MOLINE — At its quarterly earnings report Friday morning, officials from Deere & Company said profit topped expectations and it raised its earnings outlook for the year, despite continuing weakness in global markets for farm and construction equipment.
Net income for the quarter was $488.8 million, or $1,55 per share. This compares to net income of $511.6 million and $1.53 per share for the same quarter last year.
“John Deere’s performance in the third quarter reflected the continuing impact of the global farm recession as well as difficult conditions in construction equipment markets,” said Deere Chairman and CEO Sam Allen. “All of Deere’s businesses remained profitable with the Agriculture & Turf division reporting higher operating profit than last year. As in past quarters, our results benefited from the sound execution of our operating plans, the impact of a broad product portfolio, and our success keeping a tight rein on costs and assets.”
Worldwide net sales and revenues decreased 11 percent, to $6.724 billion, for the third quarter and declined 9 percent, to $20.124 billion, for nine months. Net sales of the equipment operations were $5.861 billion for the quarter and $17.737 billion for the first nine months, compared with $6.840 billion and $19.843 billion for the periods last year.
The U.S. earlier this month raised its expectations for corn and soybeans harvests to record highs, meaning profits for farmers will be more meager.
Deere said company equipment sales are projected to decrease by about 10 percent for the full fiscal year and be down about 8 percent next quarter, compared to the fourth quarter last year. Still, Allen expressed optimism based on Deere’s business model.
“Deere continues to perform well in the face of challenging market conditions, particularly in relation to agricultural downturns of the past,” Allen said. “This underscores the success of our efforts to develop a more durable business model and a wider range of revenue sources. At the same time, we are continuing to focus on ways to make our operations more efficient and achieve further structural cost reductions. We remain confident in the company’s present direction and firmly believe Deere is on the right track to deliver significant value to its customers and investors in the years ahead.”