An improvement in its key markets helped Deere & Company’s (NYSE:DE) revenues to jump in its first quarter, but the tractor and lawnmower maker recorded a net loss after a hefty one-time charge related to the recent US tax changes.
In the three months to January 28, revenues rose by almost a quarter to US$6.91bn, up from US$5.63bn in the year-ago period.
Total equipment sales rose 27% to US$5.97bn.
READ: Deere & Co. shares gain pre-market after posting above-forecast fourth-quarter profit and sales
The Illinois-based firm said it expects the strong growth to continue throughout the rest of this year and is guiding for a 29% increase in equipment sales in fiscal 2018, helped by last year’s acquisition of German heavy equipment firm Wirtgen Group as well as favourable currency effects.
Equipment sales are expected to rose by between 30-40% in the second quarter, Deere added.
“Deere has continued to experience strong increases in demand for its products as conditions in key markets show further improvement,” said chief executive Samuel Allen.
Excluding a US$965mln one-time charge relating to the US tax reforms, adjusted net income more than doubled to US$430.0mln, or US$1.31 a share, from US$199.0mln, or 62 cents, a year earlier.
The solid performance and upbeat outlook will come as welcome news for Deere investors. The agriculture and construction machinery group has struggled recently as US demand for farm machinery has fallen, while the relatively strong US dollar has also made its products more expensive abroad.
Deere shares edged 0.6% higher to US$167.72 early on Friday morning.