MOLINE (dpa-AFX) - Agricultural machinery maker Deere & Co. (DE) Friday said its second-quarter profit declined from the previous year, but came well above Wall Street projections. Looking ahead, the company lifted its profit forecast for the year.
Net income attributable to the company dropped to $690.5 million or $2.03 per share from $980.7 million or $2.65 per share in the same period last year.
On average, 19 analysts polled by Thomson Reuters expected the company to report earnings per share of $1.55 for the quarter. Analysts' estimates typically exclude special items.
Worldwide net sales and revenues declined 18 percent to $8.17 billion from $9.95 billion. Total net sales dropped 20 percent to $7.40 billion from $9.25 billion a year ago. Analysts expected revenue of $7.53 billion for the quarter.
Equipment net sales in the U.S. and Canada decreased 14 percent, and decreased 28 percent outside the U.S. and Canada.
In Agriculture and turf business, revenues fell 25 percent to $5.77 billion, due largely to lower shipment volumes and the unfavorable effects of currency translation.
Construction and forestry revenues grew 2 percent to $1.633 billion, owing to higher shipment volumes and price realization.
Samuel Allen, chairman and CEO, said, 'John Deere's second-quarter results were noteworthy in light of the weak conditions that continue to affect the global agricultural sector...Deere's construction and forestry and financial-services divisions had higher results for the quarter, and our agriculture and turf operations remained solidly profitable despite lower demand for large models of farm machinery.'
For fiscal 2015, Deere expects net income attributable to company to be about $1.9 billion. Company equipment sales are projected to decrease about 19 percent for fiscal 2015 and about 17 percent for the third quarter, compared with the year-ago periods.
In February, the company projected net income attributable to the company to be nearly $1.8 billion, and equipment sales for the full year to decline about 17 percent.
The company forecast industry sales for agricultural equipment in the U.S. and Canada to be down about 25 percent for 2015.
Meanwhile, industry sales of turf and utility equipment in the U.S. and Canada are expected to be flat to up 5 percent for 2015, benefiting from general economic growth.
DE closed up 0.5 percent on Thursday, ad gained 2.6 percent in pre-market activity.
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