了農業設備融資的強大性質。

As announced earlier today, we have filed our application with Borsa Italiana to delist CNH Industrial shares from Euronext Milan. We have just been notified that the application has been accepted, and so we can confirm now that as of January 2, 2024, our shares will be listed only on the New York Stock Exchange. We have obtained a single listing within the time frame, we have consistently communicated, without needing a corporate organization. And we did it in a smooth, albeit long process.

正如今天早些時候所宣布的，我們已向意大利證券交易所提交申請，要求凱斯紐荷蘭工業股票從米蘭泛歐交易所退市。我們剛收到申請已被接受的通知，因此我們現在可以確認，自 2024 年 1 月 2 日起，我們的股票將僅在紐約證券交易所上市。我們在規定的時間內獲得了單一上市，我們一直在溝通，不需要公司組織。我們的過程很順利，儘管過程很漫長。

The single listing represents a significant milestone for our business as it will increase liquidity for our stock and streamline financial reporting. CNH was added to the Russell 1000 in June and to the S&P Total Market Index in September, and we look forward to further shareholder participation by a new class of investors.

單一上市是我們業務的一個重要里程碑，因為它將增加我們股票的流動性並簡化財務報告。 CNH 於 6 月被納入羅素 1000 指數，並於 9 月被納入標準普爾總市場指數，我們期待新一類投資者的進一步股東參與。

We also think that our global nature will continue to be attractive to shareholders around the globe. In conjunction with the listing announcement, we also announced that today that the Board of Directors has approved a new share buyback program of up to $1 billion, of which approximately EUR 400 million will be deployed in Milan, before the listing. The remaining amount will be purchased in New York. This concludes my part, and I'll turn it back to Scott.

我們也認為，我們的全球性質將繼續對全球股東具有吸引力。在發布上市公告的同時，我們也宣布，今天董事會已批准一項高達 10 億美元的新股票回購計劃，其中約 4 億歐元將在上市前部署在米蘭。剩餘的金額將在紐約購買。我的部分到此結束，我將把它轉回給斯科特。

Thank you, Oddone. For our 2023 industry outlook, we have lowered our estimates for South America in all businesses and product categories, given the weakened demand there. The pronounced decline in combines is especially unhelpful given our market-leading presence. We also expect slightly lower demand in Asia Pacific.

謝謝你，奧多內。對於 2023 年行業前景，鑑於南美洲需求疲軟，我們下調了對南美洲所有業務和產品類別的預期。考慮到我們在市場上的領先地位，聯合收割機數量的顯著下降尤其無益。我們也預計亞太地區的需求將略有下降。

We have further lowered expectations for small tractors in North America, while increasing them for large tractors as demand for cash crop equipment remains strong. We also project slightly better demand for heavy equipment -- heavy construction equipment in North America and for light construction equipment in EMEA. Last quarter, I said our full year net sales would be contingent upon retail demand, as we are moderating production in wholesales accordingly.

我們進一步降低了北美對小型拖拉機的預期，同時提高了對大型拖拉機的預期，因為經濟作物設備的需求仍然強勁。我們也預期重型設備（北美的重型建築設備）和歐洲、中東和非洲（EMEA）的輕型建築設備的需求略有增加。上個季度，我說過我們的全年淨銷售額將取決於零售需求，因為我們正在相應地減少批發產量。

With the South American market weaker than we foresaw, we are updating our financial guidance. We now see projected net sales growth of 3% to 6% versus 2022 and free cash flow of $1 billion to $1.2 billion. We reaffirm our SG&A to be up no more than 5% compared to 2022 at constant currency and our combined R&D and CapEx spending of about $1.6 billion. Q4 net pricing will be about flat year-over-year as we will need to increase some incentive programs to address pockets of excess dealer inventory.

由於南美市場弱於我們的預期，我們正在更新我們的財務指引。我們現在預計淨銷售額將較 2022 年成長 3% 至 6%，自由現金流為 10 億至 12 億美元。我們重申，以固定匯率計算，與 2022 年相比，SG&A 成長不超過 5%，研發和資本支出合計約為 16 億美元。第四季的淨定價將與去年同期持平，因為我們需要增加一些激勵計劃來解決經銷商庫存過剩的問題。

Volumes in Q4 will be down year-over-year and where we fall in the range, again, depends on retail demand. I also previously noted that this year will likely be able to achieve some of the 2024 EBIT margin and EPS targets from our 2022 Capital Markets Day. Despite this lower sales outlook, that statement holds true, and we still expect to get our adjusted EPS target of around $1.70.

第四季的銷售量將年減，而我們所處的範圍再次取決於零售需求。我先前也指出，今年很可能能夠實現 2022 年資本市場日設定的 2024 年息稅前利潤率和每股盈餘的部分目標。儘管銷售前景較低，但這一說法是正確的，我們仍然預計調整後的每股收益目標約為 1.70 美元。

We are confident that our margin expansion efforts will allow us to better sustain profitability through the industry cycle. As shown on this chart, you see here, it is created from a 10-year average composite industry, based on our mix of agriculture and construction, with industry volumes and margins on the horizontal and vertical axes, respectively. In 2021, when our estimated composite industry was about 110% of the 10-year average, we achieved about 10% EBIT margin. Our business was operating along the gray curve.

我們相信，我們的利潤擴張努力將使我們能夠在整個行業週期中更好地維持獲利能力。如該圖表所示，您可以看到，它是根據農業和建築業的組合，根據 10 年平均複合行業創建的，水平軸和垂直軸分別為行業規模和利潤率。 2021年，當我們估計複合材料產業約為10年平均水準的110%時，我們就達到了約10%的息稅前利潤率。我們的業務沿著灰色曲線運作。

At our 2022 Capital Markets Day, we set out an ambition to achieve 12% to 13% EBIT margin by 2024, if we stayed at the 110% of the 10-year average. That's represented on the graph by the blue curve. When we talk about margin expansion, we are talking about shifting from the gray curve to the blue curve. Our margins vary with the industry demand, but every point of that blue Capital Markets Day curve is higher margin than the 2021 great curve. Higher profitability at any point in the cycle.

在 2022 年資本市場日，我們制定了目標，如果我們保持在 10 年平均水平的 110%，則到 2024 年實現 12% 至 13% 的息稅前利潤率。這在圖表上用藍色曲線表示。當我們談論利潤擴張時，我們談論的是從灰色曲線到藍色曲線的轉變。我們的利潤率隨產業需求而變化，但藍色資本市場日曲線的每一點的利潤率都高於 2021 年偉大曲線。在周期的任何時刻都有更高的盈利能力。

In 2022, we shifted up to the black curve and achieved 11.3% margin, through industry growth and our own operational improvements. In 2023, we are shifting up to the red curve with better margins than 2022, even though we expect the composite industry level to be lower than 2022. We are not prepared to say precisely where 2024 will land from an industry standpoint, but we are confident that we will shift up to the blue curve, as a result of our operational and cost improvements.

2022 年，透過產業成長和我們自身的營運改進，我們轉向黑色曲線，實現了 11.3% 的利潤率。 2023 年，我們將轉向紅色曲線，利潤率將高於 2022 年，儘管我們預計綜合行業水平將低於 2022 年。從行業角度來看，我們不准備準確地說出 2024 年將達到什麼水平，但我們我們相信，由於我們的營運和成本改進，我們將轉向藍色曲線。

Looking forward, our margin improvement programs will continue delivering measurable results and protecting profitability in any market environment. We are on track our $550 million operational efficiency targets through CBS and Strategic Sourcing, and around 30% of that will be realized in 2023, with the remainder in 2024. Couple that with the SG&A cost improvements supported by our restructuring plan, and we will be well positioned to move up that blue margin curve that I introduced on the previous slide.

展望未來，我們的利潤改善計劃將繼續提供可衡量的成果，並在任何市場環境下保護獲利能力。我們正在透過 CBS 和策略採購實現 5.5 億美元的營運效率目標，其中約 30% 將在 2023 年實現，其餘部分將在 2024 年實現。再加上我們的重組計劃支持的 SG&A 成本改進，我們將處於有利位置，可以向上移動我在上一張投影片中介紹的藍色邊際曲線。

As mentioned, South America is an increasingly important part of the global ag economy and the fundamentals there still support long-term growth. Our strong brands and regional presence, especially in Brazil, give us a solid foundation for success in this vital market. Disciplined dealer inventory management is crucial, as we close 2023 and will remain important for us next year. We are actively leveraging the synergies between our recent acquisition, Raven's capabilities and our organic proficiencies. We will continue to accelerate development of our Precision tech stack, taking more control of the factory fit and aftermarket solutions we offer.

如前所述，南美洲是全球農業經濟日益重要的一部分，那裡的基本面仍然支持長期成長。我們強大的品牌和區域影響力（尤其是在巴西）為我們在這個重要市場取得成功奠定了堅實的基礎。隨著 2023 年的結束，嚴格的經銷商庫存管理至關重要，並且明年對我們來說仍然很重要。我們正在積極利用我們最近的收購、Raven 的能力和我們的有機熟練程度之間的協同效應。我們將繼續加速我們的 Precision 技術堆疊的開發，以更好地控制我們提供的工廠組裝和售後解決方案。

As we look to 2024, mix signals abound. On one hand, soft commodity prices are likely depressed farm incomes, while interest rates remain high. And order backlogs and dealer inventories are normalizing. On the other hand, fleet ages are still elevated, and there is high demand for newer equipment with the latest Precision technologies. We are gaining some early visibility into 2024 with order books opened through the first half in major markets and in many cases, we are already filling Q2 order slots.

展望 2024 年，混合訊號比比皆是。一方面，大宗商品價格疲軟可能壓低農民收入，而利率仍然很高。訂單積壓和經銷商庫存正在正常化。另一方面，機隊機齡仍然較長，對採用最新精密技術的更新設備的需求很高。透過上半年在主要市場開放的訂單簿，我們對 2024 年有了一些初步了解，在許多情況下，我們已經填補了第二季的訂單空缺。

It is too early to call 2024 industry demand, but we do expect it to be lower than 2023. We look forward to finishing the year strong and completing our journey to become a single listed company. That concludes our prepared remarks. We'll now open the lines for questions.

現在預測 2024 年的行業需求還為時過早，但我們確實預計該需求將低於 2023 年。我們期待強勁地結束這一年，完成成為單一上市公司的旅程。我們準備好的演講到此結束。我們現在開始提問。

(Operator Instructions) Our first question comes from the line of Steven Fisher from UBS.

（操作員說明）我們的第一個問題來自瑞銀集團的史蒂文·費希爾（Steven Fisher）。

You mentioned that there's going to be some incentives to help move some inventory in Q4. You also mentioned you have the order books opened in the first half of 2024. Just curious to what extent do we know at this point about whether those incentives are going to be extending into those 2024, first half orders? Or is that sort of a different set of kind of pricing card?

您提到第四季將會有一些激勵措施來幫助轉移一些庫存。您也提到您已在 2024 年上半年開放訂單。只是好奇我們目前在多大程度上了解這些激勵措施是否會擴展到 2024 年上半年的訂單？還是這是一套不同的定價卡？

No. That's a great question, Steven. Let's definitely not confuse the two. The Q4 discussion around getting flat pricing was related to actions to drive retail performance. So we're talking about incentives for retail performance, not to incentivize people to take orders from us. That's actually lowering list prices, which we're not -- we've been very clear that we're not planning to do. It's really about just -- it's driving retail. That's what we're trying to do.

不，這是一個很好的問題，史蒂文。我們絕對不要混淆兩者。第四季圍繞統一定價的討論與推動零售業績的行動有關。因此，我們談論的是對零售業績的激勵，而不是激勵人們接受我們的訂單。這實際上是在降低標價，但我們並沒有這樣做——我們已經非常明確地表示我們不打算這樣做。這實際上只是——它正在推動零售業的發展。這就是我們正在努力做的事情。

Okay. That's very helpful. And I guess just a bigger picture question. I guess I'm curious for how you see what's different in '24 versus '23 that's actually now taking volumes down? I mean it's not terribly surprising given what we've seen in the commodity prices, but farm income is going to be down in '23 also, and there's a fadeout of bonus depreciation this year, but still '23 shows some growth. So is it just though the magnitude of the decline that's kind of cross a threshold, where it makes a difference? Or is it used values? Or is it interest rates or there's like a tale of time that just has to play out for this demand decline to play out?

好的。這非常有幫助。我想這只是一個更大的問題。我想我很好奇你如何看待 24 年與 23 年的不同之處，實際上現在銷量有所下降？我的意思是，考慮到我們在大宗商品價格中看到的情況，這並不令人意外，但農業收入在23 年也會下降，而且今年紅利貶值逐漸減弱，但23 年仍然顯示出一些增長。那麼，是否只是下降的幅度跨越了某個閾值，就會產生影響呢？還是它是使用值？還是利率，或是時間故事，需要一段時間才能讓需求下降結束？

Yes. Well, we still strongly believe in the sound fundamentals of the Agriculture industry for the long term. I mean -- and especially in Brazil, where we're seeing weakness now, I mean, the fundamentals couldn't be better. But the setup for 2024 is certainly not ideal. Higher interest rates are certainly weighing on. When I talk to farmers, they are just considering, do I want to take that new product on. If they are financing it, it's a good bit more expensive now. So that is a consideration for them.

是的。嗯，我們仍然堅信農業的長期良好基本面。我的意思是——特別是在巴西，我們現在看到了疲軟，我的意思是，基本面再好不過了。但 2024 年的設置肯定不理想。更高的利率無疑會帶來壓力。當我與農民交談時，他們只是在考慮，我是否想採用這種新產品。如果他們融資的話，現在的價格會貴一些。所以這是他們的一個考慮。

Specifically in Brazil, they're just really worried about the soft commodity prices, and they're waiting for those to come back. And I think if we see a rebound for whatever reason in soft commodity prices, I think it really gives a boost, especially to Brazil but for most markets, we're just not anticipating that in 2024. So we're being prudent with dealer inventories, and we'll certainly be able to take advantage, if the market turns out to be better, but our initial outlook, and I think it's triangulated by what we're seeing by most everybody else prognosticating is, it's going to be slightly less than this year.

特別是在巴西，他們真的很擔心大宗商品價格疲軟，他們正在等待價格回升。我認為，如果我們看到軟商品價格因某種原因而反彈，我認為這確實會帶來提振，尤其是對巴西，但對於大多數市場而言，我們只是預計2024 年不會出現這種情況。因此，我們對經銷商持謹慎態度庫存，如果市場變得更好，我們肯定能夠利用這一優勢，但我們最初的前景，我認為它是根據我們所看到的大多數其他人的預測進行三角測量的，它會略有下降比今年少。

The next question comes from the line of Nicole DeBlase from Deutsche Bank.

下一個問題來自德意志銀行的 Nicole DeBlase。

Maybe just for starting with the restructuring, the $200 million, that you guys are talking about taking, what is the expectable annual savings related to that program? And is that separate from what you've already guided for, for '24 and '25 -- or sorry, '23 and '24? Or is this completely incremental?

也許只是從重組開始，你們正在談論的 2 億美元，與該計劃相關的預期年度節省是多少？這與您已經為“24”和“25”（或抱歉，“23”和“24”）提供的指導分開嗎？還是這是完全增量的？

In terms of restructuring, that's incremental. And that's also incremental to the general COGS cost reduction of $550 million that we are working on and that we started delivering this year. In terms of spending, a chunk of it will be this year. Because we are taking immediate actions on head count right now, as we speak. And the remainder will be in the first part of next year.

就重組而言，這是漸進的。這也是我們正在努力並於今年開始實現的 5.5 億美元總體銷貨成本削減的增量。就支出而言，其中很大一部分將在今年。因為正如我們所說，我們現在正在立即採取人員清點行動。剩下的部分將在明年上半年進行。

Okay. That's helpful. And then shifting to dealer inventories. Can you guys talk a little bit about how you see current dealer inventories just around the world? And if you still think that you can kind of produce in line with retail demand, as we move into '24.

好的。這很有幫助。然後轉向經銷商庫存。你們能談談你們如何看待當前世界各地經銷商​​的庫存嗎？當我們進入 24 世紀時，如果您仍然認為您可以根據零售需求進行生產。

Yes. We've seen over the last couple of years just wild swings. We went from racing to catch up and struggling to catch up with dealer inventories. And then certainly in the low horsepower tractors, as we've talked about for quarters now, that slowed down rather quickly. We've got what I call pockets of inventory that are too high and pockets that are too low. I'd say net-net, it's -- I would call it like a mid-single-digit percent high that we'd like to get rid of. So it's really not dramatic. So I believe if we can get retail up and again, that is our focus, working with our dealers to drive retail, we'll be able to keep wholesale shipments in line.

是的。在過去的幾年裡，我們看到了劇烈的波動。我們從競速到追趕，再到努力追趕經銷商庫存。當然，在低馬力拖拉機中，正如我們已經討論了幾個季度的那樣，速度減慢得相當快。我們有我所說的庫存過高和過低的情況。我會說淨淨，我會稱之為我們想要擺脫的中個位數百分比高點。所以這真的不是什麼戲劇性的事情。因此，我相信，如果我們能夠一次又一次地提高零售量，這就是我們的重點，與我們的經銷商合作推動零售，我們將能夠保持批發出貨量。

The next question comes from the line of Michael Feniger from Bank of America.

下一個問題來自美國銀行的 Michael Feniger。

I know that you guys kept the EPS where it is, but you cut the free cash flow. Free cash flow was down year-over-year in the quarter. It looks like there was a negative use from cash from ops for financial services net of eliminations. Can you just talk about your conviction on hitting the free cash flow in the fourth quarter? Just trying to understand the moving pieces with that cut? Is it just the cuts in net sales, and as we look to next year, is $1 billion of free cash flow still kind of the base case we kind of think about for next year? Just love to get any sense on that.

我知道你們保持每股收益不變，但削減了自由現金流。本季自由現金流年減。扣除沖銷後，來自金融服務業務的現金使用似乎為負數。您能否談談您對第四季實現自由現金流的信念？只是想了解那個剪輯中的動人片段嗎？這只是淨銷售額的削減嗎？當我們展望明年時，10 億美元的自由現金流仍然是我們明年考慮的基本情況嗎？只是喜歡了解這一點。

Yes, you got it. Reduction in free cash flow is mainly linked to the reduction in sales and some of the slowdowns in production we have. And basically, we probably would have some level of higher company inventory, compensated by lower dealer inventory, right. Which are not part of our cash -- of our working capital. The -- in terms of next year, I mean it's early to talk about next year, but we think that our 70% cash conversion rate is still consistent with the overall structure of our business, over time. So we would target that range of cash generation for the year.

是的，你明白了。自由現金流的減少主要與銷售減少和生產放緩有關。基本上，我們可能會擁有一定程度的較高公司庫存，並透過較低的經銷商庫存進行補償，對吧。這不屬於我們的現金——我們的營運資金的一部分。 - 就明年而言，我的意思是現在談論明年還為時過早，但我們認為隨著時間的推移，我們 70% 的現金轉換率仍然與我們業務的整體結構一致。因此，我們的目標是今年的現金產生範圍。

And just if I could add, I understand you're saying volumes potentially are likely down next year. There's -- these cost savings numbers that we're looking at, plus the restructuring. Just can ag margins hold flat if volumes are down 5%, 10%? Is that kind of the range we should be bracketing? Are we kind of looking at down 10% to 20%? And in that case, obviously, absorption becomes a bigger headwind. Just curious if we kind of talk about these moving pieces with volumes likely down next year, but these big cost saving numbers coming in, in next year?

如果我可以補充一下，我理解你是說明年的銷售可能會下降。我們正在考慮這些成本節約數字，再加上重組。如果銷量下降 5%、10%，農業利潤率還能維持不變嗎？這是我們應該包圍的範圍嗎？我們是否會考慮下降 10% 到 20%？在這種情況下，吸收顯然會變成更大的阻力。只是好奇我們是否會談論明年銷量可能會下降的這些移動部件，但明年會出現這些巨大的成本節省數字？

No, I really like to give a shout out to Derek Neilson and the work that he and his team are doing on this very topic. I think if, just to respond to your question, if it's down 10%, yes, we can hold margins flat. If it's down 20%, we got a -- that's a heavier lift, but I wouldn't want to bet against the team to find a way to get there. But no, it's -- the team has really been focused on driving margin performance, and we're seeing the benefits of that now.

不，我真的很想讚揚德里克·尼爾森以及他和他的團隊在這個主題上所做的工作。我想，只是為了回答你的問題，如果下降 10%，是的，我們可以保持利潤率持平。如果下降 20%，我們就會得到一個——這是一個更沉重的提升，但我不想打賭團隊會找到實現這一目標的方法。但不，該團隊確實專注於提高利潤率表現，我們現在看到了這樣做的好處。

The next question comes from the line of David Raso from Evercore ISI.

下一個問題來自 Evercore ISI 的 David Raso。

A little more over a longer term and then more of a shorter term. Sort of to the point you just made, when you were considering this incremental cost reduction program, right, the 10% to 15% of SG&A, what magnitude of revenue decline were you assuming just -- there had to be some relationship to how you saw your revenue next year to the tough decision to take this kind of cost out on the SG&A. And in the same vein of some of those hard decisions. Were you thinking of those cuts in relationship to a traditional kind of 2-year downturn that we see in ag? I know we've seen some longer ones, but maybe this one could be a little shorter.

長期的多一點，然後短期的多一點。有點像你剛才提出的觀點，當你考慮這個增量成本削減計劃時，對，SG&A 的 10% 到 15%，你假設收入下降的幅度是多少——這必須與你的方式有某種關係。看到你明年的收入，你做出了艱難的決定，將此類成本計入SG&A。同樣，有些艱難的決定也是如此。您是否認為這些削減與我們在農業領域看到的傳統的兩年衰退有關？我知道我們見過一些更長的，但也許這個可以短一點。

I'm just trying to get a sense of this incremental decision, how you thought about next year and really even more importantly, is this trying to enter a couple of year downturn and that was the magnitude of the cuts?

我只是想了解這個漸進式的決定，你如何看待明年，更重要的是，這是否試圖進入幾年的低迷期，這就是削減的幅度？

And then the shorter-term question, just -- and I appreciate all that you're doing to offset some of the weakness in the market. But in the fourth quarter, your revenue growth sequentially is sort of -- it's a normal 15% to 20%. In fact, it's 21% implied. Why such the strong incremental revenue 3Q to 4Q, if we're trying to prepare a bit for a weaker '24?

然後是短期問題，我感謝你們為抵消市場的一些疲軟所做的一切。但在第四季度，你的營收季增是 15% 到 20% 的正常水準。事實上，它是隱含的 21%。如果我們想為疲軟的 24 年做好準備，為什麼第三季到第四季的營收增量如此強勁？

All right. I'll take the first one and let Oddone take the second one. First of all, we don't take any action or activity, as it relates to our head count or employees lightly. We really -- it's not something we ever want to do because we invest a lot in our team, and that's just -- it's a difficult action to take.

好的。我拿第一個，請奧多恩拿第二個。首先，我們不採取任何行動或活動，因為這與我們的人數或員工無關。我們真的——這不是我們想做的事情，因為我們在我們的團隊上投入了大量資金，而這只是——這是一個很難採取的行動。

But it's not a reaction to the market. It really is when we did the spin-off from Iveco, we took a shot at getting organized and understanding how we be. We've just learned a lot about, where we are as a company and how we can be more efficient. We do a lot of employee surveys, and we get a lot of feedback that despite, a focus on being agile and customer focused, it's still difficult to do sometimes.

但這並不是對市場的反應。事實上，當我們從依維柯分拆出來時，我們嘗試組織起來並了解我們是如何做到的。我們剛剛了解了很多關於我們公司的現狀以及如何提高效率的資訊。我們做了很多員工調查，並得到了很多回饋，儘管我們注重敏捷和以客戶為中心，但有時仍然很難做到。

So this is really about not a level of decrease in volume next year, but it's just recognizing that the market is not going to grow, like we've seen over the past several years, and we need to think about, what's the proper structure to deal with that is effectively and as efficiently as we can to create a better working environment for our employees and better for our customers. So that's what we're striving to do, and we see a good opportunity to do that, and we think the timing is right.

因此，這實際上並不是明年銷量的下降，而只是認識到市場不會成長，就像我們過去幾年所看到的那樣，我們需要思考，什麼是正確的結構盡可能有效地解決這個問題，為我們的員工和客戶創造更好的工作環境。這就是我們正在努力做的事情，我們看到了這樣做的好機會，我們認為時機是正確的。

And Dave...

還有戴夫...

Generation of the cycle. Sorry, Oddone, go ahead.

循環的產生。抱歉，奧多內，請繼續。

If you think you're going to bait me into a comment on the cycle, try again.

如果你認為你要引誘我對這個週期發表評論，請再試一次。

Well, no, I'm just trying to be thoughtful around those are hard decisions to make, and we knew the SG&A staying below 5% was it was getting hard, right? I mean, you're implying the fourth quarter SG&A, is going to be flat despite revenues up 20%, right? So we needed to take some action, and I appreciate those are not easy decisions. But when you were putting pen to paper. I was just trying to think about it's never easy to let people go. Obviously, not always easy to hire people nowadays, find good people. Just trying to think about, yes, we're just going to approach this as a typical downturns to -- yes, we've seen 3 and tougher -- 3 years and tougher eras. But I was just trying to get a sense of how you're really approaching this from a real structural view of the cycle. So I'm trying to bait you just -- those are tough decisions made at...

嗯，不，我只是想考慮一下這些很難做出的決定，而且我們知道 SG&A 保持在 5% 以下是變得越來越困難，對吧？我的意思是，您的意思是，儘管收入增長了 20%，第四季度的 SG&A 將持平，對吧？因此，我們需要採取一些行動，我知道這些決定並不容易。但當你動筆寫在紙上的時候。我只是想想想，讓一個人走絕非易事。顯然，如今聘人、找到好人並不總是那麼容易。只是想一下，是的，我們只是將其視為典型的低迷時期 - 是的，我們已經看到了三年或更艱難的時期 - 三年或更艱難的時代。但我只是想從週期的真實結構角度了解您是如何真正實現這一目標的。所以我只是想引誘你——這些都是在……做出的艱難決定。

No, no, no. it was putting the through-the-cycle margin chart together was actually helpful for us. And especially if you look at it in the middle of the chart, which reflects 100% of the market, and we're still talking about playing above that middle ground line. So it's not like we're -- the fundamentals in ag are just too good for a major downturn. It's just -- we've seen a lot of demand. We've seen dealer inventories normalize and we think it's going to be a little bit slower next year, but we don't -- if you compare it to past downturns in the market, we fully just don't see that coming right now.

不不不。將整個週期的利潤率圖表放在一起實際上對我們很有幫助。尤其是如果你看一下圖表中間的情況，它反映了 100% 的市場情況，而我們仍在談論在中間底線之上進行交易。所以，我們的情況並非如此——農業的基本面對於嚴重的衰退來說太好了。只是——我們看到了很多需求。我們已經看到經銷商庫存正常化，我們認為明年會放緩一些，但我們沒有——如果你將其與過去的市場低迷時期進行比較，我們完全看不到現在會發生這種情況。

That's helpful. No, I appreciate the discussion.

這很有幫助。不，我很欣賞討論。

And Dave, on your second question about the growth in the fourth quarter, yes, you noticed -- I mean the growth that we have sequentially fourth quarter to third quarter is pretty typical. In our rate (inaudible) sales and is predicated on higher retail sales in the fourth quarter. Which are also typical for our business and for the way our dealers and our farmers operate.

戴夫，關於你關於第四季成長的第二個問題，是的，你注意到了——我的意思是我們第四季到第三季的成長是非常典型的。我們的銷售額（聽不清楚）是基於第四季零售額的成長。這對於我們的業務以及我們的經銷商和農民的經營方式來說也是典型的。

But I guess that was the decision. Do we get the typical sequential revenue growth, which is what you're exactly correct. That's the normal third or fourth quarter, but the decision was to get that revenue, we're willing to clear out a bit with pricing? Which is fine. It just -- that was the decision, right? Without that incentive, we probably wouldn't get the sequential revenue. But at least it clears out some inventory going into '24, which I appreciate.

但我想這就是決定。我們是否得到了典型的連續收入成長，這正是你所正確的。這是正常的第三或第四季度，但決定是為了獲得收入，我們願意透過定價來清理一點嗎？這很好。這就是——這就是決定，對吧？如果沒有這種激勵，我們可能不會獲得連續的收入。但至少它清除了 24 年的一些庫存，我很感激。

Next question comes from the line of Timothy Thein from Citi.

下一個問題來自花旗銀行的 Timothy Thein。

Apologies in advance on the voice issue here. But in context with the pricing for ag that you've talked about. Can you kind of just give us a sense in terms of your expectations and what you're seeing on the cost side in ag and just maybe a little bit longer purview into '24 in terms of, again, just kind of the trend lines and what you can see through contract negotiations and the like as to into that relationship and again more on the cost side?

在此提前對語音問題表示歉意。但就您所討論的農業定價而言。您能否讓我們了解一下您的期望以及您在農業成本方面所看到的情況，以及可能對 24 年的趨勢線和趨勢線有更長的了解？您可以透過合約談判等方式了解這種關係以及成本方面的哪些內容？

And then I guess, the second question, and I'll just ask them at once, Scott, is just -- on the -- obviously, you don't do presales for every product, but what you have seen in terms of presales and where you're taking orders into '24. Is that -- can you just give us a sense in terms of how much that's informing you about the volume outlook into '24, i.e., just some kind of sense in terms of what you have seen in terms of that order uptake.

然後我想，第二個問題，我會立即問他們，斯科特，顯然，你不會對每種產品進行預售，但你在預售方面看到了什麼以及您在24 世紀接受訂單的地方。您能否讓我們了解您對 24 年銷售前景的了解程度，即您所看到的訂單吸收。

Yes. As we've said throughout the year, we've seen a moderating cost. And if you look at our EBIT margins, as we're getting carryover pricing, but not significant pricing going forward, we're seeing that cost curve been down to a level. I mean, moderating inflation is still inflation, and we're seeing that, but we're also seeing really good work by our team, specifically on logistics lanes and other costs.

是的。正如我們全年所說，我們看到成本有所放緩。如果你看看我們的息稅前利潤率，因為我們得到了結轉定價，但未來沒有顯著的定價，我們看到成本曲線已經下降到某個水平。我的意思是，溫和的通貨膨脹仍然是通貨膨脹，我們看到了這一點，但我們也看到我們的團隊做得很好，特別是在物流通道和其他成本方面。

Our strategic sourcing, actually, we have our first review tomorrow, and we'll continue to get through that. And we still see the double-digit savings, that we talked about in that -- those categories, we still see that coming to fruition. But that's a longer-term benefit. But it really is the lean activities that we're driving through CBS, the focus on logistics improvement, we're able to push back on cost.

實際上，我們的策略採購明天將進行第一次審查，我們將繼續完成這項審查。我們仍然看到我們在這些類別中談到的兩位數的節省，我們仍然看到它正在實現。但這是一個長期的好處。但這確實是我們透過 CBS 推動的精益活動，重點是物流改進，我們能夠降低成本。

And I said earlier in the year, that it was going to be the year of cost not price like last year, and the team is really delivering on that. And I think you're going to see that cost benefit show up for us for the next several quarters to come. We're not giving guidance on '24, but I did say in the prepared remarks that we have started to take orders in some markets for some products into 2024. And it seems very reasonable now.

我在今年稍早說過，今年將是成本而不是去年那樣的價格年，球隊確實正在兌現這一目標。我認為您將在接下來的幾個季度中看到我們的成本效益。我們不會在 24 年給予指導，但我確實在準備好的發言中說過，我們已經開始在一些市場接受一些產品的訂單，直到 2024 年。現在看來非常合理。

There is a bifurcation. I mean the cash crop market in North America still seems to have nice legs to it. South America is -- it's weak, and it's going to be weak, I think, until farmers decide to sell. When I mean sell, sell the crops that they harvested, and we're prepared for that. But overall, there's nothing that significantly positive or significantly negative, as we read out what we're seeing in the order books.

有一個分叉。我的意思是，北美的經濟作物市場似乎仍然有良好的發展動能。南美洲很弱，我認為，在農民決定出售之前，它將會很弱。當我的意思是出售時，出售他們收穫的農作物，我們為此做好了準備。但總體而言，當我們讀到訂單簿中看到的內容時，沒有明顯的正面或負面的影響。

Our next question comes from the line of Tami Zakaria from JPMorgan.

我們的下一個問題來自摩根大通的 Tami Zakaria。

So given your goal to bring factory fit and aftermarket precision ag solutions in-house, to over 90%, it seems by 2026, which seems quite impressive. So from -- from an R&D perspective, should we expect R&D spend to remain at 2023 level, even if there is a downturn for the next couple of years?

因此，考慮到您的目標是到 2026 年將工廠組裝和售後精密農業解決方案引入內部，達到 90% 以上，這似乎相當令人印象深刻。因此，從研發角度來看，即使未來幾年出現下滑，我們是否應該預期研發支出維持在 2023 年的水準？

We have been at an elevated R&D level for several years now. And I think what you're seeing is the fruition of those investments. We are obviously looking -- we're not going to stay at that level forever. And we're looking at every single project about where we can. I think we'll probably be flattish in that area. But we've also got some product gaps that we're leaning in to fill, and we've got some upgrades that we're looking to make, and we're not going to slow those down because it's so important to our future. But I don't think it's going to go -- over the last several years, you've seen it go higher from here, and I think it won't go higher from here. It will go lower from here, but moderately.

多年來我們一直處於較高的研發水準。我認為您所看到的是這些投資的成果。顯然我們正在尋找——我們不會永遠停留在這個水平。我們正在研究每一個項目，看看我們能做些什麼。我認為我們在該領域可能會表現平平。但我們也有一些產品差距需要填補，我們也有一些升級需要進行，我們不會放慢這些速度，因為這對我們的未來非常重要。但我不認為它會繼續上漲——在過去的幾年裡，你已經看到它從這裡走得更高，而且我認為它不會從這裡走得更高。從這裡開始，它會走低，但幅度不大。

Got it. That's very helpful. And one quick modeling question. It seems like corporate expenses ticked up in the third quarter sequentially a bit despite revenues coming in a lot lower. Anything in particular driving that?

知道了。這非常有幫助。還有一個快速建模問題。儘管收入大幅下降，但第三季的企業支出似乎略有上升。有什麼特別的推動力嗎？

I mean, I think there are 2 things here. One, sequentially as slightly lower than in the second quarter, and we expect sequentially then to be down in the third quarter -- on the fourth quarter, sorry. What you probably noticed is that there's a big gap to the number of last year. But last year, we had some nonrecurrent positive items that we didn't have. We didn't repeat this year. So that's the big gap, that you may have noticed in comparison with last year. In terms of running costs, we are in the range between the $60 million and $70 million per quarter. And of course, those will be also cost that will be subject to the review that we're looking at partially immediately...

我的意思是，我認為這裡有兩件事。一，環比略低於第二季度，我們預計第三季環比會下降——抱歉，第四季會季減。您可能注意到的是，與去年的數字有很大差距。但去年，我們有一些我們沒有的非經常性積極項目。今年我們沒有重複。因此，與去年相比，您可能已經注意到了巨大的差距。就營運成本而言，我們每季在 6,000 萬美元到 7,000 萬美元之間。當然，這些成本也將受到我們正在立即部分審查的審查的影響...

(Operator Instructions) Our next question comes from the line of Daniela Costa from Goldman Sachs.

（操作員說明）我們的下一個問題來自高盛的 Daniela Costa。

I have 2 things left. First, I wanted to ask you, you mentioned in the release in the disclosures that you had a material issue with internal controls over financial reporting. It sounds like it is sourced, but I was wondering if you could give us some clarity of what it is and if it's really all part of past now? And then the second thing, just obviously, we've seen sort of throughout the quarter, the announcement between Trimble and one of our competitors, and you used to have some sort of relationship with Trimble. Can you tell us at what sort of -- which impact should we see if any or if you're now in terms of Raven product completely independent and all sorts of -- that would be great.

我還剩下兩件事。首先，我想問您，您在披露的新聞稿中提到，您在財務報告的內部控制方面存在重大問題。聽起來它是有來源的，但我想知道你是否可以給我們一些清晰的訊息，以及它是否真的是過去的一部分？然後第二件事，很明顯，我們在整個季度都看到了 Trimble 和我們的一個競爭對手之間的公告，並且您曾經與 Trimble 存在某種關係。你能告訴我們什麼樣的影響嗎？如果有的話，我們應該看到什麼樣的影響，或者如果你現在在 Raven 產品方面完全獨立以及各種各樣的影響，那就太好了。

So let me take the first one, Daniela. You may have noticed we had an auditor rotation at the beginning of this year. And auditor rotations are mandatory under European framework. And so we started working with a new auditor and in conjunction with them. We had a different way of looking at the, I would say, the service access that we give to some of our employees, mainly in ICT to the -- to the system, so the system of record, in particular, the different SAP instances that we have. We realized that with this different way of looking at things, the number and the scope of some of these [axis] is out of what is typical nowadays even considering the fact that we are a large multinational corporation.

所以讓我來說第一個，丹妮拉。您可能已經注意到，我們在今年年初進行了審計員輪調。在歐洲框架下，審計師輪調是強制性的。因此，我們開始與新審計員合作並與他們合作。我想說的是，我們以不同的方式看待我們為一些員工提供的服務存取權限，主要是資訊通信技術、系統、記錄系統，特別是不同的 SAP 實例我們有。我們意識到，以這種不同的方式看待事物，其中一些[軸]的數量和範圍超出了當今的典型水平，即使考慮到我們是一家大型跨國公司的事實。

So what we're doing is we are acting very swiftly and looking at ways of -- well, first of all, of making sure that we have all the controls, but also of bringing or normalizing this situation, let's say. And we're working on that and we should have a solution in a timely manner.

因此，我們正在做的是，我們正在迅速採取行動，尋找方法——嗯，首先，確保我們擁有所有的控制權，而且可以說，使這種情況或正常化。我們正在努力解決這個問題，我們應該及時找到解決方案。

You don't expect any impact on business or anything?

您預計不會對業務或其他方面產生任何影響嗎？

Absolutely, no, no, no. There's no impact and is stated on the documents on the reps that you will see, when we issue our quarterly report, that this has no impact on the financial statements. Of course, the risk that we see is that having this extended access to the system, a fraud could be perpetrated and could not be immediately seen. But again, it requires some -- a lot of skills, and it's not something that has happened or that is something that has been identified.

絕對，不，不，不。沒有影響，並且在我們發布季度報告時您會看到的代表文件中已說明，這對財務報表沒有影響。當然，我們看到的風險是，透過這種擴展的系統存取權限，可能會發生詐欺行為，但無法立即發現。但同樣，它需要一些——很多技能，而且這不是已經發生的事情，也不是已經確定的事情。

Yes. And the second question as it relates to the acquisition during the quarter about Trimble and AGCO. It doesn't really affect us at all in the short term or the long term. We've got -- we still today, buy a lot of stuff from Trimble. They've been a great supplier and partner for a long time. They announced that they were going to go direct in the aftermarket earlier. So we've known since we acquired Raven, that we would have a lot of the ability to do this stuff in-house. And as we showed on the chart, we believe that is going to continue.

是的。第二個問題與本季 Trimble 和 AGCO 的收購有關。無論是短期或長期，它都不會真正影響我們。我們今天仍然從 Trimble 購買很多東西。長期以來，他們一直是優秀的供應商和合作夥伴。他們早前宣布將直接進軍售後市場。因此，自從我們收購 Raven 以來，我們就知道我們將有很多能力在內部完成這些工作。正如我們在圖表上顯示的那樣，我們相信這種情況將繼續下去。

But, we still serve our customers well with a lot of products from Precision Planting and we'll continue to do that. Raven continues to be a supplier to AGCO and that will likely continue. So really, there's we compete in the market, but we also sell to each other, and we don't see that necessarily changing. What is changing is just the execution of our long-term strategy to have the capabilities in-house to give our customers best-in-class solutions with our internal products, and that's why we're in technology. That's what we're doing.

但是，我們仍然透過 Precision Planting 的許多產品為客戶提供良好的服務，我們將繼續這樣做。 Raven 仍然是愛科的供應商，而且這種情況很可能會持續下去。事實上，我們在市場上競爭，但我們也互相銷售，我們認為這種情況不一定會改變。改變的只是我們長期策略的執行，即擁有內部能力，透過我們的內部產品為客戶提供一流的解決方案，這就是我們從事技術的原因。這就是我們正在做的事情。

The next question comes from the line of Kristen Owen from Oppenheimer.

下一個問題來自奧本海默的克里斯汀歐文。

I wanted to come back to the conversation around pricing. And Scott, I think in the prepared remarks, you mentioned price is about 3% in the quarter, flat for 4Q. If we were to abstract from that, what's happening in Brazil, Latin America writ large, how is the book pricing trending? And how much of those incentives are really in that Latin American region?

我想回到關於定價的對話。斯科特，我認為在準備好的發言中，您提到本季價格約為 3%，與第四季度持平。如果我們從中抽象化出來，巴西、拉丁美洲正在發生什麼，那麼圖書定價趨勢如何？這些激勵措施中有多少是真正在拉丁美洲地區？

No, I would say incentives are across the board, not focus on the Latin American region, frankly. And those -- I mean, the large -- a good part of those are financial incentives. So retail financing support and also the cost of holding floor plan inventory, when we deliver to our dealers. So -- but that's mainly -- that's I would say across the board is our global effort to sustain retail sales in the fourth quarter. And support for dealers getting there.

不，坦白說，我想說的是，激勵措施是全面的，而不是集中在拉丁美洲地區。我的意思是，其中很大一部分是經濟誘因。因此，當我們向經銷商交付產品時，零售融資支援以及持有平面圖庫存的成本。所以，但主要的是，我想說的是，我們在全球範圍內為維持第四季度的零售銷售所做的努力。並為經銷商提供支援。

So then my follow-up question relates to the Milan delisting and the announcement this morning for the $1 billion buyback, all of which will be executed or the majority of which you've said will be executed by March 1. Just wondering if you can talk to the appetite for further buybacks beyond that? I mean you've discussed the 70% conversion rate and free cash flow. This still generating a lot of cash. And given the headwind -- or excuse me, tailwinds to margin next year, just how to think about the buyback opportunity once this transaction closes.

那麼我的後續問題涉及米蘭退市和今天早上宣布的 10 億美元回購，所有這些都將在 3 月 1 日之前執行，或者你所說的大部分將執行。只是想知道你是否可以除此之外還有進一步回購的興趣嗎？我的意思是，您已經討論了 70% 的轉換率和自由現金流。這仍然產生大量現金。考慮到明年的逆風——或者對不起，明年的利潤率順風，一旦這筆交易結束，如何考慮回購機會。

Yes. I have to almost laugh when you -- we just announced a $1 billion buyback, and you're already asking for the next one. It sounds like a hedge fund question. But no, the reality is, we have a lot of places to deploy capital. There are times -- and I think now is right one of them we're trading below intrinsic value, and there's a large flowback expected with the delisting that we want to lean in. And we think it's the right time, and the Board was very supportive of that.

是的。當我們剛剛宣布 10 億美元的回購，而你已經在要求下一次回購時，我幾乎要笑了。這聽起來像是對沖基金的問題。但事實並非如此，現實是，我們有很多地方可以部署資本。有時——我認為現在就是其中之一，我們的交易價格低於內在價值，我們希望利用退市，預計會出現大量回流。我們認為這是正確的時間，董事會也非常支持這一點。

As it goes out over time, I think it is just part of our capital allocation strategy. We're committed to keeping our ratings intact. We're improving them. We're committed to providing all of the R&D funding that we can. We'll buy if we have acquisitions that can improve the customer experience or help us grow profitably faster, we'll do that. And sometimes we'll lean in more with share buybacks. And if you look over history, I would expect with a single listing in the New York Stock Exchange, we'll probably buy more than we have historically done. But I don't think you should look at the $1 billion and think there's going to be another $1 billion coming right after that. I mean we're going to be -- it's just part of our capital allocation strategy. And right now, it's a rather important one.

隨著時間的推移，我認為這只是我們資本配置策略的一部分。我們致力於保持我們的評級不變。我們正在改進它們。我們致力於提供所有力所能及的研發資金。如果我們的收購能夠改善客戶體驗或幫助我們更快地實現獲利成長，我們就會購買，我們就會這樣做。有時我們會更依賴股票回購。如果回顧歷史，我預計在紐約證券交易所上市後，我們可能會購買比歷史上更多的股票。但我認為你不應該看到這 10 億美元後就認為接下來還會有另外 10 億美元。我的意思是，我們將要—這只是我們資本配置策略的一部分。現在，這是一件相當重要的事情。

There are no further questions, and this concludes the conference call. Thanks for joining today. You may now disconnect your lines.

沒有其他問題了，電話會議到此結束。感謝您今天加入。現在您可以斷開線路。