0000315189falseDEERE & CO0000315189us-gaap:CommonStockMember2024-05-162024-05-160000315189de:Debentures6.55PercentDue2028Member2024-05-162024-05-1600003151892024-05-162024-05-16

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: May 16, 2024

(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

MolineIllinois 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.

Item 2.02Results of Operations and Financial Condition

On Thursday, May 16, 2024, Deere & Company (the “Company”) issued a press release announcing its results of operations for the second quarter of fiscal 2024. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 7.01Regulation FD

On Thursday, May 16, 2024, the Company made available a presentation providing a review of its second quarter of fiscal 2024 in connection with its investor earnings call. A copy of the presentation is furnished herewith as Exhibit 99.2 and is incorporated herein 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

Second Quarter 2024 Earnings Conference Call Information (Furnished herewith)

104

Cover Page Interactive Data File (the cover page XBRL tags are imbedded in the Inline XBRL document)

2

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: May 16, 2024

3

News Release

Graphic

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

Deere Reports Second Quarter Net Income of $2.370 Billion

Quarterly results underscore sound execution in the face of challenging market conditions.
Global agricultural and turf demand further softens while the construction industry remains stable.
Full-year net income forecast updated to approximately $7.0 billion.

MOLINE, Illinois (May 16, 2024) — Deere & Company reported net income of $2.370 billion for the second quarter ended April 28, 2024, or $8.53 per share, compared with net income of $2.860 billion, or $9.65 per share, for the quarter ended April 30, 2023. For the first six months of the year, net income attributable to Deere & Company was $4.121 billion, or $14.74 per share, compared with $4.819 billion, or $16.18 per share, for the same period last year.

Worldwide net sales and revenues decreased 12 percent, to $15.235 billion, for the second quarter of 2024 and decreased 9 percent, to $27.420 billion, for six months. Net sales were $13.610 billion for the quarter and $24.097 billion for six months, compared with $16.079 billion and $27.481 billion last year.

“John Deere’s second-quarter results were noteworthy in light of continued changes across the global agricultural sector,” stated John C. May, chairman and chief executive officer. “Thanks to the dedication and hard work of our team, we continue to demonstrate structurally higher performance levels across business cycles and are benefitting from stability in construction end markets amid declining agricultural and turf demand.”

Company Outlook & Summary

Net income attributable to Deere & Company for fiscal 2024 is forecasted to be approximately $7.0 billion.

“We are proactively managing our production and inventory levels to adapt to demand changes and position the business for the future,” May explained. “Despite market conditions, we are committed to our strategy and are actively investing in and deploying innovative technologies, products, and solutions to ensure our customers' success.”

4


Deere & Company

Second Quarter

Year to Date

$ in millions, except per share amounts

2024

2023

% Change

2024

2023

% Change

Net sales and revenues

$

15,235

 

$

17,387

 

-12%

 

$

27,420

 

$

30,038

 

-9%

Net income

$

2,370

$

2,860

-17%

$

4,121

$

4,819

-14%

Fully diluted EPS

$

8.53

$

9.65

$

14.74

$

16.18

Prior period results were affected by a special item. See Note 1 of the financial statements for further details.

Production & Precision Agriculture

Second Quarter

$ in millions

2024

2023

% Change

Net sales

 

$

6,581

 

$

7,822

 

-16%

Operating profit

$

1,650

$

2,170

-24%

Operating margin

25.1%

27.7%

Production and precision agriculture sales decreased for the quarter as a result of lower shipment volumes, partially offset by price realization. Operating profit decreased due to lower shipment volumes and higher production costs, partially offset by price realization.

Production & Precision Agriculture Operating Profit

Second Quarter 2024 Compared to Second Quarter 2023

$ in millions

Graphic

5


Small Agriculture & Turf

Second Quarter

$ in millions

2024

2023

% Change

Net sales

 

$

3,185

 

$

4,145

 

-23%

Operating profit

$

571

$

849

-33%

Operating margin

17.9%

20.5%

Small agriculture and turf sales decreased for the quarter as a result of lower shipment volumes, partially offset by price realization. Operating profit decreased due to lower shipment volumes, partially offset by price realization.

Small Agriculture & Turf Operating Profit

Second Quarter 2024 Compared to Second Quarter 2023

$ in millions

Graphic

6


Construction & Forestry

Second Quarter

$ in millions

2024

2023

% Change

Net sales

 

$

3,844

 

$

4,112

 

-7%

Operating profit

$

668

$

838

-20%

Operating margin

17.4%

20.4%

Construction and forestry sales decreased for the quarter due to lower shipment volumes. Operating profit decreased due to lower shipment volumes and higher SA&G and R&D expenses.

Construction & Forestry Operating Profit

Second Quarter 2024 Compared to Second Quarter 2023

$ in millions

Graphic

Financial Services

Second Quarter

$ in millions

2024

2023

% Change

Net income

 

$

162

 

$

28

 

479%

Financial services net income for the quarter increased due to income earned on higher average portfolio balances, partially offset by a higher provision for credit losses and less-favorable financing spreads. The results of the prior period were also affected by a correction of the accounting treatment for financing incentives offered to John Deere dealers. The cumulative effect of this correction, $173 million pretax ($135 million after-tax), was recorded in the second quarter of 2023.

7


Industry Outlook for Fiscal 2024

Agriculture & Turf

U.S. & Canada:

Large Ag

Down ~ 15%

Small Ag & Turf

Down ~ 10%

Europe

Down ~ 15%

South America (Tractors & Combines)

Down 15 to 20%

Asia

Down moderately

Construction & Forestry

U.S. & Canada:

Construction Equipment

Flat to Down 5%

Compact Construction Equipment

Flat

Global Forestry

Down ~ 10%

Global Roadbuilding

Flat to Down 5%

Deere Segment Outlook for Fiscal 2024

Currency

Price

$ in millions

Net Sales

Translation

Realization

Production & Precision Ag

Down 20% to 25%

~ Flat

+1.5%

Small Ag & Turf

Down 20% to 25%

~ Flat

+1.5%

Construction & Forestry

Down 5% to 10%

~ Flat

+1.5%

Financial Services

Net Income

~$ 770

Financial Services. Fiscal-year 2024 net income attributable to Deere & Company for the financial services operations is forecasted to be approximately $770 million. Results are expected to be higher than fiscal year 2023 due to income earned on a higher average portfolio, partially offset by a higher provision for credit losses and less-favorable financing spreads. A correction of the accounting treatment for financing incentives offered to John Deere dealers impacted 2023 financial results. The cumulative effect of this correction, $173 million pretax ($135 million after-tax), was recorded in the second quarter of 2023.

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. Some of these risks and uncertainties could affect all lines of the company’s operations generally while others could more heavily affect a particular line of business.

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

changes in and compliance with U.S., foreign and international laws, regulations, and policies relating to trade, economic sanctions, data privacy, spending, taxing, banking, monetary, environmental (including climate change and engine emissions), and farming policies;
political, economic, and social instability of the geographies in which the company operates, including the ongoing war between Russia and Ukraine and the conflict in the Middle East;
adverse macroeconomic conditions, including unemployment, inflation, rising interest rates, changes in consumer practices due to slower economic growth, and regional or global liquidity constraints;
worldwide demand for food and different forms of renewable energy;

8


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 customers’ changing expectations and demand for John Deere products and solutions;
accurately forecasting customer demand for products and services and adequately managing inventory;
the ability to integrate new technology, including automation and machine learning, and deliver precision technology and solutions to customers;
changes to governmental communications channels (radio frequency technology);
the 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, unfavorable weather events, and natural disasters;
governmental and other actions designed to address climate change in connection with a transition to a lower-carbon economy;
higher interest rates and currency fluctuations which could adversely affect the U.S. dollar, customer confidence, access to capital, and demand for John Deere products and solutions;
availability and price of raw materials, components, and whole goods;
delays or disruptions in the company’s supply chain;
our equipment fails to perform as expected, which could result in warranty claims, post-sales repairs or recalls, product liability litigation, and regulatory investigations;
the ability to attract, develop, engage, and retain qualified personnel;
security breaches, cybersecurity attacks, technology failures, and other disruptions to John Deere information technology infrastructure and products;
loss of or challenges to intellectual property rights;
legislation introduced or enacted that could affect the company’s business model and intellectual property, such as right to repair or right to modify legislation;
investigations, claims, lawsuits, or other legal proceedings;
events that damage the company’s reputation or brand;
the agricultural business cycle, which can be unpredictable and is affected by factors such as world grain stocks, available farm acres, acreage planted, soil conditions, harvest yields, prices for commodities and livestock, input costs, 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 financial results, is included in the company’s filings with the SEC (including, but not limited to, the factors discussed in Item 1A. “Risk Factors” of the company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q). There also may be other factors that the company cannot anticipate or that are not described herein because the company does not currently perceive them to be material.

9


DEERE & COMPANY

SECOND QUARTER 2024 PRESS RELEASE

(In millions of dollars) Unaudited

Three Months Ended

Six Months Ended

 

April 28

  

April 30

  

%

  

April 28

  

April 30

  

%

2024

2023

Change

2024

2023

Change

Net sales and revenues:

Production & precision ag net sales

$

6,581

$

7,822

 

-16

$

11,430

$

13,021

 

-12

Small ag & turf net sales

3,185

4,145

-23

5,610

7,146

-21

Construction & forestry net sales

 

3,844

 

4,112

 

-7

 

7,057

 

7,314

 

-4

Financial services revenues

 

1,395

 

1,107

 

+26

 

2,770

 

2,147

 

+29

Other revenues

 

230

 

201

 

+14

 

553

 

410

+35

Total net sales and revenues

$

15,235

$

17,387

 

-12

$

27,420

$

30,038

 

-9

Operating profit: *

Production & precision ag

$

1,650

$

2,170

 

-24

$

2,695

$

3,378

 

-20

Small ag & turf

571

849

-33

897

1,296

-31

Construction & forestry

 

668

 

838

 

-20

 

1,234

 

1,463

 

-16

Financial services

 

209

 

41

 

+410

 

466

 

279

 

+67

Total operating profit

 

3,098

 

3,898

 

-21

 

5,292

 

6,416

 

-18

Reconciling items **

 

23

 

(47)

 

 

49

 

(69)

 

Income taxes

 

(751)

 

(991)

 

-24

 

(1,220)

 

(1,528)

 

-20

Net income attributable to Deere & Company

$

2,370

$

2,860

 

-17

$

4,121

$

4,819

 

-14

*      Operating profit is income from continuing operations before corporate expenses, certain external interest expenses, certain foreign exchange gains and losses, and income taxes. Operating profit for financial services includes the effect of interest expense and foreign exchange gains or losses.

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

10


DEERE & COMPANY

STATEMENTS OF CONSOLIDATED INCOME

For the Three and Six Months Ended April 28, 2024 and April 30, 2023

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

Three Months Ended

Six Months Ended

  

2024

   

2023

2024

   

2023

Net Sales and Revenues

Net sales

$

13,610

$

16,079

$

24,097

$

27,481

Finance and interest income

 

1,387

 

1,079

 

2,746

 

2,073

Other income

 

238

 

229

 

577

 

484

Total

 

15,235

 

17,387

 

27,420

 

30,038

Costs and Expenses

Cost of sales

 

9,157

 

10,730

 

16,357

 

18,663

Research and development expenses

 

565

 

547

 

1,098

 

1,043

Selling, administrative and general expenses

 

1,265

 

1,330

 

2,330

 

2,283

Interest expense

 

836

 

569

 

1,638

 

1,049

Other operating expenses

 

295

 

363

 

664

 

660

Total

 

12,118

 

13,539

 

22,087

 

23,698

Income of Consolidated Group before Income Taxes

 

3,117

 

3,848

 

5,333

 

6,340

Provision for income taxes

 

751

 

991

 

1,220

 

1,528

Income of Consolidated Group

 

2,366

 

2,857

 

4,113

 

4,812

Equity in income of unconsolidated affiliates

 

2

 

2

 

3

 

3

Net Income

 

2,368

 

2,859

 

4,116

 

4,815

Less: Net loss attributable to noncontrolling interests

 

(2)

 

(1)

 

(5)

 

(4)

Net Income Attributable to Deere & Company

$

2,370

$

2,860

$

4,121

$

4,819

Per Share Data

Basic

$

8.56

$

9.69

$

14.80

$

16.26

Diluted

8.53

9.65

14.74

16.18

Dividends declared

1.47

1.25

2.94

2.45

Dividends paid

1.47

1.20

2.82

2.33

Average Shares Outstanding

Basic

 

276.8

 

295.1

 

278.4

 

296.3

Diluted

 

277.9

 

296.5

 

279.5

 

297.8

See Condensed Notes to Interim Consolidated Financial Statements.

11


DEERE & COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions of dollars) Unaudited

April 28

October 29

April 30

    

2024

    

2023

    

2023

Assets

Cash and cash equivalents

$

5,553

$

7,458

$

5,267

Marketable securities

 

1,094

 

946

 

856

Trade accounts and notes receivable – net

 

8,880

 

7,739

 

9,971

Financing receivables – net

 

45,278

 

43,673

 

38,954

Financing receivables securitized – net

 

7,262

 

7,335

 

5,659

Other receivables

 

2,535

 

2,623

 

2,593

Equipment on operating leases – net

 

6,965

 

6,917

 

6,524

Inventories

 

8,443

 

8,160

 

9,713

Property and equipment – net

 

7,034

 

6,879

 

6,288

Goodwill

 

3,936

 

3,900

 

3,963

Other intangible assets – net

 

1,064

 

1,133

 

1,222

Retirement benefits

 

3,056

 

3,007

 

3,519

Deferred income taxes

 

1,936

 

1,814

 

1,308

Other assets

 

2,592

 

2,503

 

2,510

Total Assets

$

105,628

$

104,087

$

98,347

Liabilities and Stockholders’ Equity

Liabilities

Short-term borrowings

$

17,699

$

17,939

$

17,109

Short-term securitization borrowings

 

6,976

 

6,995

 

5,379

Accounts payable and accrued expenses

 

14,609

 

16,130

 

14,716

Deferred income taxes

 

491

 

520

 

511

Long-term borrowings

 

40,962

 

38,477

 

35,611

Retirement benefits and other liabilities

 

2,105

 

2,140

 

2,520

Total liabilities

 

82,842

 

82,201

 

75,846

Redeemable noncontrolling interest

98

97

102

Stockholders’ Equity

Total Deere & Company stockholders’ equity

 

22,684

 

21,785

 

22,395

Noncontrolling interests

 

4

 

4

 

4

Total stockholders’ equity

 

22,688

 

21,789

 

22,399

Total Liabilities and Stockholders’ Equity

$

105,628

$

104,087

$

98,347

See Condensed Notes to Interim Consolidated Financial Statements.

12


DEERE & COMPANY

STATEMENTS OF CONSOLIDATED CASH FLOWS

For the Six Months Ended April 28, 2024 and April 30, 2023

(In millions of dollars) Unaudited

    

2024

    

2023

Cash Flows from Operating Activities

Net income

$

4,116

$

4,815

Adjustments to reconcile net income to net cash provided by (used for) operating activities:

Provision (credit) for credit losses

 

131

 

(89)

Provision for depreciation and amortization

 

1,045

 

995

Other non-cash adjustments (Note 1)

 

173

Share-based compensation expense

 

104

 

54

Credit for deferred income taxes

 

(120)

 

(377)

Changes in assets and liabilities:

Receivables related to sales

 

(2,469)

 

(4,407)

Inventories

 

(409)

 

(982)

Accounts payable and accrued expenses

 

(1,300)

 

(313)

Accrued income taxes payable/receivable

 

(29)

 

(96)

Retirement benefits

 

(208)

 

(68)

Other

 

83

 

148

Net cash provided by (used for) operating activities

 

944

 

(147)

Cash Flows from Investing Activities

Collections of receivables (excluding receivables related to sales)

 

13,703

 

12,593

Proceeds from maturities and sales of marketable securities

 

200

 

98

Proceeds from sales of equipment on operating leases

 

1,011

 

993

Cost of receivables acquired (excluding receivables related to sales)

 

(14,091)

 

(13,451)

Purchases of marketable securities

 

(432)

 

(188)

Purchases of property and equipment

 

(719)

 

(584)

Cost of equipment on operating leases acquired

 

(1,369)

 

(1,229)

Collateral on derivatives – net

96

 

367

Other

 

(69)

 

(93)

Net cash used for investing activities

 

(1,670)

 

(1,494)

Cash Flows from Financing Activities

Net proceeds in short-term borrowings (original maturities three months or less)

 

58

 

3,992

Proceeds from borrowings issued (original maturities greater than three months)

 

10,189

 

4,868

Payments of borrowings (original maturities greater than three months)

 

(8,139)

 

(3,567)

Repurchases of common stock

 

(2,422)

 

(2,546)

Dividends paid

 

(796)

 

(697)

Other

 

(52)

 

(33)

Net cash provided by (used for) financing activities

 

(1,162)

 

2,017

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash

 

(5)

 

70

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash

 

(1,893)

 

446

Cash, Cash Equivalents, and Restricted Cash at Beginning of Period

 

7,620

 

4,941

Cash, Cash Equivalents, and Restricted Cash at End of Period

$

5,727

$

5,387

See Condensed Notes to Interim Consolidated Financial Statements.

13


DEERE & COMPANY

Condensed Notes to Interim Consolidated Financial Statements

(In millions of dollars) Unaudited

(1)In the second quarter of 2023, the company corrected the accounting treatment for financing incentives offered to John Deere dealers, which impacted the timing of expense recognition and the presentation of incentive costs in the consolidated financial statements. The cumulative effect of this correction, $173 million pretax ($135 million after-tax), was recorded in the second quarter of 2023 in “Selling, administrative and general expenses” by financial services.

(2)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 3 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.”

14


DEERE & COMPANY

(3) SUPPLEMENTAL CONSOLIDATING DATA

STATEMENTS OF INCOME

For the Three Months Ended April 28, 2024 and April 30, 2023

(In millions of dollars) Unaudited

EQUIPMENT

FINANCIAL

OPERATIONS

SERVICES

ELIMINATIONS

CONSOLIDATED

 

2024

  

2023

  

2024

  

2023

  

2024

  

2023

  

2024

  

2023

  

Net Sales and Revenues

Net sales

$

13,610

$

16,079

$

13,610

$

16,079

Finance and interest income

 

129

 

121

$

1,496

$

1,206

$

(238)

$

(248)

1,387

1,079

1

Other income

 

198

 

185

 

92

 

91

 

(52)

 

(47)

 

238

 

229

2, 3

Total

 

13,937

 

16,385

 

1,588

 

1,297

 

(290)

 

(295)

 

15,235

 

17,387

Costs and Expenses

Cost of sales

 

9,164

 

10,737

(7)

(7)

9,157

10,730

4

Research and development expenses

 

565

 

547

565

547

Selling, administrative and general expenses

 

1,007

 

935

 

260

 

397

 

(2)

 

(2)

 

1,265

 

1,330

4

Interest expense

 

114

 

103

 

780

 

540

 

(58)

 

(74)

 

836

 

569

1

Interest compensation to Financial Services

 

180

 

174

(180)

(174)

1

Other operating expenses

 

1

 

85

 

337

 

316

 

(43)

 

(38)

 

295

 

363

3, 5

Total

 

11,031

 

12,581

 

1,377

 

1,253

 

(290)

 

(295)

 

12,118

 

13,539

Income before Income Taxes

 

2,906

 

3,804

 

211

 

44

 

 

 

3,117

 

3,848

Provision for income taxes

 

700

 

974

 

51

 

17

 

 

 

751

 

991

Income after Income Taxes

 

2,206

 

2,830

 

160

 

27

 

 

 

2,366

 

2,857

Equity in income of unconsolidated affiliates

 

 

1

2

1

2

2

Net Income

 

2,206

 

2,831

 

162

 

28

 

 

 

2,368

 

2,859

Less: Net loss attributable to noncontrolling interests

 

(2)

 

(1)

(2)

(1)

Net Income Attributable to Deere & Company

$

2,208

$

2,832

$

162

$

28

$

2,370

$

2,860

1 Elimination of intercompany interest income and expense.

2 Elimination of Equipment Operations’ margin from inventory transferred to equipment on operating leases.

3 Elimination of income and expense between Equipment Operations and Financial Services related to intercompany guarantees of investments in certain international markets and intercompany service revenues and expenses.

4 Elimination of intercompany service fees.

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

15


DEERE & COMPANY

SUPPLEMENTAL CONSOLIDATING DATA (Continued)

STATEMENTS OF INCOME

For the Six Months Ended April 28, 2024 and April 30, 2023

(In millions of dollars) Unaudited

EQUIPMENT

FINANCIAL

OPERATIONS

SERVICES

ELIMINATIONS

CONSOLIDATED

 

2024

 

2023

 

2024

 

2023

 

2024

 

2023

 

2024

 

2023

  

Net Sales and Revenues

Net sales

$

24,097

$

27,481

$

24,097

$

27,481

Finance and interest income

 

285

 

234

$

2,929

$

2,274

$

(468)

$

(435)

2,746

2,073

1

Other income

 

487

 

417

 

211

 

268

 

(121)

 

(201)

 

577

 

484

2, 3

Total

 

24,869

 

28,132

 

3,140

 

2,542

 

(589)

 

(636)

 

27,420

 

30,038

Costs and Expenses

Cost of sales

 

16,371

 

18,675

(14)

(12)

16,357

18,663

4

Research and development expenses

 

1,098

 

1,043

1,098

1,043

Selling, administrative and general expenses

 

1,882

 

1,719

 

453

 

569

 

(5)

 

(5)

 

2,330

 

2,283

4

Interest expense

 

223

 

204

 

1,542

 

983

 

(127)

 

(138)

 

1,638

 

1,049

1

Interest compensation to Financial Services

 

341

 

297

(341)

(297)

1

Other operating expenses

 

91

 

137

 

675

 

707

 

(102)

 

(184)

 

664

 

660

3, 5

Total

 

20,006

 

22,075

 

2,670

 

2,259

 

(589)

 

(636)

 

22,087

 

23,698

Income before Income Taxes

 

4,863

 

6,057

 

470

 

283

 

 

 

5,333

 

6,340

Provision for income taxes

 

1,117

 

1,455

 

103

 

73

 

 

 

1,220

 

1,528

Income after Income Taxes

 

3,746

 

4,602

 

367

 

210

 

 

 

4,113

 

4,812

Equity in income of unconsolidated affiliates

 

 

1

3

2

3

3

Net Income

 

3,746

 

4,603

 

370

 

212

 

 

 

4,116

 

4,815

Less: Net loss attributable to noncontrolling interests

 

(5)

 

(4)

(5)

(4)

Net Income Attributable to Deere & Company

$

3,751

$

4,607

$

370

$

212

$

4,121

$

4,819

1 Elimination of intercompany interest income and expense.

2 Elimination of Equipment Operations’ margin from inventory transferred to equipment on operating leases.

3 Elimination of income and expense between Equipment Operations and Financial Services related to intercompany guarantees of investments in certain international markets and intercompany service revenues and expenses.

4 Elimination of intercompany service fees.

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

16


DEERE & COMPANY

SUPPLEMENTAL CONSOLIDATING DATA (Continued)

CONDENSED BALANCE SHEETS

(In millions of dollars) Unaudited

EQUIPMENT

FINANCIAL

OPERATIONS

SERVICES

ELIMINATIONS

CONSOLIDATED

 

Apr 28

Oct 29

Apr 30

 

Apr 28

Oct 29

Apr 30

 

Apr 28

Oct 29

Apr 30

 

Apr 28

Oct 29

Apr 30

2024

 

2023

 

2023

2024

 

2023

 

2023

2024

 

2023

 

2023

2024

 

2023

 

2023

  

Assets

Cash and cash equivalents

$

3,800

$

5,720

$

3,587

$

1,753

$

1,738

$

1,680

$

5,553

$

7,458

$

5,267

Marketable securities

148

 

104

 

14

 

946

 

842

 

842