Summary
Deere & Company (DE) reported a significant net loss of $320.1 million ($1.36 per share) for the fourth quarter of fiscal year 2001, primarily driven by $217 million in after-tax special charges. These charges were related to early retirement programs, exiting the hand-held consumer products business, and manufacturing and marketing restructurings. Excluding these special items, the company posted a loss of $103.5 million ($0.45 per share) for the quarter. For the full year, Deere & Company reported a net loss of $64.0 million ($0.27 per share), compared to a net income of $485.5 million ($2.06 per share) in the prior year. Excluding special items, the full-year income was $152.6 million ($0.64 per share). The results were significantly impacted by production cutbacks aimed at improving asset efficiency and weakness in key markets. Despite a record number of new product launches, worldwide net sales and revenues declined for the fourth quarter and were only slightly up for the full year. The company anticipates continued pressure in the first quarter of fiscal year 2002, with net sales forecast to be down and operating profit margins in equipment divisions under significant strain. Deere is undertaking further actions to reduce costs and improve operational effectiveness, including the closure of a manufacturing facility and a reduction in corporate overhead.
Key Highlights
- 1Deere & Company reported a fourth-quarter net loss of $320.1 million ($1.36 per share) and a full-year net loss of $64.0 million ($0.27 per share).
- 2Significant special charges totaling $217 million after-tax impacted the results, stemming from early retirement programs, exiting the hand-held consumer products business, and restructuring efforts.
- 3Excluding special items, the fourth-quarter loss was $103.5 million ($0.45 per share), and the full-year income was $152.6 million ($0.64 per share).
- 4Worldwide net sales and revenues decreased by 6% in the fourth quarter, totaling $3.161 billion.
- 5Production cutbacks were implemented to improve asset efficiency, contributing to manufacturing inefficiencies and negatively impacting results.
- 6The company announced further cost-reduction measures, including closing a manufacturing facility in Loudon, Tennessee, and reducing corporate overhead.
- 7Deere anticipates continued financial pressure in the first quarter of fiscal year 2002, forecasting a 3-7% decline in net sales and negative operating profit margins for equipment divisions.