NAMA Shortcuts
Member Directory
Best of NAMA 2015
Upcoming Events
Chapters
Agri-Marketing Conf
More NAMA












1ST QUARTER: DEERE'S SALES UP 2%, NET INCOME DOWN 23%
Source: John Deere news release

To read the entire report click here.

*Results pressured by soft conditions in farm and construction equipment sectors.

*Efforts to establish more efficient cost structure on track.

*Key agricultural markets show signs of stabilization.

*Full-year forecast calls for improved sales, earnings of $1.5 billion.

Net income attributable to Deere & Company was $193.8 million, or $0.61 per share, for the first quarter ended January 29, compared with $254.4 million, or $0.80 per share, for the period ended January 31, 2016. Worldwide net sales and revenues for the first quarter increased 2 percent, to $5.625 billion, compared with $5.525 billion last year. Net sales of the equipment operations were $4.698 billion for the quarter compared with $4.769 billion a year ago.

"John Deere has started out the year on a positive note in the continued face of soft market conditions," said Samuel R. Allen, chairman and chief executive officer. "Although the quarter's sales and earnings were somewhat lower than last year, all of our businesses remained solidly profitable. Deere's performance showed further benefits from the sound execution of its operating plans, the strength of a broad product portfolio and the impact of a more flexible cost structure. At the same time, we are seeing signs that after several years of steep declines key agricultural markets may be stabilizing."

Summary of Operations

Net sales of the worldwide equipment operations declined 1 percent for the quarter. Sales included price realization of 2 percent and a favorable currency-translation effect of 1 percent. Equipment net sales in the United States and Canada decreased 8 percent. Outside the U.S. and Canada, net sales increased 11 percent, with a favorable currency-translation effect of 1 percent.

Deere's equipment operations reported operating profit of $247 million for the quarter, compared with $214 million in 2016. The improvement for the quarter was primarily driven by price realization, partially offset by expenses associated with the previously announced voluntary employee-separation program, higher warranty costs and the unfavorable effects of foreign-currency exchange. Additionally, the current quarter benefited from a gain on the sale of a partial interest in the unconsolidated affiliate SiteOne Landscape Supply, Inc.

Net income of the company's equipment operations was $80 million for the quarter, compared with $127 million for the same period last year. In addition to the operating factors mentioned above, a higher effective tax rate in 2017 reduced quarterly results.

Financial services reported net income attributable to Deere & Company of $114.4 million for the quarter compared with $129.4 million last year. Lower results for the quarter were primarily due to less-favorable financing spreads and voluntary separation expenses.

Agriculture & Turf. Sales were unchanged for the quarter with lower shipment volumes and higher warranty costs being offset by price realization and the favorable effects of currency translation.

Operating profit was $213 million compared with $144 million last year. The quarter's improvement was mainly driven by a gain on the sale of a partial interest in SiteOne Landscape Supply, Inc. and price realization. These factors were partially offset by voluntary employee-separation expenses, higher warranty costs and the unfavorable effects of foreign-currency exchange.


Search News & Articles

















Proudly associated with:
American Business Media Canadian Agri-Marketing Association National Agri-Marketing Association
Agricultural Relations Council National Association of Farm Broadcasters American Agricultural Editors' Association Livestock Publications Council
All content © Copyright 2017, Henderson Communications LLC. | User Agreement