Deere & Co., the world's largest maker of agricultural equipment, said Wednesday its fiscal first-quarter net income more than doubled, driven by growing sales of large farm machinery in the U.S. and Canada.
The company also raised its earnings prediction for the fiscal year. Deere's shares rose 4 percent in pre-market trading.
The Moline, Ill. company earned $513.7 million, or $1.20 per share, for the quarter ended Jan. 31, up from $243.2 million, or 57 cents per share, a year earlier.
FactSet says analysts forecast a profit of 97 cents per share.
Total revenue rose 27 percent to $6.12 billion. Equipment sales in the United States and Canada leaped 35 percent in the quarter. Outside those core regions, sales were up 22 percent for the quarter. Sales were helped by a 2 percent increase in prices.
Agriculture and turf sales rose 21 percent on a combination of higher demand and prices.
Deere said construction demand is up as well. Construction and forestry sales climbed 81 percent, and the unit turned an operating profit in the quarter from a loss in fiscal 2010. Higher costs for raw materials slightly weighed down results.
Deere projects equipment sales will rise 18 to 20 percent during the current fiscal year that ends in October, and about 25 percent in the current quarter.
It predicts net income this fiscal year of about $2.5 billion, up from a November prediction of $2.1 billion. Analysts currently predict $2.37 billion.
Worldwide sales of agriculture and turf equipment are forecast to increase by about 16 percent in 2011. Farmers in many of the company's markets are experiencing income growth due to strong global demand for agricultural commodities, low grain stocks and rising prices for crops such as corn, wheat, soybeans, sugar and cotton. Farm commodity prices have also risen sharply since the beginning of the year.
Deere's worldwide sales of construction and forestry equipment are forecast to rise by about 35 percent this year on higher wood and pulp prices and improved construction equipment sales to rental companies.
The company's stock rose $3.77 to $97.39 before the market opened Wednesday.
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