JOHN Deeres first quarter trading results, which ended 31 Jan, reveal a worldwide net loss of $38.1m.
The same period last year saw a net income of $56.4m.
Robert Lane, chairman and chief executive, says JDs first quarter financial results were affected by deep production cutbacks at its large North American factories.
"These were made in line with plans for improved asset utilisation. While these reductions have had a negative impact on net income, they are also helping to achieve a dramatic decline in asset levels and should be supportive of higher profitability in the future."
Despite the financial trading loss, Deere reports worldwide net sales and revenues increased to $2.522bn from $2.705bn for the same period last year. Net sales of the equipment divisions were $1.938bn compared with $2.143bn for the 2001 period.
More specifically, Deeres agricultural equipment division reported an operating loss of $15m for the quarter compared with an operating profit of $89m last year. Net sales reduced by 5% and production volumes were about 14% lower than last year.
"We are beginning to see early results from our efforts to improve asset turns and profit margins," says Mr Lane.
"Such benefits should be more evident in future quarters if economic conditions remain the same."
Highs and lows in tractor trading year
AGCOS fourth quarter and end of year figures reveal the firm had net sales of $772.9m, a rise of 21% on the same period last year, and a net income of $24.8m.
Company chairman and chief executive, Robert Ratliff, says earnings were boosted by both sales growth and margin expansion. Help also came from improved market conditions in North and South America, new product introductions and the impact of manufacturing facility rationalisations.
Mr Ratliff says this was partially offset by losses from its recently acquired AG-Chem during a seasonally low period which resulted in a loss of $2m in net income.
For the full year, Agco reports an increase in net sales of 9% to $2541.5m and a net income of $31.5m. This compares with last years net sales of $2336.1m and a net income of $16.6m.
In western Europe, sales of tractors fell by 7% compared with 2000 and Agcos sales also declined. "In 2001, western European markets were affected by concerns over livestock diseases and the longer-term impacts of CAP reform and farm consolidation," says Mr Ratliff.
"Our sales performance in 2001 was solid considering these conditions and we expect to maintain our strong market position in 2002."
Meanwhile, the Caterpillar Challenger acquisition is progressing, says Agco. The agreement with Caterpillar to acquire the design, assembly and marketing of the new MT Series Challenger tractor line is subject to regulatory approval but is expected to close in the next 30 days.
The addition of the Challenger line provides Agco with a high hp tractor which it can market worldwide primarily through the Caterpillar distribution network.
Agco will provide Caterpillar dealers with extra products which will broaden their ranges and, says Mr Ratliff, enhance their competitive position.
CNH Global, the parent company of New Holland and Case IH has released its fourth quarter and full year trading results.
On a net basis, CNH reports a fourth quarter loss of $155m compared with a loss of $134m for the same period last year as the company cut production significantly to reduce company and dealer inventories, particularly in construction equipment.
For the full year revenues totalled $9.715bn, which, although slightly less than the $10.041bn recorded in 2000, adjusted for the adverse impact of foreign exchange rates and divestitures meant that consolidated revenues rose by 3%, says the firm.
CNH boss, Paolo Monferino, says both Case and New Holland have delivered a significant growth in markets around the world. "We have regained share lost through required divestitures and competitive pressure in the early months after the merger," he says. "Thanks to the launch of the first of our new products and to the profit improvement actions we have taken, we have increased our operating earnings significantly."
Mr Monferino says this growth will continue in 2002, even though he does not expect any startling improvement in the industry.
"We are well positioned to grow this year with more products and more customers." *
AGCOs Robert Ratliff: "We expect to maintain our strong market position in this year."
Deeres Robert Lane: "We are beginning to see early results from our efforts to improve profit margins."
CNHGlobals Paulo Monferino:"We have regained share lost through required divestitures."