Deere & Company global net sales and revenues decreased 11 percent, to $8.925 billion, for the third quarter of 2020 and declined 12 percent, to $25.809 billion, for the first nine months of the company’s fiscal year.
Net sales for Deere’s Construction & Forestry segment declined by 28 percent for the quarter, going from $3.023 million in Q3 2019 to $2.187 billion in Q3 2020. Deere says sales for this segment declined “due mainly to lower shipment volumes and the unfavorable effects of currency translation, partially offset by price realization.”
In addition, Deere says its global sales of construction and forestry equipment are expected to be down around 25 percent for 2020, reflecting both pandemic uncertainty and efforts to bring down field inventory levels. In North America, construction equipment sales are expected to decline by about 20 percent. Global forestry equipment will be down 20 to 25 percent, primarily because of weaker demand in North America and Russia.
The company’s Agricultural & Turf segment will see less of an impact, with Deere forecasting a 10 percent global decline for the year for this segment. North American sales of turf and utility equipment are expected to be down about 5 percent for 2020.
“With outstanding support from our dedicated global workforce and dealer organization, John Deere delivered a strong performance in the third quarter in the face of a serious global pandemic and uncertain market conditions,” says John C. May, chairman and chief executive officer.
Deere is now forecasting its net income to be about $2.25 billion for the full year, but cautions that uncertainties remain because of the Covid-19 pandemic, The company has also announced “broad employee-separation programs that will be completed during the fourth quarter in support of its strategy to create a leaner, more agile organization.”
“We are encouraged by the early benefits we are experiencing from the company’s recently launched smart-industrial operating model,” says May. “We’re confident it will help accelerate our ability to deliver differentiated solutions to our customers, while contributing to improved efficiencies across the company.”