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Lindsay Corporation Reports Fiscal 2022 First Quarter Results

  • Solid demand for irrigation equipment continued in the first quarter across all geographies
  • Irrigation revenues increase 50 percent in North America and 94 percent in international markets
  • Infrastructure revenues decline slightly on lower Road Zipper System® project sales
  • First quarter net earnings reduced by after-tax LIFO impact of $4.5 million, or $0.41 per diluted share

Lindsay Corporation (NYSE: LNN), a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology, today announced results for its first quarter of fiscal 2022, which ended on November 30, 2021.

First Quarter Summary

Revenues for the first quarter of fiscal 2022 were $166.2 million, an increase of $57.7 million, or 53 percent, compared to revenues of $108.5 million in the prior year first quarter. Net earnings for the quarter were $7.9 million, or $0.72 per diluted share, compared with net earnings of $7.1 million, or $0.65 per diluted share, for the prior year first quarter. Net earnings for the quarter were reduced by an after-tax LIFO impact of approximately $4.5 million, or $0.41 per diluted share.

“Positive market fundamentals continue to support solid demand for irrigation equipment across all geographies,” said Randy Wood, President and Chief Executive Officer. “Raw material cost inflation and supply chain issues continue to create challenges and limit margin expansion. Our teams are managing well in this dynamic environment in order to support our customers.”

First Quarter Segment Results

Irrigation segment revenues for the first quarter of fiscal 2022 were $145.9 million, an increase of $58.6 million, or 67 percent, compared to $87.4 million in the prior year first quarter. North America irrigation revenues of $79.0 million increased $26.2 million, or 50 percent, compared to the prior year first quarter. The increase in North America irrigation revenues resulted from a combination of higher irrigation equipment unit sales volume and higher average selling prices. International irrigation revenues of $66.9 million increased $32.4 million, or 94 percent, compared to the prior year first quarter. The increase in international irrigation revenues resulted primarily from higher unit sales volumes, along with higher selling prices and a favorable foreign currency translation impact of $1.1 million. The largest sales volume increases were in the Brazil, Middle East, and Europe markets.

Irrigation segment operating income for the first quarter of fiscal 2022 was $17.2 million, an increase of $6.6 million, or 62 percent, compared to the prior year first quarter. Operating margin was 11.8 percent of sales, compared to 12.2 percent of sales in the prior year first quarter. The impact of higher irrigation system unit volume was partially offset by the impact of higher costs of raw materials and other inputs. First quarter operating results were also reduced by approximately $5.0 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.

Infrastructure segment revenues for the first quarter of fiscal 2022 were $20.2 million, a decrease of $0.9 million, or 4 percent, compared to $21.1 million in the prior year first quarter. The decrease resulted from lower Road Zipper System® sales, which were partially offset by higher Road Zipper System lease revenue and increased sales of road safety products compared to the prior year.

Infrastructure segment operating income for the first quarter of fiscal 2022 was $2.8 million, a decrease of $1.5 million, or 35 percent, compared to the prior year first quarter. Operating margin was 13.7 percent of sales, compared to 20.1 percent of sales in the prior year first quarter. Current year results reflect lower revenues and a less favorable margin mix of revenues compared to the prior year first quarter and were also reduced by approximately $1.0 million resulting from the impact of the LIFO method of accounting for inventory.

The backlog of unfilled orders at November 30, 2021 was $154.8 million compared with $89.2 million at November 30, 2020. A higher backlog of orders in irrigation was partially offset by a lower backlog in infrastructure.

Outlook

“Market conditions support continued solid demand for irrigation equipment, and we also expect raw material cost inflation and supply chain challenges to persist in the near term. We are focused on protecting and improving margins in this environment,” said Mr. Wood. “Regarding our infrastructure business, we continue to expect an increase in project activity in the second half of the fiscal year.”

Mr. Wood concluded, “We are sharply focused on our innovation growth strategy that addresses the needs of a growing population and provides solutions that improve efficiency and promote sustainability.”

First Quarter Conference Call

Lindsay’s fiscal 2022 first 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

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

 

 

 

 

 

 

 

 

Three months ended

 

 

(in thousands, except per share amounts)

 

 

November 30,

2021

 

 

 

November 30,

2020

 

 

 

 

 

 

 

 

 

 

 

 

Operating revenues

 

$

 

166,152

 

 

$

 

108,485

 

 

Cost of operating revenues

 

 

 

128,714

 

 

 

 

77,077

 

 

Gross profit

 

 

 

37,438

 

 

 

 

31,408

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Selling expense

 

 

 

7,990

 

 

 

 

7,331

 

 

General and administrative expense

 

 

 

12,880

 

 

 

 

13,452

 

 

Engineering and research expense

 

 

 

3,207

 

 

 

 

3,090

 

 

Total operating expenses

 

 

 

24,077

 

 

 

 

23,873

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

 

13,361

 

 

 

 

7,535

 

 

 

 

 

 

 

 

 

 

 

 

Other (expense) income:

 

 

 

 

 

 

 

 

 

Interest expense

 

 

 

(1,163

)

 

 

 

(1,201

)

 

Interest income

 

 

 

177

 

 

 

 

303

 

 

Other expense, net

 

 

 

(2,900

)

 

 

 

246

 

 

Total other (expense) income

 

 

 

(3,886

)

 

 

 

(652

)

 

 

 

 

 

 

 

 

 

 

 

Earnings before income taxes

 

 

 

9,475

 

 

 

 

6,883

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

 

 

1,574

 

 

 

 

(212

)

 

 

 

 

 

 

 

 

 

 

 

Net earnings

 

$

 

7,901

 

 

$

 

7,095

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

$

 

0.72

 

 

$

 

0.65

 

 

Diluted

 

$

 

0.72

 

 

$

 

0.65

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

 

 

10,927

 

 

 

 

10,845

 

 

Diluted

 

 

 

11,026

 

 

 

 

10,888

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per share

 

$

 

0.33

 

 

$

 

0.32

 

 

LINDSAY CORPORATION AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

(in thousands)

 

 

November 30,

2021

 

 

 

November 30,

2020

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

Irrigation:

 

 

 

 

 

 

 

 

 

North America

 

$

 

78,976

 

 

$

 

52,790

 

 

International

 

 

 

66,933

 

 

 

 

34,566

 

 

Irrigation segment

 

 

 

145,909

 

 

 

 

87,356

 

 

Infrastructure segment

 

 

 

20,243

 

 

 

 

21,129

 

 

Total operating revenues

 

$

 

166,152

 

 

$

 

108,485

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss):

 

 

 

 

 

 

 

 

 

Irrigation segment

 

$

 

17,212

 

 

$

 

10,633

 

 

Infrastructure segment

 

 

 

2,766

 

 

 

 

4,256

 

 

Corporate

 

 

 

(6,617

)

 

 

 

(7,354

)

 

Total operating income

 

$

 

13,361

 

 

$

 

7,535

 

 

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)

 

November 30,

2021

 

 

November 30,

2020

 

 

August 31,

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

 

84,719

 

 

$

 

126,802

 

 

$

 

127,107

 

Marketable securities

 

 

 

30,195

 

 

 

 

19,624

 

 

 

 

19,604

 

Receivables, net

 

 

 

111,959

 

 

 

 

74,909

 

 

 

 

93,609

 

Inventories, net

 

 

 

173,115

 

 

 

 

114,278

 

 

 

 

145,244

 

Other current assets, net

 

 

 

26,345

 

 

 

 

20,837

 

 

 

 

30,539

 

Total current assets

 

 

 

426,333

 

 

 

 

356,450

 

 

 

 

416,103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant, and equipment, net

 

 

 

91,639

 

 

 

 

81,295

 

 

 

 

91,997

 

Intangibles, net

 

 

 

19,827

 

 

 

 

22,817

 

 

 

 

20,367

 

Goodwill

 

 

 

67,735

 

 

 

 

68,027

 

 

 

 

67,968

 

Operating lease right-of-use assets

 

 

 

17,584

 

 

 

 

26,008

 

 

 

 

18,281

 

Deferred income tax assets

 

 

 

6,157

 

 

 

 

9,924

 

 

 

 

8,113

 

Other noncurrent assets, net

 

 

 

20,170

 

 

 

 

10,681

 

 

 

 

14,356

 

Total assets

 

$

 

649,445

 

 

$

 

575,202

 

 

$

 

637,185

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

 

58,908

 

 

$

 

36,263

 

 

$

 

45,209

 

Current portion of long-term debt

 

 

 

219

 

 

 

 

214

 

 

 

 

217

 

Other current liabilities

 

 

 

88,655

 

 

 

 

65,910

 

 

 

 

92,814

 

Total current liabilities

 

 

 

147,782

 

 

 

 

102,387

 

 

 

 

138,240

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension benefits liabilities

 

 

 

5,660

 

 

 

 

6,293

 

 

 

 

5,754

 

Long-term debt

 

 

 

115,471

 

 

 

 

115,641

 

 

 

 

115,514

 

Operating lease liabilities

 

 

 

17,679

 

 

 

 

24,863

 

 

 

 

18,301

 

Deferred income tax liabilities

 

 

 

798

 

 

 

 

902

 

 

 

 

832

 

Other noncurrent liabilities

 

 

 

20,112

 

 

 

 

21,215

 

 

 

 

20,099

 

Total liabilities

 

 

 

307,502

 

 

 

 

271,301

 

 

 

 

298,740

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

 

19,056

 

 

 

 

18,948

 

 

 

 

18,991

 

Capital in excess of stated value

 

 

 

89,006

 

 

 

 

78,026

 

 

 

 

86,495

 

Retained earnings

 

 

 

532,410

 

 

 

 

503,342

 

 

 

 

528,130

 

Less treasury stock - at cost

 

 

 

(277,238

)

 

 

 

(277,238

)

 

 

 

(277,238

)

Accumulated other comprehensive loss, net

 

 

 

(21,291

)

 

 

 

(19,177

)

 

 

 

(17,933

)

Total shareholders' equity

 

 

 

341,943

 

 

 

 

303,901

 

 

 

 

338,445

 

Total liabilities and shareholders' equity

 

$

 

649,445

 

 

$

 

575,202

 

 

$

 

637,185

 

LINDSAY CORPORATION AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

(in thousands)

 

 

November 30,

2021

 

 

 

November 30,

2020

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net earnings

 

$

 

7,901

 

 

$

 

7,095

 

Adjustments to reconcile net earnings to net cash (used in) provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 

4,896

 

 

 

 

5,140

 

Provision for uncollectible accounts receivable

 

 

 

91

 

 

 

 

158

 

Deferred income taxes

 

 

 

1,841

 

 

 

 

140

 

Share-based compensation expense

 

 

 

1,222

 

 

 

 

1,583

 

Unrealized foreign currency transaction loss (gain)

 

 

 

2,193

 

 

 

 

(203

)

Other, net

 

 

 

292

 

 

 

 

36

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Receivables

 

 

 

(17,816

)

 

 

 

8,896

 

Inventories

 

 

 

(31,674

)

 

 

 

(8,294

)

Other current assets

 

 

 

5,965

 

 

 

 

(3,068

)

Accounts payable

 

 

 

12,462

 

 

 

 

7,286

 

Other current liabilities

 

 

 

(3,632

)

 

 

 

(7,146

)

Other noncurrent assets and liabilities

 

 

 

(7,920

)

 

 

 

3,750

 

Net cash (used in) provided by operating activities

 

 

 

(24,179

)

 

 

 

15,373

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Purchases of property, plant, and equipment

 

 

 

(3,061

)

 

 

 

(5,614

)

Purchases of marketable securities available-for-sale

 

 

 

(14,354

)

 

 

 

(3,844

)

Proceeds from maturities of marketable securities available-for-sale

 

 

 

3,599

 

 

 

 

3,616

 

Other investing activities, net

 

 

 

(342

)

 

 

 

 

Net cash used in investing activities

 

 

 

(14,158

)

 

 

 

(5,842

)

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Proceeds from exercise of stock options

 

 

 

2,442

 

 

 

 

56

 

Common stock withheld for payroll tax obligations

 

 

 

(1,181

)

 

 

 

(1,269

)

Proceeds from employee stock purchase plan

 

 

 

93

 

 

 

 

 

Principal payments on long-term debt

 

 

 

(54

)

 

 

 

(35

)

Dividends paid

 

 

 

(3,621

)

 

 

 

(3,477

)

Net cash used in financing activities

 

 

 

(2,321

)

 

 

 

(4,725

)

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

 

(1,730

)

 

 

 

593

 

Net change in cash and cash equivalents

 

 

 

(42,388

)

 

 

 

5,399

 

Cash and cash equivalents, beginning of period

 

 

 

127,107

 

 

 

 

121,403

 

Cash and cash equivalents, end of period

 

$

 

84,719

 

 

$

 

126,802

 

 

Contacts

LINDSAY CORPORATION:

Brian Ketcham

Senior Vice President & Chief Financial Officer

402-827-6579



THREE PART ADVISORS:

Hala Elsherbini

214-442-0016

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