In spite of an unsettled global economy, demand for John Deere products is expected to experience substantial growth in fiscal year 2012 and the company is forecasting further increases in sales and earnings as a result. Company equipment sales are projected to increase about 15% for the year and to be up 16 to 18% for the first quarter compared with the same periods of 2011. Included is a favorable currency-translation impact of about 3% for the quarter and about 1% for the year. For the full year, net income attributable to Deere & Company is anticipated to be approximately $3.2 billion.

Supported by record 2011 performance, John Deere remains well-positioned to carry out its extensive growth plans and capitalize on positive long-term economic trends, according to Allen. "Thanks in large part to the dedication and hard work of our employees, dealers and suppliers worldwide, John Deere's plans for helping meet growing global needs for food and infrastructure are moving ahead at an accelerated rate," he said. "We are proud of the company's performance in 2011 and look forward to building on these gains in 2012 and beyond. We have great confidence in the company's future and our role in helping feed, clothe and shelter the world's growing population. These developments in our view hold great promise, which should prove rewarding to our investors and other stakeholders in the future."

Market Conditions & Outlook

Agriculture & Turf. Worldwide sales of the company's agriculture and turf division are forecast to increase by about 15% for fiscal year 2012, with a favorable currency-translation impact of about 1%. Farmers in the world's major markets are continuing to experience favorable incomes due to strong demand for agricultural commodities. As well, John Deere's sales are expected to benefit from advanced new products being launched throughout the world and from major expansion projects such as those in emerging markets. Industry farm-machinery sales in the U.S. and Canada are forecast to increase 5 to 10% in 2012, following an advance in 2011. Overall conditions remain positive and demand continues to be strong, especially for high-horsepower equipment. Industry sales in the EU 27 nations of Western and Central Europe are forecast to be flat for 2012 as a result of general economic concerns in the region. Sales in the Commonwealth of Independent States are expected to be moderately higher, after rising substantially in 2011. Sales in Asia are forecast to be up strongly again in 2012. In South America, industry sales for the year are projected to be flat in relation to the attractive levels of 2011. Industry sales of turf and utility equipment in the U.S. and Canada are expected to increase slightly in 2012. 

Construction & Forestry. Deere's worldwide sales of construction and forestry equipment are forecast to grow by about 16% for fiscal 2012, with a favorable currency-translation impact of about 1%. The increase reflects slightly improved market conditions and activity outside of the U.S., including strength in Canada. Construction equipment sales to independent rental companies are expected to see further gains. Deere's sales also are expected to be supported by a range of advanced new products and by geographic expansion. After considerable growth in 2011, world forestry markets are projected to be about the same in 2012 due to weaker economic conditions in Europe.

Financial Services. Fiscal-year 2012 net income attributable to Deere & Company for the financial services operations is expected to be approximately $450 million. The forecast decline from 2011 is primarily due to an increase in the provision for credit losses, which is anticipated to return to a more typical level, as well as higher selling, administrative and general expenses in support of enterprise growth initiatives. Partially offsetting these items is expected growth in the credit portfolio.

John Deere Capital Corporation The following is disclosed on behalf of the company's financial services subsidiary, John Deere Capital Corporation (JDCC), in connection with the disclosure requirements applicable to its periodic issuance of debt securities in the public market. Net income attributable to John Deere Capital Corporation was $93.5 million for the fourth quarter and $363.6 million year to date, compared with $96.7 million and $319.4 million for the respective periods last year. Results were lower for the quarter mainly due to narrower financing spreads and a higher effective tax rate, largely offset by growth in the credit portfolio and a lower provision for credit losses. Annual results showed improvement primarily due to growth in the credit portfolio and a lower provision for credit losses, partially offset by narrower financing spreads and a higher effective tax rate. Net receivables and leases financed by JDCC were $23.184 billion at October 31, 2011, compared with $20.854 billion last year.