10-KPeriod: FY2012

DEERE & CO Annual Report, Year Ended Oct 31, 2012

Filed December 17, 2012For Securities:DE

Summary

Deere & Company's 2012 10-K filing reveals a strong financial performance, with net sales and revenues increasing by 13% to $36.16 billion and net income attributable to Deere & Company growing to $3.06 billion, or $7.63 per diluted share. The company saw significant growth in both its Agriculture and Turf segment and its Construction and Forestry segment, driven by higher shipment volumes and improved price realization. The company's outlook for fiscal year 2013 is cautiously optimistic, with projected net income of approximately $3.2 billion and an anticipated 5% increase in equipment sales. Deere & Company continues to focus on innovation, including meeting increasingly stringent emissions regulations, and expanding its global presence. Key risks identified include international trade policies, economic uncertainties, and fluctuating commodity prices, which could impact demand for its products.

Financial Highlights

30 data points
Beta

Revenue

$36.16B

30.8% Gross Margin

Net Income

$3.06B

8.5% Net Margin

EPS (Diluted)

$7.63

Free Cash Flow

-$151.50M

Financial Statements
Beta
Revenue$36.16B
Cost of Revenue$25.01B
Gross Profit$11.15B
R&D Expenses$1.43B
SG&A Expenses$3.42B
Operating Expenses$31.42B
Operating Income$5.11B
Interest Expense$782.80M
Net Income$3.06B
EPS (Basic)$7.72
EPS (Diluted)$7.63
Shares Outstanding (Basic)397.10M
Shares Outstanding (Diluted)401.50M

Key Highlights

  • 1Net sales and revenues increased 13% to $36.16 billion in fiscal year 2012.
  • 2Net income attributable to Deere & Company rose to $3.06 billion, or $7.63 per diluted share.
  • 3Both Agriculture & Turf and Construction & Forestry segments showed strong growth in sales and operating profit.
  • 4The company repurchased $1.59 billion of its common stock in the fourth quarter of 2012.
  • 5Deere & Company anticipates a 5% increase in equipment sales and a net income of approximately $3.2 billion for fiscal year 2013.
  • 6Significant investments in research and development continue, particularly for new products and meeting emission standards.
  • 7The company identified international trade laws, government policies, economic conditions, and commodity price volatility as key risk factors.

Frequently Asked Questions

Deere & Company's financial performance in fiscal year 2012 was primarily driven by increased shipment volumes and improved price realization across its key segments, particularly Agriculture & Turf and Construction & Forestry. This led to a 13% increase in net sales and revenues and a significant rise in net income.

The company highlighted several risk factors, including the impact of international trade laws, government policies related to agriculture and trade, changing worldwide demand for food and bio-energy, negative economic conditions affecting customer demand and access to funding, and currency exchange rate fluctuations. Additionally, adherence to increasingly stringent engine emission standards and potential disruptions in the supply chain are key concerns.

Deere & Company's financial services segment primarily provides financing for the sale and leasing of equipment through John Deere dealers. It also offers wholesale financing, crop risk mitigation products, and extended warranties. The company manages risks in this segment by focusing on portfolio growth, maintaining adequate reserves for credit losses, and managing funding costs, though it is also subject to financial industry regulations and economic conditions affecting the broader financial sector.

Deere & Company projects an approximate 5% increase in equipment sales for fiscal year 2013 and anticipates net income attributable to Deere & Company to be around $3.2 billion. Growth is expected to be supported by relatively high commodity prices and strong farm incomes, though moderated by economic conditions in certain regions.