|
Lower commodity prices and falling farm incomes continued to
pressure demand for agricultural machinery, with the declines
most pronounced in higher-horsepower models, the company said on
Friday. It also cited lower demand for construction equipment.
Farm and turf equipment sales, which account for more than
two-thirds of total revenue, fell 24 percent to $5.31 billion in
the third quarter ended July 31.
Sales in the construction and forestry segment decreased by 13
percent to $1.53 billion.
Net income slid to $511.6 million, or $1.53 per share, from
$850.7 million, or $2.33 per share, a year earlier.
Total revenue declined 20 percent to $7.59 billion.
The company revised lower its outlook for fiscal 2015 net income
to $1.8 billion from $1.9 billion.
Its fourth-quarter equipment sales projection was revised down
to 24 percent lower, from 17 percent lower.
The company said equipment sales are projected to decrease about
21 percent for fiscal 2015, revised down from 19 percent
forecast in the previous quarter.
Overall U.S. and Canadian sales were forecast to be down about
25 percent for 2015, Deere said.
The company lowered full-year fiscal 2015 international sales
projections. Lower crop prices and farm income, combined with
pressure in the dairy sector were expected to drag sales lower
by 10 percent in the European Union.
In South America, sales of tractors and combines were projected
to fall by 20 percent to 25 percent due to economic uncertainty
and higher interest rates on government-sponsored financing in
Brazil.
In the latest quarter, international sales were softer due to a
stronger U.S. dollar. Outside the United States and Canada, net
sales fell 23 percent in the quarter, with 12 percent of the
decline attributable to the effects of a stronger dollar.
Deere shares were off 8.1 percent to $83.32.
(This version of the story corrects the percent figure in the
headline)
(Reporting by Meredith Davis in Chicago; Editing by Jeffrey
Benkoe)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
|
