In the company’s second quarter earnings statement, John Deere included a positive sales forecast of 21% to 23% increase for fiscal year 2011.
For the second quarter 2011, here’s a summary of equipment division performance:
Agriculture & Turf: sales increased 24% for the quarter and 23% for six months. This was largely due to higher shipment volumes, improved price realization and the favorable effects of currency translation.
Construction & Forestry: sales increased 46% for the quarter and 61% for six months mainly due to higher shipment volumes and improved price realization.
Company equipment sales are projected to be up about 20% for the third quarter compared with the same periods a year ago.
The annual forecast includes a negative impact of approximately $300 million in sales and $70 million in operating profit resulting from the recent Japanese earthquake and tsunami.
Here’s a summary of the market conditions and outlook for the agriculture and turf market. Worldwide sales are forecast to increase by 20% for full-year 2011. Farm machinery sales in the U.S. and Canada are forecast to be up 5 to 10%. Industry sales in the EU 27 nations and Western and Central Europe are forecast to increase 15%. Sales in the Commonwealth of Independent States are expected to see notably stronger gains from the depressed levels of 2010. Sales in Asia are forecast to grow strongly. South American sales are projected to be down 5 to 10% compared with 2010 and weakness in the small-tractor market in Brazil and recently enacted trade policies in Argentina are contributing to the decline. Sales of turf and utility equipment in the U.S. and Canada are expected to be flat after a modest recovery in 2010.