Friday the Moline-based manufacturer of farm and construction equipment reported net income for May through July of nearly 1.9 billion dollars, up 13 per cent from a year ago. And for the first nine months of the year, it's up 4 per cent. Sales and revenue jumped 22 per cent in the third quarter, and 13 per cent for the fiscal year-to-date.
Director of Investor Relations, Brent Norwood, says higher costs kept the results from being even better.
"We've been experiencing higher rates of inflation in material, freight costs, and then just overall I would say factory overhead, as some of the supply chain disruptions have caused and introduced a lot of inefficiencies to the factory."
And that's led Deere to lower its profit prediction for the full year, by about 200 million dollars (previous 7-7.4 billion, now 7-7.2 billion).
He says the ag economy has been surprisingly strong.
"That has really put upward pressure on demand for our products. I think in addition to the good year that our customer base is having, the average age of the ag equipment fleet in North America is getting pretty old."
Deere now predicts sales for large farm equipment will increase 25 to 30 per cent for the year, be up 10 to 15 per cent for small ag and turf equipment, and rise ten per cent for the construction and forestry division.
