Deere & Company · NYSE:DE
Deere & — Q4 2020 Earnings Presentation
23 slides from Deere &'s earnings presentation, Nov 25, 2020
Slide 1: 4Q 2020 Earnings Call
4Q 2020 Earnings Call 25 November 2020
Slide 2: Safe Harbor Statement & Disclosures
Safe Harbor Statement & Disclosures The earnings call and accompanying material include forward-looking comments and information concerning the company’s plans and projections for the future, including estimates and assumptions with respect to economic, political, technological, weather, market acce
Slide 3: FY 2020 Results
FY 2020 Results ($ millions except where noted) Net Sales & Net Sales Net Income Diluted EPS (Equipment Operations) (attributable to ($ per share) Revenues Deere & Company) $39,258 $34,886 $10.15 $35,540 $31,272 $3,253 $8.69 $2,751 FY 2019 FY 2020 FY 2019 FY 2020 FY 2019 FY 2020 FY 2019 FY 2020 9% 1
Slide 4: 4Q 2020 Results
4Q 2020 Results ($ millions except where noted) Net Sales & Net Sales Net Income Diluted EPS (Equipment Operations) (attributable to ($ per share) Revenues Deere & Company) $9,896 $9,731 $8,703 $8,659 $722 $757 $2.27 $2.39 4Q 2019 4Q 2020 4Q 2019 4Q 2020 4Q 2019 4Q 2020 4Q 2019 4Q 2020 2% 1% 5% 5% 4
Slide 5: Worldwide Agriculture & Turf
Worldwide Agriculture & Turf 4Q 2020 Results $ in millions Net Sales 8% Operating Profit Comparison $123 ($153) $6,198 $314 $33 ($28) ($20) $5,756 ($4) $860 $68 $527 4Q 2019 4Q 2020 4Q19 Volume/ Price Currency Warranty Production SA&G/ Special Other 4Q20 Mix Costs R&D Items 5 John Deere | 4Q 2020 Ea
Slide 6: Regional Ag Commentary
Regional Ag Commentary NORTH AMERICA SOUTH AMERICA – Improved sentiment driven by prices, market – Strong grain production and profitability in access and government support Brazil – Lean new and healthy used inventory levels – Lean inventories and healthy order books – Order book reflects positive
Slide 7: Agriculture & Turf Industry Outlook – FY 2021
Agriculture & Turf Industry Outlook – FY 2021 U.S. & CANADA AG EUROPE AG SOUTH AMERICA AG (tractors and combines) 5-10% Flat to up 5% ~5% ASIA AG U.S. & CANADA TURF & UTILITY Slightly Flat to up 5% Source: Deere & Company forecast as of 25 November 2020 7 John Deere | 4Q 2020 Earnings Call | Novembe
Slide 8: Worldwide Agriculture & Turf Divisional Outlook
Worldwide Agriculture & Turf Divisional Outlook NET SALES OPERATING MARGIN 15.5-16.5% 10-15% $22,325 13.3% FY 2020 FY 2021 Fcst FY 2020 FY 2021 Fcst Source: Deere & Company forecast as of 25 November 2020 8 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 9: Worldwide Construction & Forestry
Worldwide Construction & Forestry 4Q 2020 Results $ in millions Net Sales 16% Operating Profit Comparison ($154) $20 ($76) $2,947 $261 $19 $19 $2,461 $94 ($1) $14 $196 4Q 2019 4Q 2020 4Q19 Volume/ Price Currency Warranty Production SA&G/ Special Other 4Q20 Mix Costs R&D Items 9 John Deere | 4Q 2020
Slide 10: Construction & Forestry Industry Outlook – FY 2021
Construction & Forestry Industry Outlook – FY 2021 NORTH AMERICA NORTH AMERICA COMPACT GLOBAL FORESTRY CONSTRUCTION EQUIPMENT CONSTRUCTION EQUIPMENT ~5% ~5% Flat to up 5% Source: Deere & Company forecast as of 25 November 2020 10 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 11: Worldwide Construction & Forestry Divisional Outlook
Worldwide Construction & Forestry Divisional Outlook NET SALES OPERATING MARGIN 5-10% 9-10% $8,947 6.6% FY 2020 FY 2021 Fcst FY 2020 FY 2021 Fcst Source: Deere & Company forecast as of 25 November 2020 11 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 12: Worldwide Financial Services Net Income
Worldwide Financial Services Net Income - Results and Outlook Quarter Results Fiscal Year Results and Outlook $186 $630 $566 $90 4Q 2019 4Q 2020 FY 2020 FY 2021 Fcst Source: Deere & Company forecast as of 25 November 2020 12 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 13: Deere Technology Stack
Deere Technology Stack Autonomy Full set of solutions, Automation/Machine IQ connected together and to our machines helping Connectivity & Digital Solutions customers perform jobs better increasing their productivity, Guidance profitability and sustainability. Hardware & Software 13 John Deere | 4Q
Slide 14: Evolution of our Technology Stack
Evolution of our Technology Stack Autonomy Blue River Technologies Computer Vision & Machine Learning Section ExactEmerge/ Combine Advisor Control ExactApply Artificial Automation/Machine IQ Intelligence Harvest Profit JD Link Operations Connected Farm Connectivity & in Base Center Support Profitabi
Slide 15: Opportunity to Deliver Differentiated Customer Value
Opportunity to Deliver Differentiated Customer Value TECH STACK 15 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 16: Deere & Company Outlook
Deere & Company Outlook FY 2021 FORECAST Net Income Effective Net Operating (attributable to Deere & Co.) Tax Rate* Cash Flow* $3.6-4.0B 26-28% $3.8-4.2B *Equipment Operations Source: Deere & Company forecast as of 25 November 2020 16 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 17: Appendix
Appendix 17 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 18: Other Financial Information
Other Financial Information Equipment Operations FY 2021 ($ millions) 4Q 2020 FY 2020 Forecast COS (percent of Net Sales)* 75% 76% ~74% SA&G* 6% 5% ~3% Research and Development* 9% 8% Flat Capital Expenditures $816 ~ $900 Pension/OPEB Expense $107 ~ $150 Pension/OPEB Contributions $951 ~ $950 *As re
Slide 19: October 2020 Retail Sales and Dealer Inventories
October 2020 Retail Sales (Rolling 3 Months) and Dealer Inventories Retail Sales U.S. and Canada Ag Industry* Deere** 2WD Tractors (< 40 PTO hp) 22% Single digit 2WD Tractors (40 < 100 PTO hp) 12% Single digit 2WD Tractors (100+ PTO hp) 4% Flat 4WD Tractors 19% In line with the industry Combines 9%
Slide 20: October 2020 Retail Sales (Rolling 3 Months)
October 2020 Retail Sales (Rolling 3 Months) Retail Sales Europe Ag Deere* Tractors Single digit Combines Single digit Retail Sales U.S. and Canada Deere* Selected Turf & Utility Equipment Single digit Construction & Forestry First-in-the-Dirt Double digits Settlements Double digits * Based on inter
Slide 21: 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 22: 1Q 2021 earnings call scheduled
Deere & Company’s 1Q 2021 earnings call is scheduled for 9:00 a.m. central time on Friday, 19 February 2021. 22 John Deere | 4Q 2020 Earnings Call | November 25, 2020
Slide 23: John Deere
@ JOHN DEERE