0000315189falseDEERE & CO0000315189us-gaap:CommonStockMember2023-11-222023-11-220000315189de:Debentures6.55PercentDue2028Member2023-11-222023-11-2200003151892023-11-222023-11-22

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report: November 22, 2023

(Date of earliest event reported)

DEERE & COMPANY

(Exact name of registrant as specified in its charter)

Delaware

1-4121

36-2382580

(State or other jurisdiction of incorporation)

(Commission File Number)

(IRS Employer Identification No.)

One John Deere Place

MolineIllinois 61265

(Address of principal executive offices and zip code)

(309) 765-8000

(Registrant’s telephone number, including area code)

___________________________________________________

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

Title of each class

Trading symbol

Name of each exchange on which registered

Common stock, $1 par value

DE

New York Stock Exchange

6.55% Debentures Due 2028

DE28

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Items 2.02

and 7.01               Results of Operations and Financial Condition and Regulation FD Disclosure (Furnished

herewith)

Deere & Company’s press release dated November 22, 2023 concerning Fourth Quarter of Fiscal 2023 financial results and supplemental financial information (Exhibit 99.1) is furnished under Form 8-K Items 2.02 and 7.01. The attached schedules of Other Financial Information (Exhibit 99.2) and Fourth Quarter 2023 Earnings Conference Call Information (Exhibit 99.3) are furnished under Form 8-K Items 2.02 and 7.01. The information is not filed for purposes of the Securities Exchange Act of 1934 and is not deemed incorporated by reference by any general statements incorporating by reference this report or future filings into any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Deere & Company specifically incorporates the information by reference.

Item 9.01Financial Statements and Exhibits.

(d)Exhibits

Number

Description of Exhibit

99.1

Press Release and Supplemental Financial Information (Furnished herewith)

99.2

Other Financial Information (Furnished herewith)

99.3

Fourth Quarter 2023 Earnings Conference Call Information (Furnished herewith)

104

Cover Page Interactive Data File (the cover page XBRL tags are imbedded in the Inline XBRL document)

2

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

DEERE & COMPANY

By:

/s/ Edward R. Berk

Edward R. Berk

Secretary

Dated: November 22, 2023

3

Exhibit 99.1

(Furnished herewith)

News Release

Graphic

Contact:
Jen Hartmann
Director, Public Relations
HartmannJenniferA@JohnDeere.com

Deere Reports Net Income of $2.369 Billion for Fourth Quarter, $10.166 Billion for Fiscal Year

Net income grows for quarter and full year, driven by solid market conditions, differentiated products, and strong execution.
Full-year 2024 earnings forecast to be $7.75 to $8.25 billion, as volumes return to mid-cycle levels.
Ongoing focus on structural profitability, investments that deliver customer value.

MOLINE, Illinois (November 22, 2023) — Deere & Company reported net income of $2.369 billion for the fourth quarter ended October 29, 2023, or $8.26 per share, compared with net income of $2.246 billion, or $7.44 per share, for the quarter ended October 30, 2022. For fiscal-year 2023, net income attributable to Deere & Company was $10.166 billion, or $34.63 per share, compared with $7.131 billion, or $23.28 per share, in fiscal 2022.

Worldwide net sales and revenues decreased 1 percent, to $15.412 billion, for the fourth quarter of fiscal 2023 and rose 16 percent, to $61.251 billion, for the full year. Net sales were $13.801 billion for the quarter and $55.565 billion for the year, compared with $14.351 billion and $47.917 billion in 2022.

“Deere’s fourth-quarter and full-year results can be attributed to the successful execution of our Smart Industrial Operating Model and the value that customers recognize in our industry-leading products and solutions,” said John C. May, chairman and chief executive officer. “We must also recognize and credit our dedicated employees, dealers, and suppliers, whose hard work and focus have been instrumental to our overall success.”

Company Outlook & Summary

Net income attributable to Deere & Company for fiscal 2024 is forecasted to be in a range of $7.75 billion to $8.25 billion.

“While our end markets will fluctuate, we remain focused on disciplined execution and strategically investing in solutions that drive customer value,” May said. “As evidenced by our guidance for 2024, we are demonstrating higher levels of through-cycle structural profitability while making our company more resilient and better equipped for the future.”

4


Deere & Company

Fourth Quarter

Full Year

$ in millions, except per share amounts

2023

2022

% Change

2023

2022

% Change

Net sales and revenues

$

15,412

$

15,536

-1%

$

61,251

$

52,577

16%

Net income

$

2,369

$

2,246

5%

$

10,166

$

7,131

43%

Fully diluted EPS

$

8.26

$

7.44

$

34.63

$

23.28

Results for the presented periods were affected by special items. See Note 1 of the financial statements for further details.

Production & Precision Agriculture

Fourth Quarter

$ in millions

2023

2022

% Change

Net sales

$

6,965

$

7,434

-6%

Operating profit

$

1,836

$

1,740

6%

Operating margin

26.4%

23.4%

Production and precision agriculture sales decreased for the quarter due to lower shipment volumes partially offset by price realization. Operating profit improved primarily due to price realization partially offset by lower shipment volumes / sales mix and higher SA&G and R&D expenses. The prior period was impacted by higher reserves on assets in Russia.

Graphic

5


Small Agriculture & Turf

Fourth Quarter

$ in millions

2023

2022

% Change

Net sales

$

3,094

$

3,544

-13%

Operating profit

$

444

$

506

-12%

Operating margin

14.4%

14.3%

Small agriculture and turf sales decreased for the quarter due to lower shipment volumes partially offset by price realization. Operating profit decreased due to lower shipment volumes / sales mix and higher SA&G and R&D expenses, partially offset by price realization.

Graphic

6


Construction & Forestry

Fourth Quarter

$ in millions

2023

2022

% Change

Net sales

$

3,742

$

3,373

11%

Operating profit

$

516

$

414

25%

Operating margin

13.8%

12.3%

Construction and forestry sales increased for the quarter due to price realization and higher shipment volumes. Operating profit improved primarily due to price realization, partially offset by higher production costs, less-favorable sales mix, the unfavorable effects of foreign currency exchange, and a loss on the sale of the Russian roadbuilding business. The prior period was impacted by higher reserves on assets in Russia.

Graphic

Financial Services

Fourth Quarter

$ in millions

2023

2022

% Change

Net income

$

190

$

232

-18%

Financial services net income for the quarter decreased due to unfavorable derivative valuation adjustments, less-favorable financing spreads, and a higher provision for credit losses (excluding reserves in Russia). These factors were partially offset by income earned on a higher average portfolio. In the fourth quarter of 2022, financial services increased its reserves for credit losses in Russia and recorded an intercompany benefit from the equipment operations, which guarantees the financial services’ investment in certain international markets, including Russia.

7


Industry Outlook for Fiscal 2024

Agriculture & Turf

U.S. & Canada:

Large Ag

Down 10 to 15%

Small Ag & Turf

Down 5 to 10%

Europe

Down ~10%

South America (Tractors & Combines)

Down ~10%

Asia

Down moderately

Construction & Forestry

U.S. & Canada:

Construction Equipment

Down 5 to 10%

Compact Construction Equipment

Flat to Down 5%

Global Forestry

Down ~10%

Global Roadbuilding

Flat

Deere Segment Outlook for Fiscal 2024

Currency

Price

$ in millions

Net Sales

Translation

Realization

Production & Precision Ag

Down 15 to 20%

~ Flat

+1.5%

Small Ag & Turf

Down 10 to 15%

~ Flat

+1.0%

Construction & Forestry

Down ~10%

~ Flat

+1.5%

Financial Services

Net Income

~ $770

Financial Services. Fiscal-year 2024 net income attributable to Deere & Company for the financial services operations is forecast to be approximately $770 million. Results are expected to be higher in 2024 due to income earned on a higher average portfolio, partially offset by less-favorable financing spreads and lower gains on operating-lease residual values. A correction of the accounting treatment for financing incentives offered to John Deere dealers impacted 2023 financial results. See Note 1 of the financial statements for further details.

FORWARD-LOOKING STATEMENTS

Certain statements contained herein, including in the section entitled “Company Outlook & Summary,” “Industry Outlook,” and “Deere Segment Outlook,” relating to future events, expectations, and trends constitute “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 and involve factors that are subject to change, assumptions, risks, and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties could affect all lines of the company’s operations generally while others could more heavily affect a particular line of business.

Forward-looking statements are based on currently available information and current assumptions, expectations, and projections about future events and should not be relied upon. Except as required by law, the company expressly disclaims any obligation to update or revise its forward-looking statements. Many factors, risks, and uncertainties could cause actual results to differ materially from these forward-looking statements. Among these factors are risks related to:

changes in U.S., foreign and international laws, regulations, and policies relating to trade, spending, taxing, banking, monetary, environmental (including climate change and engine emission), and farming policies;

political, economic, and social instability of the geographies in which the company operates, including the ongoing war between Russia and Ukraine and the war between Israel and Hamas;

adverse macroeconomic conditions, including unemployment, inflation, rising interest rates, changes in consumer practices due to slower economic growth or possible recession, and regional or global liquidity constraints;

growth and sustainability of non-food uses for crops (including ethanol and biodiesel production);

8


the ability to execute business strategies, including the company’s Smart Industrial Operating Model, Leap Ambitions, and mergers and acquisitions;

the ability to understand and meet customers’ changing expectations and demand for John Deere products and solutions;

accurately forecasting customer demand for products and services and adequately managing inventory;

the ability to integrate new technology, including automation and machine learning, and deliver precision technology and solutions to customers;

changes to governmental communications channels (radio frequency technology);

the ability to adapt in highly competitive markets;

dealer practices and their ability to manage distribution of John Deere products and support and service precision technology solutions;

changes in climate patterns, unfavorable weather events, and natural disasters;

governmental and other actions designed to address climate change in connection with a transition to a lower-carbon economy;

higher interest rates and currency fluctuations which could adversely affect the U.S. dollar, customer confidence, access to capital, and demand for John Deere products and solutions;

availability and price of raw materials, components, and whole goods;

delays or disruptions in the company’s supply chain;

labor relations and contracts, including work stoppages and other disruptions;

the ability to attract, develop, engage, and retain qualified personnel;

security breaches, cybersecurity attacks, technology failures, and other disruptions to John Deere information technology infrastructure and products;

loss of or challenges to intellectual property rights;

compliance with evolving U.S. and foreign laws, including economic sanctions, data privacy, and environmental laws and regulations;

legislation introduced or enacted that could affect the company’s business model and intellectual property, such as so-called right to repair or right to modify legislation;

investigations, claims, lawsuits, or other legal proceedings;

events that damage the company’s reputation or brand;

world grain stocks, available farm acres, soil conditions, harvest yields, prices for commodities and livestock, input costs, and availability of transport for crops; and

housing starts and supply, real estate and housing prices, levels of public and non-residential construction, and infrastructure investment.

Further information concerning the company and its businesses, including factors that could materially affect the financial results, is included in the company’s filings with the SEC (including, but not limited to, the factors discussed in Item 1A. “Risk Factors” of the most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q). There also may be other factors that the company cannot anticipate or that are not described herein because the company does not currently perceive them to be material.

9


DEERE & COMPANY

FOURTH QUARTER 2023 PRESS RELEASE

(In millions of dollars) Unaudited

Three Months Ended

Years Ended

 

October 29

  

October 30

  

%

  

October 29

  

October 30

  

%

2023

2022

Change

2023

2022

Change

Net sales and revenues:

Production & precision ag net sales

$

6,965

$

7,434

 

-6

$

26,790

$

22,002

 

+22

Small ag & turf net sales

3,094

3,544

-13

13,980

13,381

+4

Construction & forestry net sales

 

3,742

 

3,373

 

+11

 

14,795

 

12,534

 

+18

Financial services revenues

 

1,347

 

988

 

+36

 

4,721

 

3,625

 

+30

Other revenues

 

264

 

197

 

+34

 

965

 

1,035

-7

Total net sales and revenues

$

15,412

$

15,536

 

-1

$

61,251

$

52,577

 

+16

Operating profit: *

Production & precision ag

$

1,836

$

1,740

 

+6

$

6,996

$

4,386

 

+60

Small ag & turf

444

506

-12

2,472

1,949

+27

Construction & forestry

 

516

 

414

 

+25

 

2,695

 

2,014

 

+34

Financial services

 

229

 

297

 

-23

 

795

 

1,159

 

-31

Total operating profit

 

3,025

 

2,957

 

+2

 

12,958

 

9,508

 

+36

Reconciling items **

 

51

 

(68)

 

 

79

 

(370)

 

Income taxes

 

(707)

 

(643)

 

+10

 

(2,871)

 

(2,007)

 

+43

Net income attributable to Deere & Company

$

2,369

$

2,246

 

+5

$

10,166

$

7,131

 

+43

*      Operating profit is income from continuing operations before corporate expenses, certain external interest expense, certain foreign exchange gains and losses, and income taxes. Operating profit for financial services includes the effect of interest expense and foreign exchange gains or losses.

**     Reconciling items are primarily corporate expenses, certain interest income and expenses, certain foreign exchange gains and losses, pension and postretirement benefit costs excluding the service cost component, equity in income of unconsolidated affiliates, and net income attributable to noncontrolling interests.

10


DEERE & COMPANY

STATEMENTS OF CONSOLIDATED INCOME

For the Three Months and Years Ended October 29, 2023 and October 30, 2022

(In millions of dollars and shares except per share amounts) Unaudited

Three Months Ended

Years Ended

 

2023

  

2022

  

2023

  

2022

Net Sales and Revenues

Net sales

$

13,801

$

14,351

$

55,565

$

47,917

Finance and interest income

 

1,357

 

925

 

4,683

 

3,365

Other income

 

254

 

260

 

1,003

 

1,295

Total

 

15,412

 

15,536

 

61,251

 

52,577

Costs and Expenses

Cost of sales

 

9,427

 

10,214

 

37,715

 

35,338

Research and development expenses

 

606

 

576

 

2,177

 

1,912

Selling, administrative and general expenses

 

1,203

 

1,192

 

4,595

 

3,863

Interest expense

 

781

 

348

 

2,453

 

1,062

Other operating expenses

 

322

 

320

 

1,292

 

1,275

Total

 

12,339

 

12,650

 

48,232

 

43,450

Income of Consolidated Group before Income Taxes

 

3,073

 

2,886

 

13,019

 

9,127

Provision for income taxes

 

707

 

643

 

2,871

 

2,007

Income of Consolidated Group

 

2,366

 

2,243

 

10,148

 

7,120

Equity in income of unconsolidated affiliates

 

2

 

1

 

7

 

10

Net Income

 

2,368

 

2,244

 

10,155

 

7,130

Less: Net loss attributable to noncontrolling interests

 

(1)

 

(2)

 

(11)

 

(1)

Net Income Attributable to Deere & Company

$

2,369

$

2,246

$

10,166

$

7,131

Per Share Data

Basic

$

8.30

$

7.48

$

34.80

$

23.42

Diluted

8.26

7.44

34.63

23.28

Dividends declared

1.35

1.13

5.05

4.36

Dividends paid

1.25

1.13

4.83

4.28

Average Shares Outstanding

Basic

 

285.5

 

300.4

 

292.2

 

304.5

Diluted

 

286.9

 

302.1

 

293.6

 

306.3

See Condensed Notes to Consolidated Financial Statements.

11


DEERE & COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

As of October 29, 2023 and October 30, 2022

(In millions of dollars) Unaudited

    

2023

    

2022

Assets

Cash and cash equivalents

$

7,458

$

4,774

Marketable securities

 

946

 

734

Trade accounts and notes receivable – net

 

7,739

 

6,410

Financing receivables – net

 

43,673

 

36,634

Financing receivables securitized – net

 

7,335

 

5,936

Other receivables

 

2,623

 

2,492

Equipment on operating leases – net

 

6,917

 

6,623

Inventories

 

8,160

 

8,495

Property and equipment – net

 

6,879

 

6,056

Goodwill

 

3,900

 

3,687

Other intangible assets – net

 

1,133

 

1,218

Retirement benefits

 

3,007

 

3,730

Deferred income taxes

 

1,814

 

824

Other assets

 

2,503

 

2,417

Total Assets

$

104,087

$

90,030

Liabilities and Stockholders’ Equity

Liabilities

Short-term borrowings

$

17,939

$

12,592

Short-term securitization borrowings

 

6,995

 

5,711

Accounts payable and accrued expenses

 

16,130

 

14,822

Deferred income taxes

 

520

 

495

Long-term borrowings

 

38,477

 

33,596

Retirement benefits and other liabilities

 

2,140

 

2,457

Total liabilities

 

82,201

 

69,673

Redeemable noncontrolling interest

97

92

Stockholders’ Equity

Total Deere & Company stockholders’ equity

 

21,785

 

20,262

Noncontrolling interests

 

4

 

3

Total stockholders’ equity

 

21,789

 

20,265

Total Liabilities and Stockholders’ Equity

$

104,087

$

90,030

See Condensed Notes to Consolidated Financial Statements.

12


DEERE & COMPANY

STATEMENTS OF CONSOLIDATED CASH FLOWS

For the Years Ended October 29, 2023 and October 30, 2022

(In millions of dollars) Unaudited

    

2023

    

2022

Cash Flows from Operating Activities

Net income

$

10,155

$

7,130

Adjustments to reconcile net income to net cash provided by operating activities:

Provision (credit) for credit losses

 

(16)

 

192

Provision for depreciation and amortization

 

2,004

 

1,895

Impairments and other adjustments

191

 

88

Share-based compensation expense

 

130

 

85

Gain on remeasurement of previously held equity investment

(326)

Credit for deferred income taxes

 

(790)

 

(66)

Changes in assets and liabilities:

Receivables related to sales

 

(4,253)

 

(2,483)

Inventories

 

279

 

(2,091)

Accounts payable and accrued expenses

 

830

 

1,133

Accrued income taxes payable/receivable

 

(23)

 

141

Retirement benefits

 

(170)

 

(1,015)

Other

 

252

 

16

Net cash provided by operating activities

 

8,589

 

4,699

Cash Flows from Investing Activities

Collections of receivables (excluding receivables related to sales)

 

23,051

 

20,907

Proceeds from sales of equipment on operating leases

 

1,981

 

2,093

Cost of receivables acquired (excluding receivables related to sales)

 

(28,772)

 

(26,300)

Acquisitions of businesses, net of cash acquired

(82)

(498)

Purchases of property and equipment

 

(1,498)

 

(1,134)

Cost of equipment on operating leases acquired

 

(2,970)

 

(2,654)

Collateral on derivatives – net

(12)

(642)

Other

 

(447)

 

(257)

Net cash used for investing activities

 

(8,749)

 

(8,485)

Cash Flows from Financing Activities

Net proceeds in short-term borrowings (original maturities three months or less)

 

4,008

 

3,852

Proceeds from borrowings issued (original maturities greater than three months)

 

15,429

 

10,358

Payments of borrowings (original maturities greater than three months)

 

(7,913)

 

(8,445)

Repurchases of common stock

 

(7,216)

 

(3,597)

Dividends paid

 

(1,427)

 

(1,313)

Other

 

(73)

 

(29)

Net cash provided by financing activities

 

2,808

 

826

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash

 

31

 

(224)

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash

 

2,679

 

(3,184)

Cash, Cash Equivalents, and Restricted Cash at Beginning of Year

 

4,941

 

8,125

Cash, Cash Equivalents, and Restricted Cash at End of Year

$

7,620

$

4,941

See Condensed Notes to Consolidated Financial Statements.

13


DEERE & COMPANY

Condensed Notes to Consolidated Financial Statements

(In millions of dollars) Unaudited

(1)Special Items

2023

In the fourth quarter of 2023, the company sold its Russian roadbuilding business, recognizing a loss of $18 million (pretax and after-tax). The loss was recorded in “Other operating expenses” in the construction and forestry segment.

In the third quarter of 2023, a favorable tax ruling in Brazil allowed the company to record a $243 million reduction in the provision for income taxes and $47 million of interest income.

In the second quarter of 2023, the company corrected the accounting treatment for financing incentives offered to John Deere dealers, which impacted the timing of expense recognition and the presentation of incentive costs in the consolidated financial statements. The cumulative effect of this correction, $173 million pretax ($135 million after-tax), was recorded in the second quarter of 2023. Prior period results for Deere & Company were not restated, as the adjustment is considered immaterial to the company’s financial statements.

2022

In the second quarter of 2022, the company acquired full ownership of three former Deere-Hitachi joint venture factories. The remeasurement of the previously held equity investment resulted in a non-cash gain of $326 million (pretax and after-tax).

In the second quarter of 2022, the company suspended shipments of machines and service parts to Russia. As a result, the company impaired its long-lived assets, increased reserves of certain financial assets, introduced an employee voluntary-separation program, and recorded an accrual for various contractual uncertainties. In the fourth quarter of 2022, the company increased its reserves for credit losses, reflecting further economic uncertainty in Russia. The financial services received an intercompany benefit from the equipment operations, which guarantees the financial services’ investment in certain international markets, including Russia.

In the first quarter of 2022, the company had a one-time payment related to the ratification of the UAW collective bargaining agreement, totaling $90 million.

The following table summarizes the operating profit impact, in millions of dollars, of the special items recorded for the three months and fiscal years ended October 29, 2023 and October 30, 2022:

Three Months

Fiscal Years

 

PPA

 

SAT

 

CF

 

FS

 

Total

 

PPA

 

SAT

 

CF

 

FS

 

Total

2023 Expense:

Russian roadbuilding sale – Other operating expense

$

18

$

18

$

18

$

18

Financing incentive – SA&G expense

$

173

173

Total expense

18

18

18

173

191

2022 Expense (benefit):

Gain on remeasurement of equity investment – Other income

(326)

(326)

Total Russia/Ukraine events expense

$

70

$

8

50

128

$

133

$

11

110

1

255

UAW ratification bonus – Cost of sales

53

9

28

90

Total expense (benefit)

70

8

50

128

186

20

(188)

1

19

Period over period change

$

(70)

$

(8)

$

(32)

$

(110)

$

(186)

$

(20)

$

206

$

172

$

172

14


(2)The consolidated financial statements represent the consolidation of all Deere & Company’s subsidiaries. The supplemental consolidating data is presented for informational purposes. Transactions between the Equipment Operations and Financial Services have been eliminated to arrive at the consolidated financial statements. In the supplemental consolidating data in Note 3 to the financial statements, the “Equipment Operations” represents the enterprise without “Financial Services”, which include the company’s production and precision agriculture operations, small agriculture and turf operations, and construction and forestry operations, and other corporate assets, liabilities, revenues, and expenses not reflected within “Financial Services.”

15


DEERE & COMPANY

(3) SUPPLEMENTAL CONSOLIDATING DATA
STATEMENTS OF INCOME

For the Three Months Ended October 29, 2023 and October 30, 2022

(In millions of dollars) Unaudited

EQUIPMENT

FINANCIAL

OPERATIONS

SERVICES

ELIMINATIONS

CONSOLIDATED

2023

2022

2023

2022

2023

2022

2023

2022

Net Sales and Revenues

    

    

    

Net sales

$

13,801

$

14,351

$

13,801

$

14,351

Finance and interest income

193

83

$

1,445

$

1,003

$

(281)

$

(161)

1,357

925

1

Other income

218

233

121

231

(85)

(204)

254

260

2, 3

Total

14,212

14,667

1,566

1,234

(366)

(365)

15,412

15,536

Costs and Expenses

Cost of sales

9,433

10,215

(6)

(1)

9,427

10,214

4

Research and development expenses

606

576

606

576

Selling, administrative and general expenses

980

922

225

272

(2)

(2)

1,203

1,192

4

Interest expense

114

93

757

306

(90)

(51)

781

348

1

Interest compensation to Financial Services

191

110

(191)

(110)

1

Other operating expenses

45

163

354

358

(77)

(201)

322

320

5, 6

Total

11,369

12,079

1,336

936

(366)

(365)

12,339

12,650

Income before Income Taxes

2,843

2,588

230

298

3,073

2,886

Provision for income taxes

665

576

42

67

707

643

Income after Income Taxes

2,178

2,012

188

231

2,366

2,243

Equity in income of unconsolidated affiliates

2

1

2

1

Net Income

2,178

2,012

190

232

2,368

2,244

Less: Net loss attributable to noncontrolling interests

(1)

(2)

(1)

(2)

Net Income Attributable to Deere & Company

$

2,179

$

2,014

$

190

$

232

$

2,369

$

2,246

1 Elimination of intercompany interest income and expense.

2 Elimination of Equipment Operations’ margin from inventory transferred to equipment on operating leases.

3 Elimination of Financial Services’ income related to intercompany guarantees of investments in certain international markets and intercompany service revenues.

4 Elimination of intercompany service fees.

5 Elimination of Financial Services’ lease depreciation expense related to inventory transferred to equipment on operating leases.

6 Elimination of Equipment Operations’ expense related to intercompany guarantees of investments in certain international markets and intercompany service expenses.

16


DEERE & COMPANY

SUPPLEMENTAL CONSOLIDATING DATA (Continued)
STATEMENTS OF INCOME

For the Years Ended October 29, 2023 and October 30, 2022

(In millions of dollars) Unaudited

EQUIPMENT

FINANCIAL

OPERATIONS

SERVICES

ELIMINATIONS

CONSOLIDATED

2023

2022

2023

2022

2023

2022

2023

2022

Net Sales and Revenues

    

    

    

Net sales

$

55,565

$

47,917

$

55,565

$

47,917

Finance and interest income

636

213

$

5,055

$

3,583

$

(1,008)

$

(431)

4,683

3,365

1

Other income

858

1,261

499

502

(354)

(468)

1,003

1,295

2, 3

Total

57,059

49,391

5,554

4,085

(1,362)

(899)

61,251

52,577

Costs and Expenses

Cost of sales

37,739

35,341

(24)

(3)

37,715

35,338

4

Research and development expenses

2,177

1,912

2,177

1,912

Selling, administrative and general expenses

3,611

3,137

994

735

(10)

(9)

4,595

3,863

4

Interest expense

411

390

2,362

799

(320)

(127)

2,453

1,062

1

Interest compensation to Financial Services

687

299

(687)

(299)

1

Other operating expenses

217

350

1,396

1,386

(321)

(461)

1,292

1,275

5, 6

Total

44,842

41,429

4,752

2,920

(1,362)

(899)

48,232

43,450