John Deere optimistic after improved first half

19 May 2010

Samuel Allen, CEO at John Deere

Samuel Allen, CEO at John Deere

The construction and forestry division of John Deere reported sales for the six months ending 30 April 2010 of US$ 1.5 billion, up +15% on the US$ 1.3 billion recorded for the same period in 2009. Following a -US$ 58 million operating loss for the first half last year, the division recorded a -US$ 1 million loss this year.

The company attributed its improved position to higher sales volumes, improved pricing and beneficial currency exchange. A statement said the operating loss was partially attributable to higher post-retirement benefit costs.

Looking forward, a statement said that sales of construction and forestry equipment are forecast to increase by approximately +30% for the full year, ending October 2010.

"Sales are benefitting from low inventories associated with last year's aggressive production cutbacks and more steady market conditions," said a spokesperson. "Though remaining depressed as a result of declining non-residential construction and relatively high used-equipment levels, construction equipment markets for US manufacturers are showing signs of stabilisation."

Across all its divisions John Deere reported first half sales of US$ 11.9 billion, up +1% on the US$ 11.8 billion recorded for the same period last year. Operating profit for the period rose +44% to US$ 1.5 billion, up from US$ 1 billion 12 months ago.

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