Deere said it now sees sales of all equipment dropping by 21% for the full year, worse than a projection earlier of a drop of 19%, as lower prices of soybeans and corn reduces incomes of growers.
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Deere employs 1,300 workers in the Tianjin Economic Development Area (TEDA)and manufactures agricultural and construction equipment for customers in China and the surrounding region.
Deere and Company is expecting a 25 per cent drop in it’s worldwide sales of agriculture and turf equipment this year.
Deere & Co. said profit in its latest quarter tumbled 40% as the farm-equipment maker continues to face weaker demand for its farm machinery.
For the first nine months, Deere’s net income decreased 37 percent to $1.589 billion, or $4.67 per share, compared with $2.513 billion, or $6.79 per share, last year. The results, however, represented a declining trend as demand for agricultural and construction equipment fell.
The current quarter EPS consensus estimate is 1.44 with revenue estimates of 7.17B.
“John Deere’s third-quarter outcomes mirrored the persevering with influence of the downturn within the farm financial system in addition to decrease demand for development gear”, stated Chief Government Samuel Allen.
The most positive outlook is for turf and utility products, such as John Deere Gator vehicles, in the U.S. and Canada.
Deere has done well to maintain profits even during the farm economy swoon, said Jim Corridore, equity analyst with S&P Capital IQ.
Golden said it is that long-term view that Deere must maintain. During the second quarter, construction and forestry equipment sales rose 2 percent and the company was anticipating a 2-percent gain in annual revenues from the segment.
“Global grain stocks-to-use ratios remain at somewhat sensitive levels, even after the abundant harvests of the past two years”, he said.
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Early orders for planters, sprayers and tillage equipment are down in the fiscal year that begins in November, Tony Huegel, Deere’s director of investor relations, said Friday on a conference call with investors. The stock had a year-on-year range of $98.23, which it reached June 30, and $78.88, October 8, 2014.
