Iconic US combine maker Deere & Co today reported record full year earnings of $9.79 billion. Profits for the quarter, however, failed to meet analysts expectations largely due to rising manufacturing and raw material costs.
Chairman and CEO Sam Allen highlighted the companies on-going global expansion but also flagged up the “continuing global economic pressure” on revenues.
Sales in the Agriculture and Turf Equipment Division, the division which makes John Deere combine harvesters, rose 13% for the fiscal year. Going forward the company project sales growth in the division of a more modest 4%.
Deere point to strong commodity prices and rising farm incomes as supportive in general of demand for farm machinery such as combine harvesters and high-powered tractors.
Deere, the world’s largest maker of farm equipment, is not however looking for sales to grow in the US, Canadian and European markets. The firm point to continued uncertainty in the eurozone and a relatively poor harvest in the UK as explanations for flat growth.
On a more positive note, Deere expect stronger demand for combines and farm equipment from South America and Asia.