Deere & Co. reported higher earnings for its fiscal fourth quarter as net sales and revenues rose 23% year over year due to higher farm machinery and construction equipment sales.
Net income attributable to the company rose to $510.3 million, or $1.57 per share, in the quarter ended Oct. 29, from $285.3 million, or 90 cents per share, in the year-ago quarter. The S&P Capital IQ consensus normalized EPS estimate for the quarter was $1.44.
Worldwide net sales and revenues increased 23% to $8.02 billion, from $6.52 billion in the prior-year period.
Net sales of equipment operations, which include the company's agriculture and turf and construction and forestry operations, climbed to $7.09 billion from $5.65 billion in the year-ago quarter. Revenues of the company's financial services business increased to $782 million in the quarter from $740 million.
"We saw higher overall demand for our products with farm machinery sales in South America making especially strong gains and construction equipment sales rising sharply," said Chairman and CEO Samuel Allen.
Deere's agriculture and turf business reported an operating profit of $584 million, up from $371 million in the year-ago quarter. The company attributed the improvement to higher shipment volumes and a favorable sales mix.
The construction and forestry business posted an operating profit of $85 million for the most recent quarter, compared with a loss of $17 million in the year-ago quarter, mainly due to improved shipment volumes and price realization.
For its fiscal year 2017, Deere reported net income attributable of $2.16 billion, or $6.68 per share, up from $1.52 billion, or $4.81 per share, in fiscal year ended Oct. 30, 2016. The S&P Capital IQ consensus normalized EPS estimate for the year was $6.51. Worldwide net sales and revenues increased 12% to $29.74 billion from $26.64 billion in the previous year.
For the fiscal year 2018, net income attributable to the company is projected to be about $2.6 billion. Net sales and revenues are expected to increase 19%, and equipment sales are expected to increase by about 22% for the year.
Deere expects the acquisition of road construction equipment manufacture Wirtgen Group to contribute about $3.1 billion in net sales in fiscal 2018. The acquisition is expected to close in December.
