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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: Giordano Bruno who wrote (140821)8/13/2008 7:33:29 AM
From: DebtBombRead Replies (1) of 306849
 
Deere warns. Deere stumbles as costs rise

Worries about raw material costs persist, despite the recent commodities selloff. Tractor titan Deere (DE) on Wednesday posted softer-than-expected fiscal third-quarter earnings and guided lower for the fourth quarter, citing narrowing profit margins. Deere made $575 million, or $1.32 a share, for the quarter ended July 31, up from the year-ago $537 million, or $1.18 a share. Revenue rose 17% from a year ago to $7.74 billion. Analysts surveyed by Thomson Financial were looking for a profit of $1.36 a share on revenue of $7.23 billion.

“Though agricultural commodity prices have moderated, they remain quite favorable by historical standards and are continuing to provide strong support to farm incomes and to the sale of productive farm machinery worldwide,” said CEO Robert W. Lane. Deere said a “continuation of positive conditions in the global farm sector is helping the company maintain record financial results at a time of rising raw material costs and a sluggish U.S. economy.”

But the high costs will hurt the fourth quarter, when Deere is expecting to earn $425 million. That works out to about 98 cents a share - well short of the $1.15-a-share analyst estimate. Deere shares, already down 25% for the year, fell 6% in early premarket trading.
dailybriefing.blogs.fortune.cnn.com
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