If first quarter results are anything to go on, John Deere appears set for a strong sales result in fiscal year 2021
Net income of US$1.224 billion was recorded for the first quarter ended Jan. 31, 2021. Worldwide net sales and revenues increased 19% to US$9.112 billion.
Equipment operations net sales were US$8.051 billion for the quarter, compared with US$6.53 billion for the same period in 2020.
“John Deere started 2021 on a strongly positive note,” said John C. May, chairman and chief executive officer. “Our results were aided by outstanding performance across our business line-up and improving conditions in the farm and construction sectors.
“In addition, our smart industrial operating strategy is making a significant impact on the company’s results while it also helps our customers be more profitable and sustainable.”
Net income attributable to Deere and Company for fiscal 2021 is forecast to be in a range of US$4.6 to 5 billion.
“We are proud of our success executing the strategy and creating a more focused organization that can operate with greater speed and agility,” May said. “As our recent performance shows, these steps are leading to improved efficiencies and helping the company target its resources and investments on areas that have the greatest impact.
“At the same time, even as we ramp up factory production and intensify our efforts to serve customers, we are mindful of the continuing challenges associated with the global pandemic. We remain committed, above all else, to safeguarding the health and well-being of our employees.”
Beginning in fiscal year 2021, the company implemented a new strategy, operating model and reporting structure. With this change, the company’s agriculture and turf operations were divided into two new segments.
The first segment production and precision agriculture is responsible for defining, developing and delivering global equipment and technology solutions to unlock customer value for production-scale growers of large grains, small grains, cotton and sugar.
Main products include large and certain mid-size tractors, combines, cotton pickers, sugarcane harvesters and loaders and soil preparation, seeding, application and crop care equipment.
While the second segment, small agriculture and turf is responsible for defining, developing and delivering market-driven products to support mid-size and small growers and producers globally as well as turf customers.
The operations are principally organized to support production systems for dairy and livestock, high-value crops and turf and utility operators.
Primary products include certain mid-size and small tractors, as well as hay and forage equipment, riding and commercial lawn equipment, golf course equipment and utility vehicles.
There were no reporting changes for the construction and forestry and financial services segments. As a result, the company has four reportable segments.
For fiscal year 2021, Deere expects its Production and Precision Ag segment to achieve net sales of US$15.5 to 16.5 billion. The Small Ag and Turf segment to realise net sales of US$10.5 to 11.5 billion, while the Construction and Forestry segment is expected to reach net sales of US$10.5 to 11.0 billion.
