CNH Industrial NV (CNHI) 2024 Q1 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Good morning, and welcome to the CNH First Quarter 2024 Results Conference Call. Please note that today's call is being recorded. (Operator Instructions) I will now turn the call over to Jason Omerza, Vice President of Investor Relations. Please go ahead.

女士們先生們，謝謝你們的支持。早安，歡迎參加 CNH 2024 年第一季業績電話會議。請注意，今天的通話正在錄音。 （操作員指示）我現在將電話轉給投資者關係副總裁 Jason Omerza。請繼續。

Thank you, Briana. Good morning, everyone, and we apologize for the delay. We'd like to welcome you to the webcast and conference call for CNH Industrial's first quarter results for the period ending March 31, 2024. This call is being broadcast live on our website and is copyrighted by CNH. Any other use, recording or transmission of any portion of this broadcast without the express written consent of CNH is strictly prohibited. Hosting today's call are CNH CEO, Scott Wine; and CFO, Oddone Incisa.

謝謝你，布萊安娜。大家早安，對於延遲，我們深表歉意。歡迎您參加凱斯紐荷蘭工業集團截至 2024 年 3 月 31 日第一季業績的網路廣播與電話會議。未經 CNH 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。主持今天電話會議的是 CNH 執行長 Scott Wine；和財務長 Oddone Incisa。

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 including in the presentation material. 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. The company presentation includes certain non-GAAP financial measures. Additional information, including reconciliations to the most directly comparable U.S. GAAP measures is included in the presentation material.

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安全港聲明（包括演示材料）中提到的風險和不確定性的影響。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 表格年度報告以及其他定期報告和向美國證券交易委員會提交的文件中。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衡量標準的調節。

I will now turn the call over to Scott.

我現在將把電話轉給斯科特。

Thank you, Jason, and thanks, everyone, for joining our call. Before we review the quarter, I would like to address my upcoming departure from CNH. First, I want to sincerely thank the team here for delivering 3 straight years of record sales and profitability and our notable transformation into a customer-focused technology-forward culture. I'm proud of the team's accomplishments, especially the acceleration of our tech development, the successful deployment of CBS and strategic sourcing to drive operational efficiencies and improving our through-cycle margins which will surely be a key topic of our discussions today.

謝謝傑森，也謝謝大家加入我們的電話會議。在我們回顧本季之前，我想談談我即將離開 CNH 的問題。首先，我要真誠地感謝這裡的團隊，感謝他們連續三年創造了創紀錄的銷售額和盈利能力，以及我們向以客戶為中心的技術領先文化的顯著轉變。我為團隊的成就感到自豪，特別是我們技術開發的加速、CBS 的成功部署和策略採購，以提高營運效率並提高我們的整個週期利潤率，這肯定會成為我們今天討論的關鍵話題。

I have full confidence in our strategy and our ability to achieve it even with slowing market demand. We were early to get after productivity, our cost reduction targets are achievable, and we are on track to deliver them. Our tech in-sourcing work is progressing, and we have a line of sight to execute everything we set out to do.

即使市場需求放緩，我對我們的策略以及實現該策略的能力充滿信心。我們很早就開始追求生產力，我們的成本降低目標是可以實現的，我們正在實現這些目標。我們的技術內包工作正在取得進展，我們有能力執行我們計劃要做的一切。

I believe in the team's ability to continue delivering margin expansion while outselling our peers. Simply put, the business is solid. My reasons for leaving are personal and have nothing to do with the ag cycle, our strategy or CNH's bright future. As of July 1, Gerrit Marx will rejoin CNH as the new CEO. Gerrit and I have worked closely together when he ran commercial vehicles for CNH and he has been CEO of Iveco since its spin-off in early 2022. He's a proven leader. He has my full support, and I am confident he will do well here.

我相信團隊有能力繼續實現利潤率擴張，同時超越我們的同行。簡單來說，就是生意紮實。我離開的原因是個人原因，與農業週期、我們的策略或 CNH 的光明未來無關。自 7 月 1 日起，Gerrit Marx 將重新加入 CNH，擔任新任執行長。 Gerrit 在為 CNH 經營商用車時與我密切合作，自 2022 年初依維柯分拆以來，他一直擔任依維柯的執行長。他得到了我的全力支持，我相信他會在這裡表現出色。

Now on to our quarterly results. We said the first quarter would be challenging from a demand perspective, and that is how it played out, especially in South America and Europe. We also noted competitive pricing pressure where dealers are working hard to reduce their inventories. Nonetheless, we've maintained much of our pricing and profitability gains with construction even increasing both their absolute profit level and their margin percentage year-over-year. Cost efficiency remains a priority for us in this environment.

現在來看我們的季度業績。我們表示，從需求角度來看，第一季將充滿挑戰，結果就是如此，尤其是在南美洲和歐洲。我們還注意到經銷商正在努力減少庫存的競爭性定價壓力。儘管如此，我們仍然保持了建築業的大部分定價和獲利能力成長，甚至比去年同期提高了絕對利潤水平和利潤率。在這種環境下，成本效率仍然是我們的首要任務。

We were ahead of the curve on instituting hard but necessary programs such as our SG&A restructuring to respond to the realities of operating in a cyclical downturn. We will build on the cost reductions already implemented and those savings will compound throughout the remainder of the year. And we continue to advance our tech stack, expanding our team and integrating solutions from our acquisitions effectively into our business.

我們在製定嚴格但必要的計劃（例如銷售管理、一般行政費用重組）方面處於領先地位，以應對週期性低迷時期的營運現實。我們將在已經實施的成本削減措施的基礎上再接再厲，這些節省的成本將在今年剩餘時間裡不斷增加。我們繼續推進我們的技術堆疊，擴大我們的團隊，並將我們收購的解決方案有效地整合到我們的業務中。

We announced exciting developments in satellite connectivity and off-board management earlier this week, and we will continue to leverage innovation as a competitive advantage. In line with our expectations, first quarter consolidated revenues were down 10%, and industrial net sales were down 14% as the industry adjusts to even lower demand and to dealer inventory levels. We proactively addressed South America dealer inventory last year and furthered those efforts in the quarter.

本週早些時候，我們宣布了衛星連接和場外管理的令人興奮的進展，我們將繼續利用創新作為競爭優勢。與我們的預期一致，第一季綜合收入下降了 10%，工業淨銷售額下降了 14%，因為該行業正在適應更低的需求和經銷商庫存水準。去年，我們積極解決了南美經銷商庫存問題，並在本季進一步推進了這些工作。

Industrial EBIT margin was just under 10%, down 180 basis points compared to last year. Despite the lower shipments, decremental margins were in the mid-20s, reflecting the positive price realization and cost reductions. Competitive pricing pressure was the most acute in South America, but the team there is doing a great job managing the situation and keeping our operations profitable. Adjusted EPS was $0.33, down just $0.02 from a year ago.

工業息稅前利潤率略低於 10%，比去年下降 180 個基點。儘管出貨量較低，但利潤率下降了 20 多歲，反映出積極的價格實現和成本降低。南美洲的競爭性定價壓力最為嚴重，但那裡的團隊在管理局勢並保持我們的營運獲利方面做得很好。調整後每股收益為 0.33 美元，較去年同期僅下降 0.02 美元。

Throughout the quarter and across all regions, we saw decreased demand and the end markets. However, our retail deliveries in the quarter outperformed the overall market. Despite production cuts in the quarter, we did not make our desired reductions in dealer inventories, so we still have work to do. We continue to lean out and simplify our organization.

在整個季度和所有地區，我們都看到需求和終端市場下降。然而，我們本季的零售交付量優於整體市場。儘管本季減產，但我們並沒有達到預期的經銷商庫存削減目標，因此我們仍有工作要做。我們繼續精簡和簡化我們的組織。

We completed the first phase of our restructuring program in Q1 and further actions such as combining and rationalizing our commercial back office operations are on track. We plan to conclude the restructuring program in Q2, but not our focus on cost. Derek Neilson and his agriculture team continue to execute in the quarter, achieving favorable price realization despite lower demand by working with our dealer partners on effective sales programs. Construction gross margins and EBIT margins were both up 150 basis points in the quarter.

我們在第一季完成了重組計劃的第一階段，合併和合理化我們的商業後台業務等進一步行動正在按計劃進行。我們計劃在第二季完成重組計劃，但我們不會關注成本。德里克·尼爾森 (Derek Neilson) 和他的農業團隊在本季度繼續執行任務，透過與我們的經銷商合作夥伴合作實施有效的銷售計劃，儘管需求較低，但還是實現了有利的價格。本季建築業毛利率和息稅前利潤率均成長 150 個基點。

Although volume and mix were challenged, particularly in Europe, Stefano Pampalone and his team focus on quality and cost efficiency continues to support improving profitability. Our Financial Services business delivered strong results. Their net income grew on larger receivable balances, and despite some increases in delinquencies, we have a very strong credit portfolio.

儘管銷售和產品組合受到挑戰，尤其是在歐洲，但 Stefano Pampalone 和他的團隊對品質和成本效率的關注繼續支持盈利能力的提高。我們的金融服務業務取得了強勁的業績。他們的淨利潤因應收帳款餘額的增加而增長，儘管拖欠率增加，但我們擁有非常強大的信貸組合。

As we look at our strategic priorities, I want to start with some recent developments on the tech side. Our obsessive focus on customer-centric development has shown us the importance of being the easiest to use OEM. This week, we introduced FieldOps, our brand-new web and mobile digital app. FieldOps will lead the industry in usability and intuitive design. Everything farmers need to run their operations will be at their fingertips with a dramatically improved look and feel. The FieldOps interface simplifies farm management and makes data accessible from anywhere, all with fewer clicks to accomplish every task. It also streamlines our internal workflows as our universal approach to tech development means there is one single app for all customers. The FieldOps web and mobile apps launched in June and the overall customer experience is already garnering rave reviews from our beta testers.

當我們審視我們的策略重點時，我想從技術方面的一些最新發展開始。我們對以客戶為中心的開發的執著向我們展示了成為最易於使用的 OEM 的重要性。本週，我們推出了 FieldOps，我們全新的網路和行動數位應用程式。 FieldOps 將在可用性和直覺設計方面引領業界。農民運作所需的一切都將觸手可及，並且外觀和感覺都將顯著改善。 FieldOps 介面簡化了農場管理，使數據可以從任何地方訪問，只需更少的點擊即可完成每項任務。它還簡化了我們的內部工作流程，因為我們的技術開發通用方法意味著為所有客戶提供一個應用程式。 FieldOps 網路和行動應用程式於 6 月推出，整體客戶體驗贏得了我們 Beta 測試人員的好評。

This week, we also announced our collaboration with Intelsat, which brings multi-orbit satellite connectivity to more of our customers' machines so they can access our full suite of precision offerings from remote locations. We have been judicious in our approach to connecting [solar] space. We needed to partner with technology that would work in farm severe operating environments. Intelsat's antennas had the proven -- have been proven in critical applications and inhospitable conditions, so we can bring them to market quickly with confidence they will perform. We also serve customers in areas where low orbit satellites do not consistently reach Intelsat's multi-orbit constellation of satellites by its greater coverage with a stronger connection.

本週，我們還宣布與 Intelsat 合作，為更多客戶的機器帶來多軌道衛星連接，以便他們可以從遠端位置存取我們的全套精密產品。我們在連接[太陽能]空間的方法上一直非常明智。我們需要與能夠在農場惡劣的操作環境中工作的技術合作。 Intelsat 的天線經過驗證，已在關鍵應用和惡劣條件下得到驗證，因此我們可以放心地將其快速推向市場，並對其性能充滿信心。我們還透過更大的覆蓋範圍和更強的連接，為低軌道衛星無法始終到達 Intelsat 多軌道衛星星座的地區的客戶提供服務。

Becoming a more productive company is a key part of our strategy and successfully executing our cost reduction program plays an important role. We continue to drive production cost savings through procurement, logistics and manufacturing efficiencies. Some of those savings are held on the balance sheet at the quarter, and as we build inventory for the coming season, we are confident in our full year targets. The absolute dollar impact of these savings is somewhat continue upon production levels, which we will adjust as industry man necessitates. As mentioned earlier, the First phase of our restructuring program has been implemented, and we have imposed strict discipline on our discretionary spending. We are already working on additional ejects such as expanding support operations in low-cost countries.

成為更俱生產力的公司是我們策略的關鍵部分，成功執行我們的成本削減計劃發揮著重要作用。我們繼續透過提高採購、物流和製造效率來節省生產成本。其中一些節省的費用保留在本季度的資產負債表上，當我們為下一季建立庫存時，我們對全年目標充滿信心。這些節省的絕對美元影響在一定程度上會持續影響生產水平，我們將根據業內人士的需要進行調整。如同前面所提到的，我們第一階段的重組計畫已經實施，我們對可自由支配的支出實施了嚴格的紀律。我們已經在努力開展其他項目，例如擴大在低成本國家的支援業務。

I will now turn the call over to Oddone to take us through the financial results.

現在我將把電話轉給奧多恩，讓我們了解財務表現。

Thank you, Scott, and good morning, good afternoon to everyone on the call. First quarter industrial net sales were down 14% year-over-year to $4.1 billion. This decline was mainly due to lower ag volumes in all regions, partially offset by net price realization. Adjusted net income decreased by 11% with adjusted EPS down $0.02 to $0.33. Higher net income from financial services, lower tax rate from discrete tax adjustments and lower share count, all contributed to the relative strength of the unit's earnings per share.

謝謝你，史考特，祝所有參加電話會議的人早安、下午好。第一季工業淨銷售額年減 14% 至 41 億美元。這一下降主要是由於所有地區的農產品銷售下降，但部分被淨價實現所抵消。調整後淨利下降 11%，調整後每股收益下降 0.02 美元至 0.33 美元。來自金融服務的較高淨利潤、離散稅收調整帶來的較低稅率以及較低的股票數量，所有這些都對該部門每股收益的相對強勢做出了貢獻。

Industrial free cash flow was an outflow of $1.2 billion. And outflow is normal in Q1 as we will finish good inventory in support of the Q2 selling season. And this year, we had additional working capital impacts from lower production levels. In agriculture, the net sales decrease of 14% in the quarter was driven by lower volumes and the year-over-year impact of [better] stocking. The earning inventories grew significantly in the first quarter of 2023 as our supply chain was dramatically improving, [one] in 2024 delivered by (inaudible) slightly decreased at the global level.

工業自由現金流流出 12 億美元。第一季的流出是正常的，因為我們將完成良好的庫存以支援第二季的銷售季節。今年，生產水準下降對我們的營運資本產生了額外的影響。在農業領域，本季淨銷售額下降 14%，原因是銷量下降以及[更好]庫存的同比影響。隨著我們的供應鏈大幅改善，獲利庫存在 2023 年第一季顯著成長，[一個] 2024 年交付的（聽不清楚）全球水準略有下降。

Lower sales volumes were partially offset by favorable price realization despite some fierce competitive pricing pressure, especially in South America. Gross margin for ag was 23.8%, down from 26.2% in Q1 2023, but up sequentially from Q4. The main driver for the margin compression is the lower volumes with production hours 22% lower compared to the first quarter of 2023, which impacted fixed cost absorption. But we were able to reduce product costs for the manufacturing efforts despite continued labor equation. As Scott mentioned, not all of the product cost actions implemented in Q1 were realized in the quarter P&L. Unic (inaudible) company inventory keep those savings on the balance sheet until they are sold to dealers.

儘管存在激烈的競爭定價壓力，尤其是在南美洲，但銷售下降被有利的價格實現所部分抵消。農業毛利率為 23.8%，低於 2023 年第一季的 26.2%，但較第四季有所上升。利潤壓縮的主要驅動因素是產量下降，生產時間比 2023 年第一季減少了 22%，影響了固定成本的吸收。但儘管勞動力不平等持續存在，我們仍能降低製造工作的產品成本。正如史考特所提到的，並非第一季實施的所有產品成本行動都在本季損益表中實現。 Unic（聽不清楚）公司的庫存將這些節省的資金保留在資產負債表上，直到將其出售給經銷商。

The SG&A savings of $33 million reflects our restructuring program and help mitigate the decremental margins. Adjusted EBIT margin was 12.5% to 100 basis points lower than last year. In Construction, net sales for the first quarter were down about 11%, mostly due to lower volumes with net pricing about flat. Gross margin increased by 150 basis points to 17.4% as improved product cost more than offset the volume impact. Adjusted EBIT also benefited from the lower SG&A expenses ending the quarter at 6.7% EBIT margin, well above last year's group levels.

SG&A 節省 3300 萬美元反映了我們的重組計劃，並有助於緩解利潤下降。調整後息稅前利潤率比去年低 12.5% 至 100 個基點。在建築業，第一季淨銷售額下降約 11%，主要是由於銷量下降而淨定價基本持平。由於產品成本的改善抵銷了銷售的影響，毛利率成長了 150 個基點，達到 17.4%。調整後的息稅前利潤也受惠於銷售、管理及行政費用的降低，本季息稅前利潤率為 6.7%，遠高於去年的集團水準。

Net income of Financial Services was $118 million, a $40 million increase compared to Q1 2023. The notable improvement was mostly driven by solid market gains but the adjustment to higher interest rates is now largely completed on the receivable portfolio. We also had improved volumes across regions and a favorable effective tax rate. Retail originations in the quarter were $2.5 billion, up $300 million compared to the same period of 2023 as we continue capturing a high percentage of our end customers' equipment financing needs. The managed portfolio at the end of the quarter was nearly $29 million -- $29 billion, up over $4 billion compared to the prior year. You will note that delinquencies ticked up in the quarter, which is normal when market contracts. Higher delinquency are in pockets of our portfolio and mainly in South America, where we are seeing more frequent late payments, but no increase in credit losses so far.

金融服務淨利為1.18 億美元，比2023 年第一季增加4,000 萬美元。 。我們也提高了各地區的銷售量和有利的有效稅率。由於我們持續滿足終端客戶設備融資需求的高比例，本季零售發起額為 25 億美元，比 2023 年同期增加 3 億美元。截至本季末，管理的投資組合規模接近 2,900 萬美元，即 290 億美元，比前一年增加了 40 億美元以上。您會注意到，本季拖欠率有所上升，這在市場收縮時是正常的。較高的拖欠率出現在我們的投資組合中，主要是在南美，我們看到那裡的逾期付款更加頻繁，但迄今為止信用損失並沒有增加。

The delinquency rates we are seeing now are at the same or lower levels than in previous downturns. Our credit reserves are properly set to protect our future profitability. Finally, just a quick note on our capital allocation priorities and specifically, on shareholder returns. We repurchased over $580 million worth of stock in the first quarter as we completed our $1 billion extraordinary buyback program and move on to the new $500 million program in March.

我們現在看到的拖欠率與之前的經濟低迷時期持平或更低。我們適當設定信貸儲備以保護我們未來的獲利能力。最後，簡單介紹一下我們的資本配置優先事項，特別是股東回報。我們在第一季回購了價值超過 5.8 億美元的股票，完成了 10 億美元的特別回購計劃，並於 3 月開始了新的 5 億美元計劃。

We continue to buy shares now, and we pay our annual dividend of about $600 million in the coming weeks. CNH is a cash-generating business and net M&A needs, it is our goal to return back to our shareholders, nearly 100% of industrial free cash flow through dividends and share buybacks.

我們現在繼續購買股票，並將在未來幾週內支付約 6 億美元的年度股息。 CNH是一項產生現金和淨併購需求的業務，我們的目標是透過股利和股票回購來回報股東，近100%的工業自由現金流。

And with that, I will now turn it back to Scott and come back for the Q&A.

現在，我將把它轉回斯科特並回來進行問答。

All right. Thank you, Oddone. Reviewing the full year outlook for agriculture, our forecast for tractors is largely in line with previous projections, albeit moving more towards the lower end of our range. We have reduced our expectations for combined industry volumes in both EMEA and South America. In aggregate for our key markets, we now estimate that agriculture industry retail sales will be down about 15%, putting us at the low end of our previous guidance.

好的。謝謝你，奧多內。回顧全年農業前景，我們對拖拉機的預測與先前的預測基本一致，儘管更接近我們範圍的下限。我們降低了對歐洲、中東和非洲和南美洲產業綜合銷售的預期。就我們的主要市場而言，我們現在估計農業零售額將下降約 15%，處於先前指導的低端。

Consequently, we are lowering our 2024 agriculture net sales forecast to decrease by 11% to 15% 2023, now previous projection of down 8% to 12%. This reduction only to lower industry demand and our intention to keep channel inventory in check. With this lower volume, we will decrease our EBIT margin forecast by 50 basis points to between 13.5% and 14.5%. In Construction, we have slightly improved our industry forecast for heavy products in North America but marginally lowered the projection for light equipment in APAC. In the aggregate, we still expect industry volumes to be down about 10%. We are reaffirming our net sales and EBIT margin forecast with sales down 7% to 11% and EBIT margins flat year-over-year at 5% to 6%.

因此，我們將 2024 年農業淨銷售額預測下調 11% 至 2023 年 15%，先前的預測下調 8% 至 12%。這種減少只是為了降低產業需求以及我們控制通路庫存的意圖。由於銷售量下降，我們將息稅前利潤率預測下調 50 個基點，至 13.5% 至 14.5% 之間。在建築業，我們略微提高了對北美重型產品的行業預測，但小幅降低了對亞太地區輕型設備的預測。總體而言，我們仍預期產業銷量將下降約 10%。我們重申淨銷售額和息稅前利潤率預測，銷售額下降 7% 至 11%，息稅前利潤率同比持平，為 5% 至 6%。

Combining the agriculture and construction net sales forecast, industrial net sales are expected to be down 10% to 14% versus last year, with industrial free cash flow now estimated at $1.1 billion to $1.3 billion. We've also driven the EPS projection by $0.05 to $1.45 to $1.55.

結合農業和建築業淨銷售額預測，工業淨銷售額預計將比去年下降 10% 至 14%，工業自由現金流目前估計為 11 億美元至 13 億美元。我們還將 EPS 預測上調了 0.05 美元至 1.45 美元至 1.55 美元。

What I would like you to take away from our call today is that we are on track to execute our strategy which will see us through the downturn while strengthening our position for the inevitable upswing. We have built a leaner and more resilient company that puts our customers at the center of everything we do. We have a deeply ingrained focus on margin and market share improvement as we continue on the path of marrying great iron with great tech. We've simplified our capital market profile with a single listing in New York and we have an experienced team who under Gerrit's leadership will take CNH to even greater heights. Gerrit and I have worked together since I joined CNH and he is not only a strong operator and a highly respected colleague. He's a good friend whom I have tremendous confidence in. I'm grateful for my time at CNH and would like to sincerely thank our hardworking team. I will remain a significant shareholder and a cheerleader.

我希望您從我們今天的電話會議中了解到的是，我們正在執行我們的策略，這將幫助我們渡過低迷時期，同時鞏固我們的地位，迎接不可避免的經濟復甦。我們建立了一家更精簡、更有彈性的公司，將客戶置於我們所做的一切的中心。隨著我們繼續走上將優質鋼鐵與優質技術相結合的道路，我們對利潤率和市場份額的提高有著根深蒂固的關注。我們透過在紐約單一上市簡化了我們的資本市場概況，我們擁有一支經驗豐富的團隊，在 Gerrit 的領導下，他們將把 CNH 推向更高的高度。自從我加入 CNH 以來，Gerrit 就和我一起工作，他不僅是一位強大的操作員，也是一位備受尊敬的同事。他是我非常信任的好朋友。我仍將是重要股東和啦啦隊長。

Thank you all. Briana, that concludes our prepared remarks. If you could open the line for questions.

謝謝你們。 Briana，我們準備好的演講到此結束。如果您可以開啟提問專線。

(Operator Instructions) Your first question comes from Mig Dobre with Baird.

（操作員說明）您的第一個問題來自 Baird 的 Mig Dobre。

It's a shame to see you go, and I understand your comments about the circumstances around your departure, but I do want to ask, timing-wise, you're stepping down here before we're really kind of seeing the fruits of your labor. You and the team over the past couple of years have done a lot to transform the business. So I guess 2 questions around that. As you're sort of looking at the execution or operating momentum, how do you sort of frame that relative to your expectations when you first sort of designed the strategy and the plan? And the second thing is, how is Gerrit coming into all of this, right? I mean how familiar is with the strategy that you put in place? Is it fair for shareholders to expect Gerrit to maybe take the company in a different direction than the course that it's in? What is your communication with him been so far?

看到你離開真是一種恥辱，我理解你對你離開時的情況的評論，但我確實想問，從時間上來說，在我們真正看到你的勞動成果之前，你就從這裡辭職了。在過去的幾年裡，您和您的團隊為業務轉型做了許多工作。所以我想有兩個問題。當您專注於執行或營運勢頭時，當您第一次設計策略和計劃時，您如何根據您的期望來建立它？第二件事是，Gerrit 是如何參與這一切的，對吧？我的意思是你對你所製定的策略有多熟悉？股東期望 Gerrit 可能帶領公司走向與目前不同的方向，這公平嗎？到目前為止您與他的溝通狀況如何？

Yes. Well, I mean, first of all, as I said in the prepared remarks, I'm just really thankful for the impressive work the team did delivering margin expansion, changing into a customer, all of the stuff that we've accomplished. Part of the reason that I'm comfortable leaving is that the team has really -- and I said -- I mean it's an ingrained culture of focusing on customers and delivering margins and that doesn't change. Part of -- I mean, again, I have a tremendous vested interest in the ongoing success of this company. And Gerrit and I have had ongoing dialogues since this was announced. He didn't run the ag businesses, but he watched in all of the operating reviews.

是的。嗯，我的意思是，首先，正如我在準備好的發言中所說，我真的很感謝團隊在實現利潤擴張、轉變為客戶以及我們所完成的所有事情方面所做的令人印象深刻的工作。我之所以願意離開，部分原因是該團隊確實——我說過——我的意思是，這是一種根深蒂固的文化，專注於客戶和提供利潤，而這種文化不會改變。我的意思是，我對這家公司的持續成功有著巨大的既得利益。自從宣布這一消息以來，格里特和我一直在進行對話。他並不經營農業業務，但他觀看了所有的營運評論。

He's intimately familiar with how we do this. Obviously, he's going to put his on things, but you can't -- ultimately, if you think about -- if you step way back, what our strategy is, it's about margin share -- market share gains and margin expansion. And I don't care who's running the company. Those are the 2 value creation levers that we're going to have. Now how we get to those things could change. But if you look at the construction results that Stefano's team delivered. You look at what Derek's done over the last 3 years, there is a lot of momentum that's going to carry forward, whether I'm here or not.

他非常熟悉我們如何做到這一點。顯然，他會把他的想法放在一些事情上，但你不能——最終，如果你想一想——如果你退後一步，我們的策略是什麼，它是關於利潤份額——市場份額的成長和利潤的擴張。我不在乎誰在經營這家公司。這些是我們將擁有的兩個價值創造槓桿。現在我們實現這些目標的方式可能會改變。但如果你看看 Stefano 團隊交付的施工成果。你看看德里克過去三年所做的一切，無論我是否在這裡，都有很大的動力繼續前進。

Understood. And my follow-up. Maybe a question on dealer inventories. I'd love to get your perspective as to what you're seeing in the channel. And I'd appreciate it if you could comment by geography and also by segment. I'm curious what you're seeing in construction as well as that.

明白了。還有我的後續行動。也許是關於經銷商庫存的問題。我很想了解您對頻道中看到的內容的看法。如果您能按地理位置和細分市場發表評論，我將不勝感激。我很好奇你在建築中看到了什麼。

All right. Well, I'll start with construction. Stefano and his team continue to do well. That was a different scenario because we had -- throughout last year, we got ahead of ourselves a little bit on agricultural shipments. But construction really never had that, and especially the strong retail performance they had in the fourth quarter allowed us to be in a much better position overall on construction.

好的。好吧，我將從構建開始。斯特凡諾和他的團隊繼續表現出色。這是一個不同的情況，因為去年全年，我們在農產品運輸方面有點超前了。但建築業確實從未有過這樣的情況，尤其是第四季度強勁的零售業績使我們在建築業整體上處於更好的位置。

So we'll essentially shift to demand there throughout the year. On the ag side, again, we had a good market share performance in the first quarter. But despite somewhat significant production cuts, we still did not decrease dealer inventory at the levels we wanted to. So we've got work to do. We'll get most of that done in the second quarter. Combines are -- we talked about that in the prepared remarks. Combines are where we're seeing the most pressure. There's used inventory building up. Demand is down quite considerably. So we'll adjust that as we go forward. But interestingly, the North American tractor market is still pretty strong. But we're overall committed to getting the biggest chunk of dealer inventory done in Q2. So probably some will carry into Q3, but I think we're in pretty good shape there.

因此，我們全年基本上都會轉向那裡的需求。在農業方面，我們在第一季再次取得了良好的市佔率表現。但儘管減產幅度較大，我們仍然沒有將經銷商庫存減少到我們想要的水平。所以我們還有工作要做。我們將在第二季完成大部分工作。聯合收割機是——我們在準備好的發言中談到了這一點。聯合收割機是我們壓力最大的地方。二手庫存不斷增加。需求大幅下降。因此，我們將在前進過程中對此進行調整。但有趣的是，北美拖拉機市場仍然相當強勁。但我們總體上致力於在第二季完成經銷商庫存的最大部分。所以可能有些會延續到第三季度，但我認為我們的狀態相當不錯。

Your next question comes from Jamie Cook with Truist.

您的下一個問題來自傑米庫克和 Truist。

Scott, sorry to see you going because you've done a great job with the company. So I guess my first question, just on production cuts, Scott, I know you said you have more to do in the second quarter. Can you talk to how much you think you're going to underproduce retail demand? And do you still think that you will be in a position where as we exit 2024, that we should be able to produce in line with retail demand, given just your view of the market today? And then my second question, given the stock underperformance, based on concerns about the magnitude of the downturn management changes that sort of weren't expected. I'm sort of wondering how you guys are thinking about utilizing your balance sheet. I know you've done a lot in terms of share repurchase. A lot of that was associated with the delisting, but just to give the market confidence, I guess, that there still is a cost and market share story there. So I'll wrap up with those two.

史考特，很遺憾看到你離開，因為你在公司做得很好。所以我想我的第一個問題是關於減產，史考特，我知道你說過第二季還有更多工作要做。能談談您認為零售需求的生產不足程度嗎？鑑於您對當今市場的看法，您是否仍然認為，當我們退出 2024 年時，我們應該能夠根據零售需求進行生產？然後是我的第二個問題，考慮到股票表現不佳，基於對低迷時期管理層變化幅度的擔憂，這種變化是出乎意料的。我有點想知道你們是如何考慮利用資產負債表的。我知道你們在股票回購方面做了很多工作。其中很多都與退市有關，但我想，這只是為了給市場帶來信心，因為那裡仍然存在成本和市場份額的問題。那我就以這兩個人來結束吧。

Thanks, Jamie. No, we feel really good about -- I mean, the production adjustments, Derek and his team because it's mostly an ag phenomenon, but have really looked at the ongoing production for the next 3 quarters. And there's -- I mean, unless there is -- I mean, obviously, we can't predict exactly what the market is going to do. But given the ranges that we are expecting, we will be shipping to demand not only in 2025 but later in 2024. So that I'm pretty confident in. Oddone, you want to talk about the share buybacks and where we stand.

謝謝，傑米。不，我們對——我的意思是，生產調整感到非常滿意，德里克和他的團隊，因為這主要是一種農業​​現象，但我們確實關注了未來三個季度的持續生產。我的意思是，除非有——我的意思是，顯然，我們無法準確預測市場將如何發展。但考慮到我們預期的範圍，我們不僅會在 2025 年而且會在 2024 年晚些時候滿足需求。

Yes. So I had in my prepared remarks that we completed the $1 billion program. We started a new $500 million in March, and we are burying on that program. We're going to pay $600 million in dividends this year.

是的。因此，我在準備好的發言中表示，我們完成了 10 億美元的計畫。我們在三月啟動了新的 5 億美元項目，我們正在埋頭苦幹這個項目。今年我們將支付 6 億美元的股息。

So if you add up, it's a considerable amount of money that is going out to shareholders. And if we consider the behavior we are having now on share buyback and our dividend, we don't expect to change our dividend policies. Basically, almost 100% of our free industrial free cash flow will be devoted to -- back to shareholders if we exclude any M&A that we may have considered that we don't have any large M&A upside right now.

因此，如果加起來，就會有大量資金流向股東。如果我們考慮到我們現在在股票回購和股利方面的行為，我們預計不會改變我們的股利政策。基本上，如果我們排除任何我們可能認為目前沒有任何大型併購優勢的併購，我們幾乎 100% 的自由工業自由現金流將專門用於回報股東。

Your next question comes from Nicole DeBlase with Deutsche Bank.

您的下一個問題來自德意志銀行的 Nicole DeBlase。

I guess maybe starting with picking up where Jamie just left off on production and ag. Is the expectation that the worst year-on-year production decline occurs in the second quarter? And then guys kind of get back to more modest declines in 3Q, just maybe putting a finer point on the quarterly cadence in the ag segment.

我想也許可以從傑米剛剛停下來的製作和農業開始。預計最嚴重的年產量跌幅是否會出現在第二季？然後，第三季的跌幅會有所回升，也許只是對農業領域的季度節奏提出了更好的看法。

Yes, that's true, and it's also true because of the compares year-over-year, that the compares get a lot easier for us in the second half. So that -- but also we're pretty confident. And I mean, the production cuts are one half of it. The other part is what we do, driving retail, and I'm really confident in how the team is working closely with our dealer partners to make sure that we accelerate and capture every one of those where we can.

是的，確實如此，而且由於逐年比較，下半年的比較對我們來說變得容易多了。所以，我們也非常有信心。我的意思是，減產只是其中一半。另一部分是我們所做的事情，即推動零售業的發展，我對團隊如何與我們的經銷商合作夥伴密切合作以確保我們加速並抓住每一個可能的領域充滿信心。

I will since I mentioned it. I will talk about the fact that we're not going to chase and I -- we're going to be disciplined. And when some of our competitors will really discount things to get sales, and we're not going to do that. And I think you see the price realization that we're talking to, we're being -- we're going to drive for market share gains. We're going to drive for retail efficacy, but we are going to be very disciplined on managing price through that.

我會的，因為我提到了它。我會談論這樣一個事實：我們不會追逐，而且我們會遵守紀律。當我們的一些競爭對手真的會打折以獲取銷量時，我們不會這樣做。我認為你看到了我們正在談論的價格實現，我們將推動市場份額的成長。我們將提高零售效率，但我們將非常嚴格地管理價格。

Got it. That's helpful. And then just maybe 1 on construction. The margin performance was really impressive there this quarter. you guys have still maintained the guidance for 5% to 6% for the full year implies a step down from first quarter results. I guess what's driving that?

知道了。這很有幫助。然後可能只有 1 個關於構建。本季的利潤率表現確實令人印象深刻。你們仍然維持全年 5% 至 6% 的指導，這意味著較第一季業績有所下降。我想是什麼推動了這一點？

Well, first of all, you can't not recognize the significant improvement in margins as Stefano and his team have drawn. But the reason we didn't raise it most -- a good bit of the beat in the first quarter was related to ongoing strike impact that we had in the first quarter of last year that doesn't repeat throughout the year.

嗯，首先，你不可能不認識到斯特凡諾和他的團隊所取得的利潤率的顯著提高。但我們沒有提高最多的原因是——第一季的大幅成長與我們去年第一季持續的罷工影響有關，這種影響在全年都不會重複。

Your next question comes from David Raso with Evercore.

您的下一個問題來自 Evercore 的 David Raso。

I'm just trying to square up in ag. The sales guide is down 13%, but your end market outlook is down 15%. Obviously, the parts business itself doesn't move around as much as unit forecast for the industry, the complete goods. In the fourth quarter of last year, you did underproduce retail. So I appreciate those 2 offsetting factors. But when you're thinking about the rest of the year, I don't think pricing is that high. I'm just trying to square up how much are we really underproducing if the sales guide isn't down as much as your industry guide? This is my first question. Just trying to make sure that we're level setting where you expect inventory to end the year. Just the math isn't working for me as easily as I would have liked.

我只是想在ag中擺平。銷售指南下降了 13%，但您的最終市場前景下降了 15%。顯然，零件業務本身的變動幅度並不像產業整體產品的單位預測那麼大。去年第四季度，零售業的產量確實不足。所以我很欣賞這兩個抵消因素。但當你考慮今年剩餘時間時，我認為定價不會那麼高。我只是想計算一下，如果銷售指南沒有像你們的行業指南那樣下降那麼多，那麼我們到底生產不足了多少？這是我的第一個問題。只是想確保我們將年底庫存設定在您預期的水平。只是數學對我來說並不像我希望的那麼容易。

Well, that need some mix in there. There is a market share consideration, and we expect to gain market to outperform the market this year. If you look at how we behave compared to the market last year in some parts of the world, and I will look at South America first that we have space to recover into the production or sales to market deal. I mean it's a question of stocking and destocking the dealers we had stock our dealers in the first quarter of last year.

嗯，這需要一些混合。有市場份額的考慮，我們預計今年能獲得市場跑贏大盤。如果你看看我們與去年世界某些地區的市場相比的表現，我會先看看南美洲，我們有空間恢復生產或銷售市場交易。我的意思是，這是我們去年第一季為經銷商庫存的庫存和去庫存問題。

We -- our dealers are kept -- have kept their stops basically flat this year, it was slightly down this quarter, sorry. And we expect to have inventories at the end of stock -- dealer inventories at the end of the year, lower from where they were at the end of last year. But most of the network has been done there.

我們——我們的經銷商——今年的停損基本上保持不變，抱歉，本季略有下降。我們預計年底的庫存——經銷商的庫存將低於去年年底的水平。但大部分的網路都是在那裡完成。

And don't forget, our penetration of technology sales is improving as well throughout the year.

不要忘記，我們的技術銷售滲透率全年都在提高。

Yes. I mean it feels like there's at least enough market share there to have to put that into the equation because when you look at the mix, it's actually high ticket items that are down more than the low ticket items, right? Brazil combines, really combines around the world as well as even within North America. It's the larger tractors that are down. That's why. But obviously, there's a market share component there.

是的。我的意思是，感覺那裡至少有足夠的市場份額，必須將其納入等式中，因為當你查看組合時，實際上高價商品比低價商品降價更多，對嗎？巴西聯合起來，真正聯合了世界各地，甚至包括北美地區。停產的是較大的拖拉機。這就是為什麼。但顯然，其中有市場佔有率的成分。

Lastly, on the margins for the rest of the year in ag, and if you square that up with what you're trying to insinuate on Slide 9 of how much savings are left for the year? And I know that covers both segments. So I guess the question is on price cost, for and price cost in general, does the math suggests not -- and I'm just trying to square up the market share, but are we not changing the price look? So I'm just trying to square all this up.

最後，關於農業今年剩餘時間的利潤，如果你將其與你在幻燈片 9 上試圖暗示的今年還剩下多少儲蓄相結合？我知道這涵蓋了這兩個部分。所以我想問題在於價格成本，對於一般的價格成本，數學是否表明不是——我只是想平衡市場份額，但我們是否沒有改變價格外觀？所以我只是想把這一切擺平。

No, it hasn't. It hasn't. I mean, we still have the same consideration in pricing that we had before, so modest -- if you're talking a, right, modest -- very modest price increase, but some price increase and continued reduction in our cost of production, and then positive impact of our SG&A actions. .

不，還沒有。還沒有。我的意思是，我們在定價方面仍然有與以前相同的考慮，所以適度——如果你說的是，對的，適度的——非常適度的價格上漲，但價格有所上漲，生產成本持續下降，然後是我們的 SG&A 行動的正面影響。 。

Your next question comes from Mike Shlisky with D.A. Davidson.

你的下一個問題來自 D.A. 的 Mike Shlisky。戴維森。

Scott, I'll add my best wishes to you as well. I wanted to talk quickly on pricing in ag. You mentioned positive pricing in the quarter. And I know that's just -- that's wholesale, not necessarily retail where there was some discounting happening around the world from your competitors, but I would just say that you're just kind of broadly speaking, when you price to farmers, you're not looking to kind of play that game right now. And is that implying that maybe you're trying to keep things open for some growth in 2025?

史考特，我也向你致以最美好的祝福。我想快速談談農業的定價。您提到了本季的積極定價。我知道這只是批發，不一定是零售，世界各地的競爭對手都會有一些折扣，但我只想說，從廣義上講，當你向農民定價時，你現在不想玩那個遊戲。這是否意味著您可能正在努力保持開放，以便在 2025 年實現一些成長？

I mean, obviously, we're going to do everything we can to position ourselves for growth in the years ahead. But right now, it's just being disciplined on price realization. And -- like I said before, this is a -- we were mostly covering costs before. But Derek and his team have really done a nice job. And it's a region-by-region execution. It's not a -- we don't have a universal policy. And I think what we're striving to do is get price where we can, get price where it makes sense, but get market share and retail acceleration to the extent we can. And I think the team has done a really good job region by region, executing that strategy. And we're comfortable that as we exit the year. And again, most proud of what [Rafa] and the team have done down in South America, just really having us in very, very good dealer inventory position.

我的意思是，顯然，我們將盡一切努力為未來幾年的成長做好準備。但目前，它只是在價格實現方面受到約束。而且 - 就像我之前說的，這是 - 我們之前主要承擔成本。但德里克和他的團隊確實做得很好。這是一個逐個區域的執行。這不是——我們沒有通用的政策。我認為我們正在努力做的是盡可能地獲得價格，獲得有意義的價格，但盡可能地獲得市場份額和零售加速。我認為該團隊在執行該策略方面做得非常好。當我們結束這一年時，我們對此感到滿意。再說一次，最值得自豪的是[拉法]和團隊在南美洲所做的一切，真的讓我們處於非常非常好的經銷商庫存位置。

So as soon as that market turns, we'll be able to take full advantage of what happens. So I think it's reasonable to assume that what we did in the first quarter with pricing will maintain throughout the year.

因此，一旦市場發生轉變，我們就能夠充分利用所發生的情況。因此，我認為可以合理地假設我們在第一季所做的定價將在全年保持不變。

Okay. Great. And then a follow-up on how you grow your tech stack. I guess I'm curious with the Intelsat agreement, are there any onetime costs that will take place this year or next to get either the software or the hardware upgraded on current systems and any future systems that get sold to the farmers here? Or is it kind of baked in each individual sale or some other way to account for kind of layering in Intelsat capabilities here?

好的。偉大的。然後跟進如何發展你的技術堆疊。我想我對國際通訊衛星協議感到好奇，今年或明年是否會產生一次性成本，以升級當前系統以及出售給這裡農民的任何未來系統的軟體或硬體？或者它是在每次單獨銷售中烘焙的還是某種其他方式來解釋國際通訊衛星組織能力的分層？

No. I mean part of the reason that we went with Intelsat is because of the proven ruggedness of what they do, which lowers the amount of validation work. I wouldn't I mean, I'm reluctant to ever call anything plug-and-play anymore, but it's about as close as we can get. And Marc Kermisch and his team have really done a good job of evaluating the opportunities and ensuring that this is something that we can run. The first market to benefit from this will be Brazil, and that will happen later in the year.

不，我的意思是我們選擇 Intelsat 的部分原因是因為他們所做的事情經過驗證的堅固性，這減少了驗證工作量。我並不是說，我不願意再稱任何東西為“即插即用”，但這已經是我們能做到的最接近的了。馬克·科米施 (Marc Kermisch) 和他的團隊在評估機會並確保這是我們可以運作的方面確實做得很好。第一個受益於此的市場將是巴西，這將在今年稍後發生。

Your next question comes from Kristen Owen with Oppenheimer.

您的下一個問題來自克里斯汀歐文和奧本海默。

And Scott also best wishes to you. I wanted to ask about the market share comments. This being obviously 1 of the 2 biggest drivers that you have going forward. You highlighted the outperformance relative to industry in the first quarter. Just wondering how much of the market share gains that you're seeing are this recovery given last year, you mentioned you're still comping some of the strike implications. What's you're regaining there? And how well positioned you are from a market share perspective? And do you anticipate that, that will be incremental market share versus just making up what you lost? And then I have a follow-up question on the stack.

斯科特也向你致以最良好的祝愿。我想問一下市場佔有率的評論。這顯然是您未來發展的兩個最大驅動因素之一。您強調了第一季相對於業界的優異表現。只是想知道您所看到的市場份額增長有多少是去年的復甦帶來的，您提到您仍在計算一些罷工的影響。你在那裡恢復了什麼？從市場佔有率的角度來看，您的定位如何？您是否預計這會增加市場份額，而不是僅僅彌補您失去的市場份額？然後我有一個關於堆疊的後續問題。

Well, we made up throughout the year last year, I was really proud of the work the team in (inaudible) did to just accelerate our production throughout the year. And I think we're there, again, about to making to demand. It's a street fight out there. And I'd tell you that a lot of what we've done is just a driving customer-centric customer focused.

好吧，我們去年一整年都彌補了這一點，我對團隊（聽不清楚）為加速我們全年的生產所做的工作感到非常自豪。我認為我們再次將根據需求進行生產。這是一場街頭鬥毆。我想告訴你，我們所做的很多事情只是以客戶為中心，以客戶為中心。

And I think you're seeing that play out with our dealers as we're able to win more of those battles throughout the year. But I mean don't expect big -- I mean it is a battle. And I'm not suggesting it's easy, but I think what you saw in the first quarter is the team's ability to execute that. And what we've guided is the expectation that, that will continue. But it really is -- the product portfolio is quite strong right now. And as you've seen with some of the announcements of late, it's just getting better. So we feel like technology is getting better, the product portfolio is getting better, the team's execution getting better. And if you do all of that, you can have to expect the market share gets better.

我認為您會看到我們的經銷商正在發揮作用，因為我們能夠在全年贏得更多這樣的戰鬥。但我的意思是不要期待太大——我的意思是這是一場戰鬥。我並不是說這很容易，但我認為你在第一季看到的是團隊執行這一點的能力。我們所引導的是這種情況將持續下去的期望。但事實確實如此——目前的產品組合相當強大。正如您在最近發布的一些公告中看到的那樣，情況正在變得更好。所以我們覺得技術越來越好，產品組合也越來越好，團隊的執行力也越來越好。如果你做到了所有這些，你就可以預期市場佔有率會變得更好。

Right. So then a follow-up on the tech stack. I sort of talked a little bit about the Intelsat being as close to plug and play as it can get. I mean, is there an incremental modem? Or maybe help us understand like how you actually go about implementing that and (inaudible) fits in with the integration of Raven and Hemisphere GNSS, sort of what that unlocks for you on a go-forward basis?

正確的。那麼接下來就是技術堆疊的後續。我談到了國際通訊衛星組織盡可能接近即插即用的情況。我的意思是，有增量調變解調器嗎？或者也許可以幫助我們了解您實際上如何實施該方案以及（聽不清楚）與 Raven 和 Hemisphere GNSS 的整合相適應，這在未來為您解鎖了什麼？

It is, and it kind of it goes on -- that we have to do, and that's the ruggedness we talked about. We've done -- I mean, for a long time, we figured out how to integrate different cell phone signals and everything into our operating system. So Mark and his team are really comfortable about their ability to integrate this quite seamlessly into both AFS Connect and PLM Connect going forward.

確實如此，而且這種情況還在繼續——我們必須這樣做，這就是我們談到的堅固性。我們已經完成了——我的意思是，很長一段時間以來，我們都想出瞭如何將不同的手機訊號和所有內容整合到我們的作業系統中。因此，Mark 和他的團隊對他們能夠將其無縫整合到 AFS Connect 和 PLM Connect 中感到非常滿意。

Your next question comes from Tami Zakaria with JPMorgan.

您的下一個問題來自摩根大通的 Tami Zakaria。

Scott, congrats on completing a very successful time leading (inaudible). I'll miss you but best of luck for the next chapter. My first question is -- sure. So my first question is, can you comment by geography, what you expect total sales decline in the ag segment to look like for this year, you're guiding to down 11% to 15% ag sales. Can you give me some color like how should we think about North America versus South America versus Europe for the year?

史考特，恭喜您完成了非常成功的領導時間（聽不清楚）。我會想念你的，但祝你下一章好運。我的第一個問題是──當然。所以我的第一個問題是，您能否按地理位置評論一下，您預計今年農業部門的總銷售額下降情況如何，您預計農業銷售額將下降 11% 至 15%。您能否給我一些建議，例如我們該如何看待今年的北美、南美和歐洲？

Well, South America is where we are seeing the highest declines in percentage terms. Europe as we commented, we also see industry down in the clients, in particular in the combined market. North America in percentage terms, declines are lower, but of course, the market is larger. So I would say the clients are across the board, right? They've hurt most or they are more intense in South America right now. And we may recover at the end of the year. But that's what we have. But I would say in every region, we have to find.

從百分比來看，南美洲是降幅最大的地區。正如我們評論的那樣，歐洲的客戶行業也出現下滑，特別是在綜合市場中。從百分比來看，北美地區的跌幅較低，但當然，市場規模更大。所以我想說客戶是全面的，對嗎？他們現在在南美洲受傷最嚴重或更嚴重。我們可能會在年底恢復。但這就是我們所擁有的。但我想說，在每個地區，我們都必須找到。

Got it. Okay. That's very helpful. And then on the Construction business, I think the first quarter margin was quite impressive. Can you elaborate what really drove that? And also since we are -- I mean, the guide would imply Construction segment sales improving sequentially from here on. So I guess, why keep the full year guide unseen would margins not see improvement as well as total sales move up. .

知道了。好的。這非常有幫助。然後在建築業務方面，我認為第一季的利潤率相當可觀。您能詳細說明一下真正推動這一趨勢的原因嗎？而且，因為我們 - 我的意思是，該指南將意味著建築部門的銷售從現在開始將持續改善。所以我想，為什麼不公佈全年指南，利潤率不會改善，總銷售額也不會上升。 。

Yes. Well, again, we had some benefit in the first quarter compared to the year before that didn't have the Burlington cost in there. So that's part of the reason we're not guiding it. we do expect that pricing pressure will be greater in construction than it is in ag. So we're going to have to fight that battle to the extent we can. But you cannot talk about construction and I look at -- the portfolio expansion is helping drive both sales and margin. The relocation of production to low-cost regions has helped driving it. And Stefano and his team have done a really good job of improving quality. And all of those things contribute to margin, but we don't expect everything. And again, as we go throughout the year, the compare gets more difficult. So we feel like it's prudent right now.

是的。好吧，與沒有考慮伯靈頓成本的前一年相比，我們在第一季獲得了一些好處。這就是我們不提供指導的部分原因。我們確實預計建築業的定價壓力將比農業業更大。因此，我們必須盡我們所能去打這場仗。但你不能談論建設，我認為投資組合的擴張正在幫助推動銷售和利潤率。將生產轉移到低成本地區有助於推動這一趨勢。 Stefano 和他的團隊在提高品質方面做得非常好。所有這些因素都有助於利潤，但我們並不期望一切。再說一遍，隨著全年的進行，比較變得更加困難。所以我們覺得現在是謹慎的。

And again, you see it in the other -- our peers in construction, it's been a robust market but it's not going to get more robust throughout the year. If anything it's going to get less, and we're just prepared to that.

再說一次，你在另一個方面也看到了這一點——我們的建築同行，這是一個強勁的市場，但全年不會變得更加強勁。如果有的話，它會變得更少，我們已經準備好了。

Your next question comes from Angel Castillo with Morgan Stanley.

您的下一個問題來自摩根士丹利的安吉爾·卡斯蒂略。

Just wanted to maybe stick to the cost kind of conversation a little bit more. You talked about earlier, just kind of remaining cost focus even beyond the programs that you've kind of laid out. So given you've already done so much to improve operations, you mentioned again some of the changes you made in your cost structure, what kind of levers do you foresee or left to continue to pull beyond this to continue to improve that? That aren't kind of contemplated already in your cost initiatives.

只是想多堅持一下成本類型的對話。您之前提到過，除了您制定的計劃之外，仍然需要關注成本。鑑於您已經為改善營運做了很多工作，您再次提到了您在成本結構中所做的一些改變，您預計或留下什麼樣的槓桿來繼續超越這一點以繼續改進？您的成本計劃中尚未考慮到這一點。

Yes. Well, first of all, we talked about kind of putting a bow on this overall SG&A restructuring. At some point, you got to stop having anxiety amongst the team. And I think we're going to close that out in the second quarter. So the team can move on to different things when I leave it, that restructuring will have been effective and will be over with. But what doesn't stop is the work with CBS and our lean initiatives in the plant, that just gets better and better every week, every month, every quarter and every year. And that is building momentum throughout the organization. Our strategic sourcing program, it's -- I'm so impressed with the work the team has done but it is a slow buildup as we resource things where we need to, we implement new suppliers, integrate them into the machine.

是的。嗯，首先，我們討論了對整體銷售、管理及行政費用（SG&A）重組的討論。在某些時候，你必須停止在團隊中感到焦慮。我認為我們將在第二季完成這項工作。因此，當我離開時，團隊可以繼續做不同的事情，重組將是有效的並將結束。但與 CBS 的合作以及我們在工廠的精益計劃並沒有停止，每週、每月、每季和每年都變得越來越好。這正在整個組織內累積動力。我們的策略採購計畫——我對團隊所做的工作印象深刻，但這是一個緩慢的積累，因為我們在需要的地方提供資源，我們實施新的供應商，將它們整合到機器中。

So that is one that builds over time. And then what Oddone has been leading is almost a zero-based budgeting exercise. It's just a fundamental focus on cost in everything we do. And I think those 3 levers will put us in a position that we can continue to drive margin expansion well into the future.

所以這是隨著時間的推移而建立的。奧多內一直在領導的幾乎是零基預算工作。這只是我們所做的一切中對成本的根本關注。我認為這三個槓桿將使我們能夠在未來繼續推動利潤率擴張。

That's very helpful. And sorry to keep going back to this, but I just -- I'm still a little bit confused as to the construction outlook. So you talked about, I guess, kind of the Burlington impact and some of the onetime items on the margin side. But I think you talked about kind of an industry unit performance, at least in North America for heavy construction equipment that has improved to now kind of minus 5% to flat. How do we square that with your comment that pricing in this industry is probably tougher just given that it seems like the industry demand seems to be improving? So maybe any kind of help you can kind of give to kind of bridge that as well as any incremental color on retail sales and what you're seeing and maybe what's driving some of that heavy improvement for the year?

這非常有幫助。很抱歉繼續回到這個話題，但我只是——我對建設前景仍然有點困惑。所以我想你談到了伯靈頓的影響和一些邊緣方面的一次性項目。但我認為您談到了某種行業單位的績效，至少在北美的重型建築設備方面，該績效已改善至目前的負 5% 至持平。我們如何看待您的評論，即考慮到行業需求似乎正在改善，該行業的定價可能會更加困難？因此，也許您可以為橋樑提供任何幫助，以及零售銷售的任何增量色彩以及您所看到的情況，也許是什麼推動了今年的一些重大改善？

Well, I would say two things. One, the residential outlook in North America is not clear at this point. And with the latest news on the interest rates and all the rest, we are sort of prudent there. Secondly, our ability to maintain pricing, as Scott mentioned before, in construction is very much subject to the fluctuations of the overall market. .

好吧，我想說兩件事。第一，目前北美的住宅前景尚不清楚。考慮到有關利率和其他方面的最新消息，我們對此持謹慎態度。其次，正如史考特先前提到的，我們在建築領域維持定價的能力很大程度上受到整體市場波動的影響。 。

if construction is a very competitive market. Many players there, many players coming from overseas as well, not that much, not that much in North America, but in the other regions, we have competition from the Far East, which is quite intense and on pricing. And so our prudence in construction is on the pricing line, I would say.

如果建築是一個競爭非常激烈的市場。那裡有很多玩家，也有很多來自海外的玩家，在北美沒有那麼多，但在其他地區，我們有來自遠東的競爭，競爭非常激烈，而且在價格方面。所以我想說，我們在建設上的謹慎是在定價方面。

Your final question comes from Michael Feniger with Bank of America.

您的最後一個問題來自美國銀行的 Michael Feniger。

Scott, you were more cautious on the ag cycle, getting (inaudible) in a better position for the downturn kind of became clear. Just where we stand today, 450 corn, rates potentially staying higher for longer. If there's no significant change within some of these variables. Is it tough to grow on that in 2025? I'm just curious what you feel like at least your key customer, the puts and takes there that we should be kind of keeping our eye on as you're trying to position the company for 2025, leaving in a good place.

斯科特，您對農業週期更加謹慎，在經濟低迷時期處於更好的位置（聽不清楚）變得很明顯。就我們目前的情況而言，450 玉米的價格可能會在更長時間內保持在較高水平。如果其中一些變數沒有顯著變化。到 2025 年，繼續成長會困難嗎？我只是好奇你至少對你的關鍵客戶有什麼感覺，當你試圖為公司在 2025 年定位時，我們應該密切關注在那裡的看跌期權和拿貨情況，以取得一個好的位置。

Well, I've tried, obviously, coming into this business, there was a lot to learn. But if I learned anything, it's not to comment or opine on the ag cycle. So you're not going to trap me into saying something about 2025 on this call.

嗯，我已經嘗試過，顯然，進入這個行業，有很多東西要學習。但如果說我學到了什麼的話，那就不是對農業週期發表評論或意見。所以你不會讓我在這次電話會議上談論有關 2025 年的事情。

Fair enough, Scott. And then just one of the -- we talked a lot about margins and there's some commentary on market share. I'm just curious, beyond 2024, just -- what are the regions and product groups where you see the best line of sight to gain that share? Is it new product introductions, what you guys are doing on Raven? Do you feel like that ball is already going? Or is there some more levers that need to be pulled to really drive market share higher than maybe it was when you started and came to the company a few years ago?

很公平，斯科特。然後就是其中之一——我們談了很多關於利潤率的問題，還有一些關於市場佔有率的評論。我只是好奇，在 2024 年之後，您認為獲得這一份額的最佳視線是哪些地區和產品組？你們在 Raven 上做什麼，是新品推出嗎？你覺得那顆球已經開始了嗎？或者是否還需要採取更多的手段才能真正提高市場份額，而不是幾年前你剛加入公司時的水平？

The term we like to use is great iron and great tech. I mean when I started, we got -- regularly, people commented on, man, you guys have great iron, we just wish your tech to get there. And then part of what helps our market share in the future. And you saw, I mean, FieldOps this off-board management system is really, really good as we continue to develop MGMA or our system for AFS Connect and PLM Connect to give our customers better solutions, that all plays into it. But ultimately, it comes down to, I think, a couple of levers. It's our close working relationship with our dealers and our focus on delivering for our customers.

我們喜歡使用的術語是偉大的鋼鐵和偉大的技術。我的意思是，當我開始時，人們經常評論說，夥計，你們有很棒的鐵，我們只是希望你們的技術能夠實現這一點。這也是我們未來市場份額的一部分。我的意思是，您看到，FieldOps 這個場外管理系統真的非常非常好，因為我們繼續開發MGMA 或我們的AFS Connect 和PLM Connect 系統，為我們的客戶提供更好的解決方案，所有這些都發揮了作用。但最終，我認為，這取決於幾個槓桿。這是我們與經銷商的密切合作關係以及我們對為客戶提供服務的專注。

The CR 11, the new -- I mean, it's unbelievable what that does. That's -- we're going to have 25-ish, probably a little bit more because there's so much demand for (inaudible) of those machines operating in the field. And the incremental productivity that, that brings obviously, I think, is going to drive tremendous demand going forward. What we've done with the tractor portfolio, especially the European tractors and then soon upgrading the North American tractor platforms is all really good. And Derek has been investing a lot of money in some products, what I'll call white space that we could or should be in. So I think all of those bode well for the ability to gain market share in the future.

CR 11，新的——我的意思是，它的作用令人難以置信。也就是說，我們將擁有 25 台左右，可能更多一點，因為對（聽不清楚）現場運行的機器的需求非常大。我認為，這顯然會帶來生產力的提高，這將推動未來的巨大需求。我們在拖拉機產品組合上所做的一切，特別是歐洲拖拉機，以及很快升級的北美拖拉機平台，都非常好。德里克一直在某些產品上投入大量資金，我將其稱為我們可以或應該進入的空白區域。

There are no further questions at this time. This will conclude today's conference call. Thank you all for your participation. You may now disconnect.

目前沒有其他問題。今天的電話會議到此結束。感謝大家的參與。您現在可以斷開連線。