Deere results beat forecasts on strong farm demands
DEERE & Co, the world’s largest farm equipment maker, reported first-quarter results above analysts’ expectations yesterday as farmers geared up to plant the biggest corn crop in US history following the worst drought in the US Midwest in 56 years.
The company also raised its forecast for net income in 2013 to $3.3 bn (£2.05bn) from $3.2bn. Analysts had estimated $3.26bn on average. “Relatively high commodity prices and strong farm incomes are expected to continue supporting a favorable level of demand for farm machinery during the year,” Deere said. The US Agriculture Department said this week farm income would soar to a record $127.6bn this year, up 15 per cent. Sales of agriculture and turf equipment – which make up three-quarters of Deere’s total revenue – jumped 16 per cent in the quarter ended 31 January. Total revenue rose 10 per cent to $7.42bn, well ahead of the $6.72bn expected.
Net income attributable to Deere rose to $649.7m, or $1.65 per share, in the first quarter from $532.9m, or $1.30 per share, a year earlier.
Dr Pepper Snapple Group outlook disappoints Street
DR PEPPER Snapple Group forecast profit for the current year below analysts’ estimates as the soft drink maker expects raw material costs to continue to constrain earnings. On a conference call with analysts, Dr Pepper executives said they expected packaging and ingredients to increase the total cost of goods by about two per cent in 2013. Almost half of this increase is due to the higher cost of apples, while the remainder is primarily PET used for bottles, corn for sweeteners and paper board for packaging, finance chief Marty Ellen said. The company expects full-year profit of $3.04 to $3.12 per share and sales growth of about three per cent, implying revenue of about $6.17bn. Analysts were looking for a profit of $3.20 per share on revenue of $6.17bn. Dr Pepper reported fourth-quarter SG&A expenses of $555m for the quarter ended 31 December, up from $553m a year earlier. The company said total volumes declined one per cent, with beverage concentrates declining the most. Profit rose to $170m, or 81 cents per share, from $166m, or 77 cents per share, a year earlier.
US market helps Hyatt Hotels profit top estimates
HYATT Hotels reported a better-than-expected fourth-quarter profit and said it expects a year of solid growth ahead.
Hyatt’s higher exposure to a better-positioned US market is coming in handy at a time when it said it sees “headwinds” in some other markets this year. About three quarters of Hyatt’s revenue comes from the United States, where a business-led recovery has lifted hotel occupancy rates over the past year.
Hyatt’s results follow better-than-expected earnings from Starwood Hotels & Resorts Worldwide last week.
Marriott International is scheduled to report results on 19 February.
Hyatt reported a 7.5 per cent increase in revenue per available room (revPAR) in the fourth quarter ended December.
Total revenue rose one per cent to $1bn (£643m). Net profit fell to $16m, or nine cents per share, from $52m, or 31 cents per share, largely due to one-time items such as lower tax benefits and investment losses. Excluding these, it earned 20 cents per share.
Cisco sees higher revenue and profit in second quarter
NETWORK equipment maker Cisco Systems reported quarterly revenue and earnings last night that beat Wall Street’s average estimates.
Revenue rose five per cent for Cisco’s fiscal second quarter that ended 26 January to $12.1bn versus a year ago. Analysts, on average, were expecting $12.06bn.
Income, excluding items, rose 6.2 per cent to $2.7bn, or 51 cents per share, three cents above analysts’ average estimate of 48 cents a share. For the current quarter, Cisco said it expects revenue in the current period to grow within a range of four to six per cent from the same period last year.
Analysts had been expecting Cisco to do better than forecast and Shaw Wu, an analyst at Sterne Agee, said that “it’s pretty much going to boil down to guidance now”.
“They did say they got a benefit from taxes. When you (take) that out its 50 cents. That still beat by twp cents,” he said referring to Cisco’s earnings per share. Cisco’s shares fell 1.2 per cent in after-hours trading to $20.89. They have risen almost 25 per cent since its last quarterly earnings report.