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Deere earnings down, cost management improves profits

Deere and Company’s first quarter income is down, but CEO Samuel Allen says despite lower earnings, the company is profitable because of cost management.  He also says that Deere is seeing signs that key agricultural markets may be stabilizing.  The company’s income for the quarter was near $194 million compared with $254 million a year ago.  Fewer price discounts resulted in Deere’s profits for the quarter increasing from $214 million a year ago, to $247 million.

“Deere continues to perform far better than in agricultural downturns of the past,” said Allen.

Deere sales in the U.S. and Canada were down 8 percent, but everywhere else they were up 11 percent.

To reduce operating costs, the company has undertaken what they call a voluntary employee separation program.  It cost them $94 million this past quarter.  They anticipate the total expense of voluntary employee separation to be $111 million.