Dubuque County’s largest employer recorded an increase in net income in its recently completed quarter, as well as a jump in the division that includes John Deere Dubuque Works.
Deere and Co. reported a net income of $2.86 billion for the second quarter of its fiscal year, which ended April 30. During the same period last fiscal year, that figure was $2.1 billion.
For the first six months of the fiscal year, the company has had net income total about $4.82 billion, up 61% from the $3 billion reported in the first six months of last fiscal year.
“John Deere completed the second quarter with a strong performance,” said Rachel Bach, Deere & Co. manager of investor communications, during an earnings call with investors on Friday. “Across all our businesses, our performance was driven by strong demand, optimal pricing, and improvements to the supply chain.”
Net sales and revenues for the company totaled about $17.39 billion, up 30% from the same period last year.
The construction and forestry division, which includes the Dubuque plant, saw $4.11 billion in net sales during the quarter, an increase of 23% over the second quarter last fiscal year. The division also saw operating profits increase 3% from the same period last fiscal year, to $838 million.
“Construction and forestry continues to benefit from healthy demand, with order books virtually full for the remainder of the fiscal year,” Bach said.
Brent Norwood, Deere director of investor relations, said on Friday’s call that Deere factories had their “best quarter of execution” since the beginning of the COVID-19 pandemic, and there were fewer production inefficiencies.
“As a result, we were able to pull ahead some of the year’s production into the second quarter, taking pressure off of the back half of the year,” he said.
He noted this means the company foresees production will be down a bit in the upcoming quarters. However, this also marks a return to normalcy.
“It’s really healthy to return to more seasonal productions in our schedules and make sure our schedules match the seasonal use of our products,” he said.
He added that improvements in the supply chain have allowed Deere’s suppliers to meet their commitments and deliveries of products, and the increase in production in the second quarter also allows for more time to deliver machines to customers.
Looking ahead, Bach said net sales in the construction and forestry division are forecasted to be up about 15% for the total fiscal year.
Net income company-wide is forecasted to be $9.25 billion to $9.5 billion, which, if achieved, would be a jump from $7.13 billion in net income recorded in fiscal year 2022.
“This is a reflection of our strong results from the second quarter and continued optimism for the remainder of the year,” Bach said.