Deere announces record first-quarter earnings

On Feb. 12, Deere & Company announced its net income was $681.1 million, or $1.81 per share, for the first quarter ended Jan. 31, compared with $649.7 million, or $1.65 per share, for the same period last year.

Worldwide net sales and revenues for the first quarter increased 3 percent, to $7.654 billion, compared with $7.421 billion last year. Net sales of the equipment operations were $6.949 billion for the quarter compared with $6.793 billion a year ago.

“With another record quarter, John Deere has started 2014 on a strong note,” said Samuel R. Allen, chairman and chief executive officer, Deere & Company. “Our results demonstrate the adept execution of our operating and marketing plans, which are aimed at expanding our global market position and helping our customers throughout the world be more profitable and productive. In addition, we are seeing further benefit from efforts to hold the line on costs.”

Summary of operations
Net sales of the worldwide equipment operations increased 2 percent for the quarter. Sales included price increases of 2 percent and an unfavorable currency-translation effect of 2 percent. Equipment net sales in the United States and Canada rose 3 percent for the quarter. Outside the U.S. and Canada, net sales increased 2 percent, including an unfavorable currency-translation effect of 3 percent.

Deere’s equipment operations reported operating profit of $891 million for the quarter, compared with $837 million last year. Results benefited from price realization, partially offset by a less favorable product mix and the unfavorable effects of foreign-currency exchange.

Financial services reported net income attributable to Deere & Company of $142.2 million for the quarter compared with $132.9 million last year. The improvement was primarily related to growth in the credit portfolio and a more favorable effective tax rate. These factors were partially offset by lower crop insurance margins, increased selling, administrative and general expenses and less favorable financing spreads.

Company outlook & summary
Company equipment sales are projected to decrease about 3 percent for fiscal 2014 and be down about 6 percent for the second quarter compared with the same periods of 2013. For the full year, net income attributable to Deere & Company is anticipated to be approximately $3.3 billion.

“Even in the face of moderating demand for agricultural equipment, Deere is well positioned to deliver solid performance,” said Allen. “We believe that our extensive investments in new products and new markets will provide strong support to our results and keep our strategic plans moving ahead.” These plans are essential to helping meet the world’s growing need for food, shelter and infrastructure, Allen added, and he expressed confidence they would produce significant benefits for the company’s investors and customers over the long term.

For more specifics, visit www.deere.com.