- 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,
Ill., Nov. 22, 2023 /PRNewswire/ -- 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."
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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.
|
|
|
|
|
|
|
|
|
|
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.
|
|
|
|
|
|
|
|
|
|
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.
|
|
|
|
|
|
|
|
|
|
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.
|
|
|
|
|
|
|
|
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);
- 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.
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.
|
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.
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.
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.
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
|
|
(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."
|
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.
|
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
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before Income Taxes
|
|
|
12,217
|
|
|
7,962
|
|
|
802
|
|
|
1,165
|
|
|
|
|
|
|
|
|
13,019
|
|
|
9,127
|
|
|
|
Provision for income
taxes
|
|
|
2,685
|
|
|
1,718
|
|
|
186
|
|
|
289
|
|
|
|
|
|
|
|
|
2,871
|
|
|
2,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income after Income Taxes
|
|
|
9,532
|
|
|
6,244
|
|
|
616
|
|
|
876
|
|
|
|
|
|
|
|
|
10,148
|
|
|
7,120
|
|
|
|
Equity in income
of unconsolidated affiliates
|
|
|
4
|
|
|
6
|
|
|
3
|
|
|
4
|
|
|
|
|
|
|
|
|
7
|
|
|
10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
|
9,536
|
|
|
6,250
|
|
|
619
|
|
|
880
|
|
|
|
|
|
|
|
|
10,155
|
|
|
7,130
|
|
|
|
Less: Net loss
attributable to
noncontrolling interests
|
|
|
(11)
|
|
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11)
|
|
|
(1)
|
|
|
|
Net Income Attributable to
Deere & Company
|
|
$
|
9,547
|
|
$
|
6,251
|
|
$
|
619
|
|
$
|
880
|
|
|
|
|
|
|
|
$
|
10,166
|
|
$
|
7,131
|
|
|
|
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.
|
DEERE &
COMPANY
SUPPLEMENTAL
CONSOLIDATING DATA (Continued)
CONDENSED BALANCE
SHEETS
As of 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
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
5,720
|
|
$
|
3,767
|
|
$
|
1,738
|
|
$
|
1,007
|
|
|
|
|
|
|
|
$
|
7,458
|
|
$
|
4,774
|
|
|
|
Marketable
securities
|
|
104
|
|
|
61
|
|
|
842
|
|
|
673
|
|
|
|
|
|
|
|
|
946
|
|
|
734
|
|
|
|
Receivables from
Financial Services
|
|
4,516
|
|
|
6,569
|
|
|
|
|
|
|
|
$
|
(4,516)
|
|
$
|
(6,569)
|
|
|
|
|
|
|
|
7
|
|
Trade accounts and
notes
receivable – net
|
|
1,320
|
|
|
1,273
|
|
|
8,687
|
|
|
6,434
|
|
|
(2,268)
|
|
|
(1,297)
|
|
|
7,739
|
|
|
6,410
|
|
8
|
|
Financing receivables –
net
|
|
64
|
|
|
47
|
|
|
43,609
|
|
|
36,587
|
|
|
|
|
|
|
|
|
43,673
|
|
|
36,634
|
|
|
|
Financing receivables
securitized – net
|
|
|
|
|
|
|
|
7,335
|
|
|
5,936
|
|
|
|
|
|
|
|
|
7,335
|
|
|
5,936
|
|
|
|
Other
receivables
|
|
1,813
|
|
|
1,670
|
|
|
869
|
|
|
832
|
|
|
(59)
|
|
|
(10)
|
|
|
2,623
|
|
|
2,492
|
|
8
|
|
Equipment on operating
leases – net
|
|
|
|
|
|
|
|
6,917
|
|
|
6,623
|
|
|
|
|
|
|
|
|
6,917
|
|
|
6,623
|
|
|
|
Inventories
|
|
8,160
|
|
|
8,495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,160
|
|
|
8,495
|
|
|
|
Property and equipment
– net
|
|
6,843
|
|
|
6,021
|
|
|
36
|
|
|
35
|
|
|
|
|
|
|
|
|
6,879
|
|
|
6,056
|
|
|
|
Goodwill
|
|
3,900
|
|
|
3,687
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,900
|
|
|
3,687
|
|
|
|
Other intangible assets
– net
|
|
1,133
|
|
|
1,218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,133
|
|
|
1,218
|
|
|
|
Retirement
benefits
|
|
2,936
|
|
|
3,666
|
|
|
72
|
|
|
66
|
|
|
(1)
|
|
|
(2)
|
|
|
3,007
|
|
|
3,730
|
|
9
|
|
Deferred income
taxes
|
|
2,133
|
|
|
940
|
|
|
68
|
|
|
45
|
|
|
(387)
|
|
|
(161)
|
|
|
1,814
|
|
|
824
|
|
10
|
|
Other assets
|
|
1,948
|
|
|
1,794
|
|
|
559
|
|
|
626
|
|
|
(4)
|
|
|
(3)
|
|
|
2,503
|
|
|
2,417
|
|
|
|
Total Assets
|
$
|
40,590
|
|
$
|
39,208
|
|
$
|
70,732
|
|
$
|
58,864
|
|
$
|
(7,235)
|
|
$
|
(8,042)
|
|
$
|
104,087
|
|
$
|
90,030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
borrowings
|
$
|
1,230
|
|
$
|
1,040
|
|
$
|
16,709
|
|
$
|
11,552
|
|
|
|
|
|
|
|
$
|
17,939
|
|
$
|
12,592
|
|
|
|
Short-term
securitization borrowings
|
|
|
|
|
|
|
|
6,995
|
|
|
5,711
|
|
|
|
|
|
|
|
|
6,995
|
|
|
5,711
|
|
|
|
Payables to Equipment
Operations
|
|
|
|
|
|
|
|
4,516
|
|
|
6,569
|
|
$
|
(4,516)
|
|
$
|
(6,569)
|
|
|
|
|
|
|
|
7
|
|
Accounts payable
and
accrued expenses
|
|
14,862
|
|
|
12,962
|
|
|
3,599
|
|
|
3,170
|
|
|
(2,331)
|
|
|
(1,310)
|
|
|
16,130
|
|
|
14,822
|
|
8
|
|
Deferred income
taxes
|
|
452
|
|
|
380
|
|
|
455
|
|
|
276
|
|
|
(387)
|
|
|
(161)
|
|
|
520
|
|
|
495
|
|
10
|
|
Long-term
borrowings
|
|
7,210
|
|
|
7,917
|
|
|
31,267
|
|
|
25,679
|
|
|
|
|
|
|
|
|
38,477
|
|
|
33,596
|
|
|
|
Retirement benefits and
other liabilities
|
|
2,032
|
|
|
2,351
|
|
|
109
|
|
|
108
|
|
|
(1)
|
|
|
(2)
|
|
|
2,140
|
|
|
2,457
|
|
9
|
|
Total
liabilities
|
|
25,786
|
|
|
24,650
|
|
|
63,650
|
|
|
53,065
|
|
|
(7,235)
|
|
|
(8,042)
|
|
|
82,201
|
|
|
69,673
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable
noncontrolling interest
|
|
97
|
|
|
92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
97
|
|
|
92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Deere &
Company
stockholders' equity
|
|
21,785
|
|
|
20,262
|
|
|
7,082
|
|
|
5,799
|
|
|
(7,082)
|
|
|
(5,799)
|
|
|
21,785
|
|
|
20,262
|
|
11
|
|
Noncontrolling
interests
|
|
4
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
3
|
|
|
|
Financial Services
equity
|
|
(7,082)
|
|
|
(5,799)
|
|
|
|
|
|
|
|
|
7,082
|
|
|
5,799
|
|
|
|
|
|
|
|
11
|
|
Adjusted total
stockholders' equity
|
|
14,707
|
|
|
14,466
|
|
|
7,082
|
|
|
5,799
|
|
|
|
|
|
|
|
|
21,789
|
|
|
20,265
|
|
|
|
Total Liabilities and
Stockholders' Equity
|
$
|
40,590
|
|
$
|
39,208
|
|
$
|
70,732
|
|
$
|
58,864
|
|
$
|
(7,235)
|
|
$
|
(8,042)
|
|
$
|
104,087
|
|
$
|
90,030
|
|
|
|
7
|
Elimination of
receivables / payables between Equipment Operations and Financial
Services.
|
8
|
Primarily
reclassification of sales incentive accruals on receivables sold to
Financial Services.
|
9
|
Reclassification of net
pension assets / liabilities.
|
10
|
Reclassification of
deferred tax assets / liabilities in the same taxing
jurisdictions.
|
11
|
Elimination of
Financial Services' equity.
|
DEERE &
COMPANY
SUPPLEMENTAL
CONSOLIDATING DATA (Continued)
STATEMENTS OF CASH
FLOWS
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
|
|
|
|
Cash Flows from Operating
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
9,536
|
|
$
|
6,250
|
|
$
|
619
|
|
$
|
880
|
|
|
|
|
|
|
|
$
|
10,155
|
|
$
|
7,130
|
|
|
|
Adjustments to
reconcile net income to net cash provided
by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (credit) for
credit losses
|
|
|
7
|
|
|
3
|
|
|
(23)
|
|
|
189
|
|
|
|
|
|
|
|
|
(16)
|
|
|
192
|
|
|
|
Provision (credit) for
depreciation and amortization
|
|
|
1,123
|
|
|
1,041
|
|
|
1,016
|
|
|
1,050
|
|
$
|
(135)
|
|
$
|
(196)
|
|
|
2,004
|
|
|
1,895
|
|
12
|
|
Impairments and other
adjustments
|
|
|
18
|
|
|
88
|
|
|
173
|
|
|
|
|
|
|
|
|
|
|
|
191
|
|
|
88
|
|
|
|
Share-based
compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
130
|
|
|
85
|
|
|
130
|
|
|
85
|
|
13
|
|
Gain on remeasurement
of previously held equity
investment
|
|
|
|
|
|
(326)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(326)
|
|
|
|
Distributed earnings
of Financial Services
|
|
|
215
|
|
|
444
|
|
|
|
|
|
|
|
|
(215)
|
|
|
(444)
|
|
|
|
|
|
|
|
14
|
|
Provision (credit) for
deferred income taxes
|
|
|
(959)
|
|
|
8
|
|
|
169
|
|
|
(74)
|
|
|
|
|
|
|
|
|
(790)
|
|
|
(66)
|
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables related
to sales
|
|
|
(58)
|
|
|
(189)
|
|
|
|
|
|
|
|
|
(4,195)
|
|
|
(2,294)
|
|
|
(4,253)
|
|
|
(2,483)
|
|
15, 17, 18
|
|
Inventories
|
|
|
474
|
|
|
(1,924)
|
|
|
|
|
|
|
|
|
(195)
|
|
|
(167)
|
|
|
279
|
|
|
(2,091)
|
|
16
|
|
Accounts payable and
accrued expenses
|
|
|
1,352
|
|
|
1,444
|
|
|
449
|
|
|
143
|
|
|
(971)
|
|
|
(454)
|
|
|
830
|
|
|
1,133
|
|
17
|
|
Accrued income taxes
payable/receivable
|
|
|
8
|
|
|
166
|
|
|
(31)
|
|
|
(25)
|
|
|
|
|
|
|
|
|
(23)
|
|
|
141
|
|
|
|
Retirement
benefits
|
|
|
(164)
|
|
|
(1,016)
|
|
|
(6)
|
|
|
1
|
|
|
|
|
|
|
|
|
(170)
|
|
|
(1,015)
|
|
|
|
Other
|
|
|
367
|
|
|
250
|
|
|
(51)
|
|
|
(287)
|
|
|
(64)
|
|
|
53
|
|
|
252
|
|
|
16
|
|
12, 13, 16
|
|
Net cash provided by
operating activities
|
|
|
11,919
|
|
|
6,239
|
|
|
2,315
|
|
|
1,877
|
|
|
(5,645)
|
|
|
(3,417)
|
|
|
8,589
|
|
|
4,699
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collections of
receivables (excluding receivables related
to sales)
|
|
|
|
|
|
|
|
|
24,128
|
|
|
22,400
|
|
|
(1,077)
|
|
|
(1,493)
|
|
|
23,051
|
|
|
20,907
|
|
15
|
|
Proceeds from sales of
equipment on operating leases
|
|
|
|
|
|
|
|
|
1,981
|
|
|
2,093
|
|
|
|
|
|
|
|
|
1,981
|
|
|
2,093
|
|
|
|
Cost of receivables
acquired (excluding receivables related
to sales)
|
|
|
|
|
|
|
|
|
(29,229)
|
|
|
(26,903)
|
|
|
457
|
|
|
603
|
|
|
(28,772)
|
|
|
(26,300)
|
|
15
|
|
Acquisitions of
businesses, net of cash acquired
|
|
|
(82)
|
|
|
(498)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(82)
|
|
|
(498)
|
|
|
|
Purchases of property
and equipment
|
|
|
(1,494)
|
|
|
(1,131)
|
|
|
(4)
|
|
|
(3)
|
|
|
|
|
|
|
|
|
(1,498)
|
|
|
(1,134)
|
|
|
|
Cost of equipment on
operating leases acquired
|
|
|
|
|
|
|
|
|
(3,234)
|
|
|
(2,879)
|
|
|
264
|
|
|
225
|
|
|
(2,970)
|
|
|
(2,654)
|
|
16
|
|
Increase (decrease) in
investment in Financial Services
|
|
|
(870)
|
|
|
7
|
|
|
|
|
|
|
|
|
870
|
|
|
(7)
|
|
|
|
|
|
|
|
19
|
|
Increase in trade and
wholesale receivables
|
|
|
|
|
|
|
|
|
(5,783)
|
|
|
(3,601)
|
|
|
5,783
|
|
|
3,601
|
|
|
|
|
|
|
|
15
|
|
Collateral on
derivatives – net
|
|
|
(1)
|
|
|
5
|
|
|
(11)
|
|
|
(647)
|
|
|
|
|
|
|
|
|
(12)
|
|
|
(642)
|
|
|
|
Other
|
|
|
(290)
|
|
|
(213)
|
|
|
(160)
|
|
|
(81)
|
|
|
3
|
|
|
37
|
|
|
(447)
|
|
|
(257)
|
|
18
|
|
Net cash used for
investing activities
|
|
|
(2,737)
|
|
|
(1,830)
|
|
|
(12,312)
|
|
|
(9,621)
|
|
|
6,300
|
|
|
2,966
|
|
|
(8,749)
|
|
|
(8,485)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing
Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net proceeds (payments)
in short-term borrowings (original
maturities three months or less)
|
|
|
(113)
|
|
|
136
|
|
|
4,121
|
|
|
3,716
|
|
|
|
|
|
|
|
|
4,008
|
|
|
3,852
|
|
|
|
Change in intercompany
receivables/payables
|
|
|
2,090
|
|
|
(1,633)
|
|
|
(2,090)
|
|
|
1,633
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
borrowings issued (original maturities
greater than three months)
|
|
|
342
|
|
|
138
|
|
|
15,087
|
|
|
10,220
|
|
|
|
|
|
|
|
|
15,429
|
|
|
10,358
|
|
|
|
Payments of borrowings
(original maturities greater than
three months)
|
|
|
(901)
|
|
|
(1,356)
|
|
|
(7,012)
|
|
|
(7,089)
|
|
|
|
|
|
|
|
|
(7,913)
|
|
|
(8,445)
|
|
|
|
Repurchases of common
stock
|
|
|
(7,216)
|
|
|
(3,597)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7,216)
|
|
|
(3,597)
|
|
|
|
Capital investment from
Equipment Operations
|
|
|
|
|
|
|
|
|
870
|
|
|
(7)
|
|
|
(870)
|
|
|
7
|
|
|
|
|
|
|
|
19
|
|
Dividends
paid
|
|
|
(1,427)
|
|
|
(1,313)
|
|
|
(215)
|
|
|
(444)
|
|
|
215
|
|
|
444
|
|
|
(1,427)
|
|
|
(1,313)
|
|
14
|
|
Other
|
|
|
(7)
|
|
|
6
|
|
|
(66)
|
|
|
(35)
|
|
|
|
|
|
|
|
|
(73)
|
|
|
(29)
|
|
|
|
Net cash provided by
(used for) financing activities
|
|
|
(7,232)
|
|
|
(7,619)
|
|
|
10,695
|
|
|
7,994
|
|
|
(655)
|
|
|
451
|
|
|
2,808
|
|
|
826
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of Exchange Rate Changes on Cash, Cash
Equivalents, and Restricted Cash
|
|
|
24
|
|
|
(209)
|
|
|
7
|
|
|
(15)
|
|
|
|
|
|
|
|
|
31
|
|
|
(224)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Increase (Decrease) in Cash, Cash Equivalents,
and
Restricted Cash
|
|
|
1,974
|
|
|
(3,419)
|
|
|
705
|
|
|
235
|
|
|
|
|
|
|
|
|
2,679
|
|
|
(3,184)
|
|
|
|
Cash, Cash Equivalents, and Restricted Cash at
Beginning of Year
|
|
|
3,781
|
|
|
7,200
|
|
|
1,160
|
|
|
925
|
|
|
|
|
|
|
|
|
4,941
|
|
|
8,125
|
|
|
|
Cash, Cash Equivalents, and Restricted Cash at
End of Year
|
|
$
|
5,755
|
|
$
|
3,781
|
|
$
|
1,865
|
|
$
|
1,160
|
|
|
|
|
|
|
|
$
|
7,620
|
|
$
|
4,941
|
|
|
|
12
|
Elimination of
depreciation on leases related to inventory transferred to
equipment on operating leases.
|
13
|
Reclassification of
share-based compensation expense.
|
14
|
Elimination of
dividends from Financial Services to the Equipment Operations,
which are included in the Equipment Operations operating
activities.
|
15
|
Primarily
reclassification of receivables related to the sale of
equipment.
|
16
|
Reclassification of
direct lease agreements with retail customers.
|
17
|
Reclassification of
sales incentive accruals on receivables sold to Financial
Services.
|
18
|
Elimination and
reclassification of the effects of Financial Services partial
financing of the construction and forestry retail locations sales
and subsequent collection of those amounts.
|
19
|
Elimination of
investment from Equipment Operations to Financial
Services.
|
DEERE & COMPANY
OTHER FINANCIAL INFORMATION
The company evaluates its business results on the basis of
accounting principles generally accepted in the United States. In addition, it uses a
metric referred to as Shareholder Value Added (SVA), which
management believes is an appropriate measure for the performance
of its businesses. SVA is, in effect, the pretax profit left over
after subtracting the cost of enterprise capital. The company is
aiming for a sustained creation of SVA and is using this metric for
various performance goals. Certain compensation is also determined
on the basis of performance using this measure. For purposes of
determining SVA, each of the equipment segments is assessed a
pretax cost of assets, which on an annual basis is approximately 12
percent of the segment's average identifiable operating assets
during the applicable period with inventory at standard cost.
Management believes that valuing inventories at standard cost more
closely approximates the current cost of inventory and the
company's investment in the asset. The Financial Services segment
is assessed an annual pretax cost of approximately 13 percent of
the segment's average equity. The cost of assets or equity, as
applicable, is deducted from the operating profit or added to the
operating loss of each segment to determine the amount of SVA.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equipment
|
Production
&
|
Small Ag
|
Construction
|
|
For the Years
Ended
|
|
Operations
|
Precision
Ag
|
& Turf
|
&
Forestry
|
|
|
|
Oct 29
|
Oct 30
|
Oct 29
|
Oct 30
|
Oct 29
|
Oct 30
|
Oct 29
|
Oct 30
|
|
Dollars in Millions
|
|
2023
|
2022
|
2023
|
2022
|
2023
|
2022
|
2023
|
2022
|
|
Net Sales
|
|
$
|
55,565
|
|
$
|
47,917
|
|
$
|
26,790
|
|
$
|
22,002
|
|
$
|
13,980
|
|
$
|
13,381
|
|
$
|
14,795
|
|
$
|
12,534
|
|
|
Average Identifiable
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With Inventories as
Reported
|
|
$
|
21,114
|
|
$
|
19,420
|
|
$
|
9,256
|
|
$
|
8,336
|
|
$
|
4,601
|
|
$
|
4,349
|
|
$
|
7,257
|
|
$
|
6,735
|
|
|
With Inventories at
Standard Cost
|
|
|
23,186
|
|
|
20,983
|
|
|
10,343
|
|
|
9,118
|
|
|
5,149
|
|
|
4,795
|
|
|
7,694
|
|
|
7,070
|
|
|
Operating
Profit
|
|
$
|
12,163
|
|
$
|
8,349
|
|
$
|
6,996
|
|
$
|
4,386
|
|
$
|
2,472
|
|
$
|
1,949
|
|
$
|
2,695
|
|
$
|
2,014
|
|
|
Percent of Net
Sales
|
|
|
21.9
|
%
|
|
17.4
|
%
|
|
26.1
|
%
|
|
19.9
|
%
|
|
17.7
|
%
|
|
14.6
|
%
|
|
18.2
|
%
|
|
16.1
|
%
|
|
Operating Return on
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With Inventories as
Reported
|
|
|
57.6
|
%
|
|
43.0
|
%
|
|
75.6
|
%
|
|
52.6
|
%
|
|
53.7
|
%
|
|
44.8
|
%
|
|
37.1
|
%
|
|
29.9
|
%
|
|
With Inventories at
Standard Cost
|
|
|
52.5
|
%
|
|
39.8
|
%
|
|
67.6
|
%
|
|
48.1
|
%
|
|
48.0
|
%
|
|
40.6
|
%
|
|
35.0
|
%
|
|
28.5
|
%
|
|
SVA Cost of
Assets
|
|
$
|
(2,782)
|
|
$
|
(2,519)
|
|
$
|
(1,241)
|
|
$
|
(1,094)
|
|
$
|
(618)
|
|
$
|
(576)
|
|
$
|
(923)
|
|
$
|
(849)
|
|
|
SVA
|
|
|
9,381
|
|
|
5,830
|
|
|
5,755
|
|
|
3,292
|
|
|
1,854
|
|
|
1,373
|
|
|
1,772
|
|
|
1,165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years
Ended
|
|
Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oct 29
|
Oct 30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
Millions
|
|
|
2023
|
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable
to Deere & Company
|
|
$
|
619
|
|
$
|
880
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Equity
|
|
|
6,588
|
|
|
5,725
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
Equity
|
|
|
9.4
|
%
|
|
15.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
$
|
795
|
|
$
|
1,159
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
Equity
|
|
|
(858)
|
|
|
(760)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SVA
|
|
|
(63)
|
|
|
399
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/deere-reports-net-income-of-2-369-billion-for-fourth-quarter-10-166-billion-for-fiscal-year-301995571.html
SOURCE John Deere Company