December 7, 2021
Deere Q4 profit jumps 69% despite strike and supply problems

Deere Q4 profit jumps 69% despite strike and supply problems

Deere & Co. stated its fiscal fourth-quarter profit jumped 69% on sturdy gross sales of its agricultural and building gear despite a monthlong strike that started close to the top of the interval in addition to ongoing supply chain problems.

The Moline, Illinois-based firm stated Wednesday that it earned $1.28 billion, or $4.12 per share, within the quarter that ended Nov. 1. That is up from $757 million, or $2.39 per share, a yr in the past when the pandemic slowed gross sales and layoff-related bills harm the underside line.

The outcomes topped Wall Avenue expectations. The typical estimate of 9 analysts surveyed by Zacks Funding Analysis was for earnings of $3.82 per share.

The agricultural gear producer stated its income grew 16% to $11.33 billion within the interval. Its adjusted income was $10.28 billion, which missed Avenue forecasts. 5 analysts surveyed by Zacks anticipated $10.34 billion.

“Our outcomes replicate sturdy end-market demand and our potential to proceed serving clients whereas managing supply-chain points and conducting contract negotiations with our largest union,” Deere CEO John Might stated in an announcement.

Greater than 10,000 Deere employees had been on strike at vegetation in Iowa, Illinois and Kansas from mid-October till final week when the United Auto Staff union accepted the corporate’s third supply that included 10% instant raises and an $8,500 ratification bonus.

Deere officers estimated that the brand new contract will enhance its pretax prices by about $250 million to $300 million a yr, however that will not put a big dent in its earnings.

In fiscal 2021, the corporate reported report profit of $5.96 billion, or $18.99 per share. Income was $39.74 billion. That bottom-line determine topped even Deere’s most-optimistic forecast.

Subsequent yr, Deere predicts its earnings will develop even larger to between $6.5 billion and $7 billion as demand for its iconic inexperienced tractors stays excessive and infrastructure spending helps enhance demand for its building gear. The corporate stated demand will seemingly exceed what Deere can produce subsequent yr once more due to the continuing supply chain problems.

Deere’s inventory jumped about 5.5% to $368.43 in noon buying and selling Wednesday after the outcomes had been introduced.

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Components of this story had been generated by Automated Insights (http://automatedinsights.com/ap) utilizing information from Zacks Funding Analysis. Entry a Zacks inventory report on DE at https://www.zacks.com/ap/DE

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