John Deere lowers forecast

By Helen Wright16 August 2012

US equipment manufacturer John Deere has lowered its full-year sales outlook for its construction and forestry equipment division, despite reporting solid third quarter results.

Higher prices and shipment volumes offset increased production and raw material costs to produce a +23% increase in construction and forestry equipment sales to US$ 1.7 billion for the three months to 31 July. The division's operating profit was up +3% year-on-year to US$ 113 million.

The manufacturer said levels of US public and nonā€residential construction had also impacted the results of its construction and forestry segment during the quarter.

John Deere said it expected its worldwide sales of construction and forestry equipment to increase by 17% for 2012. This is lower than the 20% full-year increase it forecast in April at its fiscal half-year mark.

The company said, "While construction equipment sales in the US continue to show strong recovery, Deere has experienced slower than expected sales activity in some international markets."

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