Moline, Ill.-based Deere & Co. last week announced worldwide net income of $422.1 million, or $1.88 per share, for the fourth quarter ended Oct. 31, compared with $277.3 million, or $1.20 per share, for the same period last year. Income from continuing operations was $422.1 million, or $1.88 per share, for the fourth quarter, versus $276.7 million, or $1.20 per share, last year.

For the full year, net income was $1.8 billion, or $8.01 per share, compared with $1.7 billion, or $7.18 per share, last year. Full-year income from continuing operations was $1.8 billion, or $8.01 per share, in comparison with $1.5 billion, or $6.16 per share, a year ago.

Earnings per share figures do not reflect the recently approved two-for-one stock split. The split, in the form of a 100-percent stock dividend on Dec. 3, to holders of record on Nov. 26, was approved by shareholders earlier this month.

“Deere's continuing strong performance reflects improving execution of our plans to create a fundamentally more profitable, resilient business,” said Robert Lane, chairman and CEO. “As a result, the company has delivered four successive years of record results, and done so in the face of mixed market conditions.”

In 2007, Deere benefited from an improving global farm economy yet saw weakening in the construction, forestry, commercial and consumer sectors, chiefly as a result of the U.S. housing downturn.

“In addition to our ongoing focus on cost and asset management, Deere has successfully entered new markets, made important acquisitions, and expanded its global customer base with advanced lines of innovative products and services,” Lane said.

Worldwide net sales and revenues increased 20 percent to $6.1 billion for the fourth quarter and were up 9 percent to $24.1 billion for the full year. Net sales of the equipment operations were $5.4 billion for the quarter and $21.5 billion for the year, compared with $4.5 billion and $19.9 billion for the respective periods last year.

Net sales of the worldwide equipment operations increased 21 percent for the quarter and rose 8 percent for the year. Included were positive effects for currency translation and price changes of 6 percent for the quarter and 5 percent for the year. Equipment sales in the U.S. and Canada were up 15 percent for the quarter and flat for the year, while net sales outside the U.S. and Canada increased by 32 percent for the quarter and 27 percent for the year. Currency translation added 9 percentage points to sales outside the U.S. and Canada for the quarter and 7 points for the year.

Deere's equipment divisions reported operating profit of $511 million for the quarter and $2.3 billion for the year, compared with $276 million and $1.9 billion for the same periods last year.

Company equipment sales are projected to increase by about 12 percent for the full year and to be up approximately 25 percent for the first quarter of 2008. LESCO operations are expected to account for about 2 percentage points of the sales increase for the year and 3 points in the first quarter. Deere's net income is forecast to be about $2.1 billion for 2008 and about $325 million for the first quarter.

In addition to achieving strong financial performance, Deere in 2007 funded a disciplined global growth plan, returned $1.9 billion to investors through share repurchases and dividends, and made further strides in operating and asset efficiency.

“Deere is well-positioned to continue benefiting from powerful global economic trends such as growing affluence and increasing demand for food, feed and biofuels,” Lane said.

Commercial & Consumer Division sales rose 35 percent for the quarter and 12 percent for the full year compared with 2006. LESCO, a supplier of consumable lawn care, landscape, golf course and pest control products, was acquired by Deere in the third quarter of 2007. Its operations accounted for 29 percentage points of the quarter's increase and 9 points for the full year. The division had an operating loss of $11 million for the quarter and an operating profit of $304 million for the full year, compared with last year's operating loss of $3 million for the quarter and operating profit of $221 million for the year.

John Deere commercial and consumer equipment sales are projected to be up about 10 percent for the year, including about 8 percentage points from a full year of LESCO sales. Division sales, in addition, are expected to benefit from new products, such as an expanded line of innovative commercial mowing equipment.

Construction & Forestry sales declined 11 percent for the fourth quarter and were down 13 percent for the full year. Operating profit was $134 million for the quarter and $571 million for the full year, compared with $136 million and $802 million a year ago. Operating profit declined for the quarter mainly due to lower sales volumes, largely offset by improved price realization. The year's decline in operating profit was primarily due to lower sales and production volumes and higher raw-material costs, partially offset by positive price realization. Last year's results included expenses related to the closure of a Canadian forestry-equipment facility.

U.S. markets for construction and forestry equipment are forecast to remain under pressure in 2008 due in large part to a continuing slump in housing starts. Non-residential construction is expected to remain flat at last year's relatively strong levels. Pressure on the U.S. housing market is expected to contribute to lower worldwide sales of forestry equipment in 2008, though sales in Europe are forecast to remain at strong levels. Despite this generally weak environment, Deere sales are expected to benefit from new products and a return to factory-production levels in closer alignment with retail demand. Last year, the company made a significant reduction in construction and forestry inventories, which restrained production. In addition, Deere's sales to the independent rental channel, which saw a large decline in 2007, are expected to be flat in the coming year. For 2008, the company's worldwide sales of construction and forestry equipment are forecast to be approximately equal to the prior year.