- ---------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------
FORM 10-Q
---------
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 1998
Commission file no: 1-6458
__________________________
JOHN DEERE CAPITAL CORPORATION
Delaware 36-2386361
(State of incorporation) (IRS employer identification no.)
1 East First Street, Suite 600
Reno, Nevada 89501
(Address of principal executive offices)
Telephone Number: (702) 786-5527
________________________________
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
At January 31, 1998, 2,500 shares of common stock, without
par value, of the registrant were outstanding, all of which were
owned by John Deere Credit Company, a wholly-owned subsidiary of
Deere & Company.
The registrant meets the conditions set forth in General
Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing
this Form with certain reduced disclosures as permitted by those
instructions.
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Page 1 of 14 Pages
Index to Exhibits: Page 12
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
John Deere Capital Corporation and Subsidiaries
Statements of Consolidated Income and Retained Earnings
(Unaudited)
(in millions)
Three Months Ended
January 31
1998 1997
Revenues
Finance income earned on retail notes $104.4 $ 92.2
Lease revenues 39.7 22.7
Revolving charge account income 25.3 22.0
Finance income earned on wholesale notes 13.9 11.8
Securitization and servicing fee income 7.8 10.4
Interest income from short-term investments 2.6 2.6
Other income 4.5 1.8
Total revenues 198.2 163.5
Expenses
Interest expense 88.3 71.5
Operating expenses:
Administrative and operating expenses 26.5 22.7
Provision for credit losses 9.3 6.5
Fees paid to Deere & Company 3.2 2.2
Depreciation of equipment on operating leases 23.4 14.3
Total operating expenses 62.4 45.7
Total expenses 150.7 117.2
Income of consolidated group before income taxes 47.5 46.3
Provision for income taxes 16.7 16.1
Income of consolidated group 30.8 30.2
Equity in losses of unconsolidated affiliates (.2) (.5)
Net income 30.6 29.7
Cash dividends declared (12.5) (20.0)
Retained earnings at beginning of the period 705.2 644.4
Retained earnings at end of the period $723.3 $654.1
See Notes to Interim Financial Statements.
Page 2
<PAGE>
John Deere Capital Corporation and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
(dollars in millions)
Jan 31, Oct 31, Jan 31,
1998 1997 1997
Assets
Cash and cash equivalents $ 197.5 $ 204.4 $ 173.9
Receivables and leases:
Retail notes 4,662.3 4,349.4 4,347.9
Wholesale notes 600.0 593.4 538.4
Revolving charge accounts 504.5 618.5 472.7
Financing leases 212.0 214.6 192.4
Total receivables 5,978.8 5,775.9 5,551.4
Equipment on operating
leases - net 577.1 527.2 325.1
Total receivables and
leases 6,555.9 6,303.1 5,876.5
Allowance for credit losses (88.0) (85.9) (88.5)
Total receivables and
leases - net 6,467.9 6,217.2 5,788.0
Other receivables 143.4 157.9 185.2
Investment in unconsolidated
affiliates 12.6 12.8 5.7
Other assets 65.1 66.8 68.1
Total Assets $6,886.5 $6,659.1 $6,220.9
Liabilities and Stockholder's
Equity
Short-term borrowings:
Commercial paper $2,098.6 $1,991.9 $2,125.1
Deere & Company 181.5 349.9 168.5
Current maturities of
long-term borrowings 1,248.5 1,042.5 955.3
Other notes payable 3.7 2.4 --
Total short-term
borrowings 3,532.3 3,386.7 3,248.9
Accounts payable and accrued
liabilities:
Accrued interest on
senior debt 58.7 39.2 49.2
Other payables 227.8 188.3 174.9
Total accounts payable
and accrued liabilities 286.5 227.5 224.1
Deposits withheld from dealers
and merchants 141.5 144.2 128.1
Long-term borrowings:
Senior debt 1,940.4 1,782.9 1,703.0
Subordinated debt 150.0 300.0 150.0
Total long-term borrowings 2,090.4 2,082.9 1,853.0
Total liabilities 6,050.7 5,841.3 5,454.1
Stockholder's equity
Common stock, without par
value (issued and
outstanding - 2,500 shares
owned by John Deere Credit
Company) 112.8 112.8 112.8
Retained earnings 723.3 705.2 654.1
Cumulative translation
adjustment (.3) (.2) (.1)
Total stockholder's equity 835.8 817.8 766.8
Total Liabilities and
Stockholder's Equity $6,886.5 $6,659.1 $6,220.9
See Notes to Interim Financial Statements.
Page 3
<PAGE>
John Deere Capital Corporation and Subsidiaries
Statements of Consolidated Cash Flows
(Unaudited)
(in millions)
Three Months Ended
January 31
1998 1997
Cash Flows from Operating Activities:
Net income $ 30.6 $ 29.7
Adjustments to reconcile net income to
net cash provided by operating
activities:
Provision for credit losses 9.3 6.5
Provision for depreciation 24.2 14.2
Equity in losses of unconsolidated
affiliates .2 .5
Other 14.4 (2.6)
Net cash provided by operating
activities 78.7 48.3
Cash Flows from Investing Activities:
Cost of receivables and leases acquired (1,675.4) (1,604.4)
Collections of receivables 1,375.5 1,323.3
Proceeds from sales of receivables 12.1 2.3
Other 69.3 49.5
Net cash used for investing
activities (218.5) (229.3)
Cash Flows from Financing Activities:
Increase in commercial paper 108.0 435.2
Change in receivable/payable with
Deere & Company (177.1) (376.3)
Proceeds from issuance of long-term
borrowings 306.0 145.0
Principal payments on long-term
borrowings (91.5) ---
Dividends paid (12.5) (20.0)
Net cash provided by financing
activities 132.9 183.9
Net increase (decrease) in cash and
cash equivalents (6.9) 2.9
Cash and cash equivalents at the
beginning of period 204.4 171.0
Cash and cash equivalents at the
end of period $ 197.5 $ 173.9
See Notes to Interim Financial Statements.
Page 4
<PAGE>
John Deere Capital Corporation and Subsidiaries
Notes to Interim Financial Statements
(1) The consolidated financial statements of John Deere Capital
Corporation (Capital Corporation) and its subsidiaries (the
Company) have been prepared by the Company, without audit,
pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote
disclosures normally included in annual financial statements
prepared in accordance with generally accepted accounting
principles have been condensed or omitted as permitted by such
rules and regulations. All adjustments, consisting of normal
recurring adjustments, have been included. Management believes
that the disclosures are adequate to present fairly the
financial position, results of operations and cash flows at the
dates and for the periods presented. It is suggested that these
interim financial statements be read in conjunction with the
financial statements and the notes thereto included in the
Company's latest annual report on Form 10-K. Results for
interim periods are not necessarily indicative of those to be
expected for the fiscal year.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
and related disclosures. Actual results could differ from those
estimates.
(2) The principal business of the Company is providing and
administering financing for retail purchases of new and used
equipment manufactured by Deere & Company's agricultural,
construction and commercial and consumer equipment divisions. The
Company purchases retail installment sales and loan contracts
(retail notes) from Deere & Company and its wholly-owned
subsidiaries (collectively called John Deere). These retail notes
are acquired by John Deere through independent John Deere retail
dealers. The Company also purchases and finances certain
agricultural, construction and lawn and grounds care retail notes
unrelated to John Deere. In addition, the Company purchases and
finances recreational product retail notes acquired from
independent dealers and marine product mortgage service companies
(recreational product retail notes). The Company also leases
equipment to retail customers, finances and services revolving
charge accounts acquired from and offered through merchants in the
agricultural, construction, lawn and grounds care and yacht
markets (revolving charge accounts), and provides wholesale
financing for inventories of recreational vehicles, manufactured
housing units, yachts, John Deere engines, and John Deere
agricultural and John Deere construction equipment owned by
dealers of those products (wholesale notes). Retail notes,
revolving charge accounts, direct financing leases and wholesale
notes receivable are collectively called "Receivables."
Receivables and operating leases are collectively called
"Receivables and Leases."
(3) The Company's ratio of earnings to fixed charges was 1.53
to 1 for the first quarter of 1998 compared with 1.64 to 1 for
the first quarter of 1997. "Earnings" consist of income before
income taxes, the cumulative effect of changes in accounting and
fixed charges. "Fixed charges" consist of interest on
indebtedness, amortization of debt discount and expense, an
estimated amount of rental expense under capitalized leases
which is deemed to be representative of the interest factor and
rental expense under operating leases.
(4) Beginning in September 1997, certain notes from dealers for
the financing of "purchase for rental equipment" were considered
wholesale notes. Prior to that time, such notes were considered
retail notes. During the first quarter of 1998, $37 million of
these wholesale notes were acquired. Prior period volumes and
ending balances have not been adjusted to reflect this change in
policy.
Page 5
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Results of Operations
Net income was $30.6 million in the first quarter of 1998
compared with $29.7 million last year. First quarter results
reflect higher income from a larger average Receivables and
Leases portfolio, partially offset by higher operating expenses,
lower securitization and servicing fee income and narrower
financing spreads.
Revenues totaled $198.2 million for the first quarter ended
January 31, 1998, compared to $163.5 million for the same period
a year ago. Finance income earned on retail notes increased 13
percent from $92.2 million during the first quarter of 1997 to
$104.4 million in 1998. Lease revenues increased $17.0 million
from $22.7 million in 1997 to $39.7 million this year, primarily
due to an increase in agricultural operating lease volumes.
Revenues on revolving charge accounts increased in the first
quarter of 1998 over the prior year, due to increasing demand
for producer operating loans and Farm Plan credit, while
wholesale finance income increased due primarily to increases in
yacht wholesale note volumes.
Other income increased from $1.8 million during the first
quarter of 1997 to $4.5 million during the first quarter of
1998. The increase in other income was primarily due to a gain
on sale adjustment from prior note sales and a net increase in
realized gains associated with sales of equipment used for
operating leases.
Total interest expense for the first quarter increased from
$71.5 million in 1997 to $88.3 million in 1998. The increase in
interest expense was the result of increased borrowings required
to finance the higher average portfolio of Receivables and
Leases and an increase in the Company's average borrowing costs.
Total average borrowings during the first quarter of 1998 were
$5.534 billion, compared to $5.015 billion during the first
quarter of 1997. The weighted average interest rate during the
first quarter of 1998 was 6.2 percent, compared to 6.0 percent
in the first quarter of 1997.
Administrative and operating expenses increased to $26.5 million
in the first quarter of 1998, compared to $22.7 million for the
same period in 1997. This increase was the result of higher
employment costs associated with administering a larger
Receivables and Leases portfolio. Depreciation of equipment on
operating leases increased to $23.4 million in the first quarter
of 1998, compared to $14.3 million for the same period in 1997,
a direct reflection of the Company's increase in operating lease
volumes.
During the first quarter of 1998, the provision for credit
losses totaled $9.3 million compared with $6.5 million in the
same period last year. The increase in the Company's loss
provision was due primarily to the growth in the portfolio of
Receivables and Leases and higher write-offs during the quarter.
The provision for credit losses, as a percentage of the total
average portfolio outstanding was .58 percent and .48 percent
for the first quarter of 1998 and 1997, respectively.
For the quarter ended January 31, 1998, all categories of retail
note volumes remained relatively stable when compared to the
same period in 1997. Within the recreational product line,
recreational vehicle volumes increased $13 million in the first
quarter of 1998 over the first quarter of 1997, while yacht
retail note volumes declined by $12 million during the same
period. Wholesale note volumes increased $27 million, or 11
percent, reflecting increases in dealer purchase for rental,
yacht, RV and engine volumes. Revolving charge accounts
increased $25 million in the first quarter of 1998 over the
first quarter of 1997, primarily due to increases in Farm Plan
and producer operating loans. Operating lease volumes increased
from $72 million in the first quarter of 1997 to $96 million in
the first quarter of 1998, primarily the result of agricultural
low-rate and guaranteed value leasing programs sponsored by John
Deere and the Company.
Page 6
<PAGE>
Total acquisition volumes of Receivables and Leases during the
first quarter ended January 31, 1998 and 1997 were as follows
(dollars in millions):
Three Months
Ended January 31,
$ %
1998 1997 Chng Chng
Retail notes volumes:
Agricultural equipment $ 838 $ 840 $ (2) --
Construction equipment 97 100 (3) (3)
Lawn and grounds care equipment 21 23 (2) (9)
Recreational products 65 64 1 2
Total retail note volumes 1,021 1,027 (6) --
Revolving charge accounts 256 231 25 11
Wholesale notes 279 252 27 11
Financing leases 23 23 -- --
Equipment on operating leases 96 72 24 33
Total Receivable and Lease
volumes $1,675 $1,605 $70 4
Total Receivables and Leases held at January 31, 1998, October
31, 1997 and January 31, 1997 were as follows (in millions):
Jan 31, Oct 31, Jan 31,
1998 1997 1997
Retail notes held:
Agricultural equipment $2,863 $2,556 $2,675
Construction equipment 666 660 644
Lawn and grounds care equipment 205 216 180
Recreational products 928 917 849
Total retail notes held 4,662 4,349 4,348
Revolving charge accounts 505 619 473
Wholesale notes 600 593 538
Financing leases 212 215 193
Equipment on operating leases 577 527 325
Total Receivables and Leases held $6,556 $6,303 $5,877
Retail notes administered by the Company, which includes retail
notes previously sold, totaled $5.676 billion at January 31,
1998, $5.663 billion at October 31, 1997, and $5.317 billion at
January 31, 1997. At January 31, 1998, the balance of retail
notes previously sold was $1.014 billion compared with $1.314
billion at October 31, 1997 and $969 million at January 31,
1997. The Company's estimated maximum exposure under all retail
note recourse provisions at January 31, 1998 was $163 million.
The balance of retail notes held (principal plus accrued
interest) with any installment 60 days or more past due was
$56.1 million, $44.4 million and $60.6 million at January 31,
1998, October 31, 1997 and January 31, 1997, respectively. The
balance of retail notes held on which any installment was 60
days or more past due as a percentage of ending retail notes
receivable was 1.20 percent, 1.02 percent and 1.39 percent at
January 31, 1998, October 31, 1997 and January 31, 1997,
respectively.
Page 7
<PAGE>
Total amounts of Receivables and Leases 60 days or more past
due, by product and as a percentage of total balances held at
January 31, 1998, October 31, 1997 and January 31, 1997, were as
follows (dollars in millions):
Jan 31, Oct 31, Jan 31,
1998 1997 1997
$ % $ % $ %
Retail notes:
Agricultural equipment $ 8.3 .29% $ 6.8 .27% $ 6.4 .24%
Construction equipment 2.7 .40 2.0 .31 3.0 .47
Lawn and grounds care
equipment .7 .32 .6 .28 .9 .49
Recreational products .2 .03 .3 .03 .4 .05
Total retail notes 11.9 .26 9.7 .22 10.7 .25
Revolving charge accounts 10.6 2.11 8.3 1.34 12.0 2.57
Wholesale notes 2.2 .37 2.0 .33 1.8 .34
Leases 3.2 .40 2.0 .27 3.0 .57
Total Receivables
and Leases $27.9 .43 $22.0 .35 $27.5 .47
During the first quarter of 1998, write-offs of Receivables and
Leases totaled $7.2 million, compared with $5.5 million during
the first quarter of 1997. Agricultural and construction
equipment write-offs increased slightly over last year, for both
retail notes and leasing products, while recreational product
retail note write-offs declined and revolving charge account
write-offs remained relatively unchanged. Annualized write-
offs, as a percentage of the total average portfolio
outstanding, were .44 percent for the first quarter of 1998 and
.40 percent during the same period last year.
Deposits withheld from dealers and merchants, representing
mainly the aggregate dealer retail note and lease withholding
accounts from individual John Deere dealers to which losses from
retail notes and leases originating from the respective dealers
can be charged, amounted to $141.5 million at January 31, 1998,
compared with $144.2 million at October 31, 1997 and $128.1
million at January 31, 1997. The Company's allowance for credit
losses on all Receivables and Leases financed totaled $88.0
million at January 31, 1998, $85.9 million at October 31, 1997
and $88.5 million at January 31, 1997. Allowance for credit
losses represented 1.34 percent of the unpaid balance of
Receivables and Leases financed at January 31, 1998, 1.36
percent at October 31, 1997 and 1.51 percent at January 31,
1997. The Company's allowance for credit losses, as a
percentage of total Receivables and Leases, has declined during
the last twelve months due to an ongoing reevaluation of loss
experience and related adjustments to ensure the allowance is
maintained at an adequate level.
Capital Resources and Liquidity
The Company relies on its ability to raise substantial amounts
of funds to finance its Receivables and Leases portfolio. The
Company's primary sources of funds for this purpose are a
combination of borrowings and equity capital. Additionally, the
Company periodically sells substantial amounts of retail notes
in the public market and in private sales. The Company's
ability to obtain funds is affected by its debt ratings, which
are closely related to the outlook for and the financial
condition of Deere & Company, and the nature and availability of
support facilities, such as its lines of credit. For
information regarding Deere & Company and its business, see
Exhibit 99.
The Company's ability to meet its debt obligations is supported
in a number of ways as described below. All commercial paper
issued is backed by bank credit lines. The assets of the
Company are self-liquidating in nature. A strong equity
position is available to absorb unusual losses on these assets.
Liquidity is also provided by the Company's ability to sell
these assets. Asset-liability risk is also managed to minimize
exposure to interest rate fluctuations.
Page 8
<PAGE>
Total interest-bearing indebtedness amounted to $5.623 billion
at January 31, 1998, compared with $5.470 billion at October
31, 1997 and $5.102 billion at January 31, 1997, generally
corresponding with the level of Receivables and Leases financed.
Total short-term indebtedness amounted to $3.532 billion at
January 31, 1998, compared with $3.387 billion at October 31,
1997 and $3.249 billion at January 31, 1997. Total long-term
indebtedness amounted to $2.091 billion, $2.083 billion and
$1.853 billion at January 31 1998, October 31, 1997 and January
31, 1997, respectively. The ratio of total interest-bearing
debt to stockholder's equity remained unchanged at 6.7 to 1 on
January 31, 1998, October 31, 1997 and January 31, 1997. During
the first quarter of 1998, the Capital Corporation issued $200
million of 5.85% notes, due in 2001. The Capital Corporation
also issued $106.0 million and retired $91.5 million of medium-
term notes.
At January 31, 1998, the Capital Corporation, Deere & Company,
John Deere Limited (Canada) and John Deere Credit, Inc.
(Canada), jointly, maintained $4.014 billion of unsecured lines
of credit with various banks in North America and overseas, $404
million of which was unused. For the purpose of computing
unused credit lines, total short-term borrowings, excluding the
current portion of long-term borrowings, of the Capital
Corporation, Deere & Company, John Deere Limited (Canada) and
John Deere Credit, Inc. (Canada), were considered to constitute
utilization. Included in the total credit lines is a long-term
credit agreement expiring on February 25, 2002, for $3.500
billion. An annual facility fee on the credit agreement is
charged to the Capital Corporation based on utilization.
The Company's business is somewhat seasonal, with overall
acquisitions of Receivables and Leases traditionally higher in
the second half of the fiscal year than in the first half, and
overall collections of Receivables and Leases traditionally
somewhat higher in the first half of the fiscal year.
During the first quarter of 1998, the aggregate net cash
provided by operating and financing activities was primarily
used to increase Receivables and Leases. Net cash provided by
operating activities was $79 million in the first quarter of
1998. Financing activities provided $133 million during the
same period, resulting from a $145 million increase in total
borrowings, which was offset by a $12.5 million dividend payment
to John Deere Credit Company. Net cash used for investing
activities totaled $219 million in 1998, primarily due to
Receivables and Leases acquired exceeding collections by $300
million. Cash and cash equivalents decreased $7 million during
the first quarter of 1998.
During the first quarter of 1997, the aggregate net cash
provided by operating and financing activities was used to
increase Receivables and Leases. Net cash provided from
operating activities was $48 million during the first quarter of
1997. Financing activities provided $184 million during the
first quarter of 1997, resulting from a $204 million increase in
total borrowings, which was offset by a $20 million dividend
payment to John Deere Credit Company. Net cash used for
investing activities totaled $229 million in the first quarter
of 1997, primarily because the cost of Receivables and Leases
acquired exceeded the collections. Cash and cash equivalents
increased $3 million during the first quarter of 1997.
The Capital Corporation paid a cash dividend to John Deere
Credit Company of $12.5 million in the first quarter of 1998.
John Deere Credit Company paid a comparable dividend to Deere &
Company. On February 27, 1998, the Capital Corporation declared
a dividend of $12.5 million to John Deere Credit Company, which
in turn, declared a dividend of $12.5 million to Deere &
Company, each payable on March 10, 1998.
Item 3. Quantitative and Qualitative Disclosures About Market
Risk.
See the information under "Management's Discussion and
Analysis," Note 12 "Financial Instruments" and "Supplemental
Information (Unaudited)" in the Company's annual report on
Form 10-K. There has been no material change in this
information.
Page 9
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is subject to various unresolved legal actions
which arise in the normal course of its business, the most
prevalent of which relate to state and federal laws and
regulations concerning retail credit. Although it is not
possible to predict with certainty the outcome of these
unresolved legal actions or the range of possible loss,
the Company believes these unresolved legal actions will
not have a material effect on its financial position or
results of operations.
Item 2. Changes in Securities and Use of Proceeds.
Omitted pursuant to instruction H(2).
Item 3. Defaults Upon Senior Securities.
Omitted pursuant to instruction H(2).
Item 4. Submission of Matters to a Vote of Security Holders.
Omitted pursuant to instruction H(2).
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
See the index to exhibits immediately preceding the
exhibits filed with this report.
Certain instruments relating to long-term debt,
constituting less than 10% of the registrant's total
assets, are not filed as exhibits herewith pursuant
to Item 601(b)(4)(iii)(A) of Regulation S-K. The
registrant will file copies of such instruments upon
request of the Commission.
(b) Reports on Form 8-K.
Current report on Form 8-K dated November 25, 1997
(items 5 and 7).
Page 10
<PAGE>
SIGNATURES
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 thereunto duly authorized.
JOHN DEERE CAPITAL CORPORATION
Date: March 10, 1998 By: /s/ N. J. Jones
--------------- ---------------------
N. J. Jones
Vice President and
Principal Financial
Officer
Page 11
<PAGE>
INDEX TO EXHIBITS
Exhibit Page No.
(12) Computation of ratio of earnings to
fixed charges 13
(27) Financial data schedule 14
(99) Part I of Deere & Company Form 10-Q for the
quarter ended January 31, 1998 (Securities
and Exchange Commission file number 1-4121*).
__________________________
* Incorporated by reference. Copies of these exhibits are
available from the Company upon request.
Page 12
Exhibit 12
John Deere Capital Corporation and Subsidiaries
Computation of Ratio of Earnings to Fixed Charges
(dollars in thousands)
Three Months Ended 31 January
-----------------------------
1998 1997
------------- -------------
Earnings:
Income before income
taxes and changes
in accounting $ 47,530 $ 46,326
Fixed charges 89,278 72,342
-------- --------
Total earnings $136,808 $118,668
======== ========
Fixed charges:
Interest expense $ 88,258 $ 71,485
Rent expense 1,020 857
-------- --------
Total fixed
charges $ 89,278 $ 72,342
======== ========
Ratio of earnings to
fixed charges * 1.53 1.64
======== ========
For the Years Ended October 31
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
Earnings:
Income before income
taxes and changes
in accounting $211,251 $206,588 $175,360 $161,809 $169,339
Fixed charges 330,648 276,726 240,913 168,507 170,226
-------- -------- -------- -------- --------
Total earnings $541,900 $483,314 $416,273 $330,316 $339,565
======== ======== ======== ======== ========
Fixed charges:
Interest expense $326,867 $273,748 $238,445 $166,591 $167,787
Rent expense 3,782 2,977 2,468 1,916 2,439
-------- -------- -------- -------- --------
Total fixed
charges $330,648 $276,725 $240,913 $168,507 $170,226
======== ======== ======== ======== ========
Ratio of earnings to
fixed charges * 1.64 1.75 1.73 1.96 1.99
======== ======== ======== ======== ========
- ---------
"Earnings" consist of income before income taxes, the cumulative
effect of changes in accounting and fixed charges. "Fixed
charges" consist of interest on indebtedness, amortization of
debt discount and expense, an estimated amount of rental expense
under capitalized leases which is deemed to be representative of
the interest factor and rental expense under operating leases.
* The Company has not issued preferred stock. Therefore, the
ratios of earnings to combined fixed charges and preferred
stock dividends are the same as the ratios presented above.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from Form 10-Q and is qualified in its entirety by reference
to such financial information.
</LEGEND>
<RESTATED>
<CIK> 0000027673
<NAME> JOHNDEERECAPITALCORP
<MULTIPLIER> 1,000,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1998
<PERIOD-START> NOV-01-1997
<PERIOD-END> JAN-31-1998
<EXCHANGE-RATE> 1
<CASH> 198
<SECURITIES> 0
<RECEIVABLES> 6,122
<ALLOWANCES> 88
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 23
<DEPRECIATION> 14
<TOTAL-ASSETS> 6,887
<CURRENT-LIABILITIES> 0
<BONDS> 2,090
0
0
<COMMON> 113
<OTHER-SE> 723
<TOTAL-LIABILITY-AND-EQUITY> 6,887
<SALES> 0
<TOTAL-REVENUES> 198
<CGS> 0
<TOTAL-COSTS> 23
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 9
<INTEREST-EXPENSE> 88
<INCOME-PRETAX> 48
<INCOME-TAX> 17
<INCOME-CONTINUING> 31
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 31
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
