Deere & Company · NYSE:DE
Deere & — Q2 2023 Earnings Presentation
21 slides from Deere &'s earnings presentation, May 19, 2023
Slide 1: 2Q 2023 Earnings Call
2Q 2023 Earnings Call 19 May 2023
Slide 2: Safe Harbor Statement and Disclosures
Safe Harbor Statement and Disclosures This earnings call and accompanying materials may include forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “for
Slide 3: 2Q 2023 Results
2Q 2023 Results ($ millions except where noted) Net Sales and Net Sales Net Income Diluted EPS (Equipment Operations) (attributable to ($ per share) Revenues Deere & Company) $17,387 $16,079 $2,860 $9.65 $13,370 $12,034 $2,098 $6.81 2Q 2022 2Q 2023 2Q 2022 2Q 2023 2Q 2022 2Q 2023 2Q 2022 2Q 2023 30%
Slide 4: Production and Precision Ag
Production and Precision Ag 2Q 2023 Results $ in millions Net Sales 53% Operating Profit Comparison $1,043 ($90) ($70) ($120) ($155) $7,822 $46 ($93) $2,170 $552 $5,117 $1,057 2Q 2022 Volume/ Price Currency Warranty Production SA&G/ Special Other 2Q 2023 2Q 2022 2Q 2023 Mix Costs R&D Items 4 John De
Slide 5: Small Ag and Turf
Small Ag and Turf 2Q 2023 Results $ in millions Net Sales 16% Operating Profit Comparison $442 ($21) ($7) ($92) $4,145 ($63) $1 ($20) $3,570 $849 $89 $520 2Q 2022 Volume/ Price Currency Warranty Production SA&G/ Special Other 2Q 2023 2Q 2022 2Q 2023 Mix Costs R&D Items 5 John Deere | 2Q 2023 Earning
Slide 6: Ag and Turf Industry Outlook (in units) – FY 2023
Ag and Turf Industry Outlook (in units) – FY 2023 U.S. and CANADA U.S. and CANADA EUROPE AG LARGE AG SMALL AG and TURF ~10% Down ~5% Flat to up 5% SOUTH AMERICA AG ASIA AG (tractors and combines) Flat Down moderately Source: Deere & Company forecast as of 19 May 2023 6 John Deere | 2Q 2023 Earnings
Slide 7: Production and Precision Ag Business Segment Outlook
Production and Precision Ag Business Segment Outlook Net Sales Operating Margin ~20% 25-26% $22,002 19.9% FY 2022 FY 2023 Fcst FY 2022 FY 2023 Fcst Source: Deere & Company forecast as of 19 May 2023 7 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 8: Small Ag and Turf Business Segment Outlook
Small Ag and Turf Business Segment Outlook Net Sales Operating Margin ~5% 15.5-16.5% $13,381 14.6% FY 2022 FY 2023 Fcst FY 2022 Fcst FY 2023 Fcst Source: Deere & Company forecast as of 19 May 2023 8 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 9: Construction and Forestry
Construction and Forestry 2Q 2023 Results $ in millions Net Sales 23% Operating Profit Comparison $426 ($5) ($18) ($187) $4,112 ($41) ($279) $3,347 $159 ($31) $814 $838 2Q 2022 Volume/ Price Currency Warranty Production SA&G/ Special Other 2Q 2023 2Q 2022 2Q 2023 Mix Costs R&D Items 9 John Deere | 2
Slide 10: Construction and Forestry Industry Outlook (in units) – FY 2023
Construction and Forestry Industry Outlook (in units) – FY 2023 NORTH AMERICA NORTH AMERICA COMPACT CONSTRUCTION EQUIPMENT CONSTRUCTION EQUIPMENT Flat to up 5% Flat to up 5% GLOBAL FORESTRY GLOBAL ROADBUILDING Flat Flat Source: Deere & Company forecast as of 19 May 2023 10 John Deere | 2Q 2023 Earni
Slide 11: Construction and Forestry Business Segment Outlook
Construction and Forestry Business Segment Outlook Net Sales Operating Margin ~15% 18-19% $12,534 16.1% FY 2022 FY 2023 Fcst FY 2022 FY 2023 Fcst Source: Deere & Company forecast as of 19 May 2023 11 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 12: Financial Services Net Income – Results and Outlook
Financial Services Net Income – Results and Outlook Quarter Results Fiscal Year Outlook $208 $880 ~ $630 $28 * 2Q 2022 2Q 2023 FY 2022 FY 2023 Fcst * Includes $135 million non-cash accounting correction Source: Deere & Company forecast as of 19 May 2023 12 John Deere | 2Q 2023 Earnings Call | May 19
Slide 13: Financial Services Credit Performance
Financial Services Credit Performance (% of average portfolio) 1.5% 1.0% 0.5% 0.0% 2008 2011 2014 2017 2020 2023 FC ~ -0.5% Provision Write-Offs -1.0% 15-year Average Provision 15-year Average Write-Offs * 2022 and 2023 data exclude Russia 13 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 14: Deere & Company Outlook
Deere & Company Outlook FY 2023 FORECAST Net Income Effective Net Operating (attributable to Deere & Co.) Tax Rate* Cash Flow* $9.25-9.5B 23-25% $10.0-10.5B *Equipment Operations Source: Deere & Company forecast as of 19 May 2023 14 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 15: Appendix
Appendix 15 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 16: Other Financial Information
Other Financial Information Equipment Operations FY 2023 ($ millions) 2Q 2023 Forecast Cost of Sales (percent of Net Sales) 67% ~68% Selling, Administrative and General Expenses 24% ~17% Research and Development Expenses 21% ~14% Capital Expenditures ~ $1,500 Pension/OPEB Expenses ~ $190 Pension/OPE
Slide 17: April 2023 Retail Sales and Dealer Inventories
April 2023 Retail Sales (Rolling 3 Months) and Dealer Inventories Retail Sales U.S. and Canada Ag Industry* Deere** 2WD Tractors (< 40 PTO hp) 20% More than the industry 2WD Tractors (40 < 100 PTO hp) 12% More than the industry 2WD Tractors (100+ PTO hp) Flat High single digit 4WD Tractors 66% More
Slide 18: April 2023 Retail Sales (Rolling 3 Months)
April 2023 Retail Sales (Rolling 3 Months) Retail Sales Europe Ag Deere* Tractors Flat Combines Double digits Retail Sales U.S. and Canada Deere* Selected Turf and Utility Equipment Low single digit Construction and Forestry First-in-the-Dirt Low single digit Settlements Single digit * Based on inte
Slide 19: Deere Use-of-Cash Priorities
Deere Use-of-Cash Priorities CASH FROM OPERATIONS Manage the balance sheet, including liquidity, to support a rating that provides COMMITTED access to low-cost and readily available short- and long-term funding TO “A” RATING mechanisms (reflects the strategic nature of our financial services operati
Slide 20: Deere & Company's 3Q 2023 earnings call
Deere & Company’s 3Q 2023 earnings call is scheduled for 9:00 a.m. Central Time on Friday, 18 August 2023. 20 John Deere | 2Q 2023 Earnings Call | May 19, 2023
Slide 21: John Deere
@ JOHN DEERE