Iowa’s largest manufacturing employer is reporting record earnings for the third quarter, but with a few “hiccups,” in the words of one company official. Ag equipment maker Deere and Company reports sales and revenues increased by 15% during the quarter to $788-million.
Jim Field, chief financial officer for the Quad Cities-based Deere, says they’re forecasting a record full-year income of just over three-billion dollars. “John Deere reported record sales and profit in the quarter, operating margins in the ag and turf division were approximately 14%,” Field says.
“We successfully launched new products while continuing the build-out of our global footprint.” Field says the good numbers are accompanied by a “miss,” as sales came up far short of projections. “The miss was in ag and turf,” Field says.
“Half of the shortfall is due to softening market conditions outside the U.S., of note, India, China and the E-U 27.” He says the bulk of that shortfall should be made up in the 4th quarter. Sales were also impacted in the U.S. by inclement weather, namely, the prolonged drought that’s hitting much of the Midwest and South.
Field says the rollout of the new North American combine line was challenged by slowdowns in the factories. “We experienced production delays of up to 14 calendar days,” Field says. “In addition, we are seeing an unprecedented early harvest of up to four to five weeks in some areas. Consequently, some machines will be shipped too late for harvest and we have allowed dealers to cancel orders.”
He says demand remains strong for U.S. farm equipment while construction continues with a solid recovery. Deere employs around 12-thousand people in Iowa at facilities in Ankeny, Johnston, Ottumwa, Waterloo, Davenport and Dubuque.