UPDATE: Deere Posts Better-Than-Expected FQ4 Results, Projects Decline In Equipment Sales

Deere & Co

reported better-than-expected fiscal fourth-quarter results. However, the company expected a drop in equipment sales. The Moline, Illinois-based company reported quarterly earnings of $649.2 million, or $1.83 per share, compared to $806.8 million, or $2.11 per share, in the year-ago quarter. Its revenue declined 5% to $8.97 billion, while equipment sales slipped 7%. However, analysts were expecting earnings of $1.57 per share on revenue of $7.68 billion. Net sales of the equipment operations slipped to $8.043 billion from $8.624 billion. Equipment net sales in the US and Canada dropped 10% in the quarter, while net sales outside the US and Canada declined 2%. Net income at its equipment operations shrank to $488 million in the fourth quarter from $650 million, while net income at financial services rose to $172.2 million from $157.1 million. Sales of agriculture and turf equipment dropped 13% for the quarter, while sales of construction and forestry equipment rose 23%. "John Deere has completed another year of solid performance in spite of weaker conditions in the global farm sector, which caused sales and earnings to decline from the record totals of 2013," said Samuel R. Allen, chairman and chief executive officer. "The slowdown has been most pronounced in the sale of large farm machinery, including many of our most profitable models. Nevertheless, our success managing costs and assets and establishing a broad-based business lineup has allowed us to deliver strong results and remain in a sound financial condition." For the current quarter, the company projects equipment sales to drop 21%. It also expects equipment sales to decline around 15% in fiscal 2015. Deere projects 2015 income of around $1.9 billion. Deere shares fell 2.27% to $85.80 in pre-market trading.