Cervus Equipment, one of John Deere’s largest farm equipment dealership groups, reports that its ag machinery sales for full-year 2018 rose by 11%. This was a new record for its agriculture segment, as revenues rose to $926,886 vs. $833,677 in 2017.
New equipment sales were up 10%, from $447,268 in the previous year to $490,524 for 2018. Used equipment sales increased by 19% to $293,264 from $246,784. Overall, total equipment revenue was up 13% for the year, to $783,788 from 2017’s total of $694,052. Parts sales were up by 2% and service revenues increased by 5% for the full year.
Commenting on the 2018 results, Cervus’ President & CEO, Graham Drake, said, Leveraging our scale and consistency was fundamental in marketing a record volume of pre-owned agricultural equipment, in addition to achieving record new agricultural equipment sales. Further, service optimization continues to elevate our customers’ experience, while increasing the efficiency of our service departments.”
Within its Agriculture segment, adjusted income before income tax expense increased $1.4 million. The company said, “This performance reflects the record agricultural equipment sales achieved in 2018, with new and used equipment increasing 13% overall compared to 2017. The overall results were comprised of a 10% increase in new equipment sales which accelerated the amount of used equipment taken on trade. In turn, focused sales efforts achieved a 19% increase in used equipment sales, compared to 2017, while marketing this increased used inventory in-season reduced used gross profit margin compared to 2017. Organic growth in parts and service revenue, along with improved gross profit, also positively contributed to the financial performance of the year. Income before income tax expense increased $1.7 million for the segment compared to 2017.
Cervus’ consolidated revenue, which includes its transportation and industrial segments, was $1.35 billion, up 11% from 2017’s $1.22 billion.