MOLINE, Ill. -- Deere & Co. is on its way to a record-earnings run not seen in a decade.

The company today reported record third-quarter earnings of $537.2 million -- or $2.37 per share -- for the quarter which ended July 31, a 23.2 percent increase from the $436 million or $1.85 per share in the third quarter of 2006.

Deere is also predicting record year-end earnings for the fourth year in a row. It would be the company's best showing since a five-year run of record earnings through 1998.

Deere projects it will have 2007 year-end earnings of $1.7 billion -- up from the record $1.694 billion for 2006, which included the company's sale that spring of its health-care operation to Minnesota-based United Healthcare.

The company's year-to-date earnings total $1.4 billion, or $6.12 per share, compared with $1.416 billion or $5.96 per share for the first nine months of 2006, including the health-care sale. Without it, that number would be $1.177 million or $4.95 per share.

Excluding the health-care sale, year-to-date earnings from continuing operations would be up almost 19 percent from a year ago. Revenues from continuing operations have been at record levels for five consecutive quarters, company spokesman Ken Golden said.

"Advanced new products and services are helping the company's market presence throughout the world," said Robert W. Lane, Deere's chief executive officer. Those new products include the company's Waterloo-designed and manufactured large row-crop tractors, particularly the 8030 tractor line.

"Large tractors have been a strong point for the quarter, and that continues to be the case," Golden said.

With healthy agricultural markets worldwide, the company projects a 16 percent increase in its ag equipment business for the year, up from a projected 13 percent increase three months ago.

"Deere's efforts to grow a great business, particularly with the support of improving conditions across the global farm sector, are gaining strong momentum and producing powerful results," Lane said. He said the company's emphasis on "rigorous asset management" allows the company "to serve this growing customer base at the highest level while maintaining lean, efficient inventory levels."

That was one goal of Deere's multi-year $127-million-plus redevelopment of its downtown Westfield Avenue and East Donald Street Tractor Works facilities in Waterloo -- to reduce turnaround times and produce equipment to meet market demand and avoid inventory stockpiles.

"It's important to note the employees of this company have done a lot of work in making this company more efficient," Golden said. "So it's a combination of really strong markets, but, also, of a company that is well prepared to benefit from strong markets. … This is what our employees have been focused on -- learning how to do more with less assets, less manufacturing space, building to demand. … Our employees have embraced this, and it's paying off."

Company ag plants, including Waterloo, are running at capacity. "That's when you have the best efficiencies," Golden said.

Deere projects total company equipment sales to increase 7 percent for the full year. Three months ago the company projected a 6 percent increase for the year. While construction equipment sales were down 20 percent for the quarter, in large part due to a home-construction slowdown, the company is still maintaining 12 percent operating margins in the construction equipment division.

Sales of the company's commercial and consumer equipment, which includes the company's lawn and grounds care equipment, were up 15 percent and 6 percent for the quarter and year to date, respectively.

The company's earnings performance of $2.37 per share beat analysts' projections of $1.99 per share. Company stock opened trading this morning at $117.09 per share, unchanged from Thursday's closing price.

Contact Pat Kinney at (319) 291-1484 or Pat.Kinney@wcfcourier.com