ディア&カンパニーの適時開示・決算・その他

UNITED STATES

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: February 17, 2023

(Date of earliest event reported)

DEERE & COMPANY

(Exact name of registrant as specified in its charter)


Delaware	1-4121	36-2382580
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One John Deere Place

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.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:


Title of each class	Trading symbol	Name of each exchange on which registered
Common stock, $1 par value	DE	New York Stock Exchange
6.55% Debentures Due 2028	DE28	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Items 2.02

and 7.01 Results of Operations and Financial Condition and Regulation FD Disclosure (Furnished

herewith).

Deere & Company’s press release dated February 17, 2023 concerning First Quarter of Fiscal 2023 financial results and supplemental financial information (Exhibit 99.1) is furnished under Form 8-K Items 2.02 and 7.01. The attached schedules of Other Financial Information (Exhibit 99.2) and First Quarter 2023 Earnings Conference Call Information (Exhibit 99.3) are furnished under Form 8-K Items 2.02 and 7.01. The information is not filed for purposes of the Securities Exchange Act of 1934 and is not deemed incorporated by reference by any general statements incorporating by reference this report or future filings into any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Deere & Company specifically incorporates the information by reference.

Item 9.01Financial Statements and Exhibits.

(d)Exhibits


Number	Description of Exhibit
99.1	Press Release and Supplemental Financial Information (Furnished herewith)
99.2	Other Financial Information (Furnished herewith)
99.3	First Quarter 2023 Earnings Conference Call Information (Furnished herewith)
104	Cover Page Interactive Data File (the cover page XBRL tags are imbedded in the Inline XBRL document)

Signature

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 hereunto duly authorized.


	DEERE & COMPANY


	By:	/s/ Edward R. Berk
		Edward R. Berk
		Secretary


Dated: February 17, 2023

EX-99.1 2 de-20230217xex99d1.htm EX-99.1

Exhibit 99.1

(Furnished herewith)


News Release

Contact:
Jen Hartmann
Director, Public Relations
HartmannJenniferA@JohnDeere.com

Deere Reports First Quarter Net Income of $1.959 Billion

●

Strong execution contributes to 34% net sales gain and higher earnings.

●

Market environment supported by positive fundamentals and healthy demand for farm and construction equipment.

●

Full-year net income forecast increased to $8.75 billion to $9.25 billion.

MOLINE, Illinois (February 17, 2023) — Deere & Company reported net income of $1.959 billion for the first quarter ended January 29, 2023, or $6.55 per share, compared with net income of $903 million, or $2.92 per share, for the quarter ended January 30, 2022.

Worldwide net sales and revenues increased 32 percent, to $12.652 billion, in the most recent quarter. Net sales were $11.402 billion for the quarter, compared with $8.531 billion in 2022.

“Deere’s first-quarter performance is a reflection of favorable market fundamentals and healthy demand for our equipment as well as solid execution on the part of our employees, dealers, and suppliers to get products to our customers,” said John C. May, chairman and chief executive officer. “We are, at the same time, benefiting from an improved operating environment, which is contributing to higher levels of production.”

Company Outlook & Summary

Net income attributable to Deere & Company for fiscal 2023 is forecast to be in a range of $8.75 billion to $9.25 billion.

“Deere is looking forward to another strong year on the basis of positive fundamentals, low machine inventories, and a continuation of solid execution,” May said. “We are proud of our recent performance and remain fully committed to helping our customers do their jobs in a more profitable, productive, and sustainable way. We have confidence in our ability to execute on our leap ambitions and run our businesses with real purpose, real technology, and real impact.”


Deere & Company	First Quarter
$ in millions, except per share amounts	2023		2022		% Change
Net sales and revenues	$	12,652	$	9,569	32%
Net income	$	1,959	$	903	117%
Fully diluted EPS	$	6.55	$	2.92

Results for the prior period were affected by special items. See Note 1 of the financial statements for further details.


Production & Precision Agriculture	First Quarter
$ in millions	2023		2022		% Change
Net sales	$	5,198	$	3,356	55%
Operating profit	$	1,208	$	296	308%
Operating margin		23.2%		8.8%

Production and precision agriculture sales increased for the quarter as a result of higher shipment volumes and price realization. Operating profit improved primarily due to price realization and improved shipment volume / mix, partially offset by higher production costs and increased SA&G and R&D expenses. UAW contract-ratification bonus costs affected the prior period.


Small Agriculture & Turf	First Quarter
$ in millions	2023		2022		% Change
Net sales	$	3,001	$	2,631	14%
Operating profit	$	447	$	371	20%
Operating margin		14.9%		14.1%

Small agriculture and turf sales increased for the quarter due to price realization and higher shipment volumes, partially offset by the negative effects of foreign currency translation. Operating profit improved primarily as a result of price realization and improved shipment volumes. These items were partially offset by higher production costs, increased SA&G and R&D expenses, and the unfavorable effects of foreign currency exchange.


Construction & Forestry	First Quarter
$ in millions	2023		2022		% Change
Net sales	$	3,203	$	2,544	26%
Operating profit	$	625	$	272	130%
Operating margin		19.5%		10.7%

Construction and forestry sales moved higher for the quarter primarily due to higher shipment volumes and price realization, partially offset by the negative effects of foreign currency translation. Operating profit improved due to price realization and improved shipment volumes, partially offset by higher production costs. UAW contract-ratification bonus costs affected the prior period.


Financial Services	First Quarter
$ in millions	2023		2022		% Change
Net income	$	185	$	231	-20%

Financial services net income for the quarter decreased mainly due to less-favorable financing spreads, higher SA&G expenses, and lower gains on operating-lease dispositions, partially offset by income earned on higher average portfolio balances.


Industry Outlook for Fiscal 2023
Agriculture & Turf
U.S. & Canada:
Large Ag						Up 5 to 10%
Small Ag & Turf						Down ~ 5%
Europe						Flat to Up 5%
South America (Tractors & Combines)						Flat to Up 5%
Asia						Down moderately

Construction & Forestry
U.S. & Canada:
Construction Equipment						Flat to Up 5%
Compact Construction Equipment						Flat to Up 5%
Global Forestry						Flat
Global Roadbuilding						Flat


Deere Segment Outlook for Fiscal 2023		Currency	Price
$ in millions	Net Sales	Translation	Realization
Production & Precision Ag	Up ~ 20%	0%	+14%
Small Ag & Turf	Flat to Up 5%	0%	+8%
Construction & Forestry	Up 10 to 15%	0%	+9%

Financial Services	Net Income	$ 820

Financial Services. Fiscal-year 2023 net income attributable to Deere & Company for the financial services operations is forecast to be $820 million. Results are expected to be lower than fiscal year 2022 due to less-favorable financing spreads, higher SA&G expenses, and lower gains on operating-lease dispositions. These factors are expected to be partially offset by income earned on a higher average portfolio. The outlook decreased from the previous forecast provided on November 23, 2022 due to further compression in financing spreads.

John Deere Capital Corporation

The following is disclosed on behalf of the company’s financial services subsidiary, John Deere Capital Corporation (JDCC), in connection with the disclosure requirements applicable to its periodic issuance of debt securities in the public market.


	First Quarter
$ in millions	2023		2022		% Change
Revenue	$	821	$	643	28%
Net income	$	147	$	190	-23%
Ending portfolio balance	$	47,227	$	40,353	17%

Net income for the quarter was lower than the same period in 2022 primarily due to less-favorable financing spreads, higher SA&G expenses, and lower gains on operating-lease dispositions, partially offset by income earned on higher average portfolio balances.

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.

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 could cause actual results to differ materially from these forward-looking statements. Among these factors are risks related to:

●	changes in U.S. 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;

●	wars and other conflicts, including the current conflict between Russia and Ukraine, and natural disasters;

●	adverse macroeconomic conditions, including unemployment, inflation, rising interest rates, changes in consumer practices due to slower economic growth or possible recession, and 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 its customers’ changing expectations and demand for John Deere products;

●	accurately forecasting customer demand for products and services and adequately managing inventory;

●	changes to governmental communications channels (radio frequency technology);

●	gaps or limitations in rural broadband coverage, capacity, and speed needed to support technology solutions;

●	the company’s 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 and unfavorable weather events;

●	higher interest rates and currency fluctuations which could adversely affect the U.S. dollar, customer confidence, access to capital, and demand for our products;

●	changes in the company’s credit ratings, and failure to comply with financial covenants in credit agreements could impact access to funding;

●	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 the information technology infrastructure of the company and its 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 (e.g., fertilizer), 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 company’s financial results, is included in the company’s other filings with the SEC (including, but not limited to, the factors discussed in Item 1A. “Risk Factors” of our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q).

DEERE & COMPANY

FIRST QUARTER 2023 PRESS RELEASE

(In millions of dollars) Unaudited


	Three Months Ended
	January 29		January 30		%
	2023		2022		Change
Net sales and revenues:
Production & precision ag net sales	$	5,198	$	3,356	+55
Small ag & turf net sales		3,001		2,631	+14
Construction & forestry net sales		3,203		2,544	+26
Financial services revenues		1,040		870	+20
Other revenues		210		168	+25
Total net sales and revenues	$	12,652	$	9,569	+32

Operating profit: *
Production & precision ag	$	1,208	$	296	+308
Small ag & turf		447		371	+20
Construction & forestry		625		272	+130
Financial services		238		296	-20
Total operating profit		2,518		1,235	+104
Reconciling items **		(22)		(82)	-73
Income taxes		(537)		(250)	+115
Net income attributable to Deere & Company	$	1,959	$	903	+117

* 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 of the financial services segment includes the effect of interest expense and foreign exchange gains or losses.

** Reconciling items are primarily corporate expenses, certain external interest expense, certain foreign exchange gains and losses, pension and postretirement benefit costs excluding the service cost component, and net income attributable to noncontrolling interests.

DEERE & COMPANY

STATEMENTS OF CONSOLIDATED INCOME

For the Three Months Ended January 29, 2023 and January 30, 2022

(In millions of dollars and shares except per share amounts) Unaudited


	2023		2022
Net Sales and Revenues
Net sales	$	11,402	$	8,531
Finance and interest income		994		800
Other income		256		238
Total		12,652		9,569

Costs and Expenses
Cost of sales		7,934		6,695
Research and development expenses		495		402
Selling, administrative and general expenses		952		781
Interest expense		479		229
Other operating expenses		299		311
Total		10,159		8,418

Income of Consolidated Group before Income Taxes		2,493		1,151
Provision for income taxes		537		250

Income of Consolidated Group		1,956		901
Equity in income of unconsolidated affiliates		1		3

Net Income		1,957		904
Less: Net income (loss) attributable to noncontrolling interests		(2)		1
Net Income Attributable to Deere & Company	$	1,959	$	903

Per Share Data
Basic	$	6.58	$	2.94
Diluted	$	6.55	$	2.92
Dividends declared	$	1.20	$	1.05
Dividends paid	$	1.13	$	1.05

Average Shares Outstanding
Basic		297.6		307.4
Diluted		299.1		309.4

See Condensed Notes to Interim Consolidated Financial Statements.

DEERE & COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions of dollars) Unaudited


	January 29		October 30		January 30
	2023		2022		2022
Assets
Cash and cash equivalents	$	3,976	$	4,774	$	4,472
Marketable securities		852		734		735
Trade accounts and notes receivable - net		7,609		6,410		4,855
Financing receivables - net		36,882		36,634		33,191
Financing receivables securitized - net		5,089		5,936		3,516
Other receivables		1,992		2,492		1,936
Equipment on operating leases - net		6,502		6,623		6,624
Inventories		10,056		8,495		7,935
Property and equipment - net		6,212		6,056		5,665
Goodwill		3,891		3,687		3,192
Other intangible assets - net		1,255		1,218		1,209
Retirement benefits		3,793		3,730		3,158
Deferred income taxes		914		824		923
Other assets		2,597		2,417		2,203
Total Assets	$	91,620	$	90,030	$	79,614

Liabilities and Stockholders’ Equity

Liabilities
Short-term borrowings	$	14,129	$	12,592	$	10,990
Short-term securitization borrowings		4,864		5,711		3,482
Accounts payable and accrued expenses		13,108		14,822		10,651
Deferred income taxes		519		495		556
Long-term borrowings		35,071		33,596		32,838
Retirement benefits and other liabilities		2,493		2,457		3,289
Total liabilities		70,184		69,673		61,806

Redeemable noncontrolling interest		100		92

Stockholders’ Equity
Total Deere & Company stockholders’ equity		21,332		20,262		17,804
Noncontrolling interests		4		3		4
Total stockholders’ equity		21,336		20,265		17,808
Total Liabilities and Stockholders’ Equity	$	91,620	$	90,030	$	79,614

See Condensed Notes to Interim Consolidated Financial Statements.

DEERE & COMPANY

STATEMENTS OF CONSOLIDATED CASH FLOWS

For the Three Months Ended January 29, 2023 and January 30, 2022

(In millions of dollars) Unaudited


	2023		2022
Cash Flows from Operating Activities
Net income	$	1,957	$	904
Adjustments to reconcile net income to net cash used for operating activities:
Provision (credit) for credit losses		(130)
Provision for depreciation and amortization		494		486
Share-based compensation expense		23		18
Provision (credit) for deferred income taxes		(56)		210
Changes in assets and liabilities:
Trade, notes, and financing receivables related to sales		(1,015)		(106)
Inventories		(1,279)		(1,297)
Accounts payable and accrued expenses		(1,577)		(1,554)
Accrued income taxes payable/receivable		199		(184)
Retirement benefits		(48)		(1,010)
Other		186		(20)
Net cash used for operating activities		(1,246)		(2,553)

Cash Flows from Investing Activities
Collections of receivables (excluding receivables related to sales)		7,198		6,435
Proceeds from sales of equipment on operating leases		497		479
Cost of receivables acquired (excluding receivables related to sales)		(6,322)		(5,603)
Acquisitions of businesses, net of cash acquired				(24)
Purchases of property and equipment		(315)		(193)
Cost of equipment on operating leases acquired		(497)		(391)
Collateral on derivatives - net		345		(13)
Other		(146)		(42)
Net cash provided by investing activities		760		648

Cash Flows from Financing Activities
Increase (decrease) in total short-term borrowings		697		(1,018)
Proceeds from long-term borrowings		2,505		2,353
Payments of long-term borrowings		(1,925)		(1,940)
Proceeds from issuance of common stock		21		11
Repurchases of common stock		(1,257)		(623)
Dividends paid		(341)		(327)
Other		(39)		(33)
Net cash used for financing activities		(339)		(1,577)

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash		62		(74)

Net Decrease in Cash, Cash Equivalents, and Restricted Cash		(763)		(3,556)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period		4,941		8,125
Cash, Cash Equivalents, and Restricted Cash at End of Period	$	4,178	$	4,569

See Condensed Notes to Interim Consolidated Financial Statements.


DEERE & COMPANY
Condensed Notes to Interim Consolidated Financial Statements
(In millions of dollars) Unaudited

(1)	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.


	Production & Precision Ag		Small Ag & Turf		Construction & Forestry		Total
UAW ratification bonus – Cost of sales	$	53	$	9	$	28	$	90

(2)	The calculation of basic net income per share is based on the average number of shares outstanding. The calculation of diluted net income per share recognizes any dilutive effect of share-based compensation.

(3)

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 4 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

(4) SUPPLEMENTAL CONSOLIDATING DATA

STATEMENTS OF INCOME

For the Three Months Ended January 29, 2023 and January 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	$	11,402	$	8,531									$	11,402	$	8,531
Finance and interest income		114		34	$	1,067	$	829	$	(187)	$	(63)		994		800	1
Other income		234		217		177		87		(155)		(66)		256		238	2, 3
Total		11,750		8,782		1,244		916		(342)		(129)		12,652		9,569

Costs and Expenses
Cost of sales		7,940		6,696						(6)		(1)		7,934		6,695	4
Research and development expenses		495		402										495		402
Selling, administrative and general expenses		783		657		172		126		(3)		(2)		952		781	4
Interest expense		101		90		442		158		(64)		(19)		479		229	5
Interest compensation to Financial Services		123		44						(123)		(44)					5
Other operating expenses		53		39		392		335		(146)		(63)		299		311	6, 7
Total		9,495		7,928		1,006		619		(342)		(129)		10,159		8,418

Income before Income Taxes		2,255		854		238		297						2,493		1,151
Provision for income taxes		483		182		54		68						537		250

Income after Income Taxes		1,772		672		184		229						1,956		901
Equity in income of unconsolidated affiliates				1		1		2						1		3

Net Income		1,772		673		185		231						1,957		904
Less: Net income (loss) attributable to noncontrolling interests		(2)		1										(2)		1
Net Income Attributable to Deere & Company	$	1,774	$	672	$	185	$	231					$	1,959	$	903

1 Elimination of Financial Services’ interest income earned from Equipment Operations.

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 revenue.

4 Elimination of intercompany service fees.

5 Elimination of Equipment Operations’ interest expense to Financial Services.

6 Elimination of Financial Services’ lease depreciation expense related to inventory transferred to equipment on operating leases.

7 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

(In millions of dollars) Unaudited


	EQUIPMENT						FINANCIAL
	OPERATIONS						SERVICES						ELIMINATIONS						CONSOLIDATED
	Jan 29		Oct 30		Jan 30		Jan 29		Oct 30		Jan 30		Jan 29		Oct 30		Jan 30		Jan 29		Oct 30		Jan 30
	2023		2022		2022		2023		2022		2022		2023		2022		2022		2023		2022		2022
Assets
Cash and cash equivalents	$	2,665	$	3,767	$	3,596	$	1,311	$	1,007	$	876							$	3,976	$	4,774	$	4,472
Marketable securities		18		61		2		834		673		733								852		734		735
Receivables from Financial Services		5,348		6,569		5,307							$	(5,348)	$	(6,569)	$	(5,307)							8
Trade accounts and notes receivable - net		1,342		1,273		996		7,827		6,434		4,843		(1,560)		(1,297)		(984)		7,609		6,410		4,855	9
Financing receivables - net		51		47		56		36,831		36,587		33,135								36,882		36,634		33,191
Financing receivables securitized - net						9		5,089		5,936		3,507								5,089		5,936		3,516
Other receivables		1,583		1,670		1,818		489		832		153		(80)		(10)		(35)		1,992		2,492		1,936	9
Equipment on operating leases - net								6,502		6,623		6,624								6,502		6,623		6,624
Inventories		10,056		8,495		7,935														10,056		8,495		7,935
Property and equipment - net		6,178		6,021		5,629		34		35		36								6,212		6,056		5,665
Goodwill		3,891		3,687		3,192														3,891		3,687		3,192
Other intangible assets - net		1,255		1,218		1,209														1,255		1,218		1,209
Retirement benefits		3,728		3,666		3,095		67		66		65		(2)		(2)		(2)		3,793		3,730		3,158	10
Deferred income taxes		1,015		940		1,095		53		45		50		(154)		(161)		(222)		914		824		923	11
Other assets		1,936		1,794		1,730		684		626		477		(23)		(3)		(4)		2,597		2,417		2,203	9
Total Assets	$	39,066	$	39,208	$	35,669	$	59,721	$	58,864	$	50,499	$	(7,167)	$	(8,042)	$	(6,554)	$	91,620	$	90,030	$	79,614

Liabilities and Stockholders’ Equity

Liabilities
Short-term borrowings	$	969	$	1,040	$	1,516	$	13,160	$	11,552	$	9,474							$	14,129	$	12,592	$	10,990
Short-term securitization borrowings						8		4,864		5,711		3,474								4,864		5,711		3,482
Payables to Equipment Operations								5,348		6,569		5,307	$	(5,348)	$	(6,569)	$	(5,307)							8
Accounts payable and accrued expenses		11,819		12,962		9,704		2,952		3,170		1,970		(1,663)		(1,310)		(1,023)		13,108		14,822		10,651	9
Deferred income taxes		404		380		425		269		276		353		(154)		(161)		(222)		519		495		556	11
Long-term borrowings		8,155		7,917		8,760		26,916		25,679		24,078								35,071		33,596		32,838
Retirement benefits and other liabilities		2,384		2,351		3,182		111		108		109		(2)		(2)		(2)		2,493		2,457		3,289	10
Total liabilities		23,731		24,650		23,595		53,620		53,065		44,765		(7,167)		(8,042)		(6,554)		70,184		69,673		61,806

Redeemable noncontrolling interest		100		92																100		92

Stockholders’ Equity
Total Deere & Company stockholders’ equity		21,332		20,262		17,804		6,101		5,799		5,734		(6,101)		(5,799)		(5,734)		21,332		20,262		17,804	12
Noncontrolling interests		4		3		4														4		3		4
Financial Services equity		(6,101)		(5,799)		(5,734)								6,101		5,799		5,734							12
Adjusted total stockholders' equity		15,235		14,466		12,074		6,101		5,799		5,734								21,336		20,265		17,808
Total Liabilities and Stockholders’ Equity	$	39,066	$	39,208	$	35,669	$	59,721	$	58,864	$	50,499	$	(7,167)	$	(8,042)	$	(6,554)	$	91,620	$	90,030	$	79,614

8 Elimination of receivables / payables between Equipment Operations and Financial Services.

9 Primarily reclassification of sales incentive accruals on receivables sold to Financial Services.

10 Reclassification of net pension assets / liabilities.

11 Reclassification of deferred tax assets / liabilities in the same taxing jurisdictions.

12 Elimination of Financial Services’ equity.

DEERE & COMPANY

SUPPLEMENTAL CONSOLIDATING DATA (Continued)

STATEMENTS OF CASH FLOWS

For the Three Months Ended January 29, 2023 and January 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	$	1,772	$	673	$	185	$	231					$	1,957	$	904
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Provision (credit) for credit losses		1		(2)		(131)		2						(130)
Provision for depreciation and amortization		279		257		252		266	$	(37)	$	(37)		494		486	13
Share-based compensation expense										23		18		23		18	14
Distributed earnings of Financial Services		3		42						(3)		(42)					15
Provision (credit) for deferred income taxes		(39)		223		(17)		(13)						(56)		210
Changes in assets and liabilities:
Trade, notes, and financing receivables related to sales		(23)		158						(992)		(264)		(1,015)		(106)	16, 18, 19
Inventories		(1,254)		(1,277)						(25)		(20)		(1,279)		(1,297)	17
Accounts payable and accrued expenses		(1,458)		(1,346)		145		(66)		(264)		(142)		(1,577)		(1,554)	18
Accrued income taxes payable/receivable		192		(192)		7		8						199		(184)
Retirement benefits		(49)		(1,012)		1		2						(48)		(1,010)
Other		17		(12)		163		(19)		6		11		186		(20)	13, 14, 17
Net cash provided by (used for) operating activities		(559)		(2,488)		605		411		(1,292)		(476)		(1,246)		(2,553)

Cash Flows from Investing Activities
Collections of receivables (excluding receivables related to sales)						7,495		6,845		(297)		(410)		7,198		6,435	16
Proceeds from sales of equipment on operating leases						497		479						497		479
Cost of receivables acquired (excluding receivables related to sales)						(6,375)		(5,719)		53		116		(6,322)		(5,603)	16
Acquisitions of businesses, net of cash acquired				(24)												(24)
Purchases of property and equipment		(315)		(193)										(315)		(193)
Cost of equipment on operating leases acquired						(531)		(419)		34		28		(497)		(391)	17
Increase in trade and wholesale receivables						(1,499)		(684)		1,499		684					16
Collateral on derivatives - net				4		345		(17)						345		(13)
Other		(9)		(22)		(137)		(36)				16		(146)		(42)	19
Net cash provided by (used for) investing activities		(324)		(235)		(205)		449		1,289		434		760		648

Cash Flows from Financing Activities
Increase (decrease) in total short-term borrowings		(136)		123		833		(1,141)						697		(1,018)
Change in intercompany receivables/payables		1,469		150		(1,469)		(150)
Proceeds from long-term borrowings		1		18		2,504		2,335						2,505		2,353
Payments of long-term borrowings				(124)		(1,925)		(1,816)						(1,925)		(1,940)
Proceeds from issuance of common stock		21		11										21		11
Repurchases of common stock		(1,257)		(623)										(1,257)		(623)
Dividends paid		(341)		(327)		(3)		(42)		3		42		(341)		(327)	15
Other		(27)		(22)		(12)		(11)						(39)		(33)
Net cash used for financing activities		(270)		(794)		(72)		(825)		3		42		(339)		(1,577)

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash		48		(75)		14		1						62		(74)

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash		(1,105)		(3,592)		342		36						(763)		(3,556)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period		3,781		7,200		1,160		925						4,941		8,125
Cash, Cash Equivalents, and Restricted Cash at End of Period	$	2,676	$	3,608	$	1,502	$	961					$	4,178	$	4,569

13 Elimination of depreciation on leases related to inventory transferred to equipment on operating leases.

14 Reclassification of share-based compensation expense.

15 Elimination of dividends from Financial Services to the Equipment Operations, which are included in the Equipment Operations operating activities.

16 Primarily reclassification of receivables related to the sale of equipment.

17 Reclassification of direct lease agreements with retail customers.

18 Reclassification of sales incentive accruals on receivables sold to Financial Services.

19 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.

EX-99.2 3 de-20230217xex99d2.htm EX-99.2

Exhibit 99.2

(Furnished herewith)

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 Three Months Ended	Operations						Precision Ag						& Turf						& Forestry
	Jan 29			Jan 30			Jan 29			Jan 30			Jan 29			Jan 30			Jan 29			Jan 30
Dollars in millions	2023			2022			2023			2022			2023			2022			2023			2022
Net Sales	$	11,402		$	8,531		$	5,198		$	3,356		$	3,001		$	2,631		$	3,203		$	2,544
Average Identifiable Assets
With Inventories at LIFO	$	20,929		$	18,009		$	9,074		$	7,430		$	4,744		$	4,190		$	7,111		$	6,389
With Inventories at Standard Cost		22,976			19,614			10,138			8,234			5,288			4,654			7,550			6,726
Operating Profit	$	2,280		$	939		$	1,208		$	296		$	447		$	371		$	625		$	272
Percent of Net Sales		20.0	%		11.0	%		23.2	%		8.8	%		14.9	%		14.1	%		19.5	%		10.7	%
Operating Return on Assets
With Inventories at LIFO		10.9	%		5.2	%		13.3	%		4.0	%		9.4	%		8.9	%		8.8	%		4.3	%
With Inventories at Standard Cost		9.9	%		4.8	%		11.9	%		3.6	%		8.5	%		8.0	%		8.3	%		4.0	%
SVA Cost of Assets	$	(689)		$	(589)		$	(304)		$	(248)		$	(159)		$	(139)		$	(226)		$	(202)
SVA		1,591			350			904			48			288			232			399			70

	Financial
For the Three Months Ended	Services
	Jan 29			Jan 30
Dollars in millions	2023			2022
Net Income Attributable to Deere & Company	$	185		$	231
Average Equity		5,948			5,644
Return on Equity		3.1	%		4.1	%
Operating Profit	$	238		$	296
Cost of Equity		(192)			(180)
SVA		46			116

EX-99.3 4 de-20230217xex99d3.htm EX-99.3

Exhibit 99.3

1Q 2023 Earnings Call 17 February 2023 19 Exhibit 99.3 (Furnished herewith)

2 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Safe Harbor Statement and Disclosures The earnings call and accompanying material include “forward-looking statements” within the meaning of the Safe Harbor Provisions of the U.S. Private Securities Litigation Reform Act of 1995 and concern the company’s plans and projections for the future, including estimates and assumptions with respect to economic, political, technological, weather, market acceptance, acquisitions and divestitures of businesses, anticipated transaction costs, the integration of new businesses, anticipated benefits of acquisitions, and other factors that impact our businesses and customers. They also may include financial measures that are not in conformance with accounting principles generally accepted in the United States of America (GAAP). Words such as “forecast,” “guidance,” “projection,” “outlook,” “prospects,” “expected,” “estimated,” “will,” “plan,” “anticipate,” “intend,” “believe,” “likely,” “future,” “may,” or other similar words or phrases often identify forward-looking statements. Actual results may differ materially from those projected in these forward-looking statements based on a number of factors and uncertainties, including those related to the conflict between Russia and Ukraine. Additional information concerning factors that could cause actual results to differ materially is contained in the company’s most recent annual report on Form 10-K and other filings with the U.S. Securities and Exchange Commission, and is incorporated by reference herein. Investors should refer to and consider the incorporated information on risks and uncertainties in addition to the information presented here. The company, except as required by law, undertakes no obligation to update or revise its forward-looking statements whether as a result of new developments or otherwise. The call and accompanying materials are not an offer to sell or a solicitation of offers to buy any of the company’s securities. 20

3 John Deere | 1Q 2023 Earnings Call | February 17, 2023 1Q 2023 Results ($ millions except where noted) $9,569 $12,652 1Q 2022 1Q 2023 $8,531 $11,402 1Q 2022 1Q 2023 $903 $1,959 1Q 2022 1Q 2023 $2.92 $6.55 1Q 2022 1Q 2023 34% Net Sales and Revenues Net Sales (Equipment Operations) Net Income (attributable to Deere & Company) Diluted EPS ($ per share) 32% 117% 124% 21

4 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Production and Precision Ag 1Q 2023 Results $ in millions $3,356 $5,198 1Q 2022 1Q 2023 Net Sales 55% Operating Profit Comparison $1,208 $613 $53 ($51) $296 $741 ($46) ($15) ($256) ($127) 1Q 2022 Volume/ Mix Price Currency Warranty Production Costs SA&G/ R&D Special Items Other 1Q 2023 22

5 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Small Ag and Turf 1Q 2023 Results $ in millions $2,631 $3,001 1Q 2022 1Q 2023 Net Sales 14% Operating Profit Comparison $447 $64 $9 ($44) $371 $300 ($18) ($1) ($185) ($49) 1Q 2022 Volume/ Mix Price Currency Warranty Production Costs SA&G/ R&D Special Items Other 1Q 2023 23

6 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Ag and Turf Industry Outlook (in units) – FY 2023 Source: Deere & Company forecast as of 17 February 2023 U.S. and CANADA LARGE AG 5-10% EUROPE AG Flat to up 5% SOUTH AMERICA AG (tractors and combines) Flat to up 5% U.S. and CANADA SMALL AG and TURF Down ~5% ASIA AG Down moderately 24

7 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Production and Precision Ag Business Segment Outlook Source: Deere & Company forecast as of 17 February 2023 19.9% FY 2022 FY 2023 Fcst $22,002 FY 2022 FY 2023 Fcst Net Sales 23.5-24.5% Operating Margin ~20% 25

8 John Deere | 1Q 2023 Earnings Call | February 17, 2023 $13,381 FY 2022 FY 2023 Fcst Small Ag and Turf Business Segment Outlook Source: Deere & Company forecast as of 17 February 2023 14.6% FY 2022 Fcst FY 2023 Fcst Flat to up 5% 14.5-15.5% Net Sales Operating Margin 26

9 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Construction and Forestry 1Q 2023 Results $ in millions $2,544 $3,203 1Q 2022 1Q 2023 Net Sales 26% Operating Profit Comparison $625 $148 ($2) ($187) ($24) $28 $272 $343 $27 $20 1Q 2022 Volume/ Mix Price Currency Warranty Production Costs SA&G/ R&D Special Items Other 1Q 2023 27

10 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Construction and Forestry Industry Outlook (in units) – FY 2023 Source: Deere & Company forecast as of 17 February 2023 NORTH AMERICA COMPACT CONSTRUCTION EQUIPMENT Flat to up 5% GLOBAL FORESTRY Flat NORTH AMERICA CONSTRUCTION EQUIPMENT Flat to up 5% GLOBAL ROADBUILDING Flat 28

11 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Construction and Forestry Business Segment Outlook Source: Deere & Company forecast as of 17 February 2023 16.1% FY 2022 FY 2023 Fcst $12,534 FY 2022 FY 2023 Fcst 17-18% 10-15% Net Sales Operating Margin 29

12 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Financial Services Net Income – Results and Outlook Source: Deere & Company forecast as of 17 February 2023 $231 $185 1Q 2022 1Q 2023 Quarter Results Fiscal Year Outlook $880 $820 FY 2022 FY 2023 Fcst ~ 30

13 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Deere & Company Outlook Effective Tax Rate* Net Income (attributable to Deere & Co.) $8.75-9.25B 23-25% FY 2023 FORECAST Net Operating Cash Flow* $9.25-9.75B *Equipment Operations Source: Deere & Company forecast as of 17 February 2023 31

14 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Appendix 32

15 John Deere | 1Q 2023 Earnings Call | February 17, 2023 ($ millions) 1Q 2023 FY 2023 Forecast Cost of Sales (percent of Net Sales) 70% ~69% Selling, Administrative and General Expenses 19% ~16% Research and Development Expenses 23% ~14% Capital Expenditures ~ $1,400 Pension/OPEB Expenses ~ $220 Pension/OPEB Contributions ~ $200 Other Financial Information Equipment Operations Source: Deere & Company forecast as of 17 February 2023 33

16 John Deere | 1Q 2023 Earnings Call | February 17, 2023 January 2023 Retail Sales (Rolling 3 Months) and Dealer Inventories Retail Sales U.S. and Canada Ag Industry* Deere** 2WD Tractors (< 40 PTO hp) 25% More than the industry 2WD Tractors (40 < 100 PTO hp) 9% In line with the industry 2WD Tractors (100+ PTO hp) 4% More than the industry 4WD Tractors 26% More than the industry Combines 37% More than the industry Deere Dealer Inventories*** U.S. and Canada Ag 2023 2022 2WD Tractors (100+ PTO hp) 25% 15% Combines 16% 7% * As reported by the Association of Equipment Manufacturers ** As reported to the Association of Equipment Manufacturers *** In units as a % of trailing 12 months retail sales, as reported to the Association of Equipment Manufacturers 34

17 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Retail Sales U.S. and Canada Deere* Selected Turf and Utility Equipment High single digit Construction and Forestry First-in-the-Dirt Settlements Double digits Double digits January 2023 Retail Sales (Rolling 3 Months) Retail Sales Europe Ag Deere* Tractors Single digit Combines Double digits * Based on internal sales reports 35

18 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Deere Use-of-Cash Priorities SHARE REPURCHASE Manage the balance sheet, including liquidity, to support a rating that provides access to low-cost and readily available short- and long-term funding mechanisms (reflects the strategic nature of our financial services operation) Fund value-creating investments in our businesses Consistently and moderately raise dividend targeting a 25-35% payout ratio of mid-cycle earnings Consider share repurchase as a means to deploy excess cash to shareholders, once above requirements are met COMMITTED TO “A” RATING FUND OPERATING & GROWTH NEEDS COMMON STOCK DIVIDEND CASH FROM OPERATIONS 36

19 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Sustainability We’re running for a world where people and planet prosper. View the 2022 Sustainability Report at: https://www.deere.com/en/our-company/sustainability/ 37

20 John Deere | 1Q 2023 Earnings Call | February 17, 2023 Deere & Company’s 2Q 2023 earnings call is scheduled for 9:00 a.m. Central Time on Friday, 19 May 2023. 38