John Deere(US:DE)2023-05-31 16:00Financial Performance - Net sales and revenues for the second quarter of 2023 increased by 30% to $17,387 million compared to $13,370 million in the same period of 2022[108] - Net income attributable to the company for the second quarter of 2023 rose by 36% to $2,860 million, up from $2,098 million in the prior year[108] - Net sales for the three months ended April 30, 2023, reached $16,079 million, a 33.9% increase from $12,034 million in the same period of 2022[144] - Total income before income taxes for the six months ended April 30, 2023, was $6,057 million, compared to $3,125 million in the same period of 2022, reflecting a 93.5% increase[146] - Net income attributable to Deere & Company for the six months ended April 30, 2023, was $4,607 million, compared to $2,562 million in the same period of 2022, representing an 80% increase[146] - Net income for the six months ended April 30, 2023, was $4,603 million, compared to $2,562 million in the same period of 2022, representing an increase of 80%[149] - Total revenues for the six months ended April 30, 2023, were $30,038 million, compared to $22,939 million in the same period of 2022, representing a 31.1% increase[146] Segment Performance - The production and precision agriculture segment reported a 53% increase in net sales for the second quarter of 2023, reaching $7,822 million, with operating profit up 105% to $2,170 million[114] - Small agriculture and turf segment net sales increased by 16% to $4,145 million in the second quarter of 2023, with operating profit rising by 63% to $849 million[117] - Construction and forestry net sales increased by 23% to $4,112 million for the three months ended April 30, 2023, compared to $3,347 million for the same period in 2022[120] - Operating profit for construction and forestry improved by 3% to $838 million for the three months ended April 30, 2023, from $814 million in the same period last year[120] Financial Services - The company's financial services operations are expected to see lower net income in 2023 due to less favorable financing spreads and higher provisions for credit losses[101] - Financial services revenue rose by 36% to $1,297 million for the three months ended April 30, 2023, compared to $951 million for the same period in 2022[123] - The average balance of receivables and leases financed was 18% higher in the second quarter of 2023 compared to the same period last year[123] Cash Flow and Liquidity - Cash outflows from operating activities were $147 million in the first six months of 2023, significantly improved from $1,762 million in the same period last year[129] - The company forecasts higher operating cash flows in 2023, driven by an increase in net income adjusted for non-cash provisions and favorable changes in working capital[128] - Cash flows from operating activities provided $3,766 million in 2023, a significant recovery from a cash outflow of $646 million in 2022[149] - The company reported a net cash outflow from financing activities of $2,547 million in 2023, compared to an outflow of $2,401 million in 2022, indicating ongoing financing challenges[149] Research and Development - Research and development expenses increased by 21% to $547 million in the second quarter of 2023, reflecting the company's focus on technology solutions[110] - Research and development expenses for the three months ended April 30, 2023, were $547 million, up from $453 million in the same period of 2022, indicating a 20.8% increase[144] Inventory and Assets - Inventories rose by $1,218 million during the first six months of 2023, attributed to higher forecasted sales volumes and supply chain disruptions[132] - Total assets increased to $41,236 million as of April 30, 2023, up from $39,208 million a year earlier, representing a growth of 5.2%[148] - Inventories increased to $9,713 million from $8,495 million, a growth of 14.4%[148] Debt and Equity - The ratio of interest-bearing debt to stockholder's equity improved to 8.0 to 1 as of April 30, 2023, compared to 8.5 to 1 in October 2022[126] - Stockholders' equity rose to $22,395 million from $20,262 million, an increase of 10.5%[148] - Total liabilities increased to $75,846 million from $69,673 million, reflecting an increase of 8.8%[148] Other Financial Metrics - The cost of sales to net sales ratio improved to 66.7% in the second quarter of 2023, down from 74.1% in the same period of 2022, due to price realization[110] - The cost of sales for the three months ended April 30, 2023, was $10,737 million, compared to $8,919 million in the same period of 2022, which is a 20.4% increase[144] - Selling, administrative, and general expenses for the three months ended April 30, 2023, were $935 million, compared to $753 million in the same period of 2022, indicating a 24.2% increase[144] - Other income for the three months ended April 30, 2023, was $185 million, down from $584 million in the same period of 2022, reflecting a decrease of 68.3%[144]