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BY KELLEN M. HENRY– MEDILL NEWS SERVICE

Deere & Co. [[DE]] saw its profits drop in the third quarter of 2009, but the agriculture machinery manufacture fared better than analysts expected.

The Moline, Ill.-based tractor-maker’s net income fell 27 percent to $420 million for the quarter ended [...]]]>

http://www.flickr.com/photos/randyread/ / CC BY 2.0

BY KELLEN M. HENRY– MEDILL NEWS SERVICE

Deere & Co. [[DE]] saw its profits drop in the third quarter of 2009, but the agriculture machinery manufacture fared better than analysts expected.

The Moline, Ill.-based tractor-maker’s net income fell 27 percent to $420 million for the quarter ended July 31 from $575 million for the same quarter in 2008, according to an earnings report released Wednesday.

The company cut its earnings projections for fourth quarter and the full year 2009, in part because of weak demand. Worldwide, Deere’s net equipment sales decreased 25 percent, with sales in the U.S. and Canada down 16 percent and sales elsewhere down 37 percent. Net sales for the quarter were $5.28 billion.

In an investor conference call, Susan Karlix, manager of investor communications, said:

The company…is projected to earn over a billion dollars in spite of what is likely to be its largest single year sales decline in at least 50 years.

Deere’s diluted earnings per share for the third quarter was 99 cents, down from $1.32 last year. However, securities analysts expected Deere to earn 57 cents per diluted share, according to Zack’s Investment Research Inc.

Deere expects a net income of $1.1 billion for the full year. It revised its full-year sales forecast, predicting sales would be down 21 percent from 2008. The previous forecast had sales down 19 percent from last year.  Its fourth quarter forecast expectation is that sales will drop 21 percent from the fourth quarter of last year.

In response to the third quarter earnings, Deere’s stock opened down more than 4 percent from Tuesday’s closing price of $45.09. As of Wednesday afternoon, the stock was trading at $44.18.

In the meantime, the company said it will continue trying to manage its inventory by curbing expenses in the difficult market and waiting to raise production of its iconic green and yellow farm machines when the economy recovers.