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: May 24, 1994
(Date of earliest event reported)
D E E R E & C O M P A N Y
(Exact name of registrant as specified in charter)
DELAWARE
(State or other jurisdiction of incorporation)
1-4121
(Commission File Number)
36-2382580
(IRS Employer Identification No.)
John Deere Road
Moline, Illinois 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.)
Page 1 of 13 pages.
The Exhibit Index appears at Page 3<PAGE>
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(c) Exhibits
(99) Press release and additional information.
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 hereto duly
authorized.
DEERE & COMPANY
By /s/ Frank S. Cottrell
Frank S. Cottrell, Secretary
Dated: May 24, 1994
<PAGE>
EXHIBIT INDEX
Number and Description of Exhibit Sequential Page
Number
(99) Press release and additional
information Pg. 4
<PAGE>
Exhibit 99
FOR IMMEDIATE RELEASE (24 May 1994)
MOLINE, ILLINOIS - Deere & Company today reported record net
income
for the second quarter of the 1994 fiscal year of $189.3 million
or
$2.20 per share, compared with last year's restated income of
$101.0
million or $1.30 per share before restructuring charges. The
second
quarter of Deere & Company's fiscal year ended April 30.
The 1993 second quarter results were restated to include the
incremental effect of accounting changes related to
postretirement
benefits expense. The accounting changes were adopted in the
fourth
quarter of 1993, effective retroactively to November 1, 1992.
Additionally, in 1993's second quarter, the company recorded an
after-
tax restructuring charge of $80.0 million related to the
downsizing and
rationalizing of the company's European operations. These items
resulted in second quarter 1993 net income of $21.0 million or
$.27 per
share.
Worldwide net sales and revenues increased 17 percent to
$2.460
billion in the second quarter from $2.105 billion during the same
period
last year. Total worldwide production was up 17 percent compared
with
the second quarter of 1993. Accounts and notes receivable from
dealers
at April 30, 1994, which largely represent dealers' inventories
financed
by the company, totaled $3.153 billion and are comparable to
year-ago
levels, despite the sizeable increase in demand for the company's
products.
Deere & Company Chairman and Chief Executive Officer Hans W.
Becherer said, "The company's results for the quarter were
significantly
better than last year primarily due to higher North American
production
and sales volumes, improved operating efficiencies, and
substantially
improved results from our overseas operations. Price realization
continued to improve during the quarter compared with last year
as sales
incentive costs declined. Additionally, net income from our
financial
services subsidiaries remained at a very strong level during the
quarter."
Net sales of equipment increased 19 percent and were $2.128
billion
in the current quarter compared with $1.788 billion in the second
quarter of 1993. Financial services revenues totaled $309
million in
the second quarter of 1994 compared with $295 million last year.
Worldwide net income for the first six months of 1994
totaled
$276.3 million or $3.22 per share compared with restated income
of $64.1
million or $.82 per share before special items during the same
period
last year. The increase was primarily due to higher production
and sales
volumes, reflecting higher retail sales activity and reduced
factory
production shutdowns in 1994. Operating efficiencies also
continued to
improve compared with the same period last year. For the first
six
months of 1993, the restated net loss after special items was
$1.121
billion or $14.51 per share, which included $1.105 billion for
the
cumulative effect of accounting changes and $80.0 million of
overseas
restructuring charges.
Worldwide production tonnage during the first six months of
1994
was 20 percent higher than in the same 1993 period. Worldwide
net sales
and revenues were $4.187 billion for the initial six months of
1994, a
19 percent increase compared to $3.529 billion over the same
period last
year. Net sales of equipment increased 22 percent to $3.535
billion for
the first six months of 1994 from $2.903 billion for the same
period of
1993. The company's financial services revenues totaled $607
million
during the first six months of 1994, a five percent increase
compared
with $576 million during the same period last year.
"North American retail sales of John Deere agricultural
equipment
during the second quarter and the first six months were higher
than last
year, reflecting strong customer demand," Becherer said. "North
American lawn and grounds care equipment retail sales for both
the
quarter and the first six months were substantially higher than
last
year as a result of the continuing strength in the general
economy.
North American retail sales of John Deere industrial equipment
were
significantly higher in both the quarter and the first six months
compared with a year ago, primarily resulting from increases in
residential and public construction activity. Overseas industry
retail
demand for agricultural equipment remained relatively weak."
Worldwide equipment operations, which exclude the financial
services subsidiaries, had income of $147.5 million for the
quarter and
$195.5 million year-to-date in 1994 compared with income before
special
items of $59.7 million for the quarter and a loss of $18.4
million year-
to-date last year. All of the company's equipment businesses
reported
higher earnings for both the quarter and year-to-date compared
with last
year.
The North American agricultural equipment operations
generated
substantially larger operating profits in both the quarter and
the first
six months compared with a year ago, reflecting higher production
and
sales volumes and continued improvements in operating
efficiencies.
North American lawn and grounds care operations also generated
higher
operating profits in both the quarter and the first six months
compared
with last year, primarily due to increased production and sales
volumes.
North American industrial equipment operations generated improved
operating profits in both the quarter and the first six months
compared
with last year's small second quarter operating profit and
year-to-date
operating loss, mainly as a result of higher production and sales
volumes and lower operating costs. The company's overseas
operations
had an operating profit in both the quarter and the first six
months of
1994 compared with an operating profit before restructuring for
the
quarter last year and an operating loss year-to-date. The
improvement
in overseas profitability resulted from lower operating costs due
to the
restructuring of these operations, and sales volumes which were
slightly
higher than a year ago. Operating profit is defined as income
before
interest expense, income taxes and certain other expenses.
Net income of the financial services subsidiaries in 1994
was $40.4
million for the second quarter and $79.0 million for the first
six
months compared with income of $39.8 million and $80.8 million,
respectively, for the same periods last year, excluding the
cumulative
effect of accounting changes. Net income for the credit
operations was
$28.4 million for the quarter and $54.0 million year-to-date
compared
with income of $29.1 million and $59.9 million, respectively, for
the
same periods last year, excluding the cumulative effect of
accounting
changes. The changes in income for both the quarter and the
first six
months primarily reflect lower margins from a smaller average
receivable
and lease portfolio caused mainly by the sale of retail notes in
1993.
These lower margins were partially offset by higher
securitization and
servicing fee income from notes previously sold but still
administered.
Net income for the insurance and health care operations was $12.0
million for the quarter and $25.0 million year-to-date compared
with
income of $10.7 million and $20.9 million for the same periods
last
year, excluding accounting changes. The increases reflect the
continued
profitable growth of those businesses.
"North American retail sales activity during the first two
quarters
of 1994 provides a sound base for operations during the remainder
of the
year," Becherer said. "For 1994, the U.S. Department of
Agriculture has
projected substantial increases in planted acreages of corn and
soybeans, and is forecasting that farm net cash income will be at
one of
the highest levels in history. These factors are expected to
result in
continued strong retail sales activity for agricultural equipment
throughout 1994, assuming normal weather patterns and reasonably
stable
levels in both interest rates and farm commodity prices.
"The European agricultural industry remains in the midst of
fundamental change due to revisions to government agricultural
policies," Becherer said. "Although the long-term downward trend
of
European industry retail sales of agricultural equipment is
expected to
continue, the current outlook for 1994 anticipates the company's
retail
sales being approximately equal to 1993 levels.
"The North American economy in 1994 has continued to
strengthen
despite recent increases in interest rates, providing a solid
base for
strong industrial and lawn and grounds care equipment retail
sales
during the remainder of the year," Becherer said. "Housing
starts are
expected to remain strong, which should further support increases
in
retail activity.
"In response to strong retail demand, we have increased our
North
American production schedules," Becherer said. "As a result,
1994
worldwide production tonnage is now anticipated to be 16 percent
higher
than 1993 output, up from our prior estimate of 13 percent.
Worldwide
agricultural equipment production tonnage is expected to be up
approximately 13 percent from last year, when dealer receivables
were
reduced by $146 million. Lawn and grounds care equipment
production is
expected to be 19 percent higher than 1993 and industrial
equipment
production 23 percent higher than a year ago. Worldwide
production
during the last six months of 1994 is expected to be up 13
percent over
the same period last year. However, it is important to note that
production in the last half of 1994 is expected to be three
percent
lower than in the first six months of the year, reflecting the
effects
of normal seasonal vacation shutdown periods and the start-up of
production of a major new tractor line.
"Retail sales activity for all of our businesses remains
strong and
the results of the company's equipment operations have improved
significantly in 1994," Becherer said. "Our operating margins in
1994
have improved, reflecting both the effects of the higher volumes,
as
well as the results of our continuing efforts to improve quality,
reduce
costs and enhance productivity."
# # #
The following information is disclosed on behalf of the
company's
United States credit subsidiary, John Deere Capital Corporation,
in
connection with the disclosure requirements of programs providing
for
the issuance of debt securities:
John Deere Capital Corporation's net income was $25.9
million in
the second quarter of 1994 compared with $26.8 million in the
same
period last year. For the first six months of 1994, net income
was
$48.9 million, compared with income of $54.3 million in 1993
excluding
the cumulative effect of accounting changes ($50.5 million after
the
accounting changes). Compared with last year, income for both
the
quarter and the year was unfavorably affected by lower margins
from a
smaller average receivable and lease portfolio caused mainly by
the sale
of retail notes in 1993. These lower margins were partially
offset by
higher securitization and servicing fee income from retail notes
previously sold but still administered.
Revenues for the quarter and the year were lower compared
with a
year ago due to the sale of notes and lower levels of interest
rates
resulting in lower finance charges earned by the company in 1994.
These
decreases were partially offset by increases in securitization
and
servicing fee income. The average receivable and lease portfolio
financed was approximately seven percent lower in the second
quarter and
10 percent lower during the first six months of this year
compared with
a year ago.
Total receivable and lease acquisitions increased by 16
percent for
the quarter and 14 percent year-to-date compared with the same
periods
last year. The higher acquisitions during the first six months
were
attributable to increased volumes of retail notes, revolving
charge
accounts and wholesale receivables. Net credit receivables and
leases
financed by John Deere Capital Corporation were $3.757 billion at
April
30, 1994 compared with $3.461 billion one year ago. The increase
in the
receivable and lease portfolio financed resulted mainly from a
higher
balance of John Deere notes and leases, and revolving charge
accounts.
Net credit receivables and leases administered, which include
receivables previously securitized and sold, amounted to $4.694
billion
at April 30, 1994 compared with $4.506 billion at April 30, 1993.
# # #
Attached data accompany this press release
<PAGE>
Second Quarter 1994 Press Release
Income (loss)
(millions of dollars)
Three Months Six Months
Ended Ended
April 30 April 30
1994 1993 1994 1993
Income before restructuring
charges as originally
reported $189.3 $110.2 $276.3 $ 82.6
Restatement of 1993 income
due to accounting changes* (9.2) (1,123.8)
Income (loss) before
restructuring charges
as restated 189.3 101.0 276.3 1,041.2)
Restructuring charges 80.0 80.0
Net income (loss) as
restated $189.3 $ 21.0 $276.3 $(1,121.2)
* After-tax incremental and cumulative adjustments for the
adoption
of FASB Statement Nos. 106 and 112.
<PAGE>
SECOND QUARTER 1994 PRESS RELEASE
Net Sales and Revenues:
(Millions of Dollars)
Three Months Ended
April 30
%
1994 1993 Change
Net Sales:
Agricultural equipment $1,332 $1,117 +19
Industrial equipment 432 339 +27
Lawn and grounds
care equipment 364 332 +10
Total net sales 2,128 1,788 +19
Financial Services
revenues 309 295 +5
Other revenues 23 22 +5
Total net sales
and revenues $2,460 $2,105 +17
United States and Canada:
Equipment net sales $1,663 $1,340 +24
Financial Services
revenues 309 295 +5
Total 1,972 1,635 +21
Overseas net sales 465 448 +4
Other revenues 23 22 +5
Total net sales
and revenues $2,460 $2,105 +17
<PAGE>
SECOND QUARTER 1994 PRESS RELEASE
Net Sales and Revenues:
(Millions of Dollars)
Six Months Ended
April 30
%
1994 1993 Change
Net Sales:
Agricultural equipment $2,219 $1,806 +23
Industrial equipment 740 570 +30
Lawn and grounds
care equipment 576 527 +9
Total net sales 3,535 2,903 +22
Financial Services
revenues 607 576 +5
Other revenues 45 50 -10
Total net sales
and revenues $4,187 $3,529 +19
United States and Canada:
Equipment net sales $2,783 $2,169 +28
Financial Services
revenues 607 576 +5
Total 3,390 2,745 +23
Overseas net sales 752 734 +2
Other revenues 45 50 -10
Total net sales
and revenues $4,187 $3,529 +19
Selected Balance Sheet Data:
(Millions of Dollars)
Apr 30 Oct 31 Apr 30
1994 1993 1993
Equipment Operations:
Dealer accounts and notes
receivable - net $3,153 $2,794 $3,123
Inventories $ 746 $ 464 $ 729
Financial Services:
Credit receivables and leases
financed - net $4,142 $3,758 $3,829
Credit receivables and leases
administered - net $5,080 $5,195 $4,874
Insurance and health care
companies' assets $1,561 $1,453 $1,404
Average Shares Outstanding 85,866,844 77,291,186 77,291,186
