EX-99.2 3 ex-99d2.htm EX-99.2

Exhibit 99.2

(Furnished herewith)

| Deere & Company |
| Other Financial Information |

For the Three Months Ended |  | Equipment Operations* | Agriculture and Turf | Construction and Forestry*
|  | February 2 |  | January 27 |  | February 2 |  | January 27 |  | February 2 |  | January 27 |
Dollars in millions |  | 2020 |  | 2019 |  | 2020 |  | 2019 |  | 2020 |  | 2019 |
Net Sales |  | $ | 6,530 |  | $ | 6,941 |  | $ | 4,486 |  | $ | 4,681 |  | $ | 2,044 |  | $ | 2,260 |
Net Sales - excluding Roadbuilding |  | $ | 5,925 |  | $ | 6,343 |  | $ | 4,486 |  | $ | 4,681 |  | $ | 1,439 |  | $ | 1,662 |
Average Identifiable Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
With Inventories at LIFO |  | $ | 20,197 |  | $ | 20,774 |  | $ | 10,782 |  | $ | 10,892 |  | $ | 9,415 |  | $ | 9,882 |
With Inventories at LIFO - excluding Roadbuilding |  | $ | 14,237 |  | $ | 14,427 |  | $ | 10,782 |  | $ | 10,892 |  | $ | 3,455 |  | $ | 3,535 |
With Inventories at Standard Cost |  | $ | 21,615 |  | $ | 22,140 |  | $ | 11,932 |  | $ | 11,993 |  | $ | 9,683 |  | $ | 10,147 |
With Inventories at Standard Cost - excluding Roadbuilding |  | $ | 15,655 |  | $ | 15,793 |  | $ | 11,932 |  | $ | 11,993 |  | $ | 3,723 |  | $ | 3,800 |
Operating Profit |  | $ | 466 |  | $ | 577 |  | $ | 373 |  | $ | 348 |  | $ | 93 |  | $ | 229 |
Operating Profit - excluding Roadbuilding |  | $ | 449 |  | $ | 563 |  | $ | 373 |  | $ | 348 |  | $ | 76 |  | $ | 215 |
Percent of Net Sales - excluding Roadbuilding |  |  | 7.6 | % |  | 8.9 | % |  | 8.3 | % |  | 7.4 | % |  | 5.3 | % |  | 12.9 | %
Operating Return on Assets - excluding Roadbuilding |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
With Inventories at LIFO - excluding Roadbuilding |  |  | 3.2 | % |  | 3.9 | % |  | 3.5 | % |  | 3.2 | % |  | 2.2 | % |  | 6.1 | %
With Inventories at Standard Cost - excluding Roadbuilding |  |  | 2.9 | % |  | 3.6 | % |  | 3.1 | % |  | 2.9 | % |  | 2.0 | % |  | 5.7 | %
SVA Cost of Assets |  | $ | (470) |  | $ | (474) |  | $ | (358) |  | $ | (360) |  | $ | (112) |  | $ | (114) |
SVA |  | $ | (21) |  | $ | 89 |  | $ | 15 |  | $ | (12) |  | $ | (36) |  | $ | 101 |
For the Three Months Ended |  | Financial Services |  |  |  |  |  |  |  |  |  |  |  |
|  | February 2 |  | January 27 |  |  |  |  |  |  |  |  |  |  |  |  |
Dollars in millions |  | 2020 |  | 2019 |  |  |  |  |  |  |  |  |  |  |  |  |
Net Income Attributable to Deere & Company |  | $ | 137 |  | $ | 154 |  |  |  |  |  |  |  |  |  |  |  |  |
Average Equity |  | $ | 5,119 |  | $ | 4,997 |  |  |  |  |  |  |  |  |  |  |  |  |
Return on Equity |  |  | 2.7 | % |  | 3.1 | % |  |  |  |  |  |  |  |  |  |  |  |
Operating Profit |  | $ | 179 |  | $ | 192 |  |  |  |  |  |  |  |  |  |  |  |  |
Cost of Equity |  | $ | (166) |  | $ | (156) |  |  |  |  |  |  |  |  |  |  |  |  |
SVA |  | $ | 13 |  | $ | 36 |  |  |  |  |  |  |  |  |  |  |  |  |
The Company evaluates its business results on the basis of accounting principles generally accepted in the United States. In addition, it uses a metric referred to as Shareholder Value Added (SVA), which management believes is an appropriate measure for the performance of its businesses. SVA is, in effect, the pretax profit left over after subtracting the cost of enterprise capital. The Company is aiming for a sustained creation of SVA and is using this metric for various performance goals. Certain compensation is also determined on the basis of performance using this measure. For purposes of determining SVA, each of the equipment segments is assessed a pretax cost of assets, which on an annual basis is approximately 12 percent of the segment’s average identifiable operating assets during the applicable period with inventory at standard cost. Management believes that valuing inventories at standard cost more closely approximates the current cost of inventory and the Company’s investment in the asset. The Financial Services segment is assessed an annual pretax cost of approximately 13 percent of the segment's average equity. The cost of assets or equity, as applicable, is deducted from the operating profit or added to the operating loss of each segment to determine the amount of SVA. * The results and assets related to the Company's Roadbuilding product line are excluded from the calculation of SVA to allow time for integration and assimilation of the 2017 acquisition of Wirtgen Group Holding GmbH's operations.

20