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Deere Reports Lower Net Income During First Quarter
USAgNet - 02/20/2017

Deere & Company has announced a big drop in first quarter earnings, with $194 million dollars. Those earnings compare with $254 million, or 80 cents per share, a year ago.

The company says soft market conditions in farm and construction equipment sales affected the results. Worldwide net sales and revenues for the first quarter increased 2 percent, to $5.6 billion.

"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."

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.

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.


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