Deere posts first-quarter loss

Moline, Ill-based Deere & Co. last week reported a worldwide net loss of $38.1 million for the first quarter ended Jan. 31, or 16 cents per share, compared with year-earlier net income of $56.4 million, or 24 cents per share.

"Deere's first-quarter financial results were affected by deep production cutbacks at our major North American factories, which were made in line with our plans for improved asset utilization," said Robert Lane, chairman and CEO. "While these reductions have had a negative impact on net income, they are also helping achieve a dramatic decline in asset levels and should be supportive of higher profitability in the future."

Trade receivables and inventories carried by the enterprise decreased by $1.1 billion over the past 12 months, in support of a strong balance sheet. Worldwide net sales and revenues for the first quarter were $2.52 billion, compared with $2.71 billion for the same period last year.

Deere said it expects 2002 equipment sales to be flat to up slightly for the year, with operating profit ranging from break-even to a positive 1 percent of sales. For the second quarter, it expects sales to be flat to up slightly, with operating profit as a percent of sales at 4 percent to 5 percent.

Deere also said commercial and consumer equipment shipments should fall about 5 to 10 percent in 2002, excluding the impact of acquisitions and divestitures. It predicted North American sales of construction and forestry equipment will fall 10 to 15 percent, with pricing under pressure from an uncertain outlook for the construction industry.

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