Deere & Company profits surge in 2019
Global trade tensions continue to impact equipment manufacturer’s results.
Deere & Company reported a net sales increased 5% in the fourth quarter 2019 to $9.896 billion while revenues for the full year also rose 5% to $39.258 billion.
The Moline, Ill.-based equipment manufacturer posted a net income of $722 million for the fourth quarter, an 8% drop from a net income of $758 million in the fourth quarter of 2018. But for the full year Deere reported a net income of $3.253 billion, more than a 37% increase from a net income of $2.368 billion for 2018.
Net sales of equipment operations were $8.7 billion for the quarter, increasing 4.3%, while sales increased 4.6% to $33.3 billion for the year.
The bottom line: Deere & Company profits increase dramatically for the full year but earnings fall 8% for the fourth quarter.
What the CEO said: “John Deere’s performance reflected continued uncertainties in the agricultural sector,” said John May, CEO of Deere & Company. “Lingering trade tensions coupled with a year of difficult growing and harvesting conditions have caused many farmers to become cautious about making major
investments in new equipment. Additionally, financial services results have come under pressure due to operating-lease losses. At the same time, general economic conditions have remained favorable. This has supported demand for smaller equipment and led to solid results for Deere’s construction and forestry business, which had a record year for sales and operating profit.”
“Despite present challenges, the longer-term outlook for our businesses remains healthy and points to a promising future for Deere,” May said. “We are particularly encouraged by the adoption of precision technologies and believe we are well-positioned to be a leader in the delivery of smarter, more efficient and sustainable solutions to our customers. At the same time, we are committed to the successful execution of our strategic plan and have initiated a series of measures to create a leaner organizational structure that can operate with more speed and agility. We’re confident these steps will lead to improved efficiencies and help the company focus its resources and investments on areas that have the greatest impact on performance.”
Company info: The full fourth quarter and 2019 report from Deere & Company can be read here.
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