Summary
Deere & Company (DE) reported a significant decrease in net sales and revenues for the second quarter and first six months of fiscal year 2015, driven primarily by a decline in the Agriculture and Turf segment. Net sales for the quarter fell 18% year-over-year, with net income attributable to Deere & Company down 30% to $690.5 million, or $2.03 per diluted share. The company's performance was impacted by weaker conditions in the global agricultural sector, compounded by unfavorable currency translation effects. Despite these challenges, the Construction and Forestry segment showed modest growth, and the Financial Services segment saw an increase in operating profit, boosted by a gain from the sale of its crop insurance business. While revenue and profit declined, Deere maintained a strong focus on cost management and developing a more responsive cost and asset structure, which contributed to its continued profitability. The company also repurchased a substantial amount of its own stock during the quarter, indicating confidence in its long-term value. Looking ahead, Deere anticipates continued softness in agricultural markets but expects overall profitability for fiscal year 2015 to be approximately $1.9 billion, demonstrating resilience and a commitment to returning value to shareholders through dividends and share repurchases.
Financial Highlights
45 data points| Revenue | $8.17B |
| Cost of Revenue | $5.69B |
| Gross Profit | $1.70B |
| R&D Expenses | $341.10M |
| SG&A Expenses | $740.00M |
| Operating Expenses | $7.15B |
| Operating Income | $1.09B |
| Interest Expense | $165.50M |
| Net Income | $690.00M |
| EPS (Basic) | $2.05 |
| EPS (Diluted) | $2.03 |
| Shares Outstanding (Basic) | 337.10M |
| Shares Outstanding (Diluted) | 339.70M |
Key Highlights
- 1Net sales decreased 18% to $8.17 billion in Q2 2015 compared to Q2 2014.
- 2Net income attributable to Deere & Company decreased 30% to $690.5 million ($2.03/share) in Q2 2015.
- 3Agriculture and Turf segment sales declined significantly by 25% due to lower shipment volumes and unfavorable currency translation.
- 4Construction and Forestry segment sales showed a modest increase of 2% due to higher shipment volumes and price realization.
- 5Financial Services segment operating profit increased 16% to $265 million, aided by the gain on the sale of the crop insurance business.
- 6The company repurchased approximately $617 million of its common stock during the second quarter.
- 7Deere maintains a strong liquidity position with $4.36 billion in cash and cash equivalents at April 30, 2015.