John Deere completes fifth consecutive year of record earnings

Dec. 6, 2010 – John Deere has recently released its Q4 earnings. The company earned $345 million (EPS $0.81) in Q4. Despite the global economic downturn, decreased consumer confidence and spending, and declines in home sales, John Deere’s global net sales and revenue increased 21 percent to $7.401 billion for Q4.

The company lowered expectations for 2009 and said “given the sudden, sharp downturn in global economic activity, and the ongoing turmoil in world financial markets, the outlook for the year ahead is highly uncertain and its impact on John Deere’s operations is difficult to assess.”

"In the face of highly uncertain global economic conditions, John Deere has completed a fifth consecutive year of record earnings, reflecting our efforts to build and grow a great business," said Robert W. Lane, chairman and chief executive officer. Agricultural equipment operations had their best year ever in 2008, he pointed out, and the company's other equipment businesses remained solidly profitable on a full-year basis.

Net sales of the worldwide equipment operations increased 24 percent for the quarter and 20 percent for the year. Included were positive effects for currency translation and price changes of 3 percent for the quarter and 6 percent for the full year. Equipment net sales in the United States and Canada were up 16 percent for the quarter and 9 percent for the full year. Net sales outside the United States and Canada increased by 39 percent for the quarter and 40 percent for the year, including a positive currency-translation effect of 10 percent for the year.

Deere's equipment operations reported operating profit of $549 million for the quarter and $2.927 billion for the year, compared with $511 million and $2.318 billion for the periods last year. The improvement for both periods was largely due to the favorable impact of higher shipment volumes and improved price realization, partially offset by increased raw material costs and higher research and development expenses. The quarter's results included pretax expenses of approximately $50 million to close a facility in Canada, while higher selling, administrative and general expenses had an impact on the full year.