John Deere Releases Second-Quarter Results

Citing an 11 percent increase in net income over second quarter 2001, Deere & Company announced a worldwide net income of $141.8 million for the second quarter ending April 30. Second quarter net income for 2001 came in at $127.8 million. “We’ve had pretty solid performance in the quarter, given the overall weak market conditions,” said Marie Ziegler, vice president of investor relations for the Moline, Ill.-based company, during an Internet-broadcast conference call.

Worldwide net sales and revenues also increased, from $3.8 billion in 2001 to nearly $4 billion this year. According to a press release, this increase is due to higher agricultural equipment sales and the addition of sales from John Deere Landscapes, a division that was formed in 2001. Net sales for commercial and consumer equipment increased from $840 million in 2001 to $883 million in 2002.

Operating profit for the worldwide commercial and consumer equipment division rose from $70 million last year to $80 million in 2002. Ziegler identified increased volume as the impetus for the improved profitability.

Additionally, although equipment sales increased 7 percent for the quarter, they have decreased 4 percent throughout the first and second quarters. Ziegler attributed the quarterly sales increase to alignment of product shipments and consumer demand. “We’ve moved to produce more closely to seasonal demands, which has had implications on operating profits,” Ziegler stated. “You’ll start to see more seasonality in our commercial and consumer equipment division.”

Throughout the rest of the year, shipments of commercial and consumer equipment will most likely be down 5 to 10 percent, according to the release. This is due partly to a general attitude of caution among consumers, but in some cases, drought conditions and watering restrictions may have caused equipment sales to decrease.

The author is Assistant Editor – Internet of Lawn & Landscape magazine and can be reached at kmohn@lawnandlandscape.com.