Deere & Company · NYSE:DE
Deere & — Investor Presentation (January 2024)
28 slides from Deere &'s investor presentation, January 2024
Slide 1: Investor Presentation January 2024
JOHN DEERE INVESTOR PRESENTATION JANUARY 2024 1 John Deere | Investor Presentation Public
Slide 2: Safe Harbor Statement & Disclosures
SAFE HARBOR STATEMENT & DISCLOSURES This presentation includes forward-looking comments subject to important risks and uncertainties. It may also contain financial measures that are not in conformance with accounting principles generally accepted in the United States of America (GAAP). Refer to Deer
Slide 3: Contents
CONTENTS JOHN DEERE STRATEGY………………………………….….4 FINANCIAL PERFORMANCE…………………………….……14 USE OF CASH……………………………………………….…..20 APPENDIX………………………….…………………………….24 3 John Deere | Investor Presentation Public
Slide 4: John Deere Strategy
JOHN DEERE STRATEGY John Deere | Investor Presentation Public
Slide 5: Key Focus Areas
KEY FOCUS AREAS PRODUCTION SYSTEMS TECHNOLOGY STACK LIFECYCLE SOLUTIONS Unlocks customer value by making each Enables our machines to be smarter, more Adds value throughout the life of the product, step of the system more efficient precise, and more productive maximizing uptime and minimizing cost C
Slide 6: Organizational Design
ORGANIZATIONAL DESIGN THAT ALIGNS WITH OUR CUSTOMERS’ BUSINESS BUSINESS UNITS PRODUCTION SYSTEMS PRODUCTION & PRECISION AG CORN & SOY SMALL GRAINS SUGARCANE COTTON SMALL AG & TURF DAIRY & LIVESTOCK HIGH VALUE CROPS TURF & COMPACT UTILITY CONSTRUCTION & FORESTRY EARTHMOVING ROADBUILDING FORESTRY ENAB
Slide 7: Production System Structure Leads to Customer Focused Innovation
PRODUCTION SYSTEM STRUCTURE LEADS TO CUSTOMER FOCUSED INNOVATION Unlock economic value Deliver sustainable outcomes 7 John Deere | Investor Presentation Public
Slide 8: Technology accelerates precision and automation while driving efficiency
Technology accelerates AUTONOMY precision and automation AUTOMATION / MACHINE IQ while driving efficiency. CONNECTIVITY AND DIGITAL SOLUTIONS We have a full set of technology to help customers increase GUIDANCE their productivity, profitability, and sustainability. HARDWARE & SOFTWARE 8 John Deere |
Slide 9: Our Tech Stack Continues to Evolve
OUR TECH STACK CONTINUES TO EVOLVE Blue River Bear Flag Autonomous Technologies Robotics Computer Vision & Autonomous Tractor/ Autonomy Tillage Solution Machine Learning Solutions Combine ExactShot Section ExactEmerge/ Advisor Exact See & Control ExactApply Artificial Rate Spray Automation/Machine I
Slide 10: Lifecycle Solutions
LIFECYCLE SOLUTONS ENHANCE CUSTOMER EXPERIENCE & EXTEND PRODUCT VALUE SUPPORT PARTS SERVICES PRECISION UPGRADES 10 John Deere | Investor Presentation Public
Slide 11: Leap Ambitions
LEAP AMBITIONS MEASURE OUR ABILITY TO EXECUTE THE SMART INDUSTRIAL STRATEGY JOHN DEERE is uniquely positioned to deliver both ECONOMIC and SUSTAINABLE VALUE for our customers through ADVANCED TECHNOLOGY and SOLUTIONS. 11 John Deere | Investor Presentation Public
Slide 12: Leap Ambitions: >$150 Billion Incremental Addressable Market
LEAP AMBITIONS INCREMENTAL ADDRESSABLE MARKET OPPORTUNITY >$150 BILLION EXECUTING OUR STRATEGY FINANCIAL & SUSTAINABLE OUTCOMES 12 John Deere | Investor Presentation Public
Slide 13: Connected Machines and Engaged Acres
642K 388M 92M 160M Connected Machines Engaged Acres Highly Engaged Acres Sustainably Engaged Acres John Deere is delivering intelligent, John Deere’s Smart Industrial connected machines and applications in agriculture and construction; strategy is revolutionizing unlocking customer economic agricult
Slide 14: Financial Performance
FINANCIAL PERFORMANCE John Deere | Investor Presentation Public
Slide 15: Sales Data
SALES DATA Focused approach to serve customers EQUIPMENT OPERATIONS EQUIPMENT OPERATIONS NET SALES & REVENUES BY MAJOR PRODUCT LINE NET SALES & REVENUES BY MAJOR MARKET FISCAL YEAR 2023 ($ in billions) Asia, Africa, Australia, Financial Other New Zealand & Middle East Products 3% 9% Forestry 8% Lati
Slide 16: Investment in New Products & Technologies
INVESTMENT IN NEW PRODUCTS & TECHNOLOGIES Consistent R&D investment allocated to biggest opportunities $2,500 100.0% EQUIPMENT OPERATIONS $2,177 90.0% RESEARCH & DEVELOPMENT EXPENSES ($ in millions) $2,000 80.0% 70.0% $1,500 60.0% 50.0% $1,000 40.0% 30.0% $500 20.0% 10.0% 3.9% % of Net Sales $- 0.0%
Slide 17: Exceptional Operating Performance - OROA
EXCEPTIONAL OPERATING PERFORMANCE - OROA Smart Industrial strategy drives strong operating performance EQUIPMENT OPERATIONS – OROA1 60% 2023 50% OROA Target 2022 40% 2021 40% 30% 2014 30% 2017 2020 2018 20% 2015 2016 2019 15% 10% 0% % of Mid-Cycle 1) Operating Return on Operating Assets - beginning
Slide 18: Exceptional Operating Performance - SVA
EXCEPTIONAL OPERATING PERFORMANCE - SVA $9.4 billion SVA in 2023 EQUIPMENT OPERATIONS – SVA1,2 ($ in millions) $10,000 $9,381 Adoption of SVA Model $8,000 $6,000 $4,000 $2,000 $0 -$2,000 1994 1998 2002 2006 2010 2014 2018 2023 1) Shareholder Value Added; for reconciliation to GAAP see “SVA Reconcili
Slide 19: Exceptional Operating Performance - Operating Cash Flow
EXCEPTIONAL OPERATING PERFORMANCE – OPERATING CASH FLOW $11.9 billion net cash flow in 2023 EQUIPMENT OPERATIONS – OPERATING CASH FLOW ($ in millions) $14,000 $11,919 $12,000 Adoption of SVA Model $10,000 $8,000 $6,000 Sale of Trade Receivables to John Deere Financial $4,000 $2,000 $0 1994 1998 2002
Slide 20: Use of Cash
USE OF CASH 20 John Deere | Investor Presentation Public
Slide 21: Deere Use-of-Cash Priorities
DEERE USE-OF-CASH PRIORITIES EQUIPMENT OPERATIONS SVA 1 CASH FROM OPERATIONS Manage the balance sheet, including liquidity, to support a rating that provides COMMITTED access to low-cost and readily available short- and long-term funding TO “A” RATING mechanisms (reflects the strategic nature of our
Slide 22: Sources & Uses of Cash
SOURCES & USES OF CASH FISCAL 2004-2023 ~60% of cash from operations returned to shareholders EQUIPMENT OPERATIONS ($ in millions) Source of Cash $1,753 Use of Cash $5,222 Cash returned to shareholders $16,949 $2,245 $14,333 $72,739 $29,279 $1,496 $4,287 $5,755 Beginning Cash & Cash From Acquisition
Slide 23: Deere Quarterly Dividends Declared
DEERE QUARTERLY DIVIDENDS DECLARED 1Q 2004 – 1Q 2024 Quarterly dividend increased 93% since 2020 $1.47 $1.50 $1.25 $1.00 $0.76 $0.75 $0.50 $0.25 $0.00 2004 2005 2006 2007* 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 * Adjusted for 2 for 1 stock split on 26 No
Slide 24: Appendix
JOHN DEERE APPENDIX PRESENTATION INVESTOR John Deere | Investor Presentation Public
Slide 25: Leap Ambitions Glossary
Leap Ambitions Glossary Leap Ambitions The performance and sustainability measures of the John Deere Smart Industrial strategy. Incremental Addressable Market Opportunity The new opportunity for all stakeholders across the applicable acres and job sites that John Deere solutions operate in beyond th
Slide 26: SVA Reconciliation to GAAP (1994-2013)
SVA Reconciliation to GAAP Equipment Operations (1994-2013) ($ millions except where noted) 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 Net Sales 7,663 8,830 9,640 11,082 11,926 9,701 11,169 11,077 11,703 13,349 Average Identifiable Assets With Inventories at LIFO 5,551 6,187 6,502 6,682 7,672
Slide 27: SVA Reconciliation to GAAP (2014-2023)
SVA Reconciliation to GAAP Equipment Operations (2014-2023) ($ millions except where noted) 2014 2015 2016 2017 20181 20191 20201 20212 2022 2023 Net Sales 32,961 25,775 23,387 25,885 30,324 31,693 28,348 39,737 47,917 55,565 Average Identifiable Assets With Inventories at LIFO 14,113 12,491 11,816
Slide 28: 28 John Deere | Investor Presentation
28 John Deere | Investor Presentation Public
Deere & Company — Investor Presentation (January 2024) on 6ix