Deere & Company Investor Relations - John Deere

deere.com

Deere & Company Investor Relations - John Deere

John Deere

Committed to Those

Linked to the Land

Deere & Company

May / June 2012


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 Deere’s reports filed on Forms 8-K (current), 10-Q (quarterly), and

10-K (annual) for information on factors that could cause actual results to differ

materially from information in this presentation and for information reconciling

financial measures to GAAP.

Guidance noted in the following slides was effective as of the company’s most

recent earnings release and conference call (16 May 2012). Nothing in this

presentation should be construed as reaffirming or disaffirming such guidance.

This presentation is not an offer to sell or a solicitation of offers to buy any of

Deere’s securities.

2

| Deere & Company | May / June 2012


Table of Contents

3

| Deere & Company | May / June 2012

Slide #

John Deere Strategy 4

Macroeconomic Tailwinds 19

Foundational Success Factors 26

Global Markets and Opportunities 38

John Deere Financial Services 69

John Deere Power Systems 75

Farm Fundamentals 78

Market and Currency Volatility 87

Appendix 90


John Deere

Strategy


5 | Deere & Company | May / June 2012


The John Deere Strategy

Our Purpose: Committed to those linked to the land

6

No longer “business as usual”

– Global macro-trends present significant

opportunities for John Deere

– Global population and income growth

– Global infrastructure needs

– New customer segments

– Technology advances

| Deere & Company | May / June 2012

460E Articulated Dump Truck

744K Wheel Loader

843K Wheeled Feller Buncher

8360R Tractor

S690 Combine

X728 Riding Mower


The John Deere Strategy

Realizing Sustainable Growth Through Global Expansion

Sustainable SVA growth is delivered by distinctively serving

our customers, employees, and investors

Extend and enhance our financial and operating achievements of

recent years

Our challenge: to capture anticipated tailwinds by attracting

more customers to the John Deere Experience across our six key

geographies (US/Canada, EU 27, Brazil, CIS/Russia, India,

China) in a manner that meets local needs while leveraging our

global scale

7 | Deere & Company | May / June 2012


The John Deere Strategy

Agricultural and Construction Equipment Aspirations

Agricultural Equipment Solutions

Strategy

– Defend and grow market share in

developed markets

– Grow market share in developing

markets

Construction Equipment Solutions

Strategy

– Continue to grow strong #2 position in

North America

– Globalize the business

8 | Deere & Company | May / June 2012

9530T Tractor - USA

755K Crawler Loader - USA

6488 Combine - China

435 Backhoe Loader - India


The John Deere Strategy

Performance Target Aspirations

Sales

– Enterprise net sales of $50 billion

at mid-cycle by 2018

Profitability

– Operating margins of no less than

12% at mid-cycle by 2014

Asset Efficiency

– Asset turns of 2.5 times at midcycle

by 2018

9 | Deere & Company | May / June 2012

Equipment

Operations

Equipment

Operations

2010 Normal Volume

$25 billion

6.6%

2018 Normal Volume

$50 billion

12.3%

U.S. & Canada

BRIC

13.0%

2009 2010 2011

1.9 2.2 2.3

2009 2010 2011

Rest of World


The John Deere Strategy

Integrated Enterprise

Integrated portfolio of businesses, each with a vital and specific role

Global Growth Businesses

Agricultural and Construction Equipment Solutions

– Invest in global expansion for profitable growth by

capitalizing on macro-trends

Complementary Businesses

Turf and Forestry Equipment Solutions

– Defend and grow share, enhance SVA, strengthen the

channel of the Global Growth Businesses

Supporting Businesses

Financial Services, Power Systems, Worldwide

Parts, and Intelligent Solutions Group

– Strengthen and further differentiate our Global

Growth and Complementary Businesses

10 | Deere & Company | May / June 2012

Financial

Services

S660i Combine 310SJ Backhoe Loader

XUV 550 Gator 1170E Wheeled Harvester

Power

Systems

Worldwide

Parts

Intelligent

Solutions


The John Deere Strategy

Foundational and Critical Success Factors

Both Foundational and Critical

Success Factors necessary…

FOUNDATIONAL SUCCESS FACTORS

Building on the core strengths that have guided our success

Exceptional Operating Performance

Disciplined SVA Growth

Aligned High-Performance Teamwork

CRITICAL SUCCESS FACTORS

Developing the capabilities essential to reaching our goals

Deep Customer Understanding

Deliver Customer Value

World-Class Distribution System

Grow Extraordinary Talent

11 | Deere & Company | May / June 2012

…to ensure that Deere is the

provider of choice across the

world


The John Deere Strategy

Foundational Success Factors

Exceptional Operating Performance - Equipment Operations

� 29.8% OROA in 2011, a record high for the company

35%

30%

25%

20%

15%

10%

5%

0%

2009

12%

*Excludes fiscal 2009 expenses related to goodwill impairment and voluntary employee-separation, for reconciliation to GAAP see “2009 OROA

Reconciliation to GAAP” slide in Appendix.

12

| Deere & Company | May / June 2012

2009, adjusted*

80%

Low

2001

2010

2002

2003

2007

2006

20%

100%

Normal

% of Normal Volume

2011

2008

2005

2004

12% OROA (SVA Neutral)

120%

High

28%


The John Deere Strategy

Foundational Success Factors

Exceptional Operating Performance - Equipment Operations

� SVA Model: Higher Net Cash Flow, More Consistently

$ Millions

3,500

3,000

2,500

2,000

1,500

1,000

500

0

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

13

| Deere & Company | May / June 2012

Adoption of SVA Model

Sale of Trade Receivables to

Credit

� Over $7 billion in Pension/OPEB contributions, 2001-2011


The John Deere Strategy

Foundational Success Factors

SVA ($ millions)

Disciplined SVA Growth - Equipment Operations

� SVA Journey, 1991 - 2011

2,800

2,400

2,000

1,600

1,200

800

400

0

-400

-800

-1,200

-1,600

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Note: For reconciliation of SVA to GAAP, please see “Equipment Ops SVA Reconciliation to GAAP” slide in Appendix

14

| Deere & Company | May / June 2012


The John Deere Strategy

Foundational Success Factors

SVA ($ millions)

Disciplined SVA Growth - Enterprise

� SVA Journey, 2002 - 2011

� SVA in 2011 was ~ $2.5 billion – a record high for the company

2,800

2,400

2,000

1,600

1,200

800

400

0

-400

-800

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Note: For reconciliation of SVA to GAAP, please see “Equipment Ops SVA Reconciliation to GAAP” slide in Appendix

15

| Deere & Company | May / June 2012


The John Deere Strategy

Foundational Success Factors

16

Aligned High-Performance Teamwork

� Integral part of strategy, reinforced with compensation

� Global Performance Management reinforces alignment

� Base pay changes linked to achieving goals

STI: Short-Term Incentive – Bonus focuses on OROA/ROE

� Covers most worldwide salaried employees

� Applies one enterprise-wide bonus metric

MTI: Mid-Term Incentive – Bonus driven by sustained SVA creation

� About 8,200 management employees eligible

LTI: Long-Term Incentive – Primarily stock options

� Top 900 employees eligible

� Minimum stock holding requirements for senior management (~ top 125)

| Deere & Company | May / June 2012


The John Deere Strategy

Measures

Commitment to execute and monitor all initiatives critical to our success

Performance measures

– Traditional financial measures based on what we are delivering today to our stakeholders

Health measures

Metric Target

Sales Net Sales Growth Target $50B* (2018, at mid-cycle)

Profitability Return on Sales (Operating Margin) 12% (2014, at mid-cycle)

Asset Efficiency Asset Turns 2.5x (2018, at mid-cycle)

*Implies a CAGR of ~ 9% (2010 – 2018) vs. historical CAGR of 7-8%

– The qualities, attributes and actions being introduced to ensure the sustainability of our

performance over time

Exceptional Operating

Performance

Disciplined SVA Growth

Aligned High- Performance

Teamwork

17 | Deere & Company | May / June 2012

Metric Target

Quality % JDQPS certification

Sales/SVA Mix

by Geography

Employee Engagement

% Non- U.S. & Canada

Employee Survey’s

Engagement Index


The John Deere Strategy

In Summary

18

Accelerated emphasis on global growth

–$50 billion mid-cycle sales by 2018

–Approximately 50% outside of U.S. & Canada

–Capitalize on increased global demand for food, shelter and infrastructure

Focus on improved profitability

–12% mid-cycle margin by 2014

Continued adherence to OROA/SVA model

–30% OROA at mid-cycle sales (12% at trough) with improved asset turns

Focus on two growth platforms

–Global pre-eminence in agricultural-equipment solutions

–Global construction-equipment operations (with presence in China)

–Complementary/supporting businesses to help drive performance of global

growth platforms

Revised metrics reflect strategic direction

–“Performance” metrics align compensation to strategy

–“Health” metrics introduced to monitor underlying factors (e.g., market

share, quality) to ensure performance is sustainable

| Deere & Company | May / June 2012


Macroeconomic Tailwinds

Support John Deere’s

Global Growth Businesses


Long-Term Macroeconomic Tailwinds

Support Global Growth Opportunities

Population growing in size and affluence

By 2050, world population will reach 9 billion, up from ~7 billion today, with

most of population growth in Asia and Africa

Large middle class developing in China and India

Opportunity #1: Feeding the world

Agricultural output must double by 2050

Gross output must increase 3.4% annually in the next 10 years vs. 2.4%

annual growth in past 10 years

Natural resources under strain, especially water

Opportunity #2: Massive urbanization

Migration from rural areas creates need for infrastructure development

2010: For the first time in history, more than half the world population lives

in cities

2050: More than 70 percent will live in cities

20 | Deere & Company | May / June 2012


Strong Global Tailwinds in Ag & Construction

Significant Growth from Developing Economies

Agriculture and Construction amongst the Top 10 industry

sectors in the G-20 countries . . .

Sector

Manufacturing

Real Estate and Business Activities

Wholesale and Retail Trade

Transport, Storage and

Telecommunication

Financial Intermediation

Construction

Health and Social Services

Public Administration and Defense,

Compulsory Social Security

Education

Agriculture

Social and Personal Services

Utilities

Mining

Hotels and Restaurants

Private Household Services

21

| Deere & Company | May / June 2012

Absolute increase in real value

added 2009-18,

$ Billions

88

462

381

351

331

321

289

757

647

575

1,315

1,052

1,805

2,301

Note: G20 countries account for 73% and 89% of agriculture and construction segments respectively.

Total global growth for agriculture is $520B and construction is $854B

3,625

CAGR

2009-18

Percent

3.1

2.3

5.3

2.9

5.2

4.0

4.1

3.0

3.2

3.4

2.9

2.7

4.8

3.8

3.8

. . . Significant growth in Agriculture and Construction

between 2009-2018 will happen in the BRIC countries

Private Household Services

Agriculture

Mining

Manufacturing

Utilities

Transport, Storage and

Telecommunication

Construction

Wholesale and Retail Trade

Financial Intermediation

Public Administration and Defense,

Compulsory Social Security

Education

Hotels and Restaurants

Social and Personal Services

Real Estate and Business Activities

Health and Social Services

1 Brazil, Russia, India, China

Sector

Source: Global Insight World Industry Service

Share of growth

from BRIC 1

17%

26%

24%

36%

36%

34%

34%

39%

49%

46%

61%

58%

58%

71%

71%

Real value-added 2005 USD


Developing Economies Growing Faster

While developed economies have

always accounted for a larger

share of GDP . . .

Real GDP 1

$ Trillions

11.3

1.3

10.0

1970

3.8

28.1

5.2

22.9

1990

Developing Developed

22

| Deere & Company | May / June 2012

46.6

12.0

34.6

2008

1 Real GDP (expenditure method) base year 2005

CAGR,

1970-2008

Percent

6.1

1.9x

3.3

... their growth will slow

significantly, relative to that

of developing economies

Real GDP 1

$ Trillions

46.6

12.0

34.6

2008

3.0

65.5

22.5

43.0

2020

115.3

53.3

62.0

2039

Developed countries include OECD. Developing countries include all developing markets (Regions as defined by Global Insight)

Source: Global Insight World Market Monitor

CAGR,

2008-2039

Percent

4.9

2.6x

1.9


Dynamics of Food Demand

Services

Processed

Products

Livestock

Products

Commodities

Source: World Bank 2008

23

| Deere & Company | May / June 2012

27% of world’s population

(Most hunger problems solved at

$2.50 threshold)

20% of world’s population

(2/3rds experience hunger &

malnutrition)

Per Capita

Income

>$10

per day

$2.50-10

per day

$1.25-2.50

per day


Global Construction and Infrastructure Needs

Infrastructure is expected to be the fastest

growing segment of construction

Residential

Non-residential

Infrastructure

WW Construction spending

Gross output, $ 2008 Billions

6,509

2,266

2,356

1,888

2008

3.6%

9,915

2,998

3,555

3,361

2020

24

| Deere & Company | May / June 2012

CAGR

2008-2020

Percent

2.4

3.5

4.9

Estimated gross spending as a percent of

2008 global GDP

Construction

12%

Mining & Quarrying

All Other

*Note: Construction and Mines & Quarries account for ~5% and ~4% of 2008 value-added WW GDP, respectively

Source: IHS Global Insight, March 2009; Off Highway Research; AEM; CCMA; Yengst; Deere analysis

74%

7% Ag, Hunting,

Forestry & Fishing

7%


Global Construction Spending in 2020

Concentrated in a Small Number of Markets

China

Construction spending 2020 absolute,

Top 10 (Billions of 2009 $s)

U.S. & Canada

India

Japan

U.K.

France

Germany

Brazil

Russia

Italy

432

365

302

299

267

257

592

751

25

| Deere & Company | May / June 2012

1,508

Infrastructure

Non-residential

Residential

2,049

All Construction

Construction spending 2010-2020 change,

Top 10 (Billions of 2009 $s)

�China + U.S. & Canada� 36% of 2020 absolute, compared to 30% today

�China + U.S. & Canada + Brazil, Russia, India � 50% of 2020 absolute, compared to 40% today

Source: IHS Global Insight, Deere Analysis, August 2011

China

U.S. & Canada

India

Brazil

Russia

U.K.

Japan

Indonesia

Mexico

Korea

168

106

103

95

92

60

57

437

534

1,128

Infrastructure

Non-residential

Residential

All Construction


Foundational

Success Factors

Building on Core Strengths

That Have Guided Our

Success


Asset Management

Dramatic Reduction in Asset Intensity

Quarterly Receivables & Inventory as a % of Previous 12 Months Sales

60%

55%

50%

45%

40%

35%

30%

25%

Avoided ~ $5.5 billion in working capital in 2011 vs. 1997

Receivable level in 2011 consistent with 1997, with almost 3x the sales

20%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012*

*Through 2 nd quarter 2012

27

| Deere & Company | May / June 2012

Prior Year

Current Year

$ Millions

$35,000

$30,000

$25,000

$20,000

$15,000

$10,000

$5,000

$0

Trade Receivables and Net Sales

Trade Receivables Net Sales

1997 2011


Productivity Improvement

~ 6% CAGR over 30 Years

$ Thousands

Deere’s net sales and revenues per employee have increased at a CAGR

of ~ 6% over last 30 years

$600

$500

$400

$300

$200

$100

$0

28

| Deere & Company | May / June 2012

Net Sales and Revenues per Employee

1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011


Manufacturing Efficiencies – Waterloo, IA

Journey to a 6-Day Drive Train

Production Days

50

45

40

35

30

25

20

15

10

5

0

Prior to 2005 2005 2006 2007 2008

29

| Deere & Company | May / June 2012

-12 Days

� Relocation of 412 machines

� Eliminated 155 machines

-14 Days

� Machining departments based on part families

� Arranged machines using cellular concepts

� Started evacuation of multi-story buildings

-10 Days

� Total evacuation of multi-story buildings

� New heat treat fully operational

� Set-up improvement

� On-site forging storage

� Insourcing of core processes

-2 Days

� Run size optimization and

set-up improvement

� Daily run size parameters

� Outsourcing non-core

processes


Investment in New Products and Technologies

$1,400

$1,200

$1,000

$800

$600

$400

$200

$0

Source: Deere & Company and competitor SEC filings

30

| Deere & Company | May / June 2012

R&D as Percent of Net Sales

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

0.00%

Deere R&D $ Deere % Competitor A % Competitor B % Competitor C %


Net Sales by Product Category

Equipment Operations - Fiscal Year 2011

Agriculture & Turf – $24.1B Construction & Forestry – $5.4B

Small Ag

Turf

Other

31

| Deere & Company | May / June 2012

Large Ag

Forestry

CWP

Other

Construction


Committed Bank Group Supports Credit Facility

Average length of continuous relationship = ~29 Years

$5.00 billion credit facility supporting commercial paper

$ Millions

– $1.50 billion 61-month facility expiring in 2017

– $2.75 billion 49-month facility expiring in 2015

– $750 million 364-day facility expiring in 2013

– Have not drawn on facility

– $2.7 billion incremental capacity as of 30 April 2012

$6,000

$5,000

$4,000

$3,000

$2,000

$1,000

$0

32

| Deere & Company | May / June 2012

Credit Facility Size & Commercial Paper Outstanding

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Total Facility CP Outstanding as of October 31


Deere Use-of-Cash Priorities

Cash from Operations

Committed to “A” Rating

Fund Operating and Growth Needs

Common Stock Dividend

Share Repurchase

33

| Deere & Company | May / June 2012

� Manage the balance sheet, including liquidity, to support a rating

that provides access to low-cost and readily available short- and

long-term funding mechanisms

� Reflects the strategic nature of our financial services operation

� Fund value-creating investments in our businesses

� Consistently and moderately raise dividend targeting a 25%-

35% payout ratio of mid-cycle earnings

� Consider share repurchase as a means to deploy excess cash

to shareholders, once above requirements are met and

repurchase is viewed as value-enhancing


Worldwide Financial Services

2012 Unsecured Term Debt Maturities*

* Maturities as of 30 April 2012

34

$ Millions

$2,400

$2,200

$2,000

$1,800

$1,600

$1,400

$1,200

$1,000

$800

$600

$400

$200

$0

| Deere & Company | May / June 2012

1Q 2Q 3Q 4Q


Share Repurchase

As Part of Publicly Announced Plans

35

Cumulative cost of repurchases 2004-2Q2012: ~ $8.3 billion

Amount remaining on May 2008 authorization of $5 billion: ~ $3.3 billion

30 April 2012 period ended shares (basic): ~ 397.7 million

(diluted): ~ 402.1 million

Shares repurchased 2004-2Q2012: ~ 149.8 million

Average repurchase price 2004-2Q2012: $55.64

| Deere & Company | May / June 2012

Actual

Shares

Repurchased*

(in millions)

Total Amount**

(in billions)

2004 5.9 $0.2

2005 27.7 $0.9

2006 34.0 $1.3

2007 25.7 $1.5

2008 21.2 $1.7

2009 0.0 $0.0

2010 5.2 $0.4

2011 20.8 $1.7

2012 YTD 9.3 $0.7

* All shares adjusted for two-for-one stock split effective 26 November 2007

** Rounded totals for each period – sum may not tie to cumulative cost of repurchases 2004-2Q2012


Deere Quarterly Dividends Declared*

Q1 2003 – Q2 2012

$0.50

$0.45

$0.40

$0.35

$0.30

$0.25

$0.20

$0.15

$0.10

$0.05

$0.00

$0.11

$0.14 $0.16

36

| Deere & Company | May / June 2012

$0.20

$0.22

$0.25

$0.28

$0.30

$0.35

$0.41

$0.46

'03 Q1

Q2

Q3

Q4

'04 Q1

Q2

Q3

Q4

'05 Q1

Q2

Q3

Q4

'06 Q1

Q2

Q3

Q4

'07 Q1

Q2

Q3

Q4

'08 Q1

Q2

Q3

Q4

'09 Q1

Q2

Q3

Q4

'10 Q1

Q2

Q3

Q4

'11 Q1

Q2

Q3

Q4

'12 Q1

Q2

* Adjusted for 2 for 1 stock split on 26 November 2007


Sources and Uses of Cash Fiscal 2004 - 2011

Equipment Operations

$ Millions

$21,000

$18,000

$15,000

$12,000

$9,000

$6,000

$3,000

$0

$4,287

Beginning

Cash & Cash

Equivalents

(10/31/03)

(1) Other includes proceeds from maturities and sales of marketable securities and purchases of marketable securities and reconciliation for non-cash

items including excess tax benefits from share-based compensation and the effect of exchange rates on cash and cash equivalents

Source: Deere & Company SEC filings

$16,378

Cash From

Operations

37

| Deere & Company | May / June 2012

$5,214

Capital

Expenditures

$748

Investment in

Financial

Services

$638

Divestitures,

net of

Acquisitions

$2,411

Net Change in

Debt and

Intercompany

Balances

$3,270

$6,194

~58% of cash from operations

returned to shareholders

Dividends Share

Repurchase,

net of

Common

Stock

Issuances

$278

$3,188

Other(1) Ending Cash &

Cash

Equivalents

(10/31/11)


Global Markets and

Opportunities


Growing Global Presence

FY 2011 equipment net sales outside U.S. & Canada over 4x the

level in FY 2000

$ Millions

$14,000

$12,000

$10,000

$8,000

$6,000

$4,000

$2,000

$0

39

| Deere & Company | May / June 2012

Net Sales Outside U.S. and Canada

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Net Sales Outside U.S. & Canada % of Total Net Sales

50%

45%

40%

35%

30%

25%

20%


Net Sales by Major Markets

Fiscal Years 2011, 2010, 2009, 2008

(in millions of dollars) 2011 2010

40

| Deere & Company | May / June 2012

%

Change 2009 2008

United States 15,029 13,026 +15% 11,568 13,166

Canada 2,329 1,767 +32% 1,454 1,902

Western Europe 4,382 3,360 +30% 3,427 4,610

Central Europe & CIS 1,407 746 +89% 749 1,874

Central & South America 3,612 2,623 +38% 1,787 2,577

Asia, Africa & Middle East 1,930 1,431 +35% 1,166 1,062

Asia Pacific, Australia &

New Zealand

777 620 +25% 605 612

Total 29,466 23,573 +25% 20,756 25,803


U.S. and Canada

Factory Locations

British Columbia, Canada

Log Loaders & Specialty Products

Iowa, USA

Cotton Harvesting Equipment

Planting Equipment

Spraying Equipment

Tillage Equipment

Ag Tractors

Components

Foundry

Engines

Hay & Forage Equipment

Articulated Dump Trucks

4WD Loaders

Motor Graders

Skidders

Wheeled Feller Bunchers

Backhoes

Compact Tracked Loaders

Crawler Dozers

High-Speed Dozers

Knuckleboom Loaders

Skid Steer Loaders

Tracked Feller Bunchers

Tracked Harvesters

California, USA

Satellite Receivers

41 | Deere & Company | May / June 2012

Alberta, Canada

Remanufactured Components

Kansas, USA

Power Transmission Equipment

North Dakota, USA

Air Seeding Equipment

Electronics

Missouri, USA

Remanufactured Components

Wisconsin, USA

Lawn & Garden Equipment

Utility Vehicles

Golf & Turf Reel Mowers

Louisiana, USA

Sugarcane Harvesting Equipment

Tractor Loaders

Scrapers

Cotton Strippers

Illinois, USA

Combine Harvesters

Headers

Planting Equipment

Hydraulic Cylinders

Tennessee, USA

Lawn Tractors

North Carolina, USA

Commercial Mowers

Golf & Turf Mowers

Utility Vehicles

Hydraulic Excavators

Georgia, USA

Utility Tractors

Compact Utility Tractors


U.S. and Canada

Recent Announcements

March 2012 – Final Tier 4/Stage IV solution to combine

proven EGR Interim Tier 4 platform with customized

selective catalytic reduction (SCR) system

March 2012 – $70 million investment at Waterloo, IA

factory to expand production of large farm tractors by

10%

January 2012 – Strategic agreement with MacDon to

manufacture self-propelled windrowers

December 2011 – $85 million in capital improvements

at Des Moines, IA factory to expand production of selfpropelled

sprayers

August 2011 – Largest, most significant product

introduction in the company’s history

Deere & Company Forecast as of 16 May 2012

42

| Deere & Company | May / June 2012

Waterloo Works Capacity

Expansion

2008 to 2013

25%

2008-

2010

15%

2010-

2012

10%

2012-

2013


EU 27

Factory Locations

Horst, The Netherlands

Spraying Equipment

Zweibrücken, Germany

Combine & Forage Harvesters

Material Handling Equipment

Saran, France

Engines

Arc-les-Gray, France

Forage Equipment

Balers

Material Handling Equipment

43

| Deere & Company | May / June 2012

Madrid, Spain

Components

Mannheim, Germany

Tractors

Joensuu, Finland

Wheel Forwarders

Wheel Harvesters

Forestry Attachments

Stadtlohn, Germany

Forage Harvesters

Headers

Gummersbach, Germany

Walk-Behind Mowers

Bruchsal, Germany

Tractor, Combine & Forestry Cabs


EU 27

Economic Data

General (2010)

Population ~ 516 million

GDP (PPP) ~ $13.77 trillion

Top four economies based on GDP:

Agricultural (2009)

PPP: Purchasing Power Parity

Source: FAO, Global Insight, The World Factbook

44

| Deere & Company | May / June 2012

Production Net Exports

Total Grains 15% 4%

Wheat 20% 7%

Barley 39% 39%

Pork Meat 22% 30%

Cow Milk 27% 22%

Source: USDA, 2011

Germany, UK, France, Italy

Utilized agricultural area ~ 192 million hectares

Arable land ~ 111 million hectares

Approximately 70 million hectares of permanent

crop or grassland

Share of the world market:

GDP Composition

73.2%

1.8%

25.0%

Agriculture Industry Services

Source: The World Factbook, 2011 est.

Labor Composition

66.6%

4.7%

28.7%

Agriculture Industry Services

Source: The World Factbook, 2010 est.


EU 27

Economic Update

Optimism continues in the Agricultural sector

Farm business climate and mood remain at high levels

Farm income expected to be above long-term average levels

Grain, beef and milk prices at attractive levels

Demand for agricultural equipment remains strong

Sovereign debt and fiscal issues concentrated in Southern Europe

Deere & Company Forecast as of 16 May 2012

45 | Deere & Company | May / June 2012

Not key agricultural markets

Low levels of used equipment


EU 27

Recent Announcements

November 2011 – Awards received at Agritechnica 2011

7280R – “Tractor of the Year 2012”

6R tractor – “Machine of the Year”

Five silver medals

June 2011 – Largest new product introduction for Region 2*

Over 100 new products

80% of large tractor and combine models new or

updated

Focus on Dealer of Tomorrow strategy

May 2011 – John Deere and Kuhn Group sign strategic

cooperation

Provides large square balers into Region 2* in 2012

* Region 2: EU 27, CIS (including Russia), Mediterranean countries in Africa, and the Near and Middle East

46

| Deere & Company | May / June 2012


EUR bn (nominal prices)

EU 27

Government Support of Agriculture

70

60

50

40

30

20

10

Common Agricultural Policy proposed budget 2014-2020 frozen at 2007-2013 nominal levels

0

Rules generally known, eliminating uncertainty

Redistribution of direct payments in favor of new member states

1990 1995 2000 2005 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Source: EU Commission, Agra Europe

47

| Deere & Company | May / June 2012

2007-2013 2014-2020

Pillar I (Direct Payments + Market Expenditures) Pillar II (Rural Development)


Brazil

Factory Locations

São Paulo, Brazil (JV)

Components

Horizontina, Brazil

Combine Harvesters

Planters

Deere & Company Forecast as of 16 May 2012

48 | Deere & Company | May / June 2012

Catalão, Brazil

Sugarcane Harvesters

Sprayers

Montenegro, Brazil

Tractors

Indaiatuba, Brazil

Backhoe Loaders

4WD Loaders

Indaiatuba, Brazil (JV)

Excavators

Existing Under Construction


Brazil

Economic Data

General (2010)

Population ~ 193 million

GDP (PPP) ~ $2.172 trillion

Top four cities based on population:

Agricultural

São Paulo, Rio de Janeiro, Salvador and Brasília

Brazil converted ~ 13 million hectares from pasture land into

crop land in the last 10 years

Soybean, Corn, Sorghum, Cotton, and Sugarcane

Deere projects ~20 million hectares will be brought into

production in the next decade

Soybeans and corn

Deere projects ~5% CAGR in industry equipment sales through

the end of this decade

PPP: Purchasing Power Parity

Source: Brazilian Institute of Geography and Statistics (IBGE), The World Fact Book

Deere & Company Forecast as of 16 May 2012

49

| Deere & Company | May / June 2012

GDP Composition

67.4%

5.8%

26.8%

Agriculture Industry Services

Source: Brazilian Institute of Geography

and Statistics (IBGE), 2010

Labor Composition

58%

18%

24%

Agriculture Industry Services

Source: Brazilian Institute of Applied

Economic Research (IPEA), 2008


Brazil

Recent Announcements

October 2011 – Two new factories in São Paulo to manufacture construction equipment

Solely-owned Deere factory

Backhoe and four-wheel-drive loaders

Partner with Hitachi in second factory

Excavators

Expect production to begin in 2013

Agriculture portfolio and dealer expansion

50 new or updated products

Dealer locations roughly doubled since 2007

Achieved 4 points of tractor market share in

FY 2011 1

Deere & Company Forecast as of 16 May 2012

1 Carta da Anfavea, November 2011

50

| Deere & Company | May / June 2012


Brazil

Gross Value of Production

Source: MAPA (Brazilian Ministry of Agriculture), May 2012

51

Expected to increase 2.7% in 2012 over last season

1997

1999

* In Brazilian Real

Gross Value of Agricultural Production*

2001

2003

| Deere & Company | May / June 2012

2005

2007

2009

2011

2011 Mix by Crop

35%

16%

49%

Grains Sugarcane Other


Brazil

Government Support of Agriculture

Tractor

52

R$123 billion approved for 2011/2012 Agriculture and Livestock Plan

R$107 billion targeted towards Agribusiness (large-scale operations)

7% higher than 2010/2011

R$16 billion targeted towards family agriculture (small-scale operations)

Government programs to support equipment purchases

Programs 1

Mais Alimentos

Pró-Trator

Trator Solidário

Finame PSI

Moderfrota

Combine

Engine

| Deere & Company | May / June 2012

hp Where

50-78

50-120

50-80

All

All

Brazil

SP

PR

Brazil

Brazil

Programs 1 Class Where

Interest

Rate

2%

0%

~ 2% 2

5.5% to 7.3% 3

7.5%/9.5% 4

Interest

Rate

Grace

Period (Max) Term Maturity

3 Years

2

2

2

1.5

Grace

10

5

5

10

4-8 5

Perennial

Dec11

Dec14

Dec13

Jun12

Period (Max) Term Maturity

Mais Alimentos IV Brazil 2% 3 Years 10 Perennial

Finame PSI

Moderfrota

All

All

Brazil

Brazil

1 Exclusively Finame qualified products. Minimum of 60% local content (weight and value)

2 Same as Pronaf (Programa Nacional de Fortalecimento da Agricultura Familiar)

3 6.5% if annual gross revenue < R$90 million, 8.7% other farmers

5.5% to 7.3% 3

7.5%/9.5% 4

2

1.5

Up to 10

4-8 5

Dec13

Jun12

4 7.5% if annual gross revenue < R$500 thousand and 80% of income from agriculture related

activities. 9.5% all other farmers

5 Depending if used or new equipment and if equipment acquisition is isolated or in combination with

implements


CIS

Factory Locations

Domodedovo, Russia

Tractors

Combine Harvesters

Combine Front-End Equipment

Backhoes, Loaders, Graders

Log Forwarders, Skidders

Deere & Company Forecast as of 16 May 2012

53 | Deere & Company | May / June 2012

Orenburg, Russia

Seeding Equipment

Tillage Equipment

Spraying Equipment

Orenburg, Russia

Seeding Equipment

Tillage Equipment

Spraying Equipment

Existing Under Construction


CIS

Economic Data

General (2010)

Population ~ 279 million

GDP (PPP) ~ $2.81 trillion

Top four economies based on GDP:

Agricultural (2009)

Russia, Ukraine, Kazakhstan and Belarus

Utilized agricultural area ~ 560 million hectares

Arable land ~ 196 million hectares

Deere estimates “western-style” equipment used


CIS

Recent Announcements

November 2011 – Orenburg, Russia

Move existing operations to a new, larger facility

Increase available manufacturing space by ~ 600 percent

Expand product offering from four to fifteen models

March 2011 – Domodedovo, Russia

Double manufacturing space at the factory

Expand capacity for existing products

Enable addition of new products such as log

forwarders and front-end equipment

55

| Deere & Company | May / June 2012


CIS

Government Support of Agriculture

Export barriers lifted

Russian grain export ban ended in July 2011

Ukraine’s wheat and corn export duty ended in October 2011

Barley export duty ended in January 2012

Russian Ag funding is expected to increase in 2012 by ~ 7% in nominal terms

Annual Ag support in the Russian National Ag Program for 2013 - 2020 expected to

more than double by 2020 in nominal terms, but can be shortened and/or

restructured due to WTO requirements

Ag modernization support, including machinery investments, expected to be $4.2 billion

over 8 year period

Loan interest rate subsidies may decline in favor of direct payments

56

| Deere & Company | May / June 2012


India

Factory Locations

Deere & Company Forecast as of 16 May 2012

57 | Deere & Company | May / June 2012

Pune, India

Engines

Transmissions

Tractors (36-75 hp)

Sirhind, India

Combine Harvesters

Gummidipoondi, India (JV)

Side-Shift Backhoes

4WD Loaders (planned production 2013)

Dewas, India

Tractors (36-50 hp)

Existing Under Construction


India

Economic Data

General

Population ~ 1.205 billion (July 2012 est.)

GDP (PPP) ~ $4.463 trillion (2011 est.)

Top four cities based on population (2011 est.):

Agricultural

Mumbai, Delhi, Bangalore and Hyderabad

Total land area ~ 3.0 million sq km

Arable land ~ 1.5 million sq km (2005 est.)

Annual industry tractor sales >500,000 units

High interest rates

Commodity prices expected to soften against 2011 but remain

elevated due to strong demand

Increased focus from government for farm mechanization

Infrastructure investment projected to be ~ 9% of GDP by 2012

(~5% in 2007)

PPP: Purchasing Power Parity

Source: The World Fact Book, Censusindia, Tractor Manufacturers Association of India

58

| Deere & Company | May / June 2012

GDP Composition

62.8%

18.9%

18.2%

Agriculture Industry Services

Source: IHS Global Insight, 2010 est.

Labor Composition

34.0%

14.0%

52.0%

Agriculture Industry Services

Source: The World Factbook, 2009 est.


India

Recent Announcements

January 2011 – New tractor factory in Dewas and

expand current tractor facility in Pune

~ $100 million investment

Expect production in Dewas to begin in 2013

October 2010 – Ashok Leyland John Deere

Construction Equipment Company inauguration

Production of backhoes commenced in 2011

Four-wheel-drive loader production expected in 2013

September 2010 – New combine factory in Sirhind

Production commenced February 2012

John Deere has been the largest exporter of tractors

from India for past 8 years

Deere & Company Forecast as of 16 May 2012

59

| Deere & Company | May / June 2012


India

Government Support of Agriculture

2012F

2011

2010

2009

2008

2007

2006

2005

2004

185

159

325

262

610

623

530

258

672

231

766

240

313

143

123

| Deere & Company | May / June 2012

170

194

180

195

560

197

36

750

638

207

56

438

728

48

151

237

0 500 1,000 1,500 2,000 2,500

Rupees (in billions)

Source: India Ministry of Agriculture (2004-2009), India Ministry of Finance (2010-2012)

60

756

809

917

1,090

1,191

35

1,296

60

1,420

40

1,440

275

332

Fertilizer Subsidy

Food Subsidy (for households)

Interest Rate Subsidy (for farmers)

Irrigation Subsidy

Electricity Subsidy

2,048

Other Subsidies (mainly for seeds)


China

Factory Locations

Deere & Company Forecast as of 16 May 2012

61 | Deere & Company | May / June 2012

Harbin, China

Combine Front-End Equipment

Tractors (150+ hp)

Planters

Sprayers

Irrigation Products

Xuzhou, China (JV)

Excavators

Jiamusi, China

Large Combine Harvesters

Corn Pickers

Ningbo, China

Tractors (28-70 hp)

Small Combine Harvesters

Tianjin (TEDA), China

4WD Loaders

Excavators

Tianjin (TEDA), China

Engines

Tianjin (TEDA), China

Transmissions

Tianjin, China (JV)

Tractors (75-135 hp)

Existing Under Construction


China

Economic Data

General

Population ~ 1.343 billion (July 2012 est.)

GDP (PPP) ~ $11.3 trillion (2011 est.)

Top four cities based on population (2009):

Agricultural

Shanghai, Beijing, Chongqing and Shenzhen

Total land area ~ 9.6 million sq km

Arable land ~ 1.4 million sq km (2005 est.)

Share of the world market:

PPP: Purchasing Power Parity

Source: The World Factbook

Production

Total Grains 17%

Wheat 17%

Corn 22%

Rice 30%

Cotton 27%

Source: USDA, 2011

62 | Deere & Company | May / June 2012

GDP Composition

43.1%

10.1%

46.8%

Agriculture Industry Services

Source: The World Factbook, 2011 est.

Labor Composition

34.6%

28.7%

36.7%

Agriculture Industry Services

Source: The World Factbook, 2008 est.


China

Recent Announcements

May 2011 – New engine facility in Tianjin

~ $60 million investment

Expect production to begin in 2013

May 2011 – New factory in Harbin

~ $80 million initial outlay

Mid- and large-sized tractors

Harvesting front-end equipment

Planters and sprayers

Irrigation products

Expect production to begin in 2013

Deere & Company Forecast as of 16 May 2012

63

| Deere & Company | May / June 2012

Construction Equipment (New)

Drivetrain

December 2010 – New construction equipment factory in Tianjin

~ $50 million investment

Expect production to begin in 2013

Office (New)

Engines (New)

Product

Test (PV&V)

Tianjin Economic-Technological Development Area (TEDA) Site


China

Government Support of Agriculture

12

28

Source: China Ministry of Agriculture

64

2012F

2011

2010

2009

2008

2007

2006

2005

2004

13

12

3

14

72

75

72

15

| Deere & Company | May / June 2012

4

15

17

4

31

1

86

7

108

52

2

15

15

19

0 25 50 75 100 125 150 175

RMB (in billions)

15

12

20

4

20

22

103

15

16

Material Subsidy (basic subsidy for purchase of inputs)

Grain Direct Subsidy (for growing encouraged crops)

Seed Subsidy (for purchasing high-performing seed)

Equipment Subsidy (for purchasing encouraged equipment)

13

22

18

123

127

141

20

165


Other Regions

Factory Locations

Monterrey, Mexico

Rotary Cutters

Implements

Components

Torreon, Mexico

Axles

Engines

Electronics

Rosario, Argentina

Engines

Tractors (planned)

Combines (planned)

Deere & Company Forecast as of 16 May 2012

65 | Deere & Company | May / June 2012

Ramos, Mexico

Ag Loaders

Compact Utility Tractor Loaders

Utility Tractor Cabs

Saltillo, Mexico

Ag Tractors

Transaxles

Kibbutz Beit Hashita, Israel

Cotton Picker Components

Richards Bay, South Africa

Articulated Dump Trucks

Loaders

Tokoroa, New Zealand

Forestry Harvester Heads


Worldwide Parts Services

Supporting the Global Growth of Our Equipment Operations

Recent announcements:

� November 2011 – Bruchsal, Germany

� Inauguration of new deconsolidation & packaging facility within

European Parts Distribution Center

� September 2011 – Rosario, Argentina

� Construction of new, larger parts facility

66

| Deere & Company | May / June 2012

3 largest Parts Distribution Centers

Other Parts Distribution locations


John Deere FarmSight TM

Integrated wireless technology linking the equipment, owners, operators, dealers, and

agricultural consultants to provide more productivity to a farm or business.

� Machine Optimization

� Solutions that get the most out of machinery

� Use of precision technology and wireless data networks

� Higher levels of productivity and increased uptime

� Logistics Optimization

� Manage logistics and machinery from remote locations

� Fleet management solutions

� Increased machine-to-machine communication

� Ag Decision Support

� User-friendly monitors, sensors, wireless networks

� Easy access to machinery and agronomic data

� Enable proactive management decisions

67

| Deere & Company | May / June 2012


John Deere Water

Leveraging our leadership in global agriculture to provide innovative and efficient agricultural

water management solutions, and increase agricultural productivity

� Innovative solutions

� Efficient irrigation and water management

� Superior channel partners

� Integration of machinery and technology

� Consistent application of the right amount of

water at the right time

� Enable increased yields and higher quality

crops

� Improve water use efficiency and reduce input

costs

� Partnering with our customers

� Optimize operations and output

� Enable good stewardship of water resources

68

| Deere & Company | May / June 2012


John Deere

Financial Services


John Deere Financial Services

Supporting the Global Growth of Our Equipment Operations

New locations announced:

� China … began operations 4Q 2011

� Russia … began operations 2Q 2012

� Chile … operations expected to begin 2H 2012

� India … operations expected to begin 2H 2012

� Thailand … operations expected to begin 2H 2012

Deere & Company Forecast as of 16 May 2012

70

| Deere & Company | May / June 2012


John Deere Financial Services

$28.1 Billion Owned Portfolio at 31 October 2011

Portfolio Composition by

Market

C&F

13%

Ag & Turf

87%

71

| Deere & Company | May / June 2012

Latin America

6%

Europe

7%

Canada

12%

Portfolio Composition by

Geography

Australia

3%

Portfolio Composition by

Product

Information above includes all Deere lending activities worldwide. John Deere Capital Corporation is the largest lending operation of Deere & Company.

U.S.

72%

Leasing

12%

Wholesale /

Floorplan

21%

Revolving Credit

9%

Installment

Financing

58%


John Deere Capital Corporation

Profitability and Growth

72

| Deere & Company | May / June 2012

271 275

291

Administered Portfolio Growth ($ Billions)

16.4

17.7

18.6 19.0 19.1 19.3

Net Income ($ Millions)

311

282

149

319

364

2004 2005 2006 2007 2008 2009 2010 2011

21.1

23.3

2004 2005 2006 2007 2008 2009 2010 2011

Write-offs/Average Owned Portfolio

0.28% 0.16% 0.22% 0.29% 0.33%

0.70%

0.48%

0.12%

2004 2005 2006 2007 2008 2009 2010 2011


John Deere Capital Corporation Retail Notes

60+ Days Past Due vs. Write-offs

Agriculture & Turf 1

3.95%

3.45%

2.95%

2.45%

1.95%

1.45%

0.95%

0.45%

-0.05%

Extremely low write-offs; average less than 5

bps over last 10 years

Even in severe Ag market of the 1980s, losses

were comparatively low

'83 '86 '89 '92 '95 '98 '01 '04 '07 '10

Net Write-offs (Ag) Installments 60+DPD (Ag)

73

| Deere & Company | May / June 2012

Construction & Forestry

3.95%

3.45%

2.95%

2.45%

1.95%

1.45%

0.95%

0.45%

The performance and quality

of portfolio improved during

2011

-0.05%

'95 '98 '01 '04 '07 '10

Net Write-offs (C&F) Installments 60+DPD (C&F)

(1) 1982 – 1985 includes Construction; 1986 - 1994 includes Lawn & Grounds Care; beginning in 2009 includes both Ag and Turf equipment; As %

of Owned Losses After Dealer Reserve Charges

Source: 1982 – 1994 internal reporting, 1995 - 2010 JDCC 10-K filings, 2011 Deere & Company 8-K filed with SEC 23 November 2011


U.S. Resale Value vs. Loan Balance

7830 Tractor and 9670 Combine

Resale Value as a % of Original List Price

7830 Tractor (1)

110%

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

Loan Balance

0%

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Time Since Origination

Model Year

2010 2009 2008 2007 2006 2005

(1) Model 7810 was replaced with Model 7820 in 2004. In 2007 the 7830 series was introduced to the market. Loan balance assumes a

30% down payment on the highest list price financed for 5 years with annual payments at a rate of 6.50%.

(2) Model 9650 was replaced with Model 9660 in 2004. Model 9660 was subsequently replaced with Model 9670 in 2006.

Loan balance assumes a 30% down payment on the highest list price financed for 5 years with annual payments at a rate of 6.50%.

Source for equipment values: North American Equipment Dealers Association

74

| Deere & Company | May / June 2012

9670 Combine (2)

Resale Value as a % of Original List Price

110%

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

Loan Balance

0%

Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Time Since Origination

Model Year

2010 2009 2008 2007 2006 2005


John Deere

Power Systems

Engine Emissions and

Technology


Tier 4 Engine Implementation

Interim Tier 4 (IT4):

50% Nitrogen Oxide (NOx) reduction

90% Particulate Matter (PM) reduction

Final Tier 4

PM, g/kw-hr

0.50

0.40

0.30

0.20

0.10

76

| Deere & Company | May / June 2012

0

Interim

Tier 4

Tier 3

Tier

2

Final Tier 4 (FT4):

Tier 1

80% NOx reduction

0 2.00 4.00 6.00 8.00 10.00 12.00

NOx, g/kw-hr


Final Tier 4

Continuing Our Planned Building-Block Approach

Combines our customized selective catalytic reduction (SCR) system with our

proven IT4 engine platform of cooled exhaust gas recirculation (EGR), diesel

oxidation catalyst (DOC), and diesel particulate filter (DPF)

An optimized solution – John Deere Integrated Emissions Control system

– Meets Final Tier 4 emissions regulations

– Uncompromised performance: power, torque, and responsiveness

A fluid-efficient solution - maximum total fluid economy, not just fuel economy

– Leverages the proven fuel efficiency of our PowerTech Plus engine platform

– Low diesel exhaust fluid (DEF) dosing rates

– Operate efficiently with low-sulfur diesel and B5-B20 blends

A field-proven solution

– Since 2005, our cooled EGR engines have a proven record of performance and durability

– More than 5 million customer operating hours with our smart exhaust filter technology

– Dedicated in-house aftertreatment team customizing our own SCR system

An integrated vehicle solution

– We design, manufacture, and service the engine, drivetrain, hydraulics, cooling, and electrical

systems

A fully supported solution

John Deere’s proven worldwide dealer network is highly trained to provide service and support

as well as increase productivity, reliability, and utilization of Deere machines

77

| Deere & Company | May / June 2012


Farm Fundamentals


U.S. Farm Cash Receipts

Operating Cash Receipts and Government Payments

$ Billions

Total cash receipts remain at historically high levels

Record levels expected for 2011

$400

$350

$300

$250

$200

$150

$100

$50

$0

79

| Deere & Company | May / June 2012

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011F 2012F

Source: 1998 – 2010: USDA 13 February 2012

2011F – 2012F: Deere & Company Forecast as of 16 May 2012

Government Payments Total Cash Receipts


U.S. Farm Balance Sheet Strong

$ Billions

$2,500

$2,000

$1,500

$1,000

$500

$0

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011F

2012F

Farm Debt Farm Equity Debt to Equity Ratio (%) Debt to Asset Ratio (%)

Source: 1970 – 2010: USDA 13 February 2012

2011F – 2012F: Deere & Company Forecast as of 16 May 2012

80

| Deere & Company | May / June 2012

30%

28%

26%

24%

22%

20%

18%

16%

14%

12%

10%


Corn, Soybeans, Wheat and Cotton Prices

Nearby Futures: 7 May 2007 – 7 May 2012

Dollars Per Bushel

Dollars per Bushel

9.00

8.00

7.00

6.00

5.00

4.00

3.00

2.00

Corn

1.00

5/7/07 5/7/08 5/7/09 5/7/10 5/7/11 5/7/12

14.00

12.00

10.00

8.00

6.00

4.00

Wheat

2.00

5/7/07 5/7/08 5/7/09 5/7/10 5/7/11 5/7/12

Source: Chicago Board of Trade – Corn, Soybeans & Wheat; Intercontinental Exchange – Cotton

81

| Deere & Company | May / June 2012

Dollars per Bushel

Dollars per Pound

18.00

16.00

14.00

12.00

10.00

8.00

6.00

Soybeans

4.00

5/7/07 5/7/08 5/7/09 5/7/10 5/7/11 5/7/12

2.25

2.00

1.75

1.50

1.25

1.00

0.75

0.50

Cotton

0.25

5/7/07 5/7/08 5/7/09 5/7/10 5/7/11 5/7/12


Agricultural Growth – Energy

2007 U.S. Energy Bill

Significantly expanded mandatory levels of renewable fuels

Gallons (billions)

40

35

30

25

20

15

10

5

0

Source: Energy Independence and Security Act of 2007

82

| Deere & Company | May / June 2012

2008 2010 2012 2014 2016 2018 2020 2022

Corn-Based Starch Ethanol Advanced Biofuels


Uses of U.S. Corn Crop 2010-2021

Bushels (millions)

Source: USDA Agricultural Projections to 2021, February 2012

83

25,000

20,000

15,000

10,000

5,000

0

Feed & residual Ethanol & By-Products for fuel

Food, Seed, & Industrial (Less Ethanol) Exports

Ethanol & By-Products for Fuel as % of Total Corn Usage

| Deere & Company | May / June 2012

41.0%

38.0%

35.0%

32.0%

29.0%

26.0%

23.0%

20.0%


World Farm Fundamentals

Global Stocks-To-Use Ratios

70%

60%

50%

40%

30%

20%

10%

0%

1992

Source: USDA - 10 May 2012

1993

1994

1995

84 | Deere & Company | May / June 2012

1996

1997

1998

Cotton

Wheat

Corn

Soybeans

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011E

2012P


Agricultural Growth – Energy

U.S. Ethanol

Source: Informa – April 2012

85

Bushels (millions)

6,000

5,000

4,000

3,000

2,000

1,000

| Deere & Company | May / June 2012

0

U.S. Corn Used In Ethanol

99/00 01/02 03/04 05/06 07/08 09/10F 11/12F 13/14F 15/16F


Daily Ethanol Margin Per Bushel Corn Grind

Based on Nearby Futures Prices (Excl ITDA*)

$3.00

$2.50

$2.00

$1.50

$1.00

$0.50

$0.00

($0.50)

5/7/08

8/7/08

11/7/08

2/7/09

*Interest, Tax, Depreciation and Amortization (ITDA) totals ~$0.50 and is often disregarded in margin calculations because it does not influence short

term production decisions

Source: Informa – May 2012

86

| Deere & Company | May / June 2012

5/7/09

8/7/09

11/7/09

2/7/10

5/7/10

8/7/10

11/7/10

2/7/11

5/7/11

8/7/11

11/7/11

2/7/12

5/7/12


Market and Currency

Volatility


Volatility / Uncertainty Metrics

Updated as of 15 May 2012

Percentage Points

Spread over Treasuries (bps)

100

75

50

25

400

300

200

100

VIX

(Chicago Board Options Exchange Market Volatility Index)

88 | Deere & Company | May / June 2012

Sep 08-Dec 09 Avg.: 36

Credit Crisis Peak: 81

Rolling 12 Mo Avg.: 24

Rolling 12 Mo Peak: 48

15 May 12: 22

0

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12

'A' Industrial Index 3-Year Spread

Sep 08-Dec 09 Avg.: 209

Credit Crisis Peak: 364

Rolling 12 Mo Avg.: 68

Rolling 12 Mo Peak: 94

15 May 12: 52

0

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12

Spread over T-Bill (bps)

Basis Points

500

375

250

125

TED Spread

(Spread differential between 3M LIBOR and 3M T-Bill)

Sep 08-Dec 09 Avg.: 98

Credit Crisis Peak: 457

Rolling 12 Mo Avg.: 37

Rolling 12 Mo Peak: 57

15 May 12: 38

0

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12

1,200

900

600

300

GECC 5 Yr CDS

Sep 08-Dec 09 Avg.: 411

Credit Crisis Peak: 1,000

Rolling 12 Mo Avg.: 196

Rolling 12 Mo Peak: 309

15 May 12: 168

0

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12


Currency Movement Post Credit Crisis

Stronger FC Indexed Value Weaker FC

135

125

115

105

95

85

75

65

FY 2007

89 | Deere & Company | May / June 2012

FY 2008 FY 2009 FY 2010 FY 2011

EUR

GBP

AUD

JPY

CAD

BRL


Appendix


Enterprise SVA Reconciliation to GAAP

(millions of dollars unless stated otherwise)

Equipment Operations 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Net Sales

Average Identifiable Assets

11,077 11,703 13,349 17,673 19,401 19,884 21,489 25,803 20,756 23,573 29,466

With Inventories at LIFO 8,743 6,229 5,965 6,482 7,248 7,546 8,092 9,652 9,647 9,196 11,516

With Inventories at Standard Cost 9,678 7,147 6,925 7,477 8,312 8,634 9,205 10,812 10,950 10,494 12,875

Operating Profit (46) 401 708 1,905 1,842 1,905 2,318 2,927 1,365 2,909 3,839

Percent of Net Sales

Operating Return on Assets

-0.4% 3.4% 5.3% 10.8% 9.5% 9.6% 10.8% 11.3% 6.6% 12.3% 13.0%

With Inventories at LIFO -0.5% 6.4% 11.9% 29.4% 25.4% 25.2% 28.6% 30.3% 14.1% 31.6% 33.3%

With Inventories at Standard Cost -0.5% 5.6% 10.2% 25.5% 22.2% 22.1% 25.2% 27.1% 12.5% 27.7% 29.8%

SVA Cost of Assets (1,162) (858) (831) (897) (998) (1,036) (1,094) (1,284) (1,301) (1,259) (1,545)

Equipment Operations SVA (1,208) (457) (123) 1,008 844 869 1,224 1,643 64 1,650 2,294

Financial Services

Net Income 262 330 309 345 584 364 337 203 373 471

Average Equity 2,115 2,177 2,265 2,227 2,466 2,524 2,355 2,732 3,064 3,194

Return on Equity 12.40% 15.20% 13.60% 15.50% 23.70% 14.40% 14.30% 7.40% 12.20% 14.70%

Operating Profit Continuing 416 504 466 491 521 553 493 242 499 725

Change in Allowance for Doubtful Receivables 16 17 -8 -12 15 17 -4 68 -14 -

SVA Income Continuing 432 521 458 479 536 570 489 310 485 725

Average Equity Continuing Operations 2,115 2,177 2,163 2,110 2,424 2,524 2,355 2,732 3,064 3,194

Average Allowance for Doubtful Receivables 161 160 165 150 148 167 183 195 232 -

SVA Average Equity 2,276 2,337 2,328 2,260 2,572 2,691 2,538 2,927 3,296 3,194

Cost of Equity -437 -431 -414 -410 -457 -480 -430 -458 -420 -492

SVA Continuing Operations 44 69 79 90 59 -148 65 233

SVA Discontinued Operations -11 25 - - - - - -

Financial Services SVA (5) 90 44 69 79 90 59 (148) 65 233

Deere & Company - Enterprise SVA (462)

91

| Deere & Company | May / June 2012

(33)

1,052

913

948

1,314

1,702

(84)

1,715

2,527


Equipment Ops SVA Reconciliation to GAAP

(millions of dollars unless stated otherwise)

Equipment Operations 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Net Sales

Average Identifiable Assets

5,848 5,723 6,479 7,663 8,830 9,640 11,082 11,926 9,701 11,169 11,077

With Inventories at LIFO 5,585 5,765 5,449 5,551 6,187 6,502 6,682 7,672 7,724 8,069 8,743

With Inventories at Standard Cost 6,702 6,846 6,442 6,494 7,131 7,488 7,703 8,711 8,739 9,039 9,678

Operating Profit 16 77 242 847 1,006 1,125 1,402 1,476 272 693 (46)

Percent of Net Sales

Operating Return on Assets

0.3% 1.3% 3.7% 11.1% 11.4% 11.7% 12.6% 12.4% 2.8% 6.2% -0.4%

With Inventories at LIFO 0.3% 1.3% 4.4% 15.3% 16.3% 17.3% 21.0% 19.3% 3.5% 8.6% -0.5%

With Inventories at Standard Cost 0.2% 1.1% 3.8% 13.0% 14.1% 15.0% 18.2% 16.9% 3.1% 7.7% -0.5%

SVA Cost of Assets (804) (821) (773) (780) (856) (898) (924) (1,045) (1,049) (1,085) (1,162)

SVA (788) (744) (531) 67 150 227 477 431 (776) (392) (1,208)

Equipment Operations 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Net Sales

Average Identifiable Assets

11,703 13,349 17,673 19,401 19,884 21,489 25,803 20,756 23,573 29,466

With Inventories at LIFO 6,229 5,965 6,482 7,248 7,546 8,092 9,652 9,647 9,196 11,516

With Inventories at Standard Cost 7,147 6,925 7,477 8,312 8,634 9,205 10,812 10,950 10,494 12,875

Operating Profit 401 708 1,905 1,842 1,905 2,318 2,927 1,365 2,909 3,839

Percent of Net Sales

Operating Return on Assets

3.4% 5.3% 10.8% 9.5% 9.6% 10.8% 11.3% 6.6% 12.3% 13.0%

With Inventories at LIFO 6.4% 11.9% 29.4% 25.4% 25.2% 28.6% 30.3% 14.1% 31.6% 33.3%

With Inventories at Standard Cost 5.6% 10.2% 25.5% 22.2% 22.1% 25.2% 27.1% 12.5% 27.7% 29.8%

SVA Cost of Assets (858) (831) (897) (998) (1,036) (1,094) (1,284) (1,301) (1,259) (1,545)

SVA (457) (123) 1,008 844 869 1,224 1,643 64 1,650 2,294

92

| Deere & Company | May / June 2012


2009 OROA Reconciliation to GAAP

Equipment Operations

(millions of dollars unless stated otherwise)

2009, as

Exclude Goodwill

Impairment &

Voluntary Employee- 2009, as

Equipment Operations

Reported Separation Adjusted

Net Sales

Average Identifiable Assets

20,756

20,756

With Inventories at LIFO 9,647

9,647

With Inventories at Standard Cost 10,950

10,950

Operating Profit 1,365

380 1,745

Percent of Net Sales

Operating Return on Assets

6.6% 8.4%

With Inventories at LIFO 14.1% 18.1%

With Inventories at Standard Cost 12.5% 15.9%

93

| Deere & Company | May / June 2012

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