Case financial data tells familiar story
LATEST financial results released by Case Corporation reveal a picture with which many big agricultural machinery manufacturers will be able to associate.
Operating earnings for the third quarter were $106m to provide a net income of $63m. For the same period last year Case reported operating earnings of $123m and a net income of $78m.
Case blames declining sales of large agricultural equipment, unfavourable exchange rates and new product launch costs.
"Business conditions have changed markedly from this time last year," says Jean-Pierre Rosso, Case chairman and chief executive. "Economic difficulty has spread to many regions of the world at a time when historically low commodity prices have caused retail sales of agricultural equipment to decline considerably, particularly four-wheel-drive tractors and combines."
Mr Rosso anticipates further economic deterioration and, as a result, is decreasing agricultural equipment production this year by 15% to keep product inventories to a four to five month supply – a move which will result in labour reductions at the companys manufacturing sites.
Overall, Case expects the worldwide agricultural equipment market to decline by 7-8% in 1998 with earnings to be about 40% below those of 1997. *