Deere & Company (NYSE:DE) Q2 2019 Earnings Conference Call Transcript

May 17, 2019 • 10:00 am ET

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Deere & Company (NYSE:DE) Q2 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning and welcome to John Deere & Company Second Quarter Earnings Conference Call. Your lines have been placed on a listen-only, until the question-and-answer session of today's conference.

I would now like to turn over the call to Mr. Josh Jepsen, Director of Investor Relations. Thank you. You may begin.

Executive
Josh Jepsen

Hello. Good morning. Also on the call today are Ryan Campbell, our Chief Financial Officer; Cory Reed, President of Ag & Turf Division; and Brent Norwood, Manager of Investor Communications.

Today, we'll take a closer look at Deere's second quarter earnings then spend some time talking about our markets and our current outlook for fiscal 2019. After that we'll respond to your questions. Please note -- note that slides are available to complement the call. They can be accessed on our website at www.johndeere.com/earnings.

First a reminder, this call is being broadcast live on the Internet and recorded for future transmission and use by Deere & Company. Any other use recording or transmission of any portion of this copyrighted broadcast without the expressed written consent of Deere is strictly prohibited. Participants in the call, including the Q&A session agree that their likeness and remarks in all media may be stored and used as part of the earnings call.

This call also includes forward-looking comments, concerning the Company's plans and projections for the future, that are subject to important risks and uncertainties. Additional information concerning factors that could cause actual results to differ materially is contained in the Company's most recent Form 8-K and periodic reports filed with the Securities and Exchange Commission.

This call may also include financial measures that are not in conformance with accounting principles generally accepted in the United States. Additional information concerning these measures, including reconciliations to comparable GAAP measures is included in the release and posted on our website at www.johndeere.com/earnings under Quarterly Earnings and Events. Brent?

Executive
Brent Norwood

John Deere completed the second quarter with solid results, despite uncertain conditions in the agricultural sector. While near term ag markets remain challenging in the US, foreign markets such as Brazil show signs of strength. Additionally, the Ag division continues to make solid progress advancing our technology investments and innovative new product programs. In construction and forestry, end market demand remains strong resulting from broad-based industry drivers such as GDP growth, oil and gas activity and infrastructure investment. With order books extending into the fourth quarter, the division is on track for a solid finish to the year.

Now, let's take a closer look at our second quarter results, beginning on Slide 3. Net sales and revenues were up 6% to $11.3 billion. Net income attributable to Deere & Company was $1.135 billion or $3.52 per diluted share.

On Slide 4, total worldwide equipment operations, net sales were up 5% to $10.273 billion. Price realization in the quarter was positive by 4 points, while currency translation was negative by 4 points. At this point, I'd like to welcome to the call, Cory Reed, President of Ag and Turf