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UNITED STATES |
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SECURITIES AND EXCHANGE COMMISSION |
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WASHINGTON, D.C. 20549 |
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FORM 10-Q |
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
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SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended July 31, 2003 |
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Commission file no: 1-6458 |
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JOHN DEERE CAPITAL CORPORATION |
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Delaware |
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36-2386361 |
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1 East First Street, Suite 600 |
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Telephone Number: (775) 786-5527 |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. |
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Yes |
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x |
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No |
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Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). |
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Yes |
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No |
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x |
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At July 31, 2003, 2,500 shares of common stock, without par value, of the registrant were outstanding, all of which were owned by John Deere Credit Company, a wholly-owned subsidiary of Deere & Company. |
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The registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with certain reduced disclosures as permitted by those instructions. |
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Page 1 of 22 Pages |
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PART I. FINANCIAL INFORMATION |
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Item 1. Financial Statements. |
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John Deere Capital Corporation and Subsidiaries |
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Statements of Consolidated Income and Retained Earnings |
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(Unaudited) |
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(in millions) |
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Three Months Ended |
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Nine Months Ended |
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2003 |
2002 |
2003 |
2002 |
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Revenues |
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Finance income earned on retail notes |
$ |
105.8 |
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$ |
98.9 |
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$ |
306.0 |
$ |
302.6 |
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Lease revenues |
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79.2 |
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100.6 |
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256.1 |
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312.6 |
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Revolving charge account income |
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40.6 |
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35.9 |
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106.8 |
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97.6 |
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Finance income earned on wholesale receivables |
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64.3 |
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56.9 |
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180.4 |
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161.8 |
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Operating loan income |
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7.9 |
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6.0 |
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23.6 |
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18.8 |
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Securitization and servicing fee income |
11.5 |
11.7 |
36.9 |
35.0 |
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Net gain on receivables and leases sold |
23.8 |
4.7 |
38.1 |
76.3 |
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Interest income from short-term investments |
4.8 |
2.6 |
11.1 |
8.0 |
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Other income |
5.1 |
5.3 |
20.1 |
14.9 |
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Total revenues |
343.0 |
322.6 |
979.1 |
1,027.6 |
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Expenses |
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Interest expense |
93.4 |
92.9 |
274.7 |
278.9 |
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Operating expenses: |
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Administrative and operating expenses |
50.3 |
48.7 |
146.0 |
155.2 |
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Provision for credit losses |
22.7 |
18.9 |
55.5 |
108.3 |
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Fees paid to John Deere |
6.6 |
4.6 |
21.0 |
15.3 |
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Depreciation of equipment on operating leases |
47.3 |
64.1 |
160.1 |
192.1 |
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Total operating expenses |
126.9 |
136.3 |
382.6 |
470.9 |
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Total expenses |
220.3 |
229.2 |
657.3 |
749.8 |
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Income of consolidated group before income taxes |
122.7 |
93.4 |
321.8 |
277.8 |
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Provision for income taxes |
43.0 |
33.6 |
112.4 |
101.5 |
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Income of consolidated group |
79.7 |
59.8 |
209.4 |
176.3 |
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Equity in income (loss) of unconsolidated affiliates |
0.1 |
(.9 |
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0.2 |
(2.9 |
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Net income |
79.8 |
58.9 |
209.6 |
173.4 |
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Cash dividends declared |
(40.0 |
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(140.0 |
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(90.0 |
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(340.0 |
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Retained earnings at beginning of period |
1,123.7 |
1,077.8 |
1,043.9 |
1,163.3 |
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Retained earnings at end of period |
$ |
1,163.5 |
$ |
996.7 |
$ |
1,163.5 |
$ |
996.7 |
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Page 2
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John Deere Capital Corporation and Subsidiaries |
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Consolidated Balance Sheets |
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(Unaudited) |
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(in millions) |
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July 31, 2003 |
October 31, |
July 31, |
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Assets |
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Cash and cash equivalents |
$ |
344.5 |
$ |
147.8 |
$ |
354.0 |
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Receivables |
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Retail notes |
5,497.8 |
5,311.7 |
4,734.4 |
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Revolving charge accounts |
1,116.5 |
896.0 |
863.9 |
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Operating loans |
619.3 |
561.2 |
553.5 |
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Wholesale receivables |
3,523.9 |
2,942.2 |
3,068.0 |
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Financing leases |
430.9 |
467.5 |
456.3 |
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Total receivables |
11,188.4 |
10,178.6 |
9,676.1 |
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Allowance for credit losses |
(126.5 |
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(118.3 |
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(162.1 |
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Total receivables - net |
11,061.9 |
10,060.3 |
9,514.0 |
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Notes receivable - unconsolidated affiliates |
300.3 |
259.9 |
271.1 |
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Other receivables |
141.8 |
96.9 |
101.3 |
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Equipment on operating leases - net |
908.8 |
1,180.0 |
1,232.9 |
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Investment in unconsolidated affiliates |
2.9 |
7.1 |
9.2 |
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Other assets |
377.1 |
350.4 |
378.9 |
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Total Assets |
$ |
13,137.3 |
$ |
12,102.4 |
$ |
11,861.4 |
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Liabilities and Stockholder's Equity |
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Short-term borrowings: |
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Commercial paper |
$ |
1,995.0 |
$ |
1,422.0 |
$ |
1,622.8 |
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Other notes payable |
15.0 |
37.5 |
35.3 |
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John Deere |
117.3 |
654.0 |
979.1 |
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Current maturities of long-term borrowings |
1,402.3 |
2,158.6 |
2,243.9 |
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Total short-term borrowings |
3,529.6 |
4,272.1 |
4,881.1 |
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Accounts payable and accrued liabilities |
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Accrued interest on debt |
89.4 |
52.3 |
86.6 |
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Other payables |
425.8 |
446.3 |
265.2 |
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Total accounts payable and accrued liabilities |
515.2 |
498.6 |
351.8 |
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Deposits withheld from dealers and merchants |
150.2 |
138.4 |
134.0 |
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Long-term borrowings: |
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Senior debt |
6,841.8 |
5,231.3 |
4,583.8 |
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Subordinated debt |
150.0 |
150.0 |
150.0 |
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Total long-term borrowings |
6,991.8 |
5,381.3 |
4,733.8 |
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Total liabilities |
11,186.8 |
10,290.4 |
10,100.7 |
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Stockholder's equity: |
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Common stock, without par value (issued and outstanding - 2,500 shares |
812.8 |
812.8 |
812.8 |
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Retained earnings |
1,163.5 |
1,043.9 |
996.7 |
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Cumulative translation adjustment |
8.9 |
(2.2 |
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(4.9 |
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Unrealized loss on derivatives |
(35.6 |
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(44.1 |
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(45.9 |
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Unrealized gain on investments |
0.9 |
1.6 |
2.0 |
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Total accumulated other comprehensive income (loss) |
(25.8 |
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(44.7 |
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(48.8 |
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Total stockholder's equity |
1,950.5 |
1,812.0 |
1,760.7 |
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Total Liabilities and Stockholder's Equity |
$ |
13,137.3 |
$ |
12,102.4 |
$ |
11,861.4 |
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Page 3
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John Deere Capital Corporation and Subsidiaries |
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Condensed Statements of Consolidated Cash Flows |
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For the Nine Months Ended July 31, 2003 and 2002 |
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(Unaudited) |
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(in millions) |
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2003 |
2002 |
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Cash Flows from Operating Activities: |
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Net income |
$ |
209.6 |
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$ |
173.4 |
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Adjustments to reconcile net income to net cash |
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provided by operating activities |
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166.6 |
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159.0 |
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Net cash provided by operating activities |
376.2 |
332.4 |
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Cash Flows from Investing Activities: |
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Cost of receivables acquired |
(15,311.8 |
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(12,293.1 |
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Collections of receivables |
12,882.9 |
10,212.9 |
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Cost of operating leases acquired |
(190.6 |
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(260.1 |
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Proceeds from sales of equipment on operating leases |
320.4 |
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