- Second quarter consolidated revenues increase 39 percent to $200.1 million with EPS of $1.32
- Irrigation revenues increase 52 percent on continued strength in agricultural markets and favorable pricing
- Infrastructure revenues decrease 23 percent on lower Road Zipper System® sales
Lindsay Corporation (NYSE: LNN), a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology, today announced results for its second quarter of fiscal 2022, which ended on February 28, 2022.
Second Quarter Summary
Revenues for the second quarter of fiscal 2022 were $200.1 million, an increase of $56.6 million, or 39 percent, compared to revenues of $143.6 million in the prior year second quarter. Net earnings for the quarter were $14.6 million, or $1.32 per diluted share, compared with net earnings of $11.9 million, or $1.08 per diluted share, for the prior year second quarter.
“Global agricultural market conditions continue to be favorable and have contributed to an increase in demand for our irrigation equipment,” said Randy Wood, President and Chief Executive Officer. “At the same time, the effects of the global pandemic continue to impact our business and create operational challenges. During the quarter we experienced a short-term disruption in labor availability in our Nebraska manufacturing facility due to an increase in employee absences caused by the Omicron variant. Our teams have continued to prioritize safety and manage well in this dynamic environment, and we were pleased to see absences decline as we completed the quarter.”
Second Quarter Segment Results
Irrigation segment revenues for the second quarter of fiscal 2022 were $180.7 million, an increase of $62.2 million, or 52 percent, compared to $118.6 million in the prior year second quarter. North America irrigation revenues of $100.7 million increased $20.6 million, or 26 percent, compared to the prior year second quarter. The increase in North America irrigation revenues resulted primarily from higher average selling prices. Unit sales volume was lower year-over-year due to the impact of Omicron-related employee absences on production and shipping capabilities. International irrigation revenues of $80.0 million increased $41.6 million, or 108 percent, compared to the prior year second quarter. The increase in international irrigation revenues resulted primarily from higher unit sales volumes, along with higher selling prices. Revenues in Brazil more than tripled compared to the prior year second quarter, and we also completed final deliveries of a large project in Egypt.
Irrigation segment operating income for the second quarter of fiscal 2022 was $24.7 million, an increase of $6.7 million, or 37 percent, compared to the prior year second quarter. Operating margin was 13.7 percent of sales, compared to 15.2 percent of sales in the prior year second quarter. The impact of higher irrigation system unit volume was partially offset by the impact of higher input costs that were not fully recovered by higher pricing. Second quarter operating results were also reduced by approximately $2.8 million resulting from the impact of the LIFO method of accounting for inventory (under which higher raw material costs are recognized in cost of goods sold rather than in ending inventory values), and by approximately $1.8 million of non-recurring expenses related to factory maintenance and outside consulting services.
Infrastructure segment revenues for the second quarter of fiscal 2022 were $19.4 million, a decrease of $5.6 million, or 23 percent, compared to $25.0 million in the prior year second quarter. The decrease resulted from lower Road Zipper System® sales and lease revenue, which were partially offset by increased sales of road safety products compared to the prior year.
Infrastructure segment operating income for the second quarter of fiscal 2022 was $0.3 million, a decrease of $6.0 million, or 95 percent, compared to the prior year second quarter. Operating margin was 1.7 percent of sales, compared to 25.4 percent of sales in the prior year second quarter. Current year results reflect lower revenues and a less favorable margin mix of revenues compared to the prior year second quarter and under absorbed overhead costs.
The backlog of unfilled orders at February 28, 2022 was $111.0 million compared with $101.4 million at February 28, 2021. A higher backlog of orders in irrigation was partially offset by a lower backlog in infrastructure.
Outlook
“Strong agricultural commodity prices and farm income projections support a solid demand environment for irrigation equipment in North America. We expect these same dynamics, along with increased concerns around food security, to drive growth in our international markets. Inflationary pressures and supply chain challenges are also expected to persist in the near term, and we continue to focus on protecting and improving margins in this environment,” said Mr. Wood. “In our infrastructure business, we are actively managing projects through our sales funnel and expect an increase in project sales in the second half of the fiscal year.”
Mr. Wood concluded, “We continue to invest in our innovation growth strategy that addresses the needs of a growing population and provides solutions that improve efficiency and promote sustainability.”
Second Quarter Conference Call
Lindsay’s fiscal 2022 second quarter investor conference call is scheduled for 11:00 a.m. Eastern Time today. Interested investors may participate in the call by dialing (833) 535-2202 in the U.S., or (412) 902-6745 internationally, and requesting the Lindsay Corporation call. Additionally, the conference call will be simulcast live on the Internet and can be accessed via the investor relations section of the Company's Web site, www.lindsay.com. Replays of the conference call will remain on our Web site through the next quarterly earnings release. The Company will have a slide presentation available to augment management's formal presentation, which will also be accessible via the Company's Web site.
About the Company
Lindsay Corporation (NYSE: LNN) is a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology. Established in 1955, the company has been at the forefront of research and development of innovative solutions to meet the food, fuel, fiber and transportation needs of the world’s rapidly growing population. The Lindsay family of irrigation brands includes Zimmatic® center pivot and lateral move agricultural irrigation systems, FieldNET® remote irrigation management and scheduling technology, and industrial IoT solutions. Also a global leader in the transportation industry, Lindsay Transportation Solutions manufactures equipment to improve road safety and keep traffic moving on the world’s roads, bridges and tunnels, through the Barrier Systems®, Road Zipper® and Snoline™ brands. For more information about Lindsay Corporation, visit www.lindsay.com.
Concerning Forward-looking Statements
This release contains forward-looking statements that are subject to risks and uncertainties and which reflect management’s current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. You can find a discussion of many of these risks and uncertainties in the annual, quarterly and current reports that the Company files with the Securities and Exchange Commission. Forward-looking statements include information concerning possible or assumed future results of operations and planned financing of the Company and those statements preceded by, followed by or including the words “anticipate,” “estimate,” “believe,” “intend,” "expect," "outlook," "could," "may," "should," “will,” or similar expressions. For these statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking information contained in this press release.
LINDSAY CORPORATION AND SUBSIDIARIES |
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CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS |
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(Unaudited) |
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|||||||||||||||||||
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|
|
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|
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||||||||
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Three months ended |
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Six months ended |
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(in thousands, except per share amounts) |
|
|
February 28,
|
|
|
|
February 28,
|
|
|
|
February 28,
|
|
|
|
February 28,
|
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||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating revenues |
|
$ |
|
200,137 |
|
|
$ |
|
143,577 |
|
|
$ |
|
366,288 |
|
|
$ |
|
252,062 |
|
Cost of operating revenues |
|
|
|
157,193 |
|
|
|
|
102,403 |
|
|
|
|
285,907 |
|
|
|
|
179,480 |
|
Gross profit |
|
|
|
42,944 |
|
|
|
|
41,174 |
|
|
|
|
80,381 |
|
|
|
|
72,582 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
||||
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selling expense |
|
|
|
7,932 |
|
|
|
|
7,778 |
|
|
|
|
15,922 |
|
|
|
|
15,110 |
|
General and administrative expense |
|
|
|
13,022 |
|
|
|
|
14,275 |
|
|
|
|
25,901 |
|
|
|
|
27,727 |
|
Engineering and research expense |
|
|
|
3,652 |
|
|
|
|
3,312 |
|
|
|
|
6,859 |
|
|
|
|
6,402 |
|
Total operating expenses |
|
|
|
24,606 |
|
|
|
|
25,365 |
|
|
|
|
48,682 |
|
|
|
|
49,239 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
|
18,338 |
|
|
|
|
15,809 |
|
|
|
|
31,699 |
|
|
|
|
23,343 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
|
|
(1,176 |
) |
|
|
|
(1,205 |
) |
|
|
|
(2,339 |
) |
|
|
|
(2,406 |
) |
Interest income |
|
|
|
160 |
|
|
|
|
268 |
|
|
|
|
338 |
|
|
|
|
571 |
|
Other income (expense), net |
|
|
|
1,882 |
|
|
|
|
(311 |
) |
|
|
|
(1,018 |
) |
|
|
|
(65 |
) |
Total other income (expense) |
|
|
|
866 |
|
|
|
|
(1,248 |
) |
|
|
|
(3,019 |
) |
|
|
|
(1,900 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings before income taxes |
|
|
|
19,204 |
|
|
|
|
14,561 |
|
|
|
|
28,680 |
|
|
|
|
21,443 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income tax expense |
|
|
|
4,638 |
|
|
|
|
2,685 |
|
|
|
|
6,213 |
|
|
|
|
2,472 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
||||
Net earnings |
|
$ |
|
14,566 |
|
|
$ |
|
11,876 |
|
|
$ |
|
22,467 |
|
|
$ |
|
18,971 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
||||
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
||||
Basic |
|
$ |
|
1.33 |
|
|
$ |
|
1.09 |
|
|
$ |
|
2.05 |
|
|
$ |
|
1.75 |
|
Diluted |
|
$ |
|
1.32 |
|
|
$ |
|
1.08 |
|
|
$ |
|
2.04 |
|
|
$ |
|
1.74 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Shares used in computing earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
|
10,974 |
|
|
|
|
10,884 |
|
|
|
|
10,950 |
|
|
|
|
10,865 |
|
Diluted |
|
|
|
11,014 |
|
|
|
|
10,981 |
|
|
|
|
11,020 |
|
|
|
|
10,934 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash dividends declared per share |
|
$ |
|
0.33 |
|
|
$ |
|
0.32 |
|
|
$ |
|
0.66 |
|
|
$ |
|
0.64 |
|
LINDSAY CORPORATION AND SUBSIDIARIES |
|
|||||||||||||||||||
SUMMARY OPERATING RESULTS |
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|||||||||||||||||||
(Unaudited) |
|
|||||||||||||||||||
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|
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|
|
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|
|
|
|
|
|
|
|
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|
||||
|
|
Three months ended |
|
|
|
Six months ended |
|
|||||||||||||
(in thousands) |
|
|
February 28,
|
|
|
|
February 28,
|
|
|
|
February 28,
|
|
|
|
February 28,
|
|
||||
Operating revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Irrigation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
North America |
|
$ |
|
100,730 |
|
|
$ |
|
80,178 |
|
|
|
|
179,705 |
|
|
$ |
|
132,968 |
|
International |
|
|
|
80,029 |
|
|
|
|
38,394 |
|
|
|
|
146,962 |
|
|
|
|
72,961 |
|
Irrigation segment |
|
|
|
180,759 |
|
|
|
|
118,572 |
|
|
$ |
|
326,667 |
|
|
$ |
|
205,929 |
|
Infrastructure segment |
|
|
|
19,378 |
|
|
|
|
25,005 |
|
|
|
|
39,621 |
|
|
|
|
46,133 |
|
Total operating revenues |
|
$ |
|
200,137 |
|
|
$ |
|
143,577 |
|
|
$ |
|
366,288 |
|
|
$ |
|
252,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Irrigation segment |
|
$ |
|
24,734 |
|
|
$ |
|
18,045 |
|
|
$ |
|
41,946 |
|
|
$ |
|
28,678 |
|
Infrastructure segment |
|
|
|
324 |
|
|
|
|
6,341 |
|
|
|
|
3,090 |
|
|
|
|
10,597 |
|
Corporate |
|
|
|
(6,720 |
) |
|
|
|
(8,577 |
) |
|
|
|
(13,337 |
) |
|
|
|
(15,932 |
) |
Total operating income |
|
$ |
|
18,338 |
|
|
$ |
|
15,809 |
|
|
$ |
|
31,699 |
|
|
$ |
|
23,343 |
|
The Company manages its business activities in two reportable segments as follows:
Irrigation - This reporting segment includes the manufacture and marketing of center pivot, lateral move, and hose reel irrigation systems, as well as various innovative technology solutions such as GPS positioning and guidance, variable rate irrigation, remote irrigation management and scheduling technology, irrigation consulting and design and industrial IoT solutions.
Infrastructure – This reporting segment includes the manufacture and marketing of moveable barriers, specialty barriers, crash cushions and end terminals, and road marking and road safety equipment.
LINDSAY CORPORATION AND SUBSIDIARIES |
|
||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|
||||||||||||||
(Unaudited) |
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
(in thousands) |
|
February 28,
|
|
|
February 28,
|
|
|
August 31,
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Current assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
|
68,951 |
|
|
$ |
|
110,775 |
|
|
$ |
|
127,107 |
|
Marketable securities |
|
|
|
24,934 |
|
|
|
|
19,555 |
|
|
|
|
19,604 |
|
Receivables, net |
|
|
|
134,694 |
|
|
|
|
94,211 |
|
|
|
|
93,609 |
|
Inventories, net |
|
|
|
187,328 |
|
|
|
|
121,566 |
|
|
|
|
145,244 |
|
Other current assets, net |
|
|
|
34,350 |
|
|
|
|
29,509 |
|
|
|
|
30,539 |
|
Total current assets |
|
|
|
450,257 |
|
|
|
|
375,616 |
|
|
|
|
416,103 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Property, plant, and equipment, net |
|
|
|
92,291 |
|
|
|
|
89,221 |
|
|
|
|
91,997 |
|
Intangibles, net |
|
|
|
19,311 |
|
|
|
|
22,383 |
|
|
|
|
20,367 |
|
Goodwill |
|
|
|
67,679 |
|
|
|
|
68,087 |
|
|
|
|
67,968 |
|
Operating lease right-of-use assets |
|
|
|
16,724 |
|
|
|
|
20,173 |
|
|
|
|
18,281 |
|
Deferred income tax assets |
|
|
|
5,352 |
|
|
|
|
10,347 |
|
|
|
|
8,113 |
|
Other noncurrent assets, net |
|
|
|
24,970 |
|
|
|
|
10,821 |
|
|
|
|
14,356 |
|
Total assets |
|
$ |
|
676,584 |
|
|
$ |
|
596,648 |
|
|
$ |
|
637,185 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Current liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Accounts payable |
|
$ |
|
74,345 |
|
|
$ |
|
39,934 |
|
|
$ |
|
45,209 |
|
Current portion of long-term debt |
|
|
|
220 |
|
|
|
|
215 |
|
|
|
|
217 |
|
Other current liabilities |
|
|
|
86,837 |
|
|
|
|
74,687 |
|
|
|
|
92,814 |
|
Total current liabilities |
|
|
|
161,402 |
|
|
|
|
114,836 |
|
|
|
|
138,240 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Pension benefits liabilities |
|
|
|
5,567 |
|
|
|
|
6,182 |
|
|
|
|
5,754 |
|
Long-term debt |
|
|
|
115,428 |
|
|
|
|
115,599 |
|
|
|
|
115,514 |
|
Operating lease liabilities |
|
|
|
17,170 |
|
|
|
|
20,174 |
|
|
|
|
18,301 |
|
Deferred income tax liabilities |
|
|
|
783 |
|
|
|
|
900 |
|
|
|
|
832 |
|
Other noncurrent liabilities |
|
|
|
19,696 |
|
|
|
|
19,933 |
|
|
|
|
20,099 |
|
Total liabilities |
|
|
|
320,046 |
|
|
|
|
277,624 |
|
|
|
|
298,740 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Shareholders' equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Preferred stock |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
Common stock |
|
|
|
19,061 |
|
|
|
|
18,990 |
|
|
|
|
18,991 |
|
Capital in excess of stated value |
|
|
|
90,711 |
|
|
|
|
84,206 |
|
|
|
|
86,495 |
|
Retained earnings |
|
|
|
543,355 |
|
|
|
|
511,728 |
|
|
|
|
528,130 |
|
Less treasury stock - at cost |
|
|
|
(277,238 |
) |
|
|
|
(277,238 |
) |
|
|
|
(277,238 |
) |
Accumulated other comprehensive loss, net |
|
|
|
(19,351 |
) |
|
|
|
(18,662 |
) |
|
|
|
(17,933 |
) |
Total shareholders' equity |
|
|
|
356,538 |
|
|
|
|
319,024 |
|
|
|
|
338,445 |
|
Total liabilities and shareholders' equity |
|
$ |
|
676,584 |
|
|
$ |
|
596,648 |
|
|
$ |
|
637,185 |
|
LINDSAY CORPORATION AND SUBSIDIARIES |
|
|||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
|||||||||
(Unaudited) |
|
|||||||||
|
|
|
|
|
|
|
|
|
||
|
|
Six months ended |
|
|||||||
(in thousands) |
|
|
February 28,
|
|
|
|
February 28,
|
|
||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
||
Net earnings |
|
$ |
|
22,467 |
|
|
$ |
|
18,971 |
|
Adjustments to reconcile net earnings to net cash (used in) provided by operating activities: |
|
|
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
9,912 |
|
|
|
|
9,878 |
|
Provision for uncollectible accounts receivable |
|
|
|
322 |
|
|
|
|
246 |
|
Deferred income taxes |
|
|
|
3,052 |
|
|
|
|
206 |
|
Share-based compensation expense |
|
|
|
2,411 |
|
|
|
|
4,047 |
|
Unrealized foreign currency transaction gain |
|
|
|
(111 |
) |
|
|
|
(754 |
) |
Other, net |
|
|
|
627 |
|
|
|
|
1,804 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
||
Receivables |
|
|
|
(41,286 |
) |
|
|
|
(10,769 |
) |
Inventories |
|
|
|
(42,412 |
) |
|
|
|
(16,245 |
) |
Other current assets |
|
|
|
(2,541 |
) |
|
|
|
(9,492 |
) |
Accounts payable |
|
|
|
28,757 |
|
|
|
|
10,962 |
|
Other current liabilities |
|
|
|
(8,317 |
) |
|
|
|
334 |
|
Other noncurrent assets and liabilities |
|
|
|
(8,732 |
) |
|
|
|
1,940 |
|
Net cash (used in) provided by operating activities |
|
|
|
(35,851 |
) |
|
|
|
11,128 |
|
|
|
|
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
||
Purchases of property, plant, and equipment |
|
|
|
(6,926 |
) |
|
|
|
(16,556 |
) |
Purchases of marketable securities |
|
|
|
(18,468 |
) |
|
|
|
(8,313 |
) |
Proceeds from maturities of marketable securities |
|
|
|
12,752 |
|
|
|
|
8,043 |
|
Other investing activities, net |
|
|
|
(2,974 |
) |
|
|
|
(860 |
) |
Net cash used in investing activities |
|
|
|
(15,616 |
) |
|
|
|
(17,686 |
) |
|
|
|
|
|
|
|
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
||
Proceeds from exercise of stock options |
|
|
|
2,821 |
|
|
|
|
3,814 |
|
Common stock withheld for payroll tax obligations |
|
|
|
(1,181 |
) |
|
|
|
(1,269 |
) |
Proceeds from employee stock purchase plan |
|
|
|
235 |
|
|
|
|
— |
|
Principal payments on long-term debt |
|
|
|
(108 |
) |
|
|
|
(88 |
) |
Dividends paid |
|
|
|
(7,242 |
) |
|
|
|
(6,967 |
) |
Net cash used in financing activities |
|
|
|
(5,475 |
) |
|
|
|
(4,510 |
) |
|
|
|
|
|
|
|
|
|
||
Effect of exchange rate changes on cash and cash equivalents |
|
|
|
(1,214 |
) |
|
|
|
440 |
|
Net change in cash and cash equivalents |
|
|
|
(58,156 |
) |
|
|
|
(10,628 |
) |
Cash and cash equivalents, beginning of period |
|
|
|
127,107 |
|
|
|
|
121,403 |
|
Cash and cash equivalents, end of period |
|
$ |
|
68,951 |
|
|
$ |
|
110,775 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20220404006038/en/
Contacts
LINDSAY CORPORATION:
Brian Ketcham
Senior Vice President & Chief Financial Officer
402-827-6579
THREE PART ADVISORS:
Hala Elsherbini
214-442-0016
