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Lindsay Corporation Reports Fiscal 2024 First Quarter Results

Lindsay Corporation (NYSE: LNN), a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology, today announced results for its first quarter which ended on November 30, 2023.

Key Highlights

  • North America irrigation revenue growth driven by improved demand for irrigation equipment
  • Irrigation equipment pricing remains stable, supporting gross margin improvement
  • Improved infrastructure operating performance driven by growth in Road Zipper SystemTM leasing

“Demand for irrigation equipment in North America improved in the quarter, reflecting increased order activity as grower profitability became more certain post-harvest compared to the delayed investment decisions we had experienced in last year's spring selling season,” said Randy Wood, President and Chief Executive Officer. "Quoting activity in international irrigation markets remains active and growing, however revenues for the quarter were lower in South America following the record revenues captured in Brazil in the prior year. Across our infrastructure business, growth in our Road Zipper System leasing revenues and sales of our road safety products largely offset muted Road Zipper System project activity in the quarter. Importantly, our leasing business continues to represent a greater proportion of our infrastructure segment revenues with this sales mix accretive to Lindsay's overall margin profile."

First Quarter Summary

Consolidated Financial Summary

 

First Quarter

(dollars in millions, except per share amounts)

 

FY2024

 

FY2023

 

$ Change

 

% Change

 

 

 

 

 

 

 

 

 

Total revenues

 

$161.4

 

$176.2

 

($14.8)

 

(8%)

Operating income

 

$21.1

 

$24.6

 

($3.5)

 

(14%)

Operating margin

 

13.1%

 

14.0%

 

 

 

 

Net earnings

 

$15.0

 

$18.2

 

($3.2)

 

(18%)

Earnings per share

 

$1.36

 

$1.65

 

($0.29)

 

(18%)

Revenues for the quarter were $161.4 million, a decrease of $14.8 million, or 8 percent, compared to revenues of $176.2 million in the prior year first quarter. The decrease resulted primarily from lower international irrigation sales compared to prior year first quarter.

Operating income for the quarter was $21.1 million, a decrease of $3.5 million, or 14 percent, compared to operating income of $24.6 million in the prior year first quarter. Operating margin was 13.1 percent of sales compared to 14.0 percent of sales in the prior year first quarter. The decrease in operating income and margin resulted primarily from lower revenues as gross margin improved compared to prior year first quarter.

Net earnings for the quarter were $15.0 million, or $1.36 per diluted share, compared with net earnings of $18.2 million, or $1.65 per diluted share, in the prior year first quarter. Lower net earnings resulted largely from lower operating income that was partially offset by higher interest income. In addition, net earnings in the quarter were impacted by a higher effective income tax rate compared to the prior year first quarter.

First Quarter Segment Results

Irrigation Segment

 

First Quarter

(dollars in millions)

 

FY2024

 

FY2023

 

$ Change

 

% Change

Revenues:

 

 

 

 

 

 

 

 

North America

 

$89.4

 

$83.9

 

$5.4

 

7%

International

 

$50.8

 

$68.1

 

($17.3)

 

(25%)

Total revenues

 

$140.2

 

$152.1

 

($11.9)

 

(8%)

Operating income

 

$25.3

 

$28.6

 

($3.3)

 

(12%)

Operating margin

 

18.1%

 

18.8%

 

 

 

 

Irrigation segment revenues for the quarter were $140.2 million, a decrease of $11.9 million, or 8 percent, compared to $152.1 million in the prior year first quarter. North America irrigation revenues of $89.4 million increased $5.4 million, or 7 percent, compared to the prior year first quarter. The increase in North America irrigation revenues resulted primarily from higher unit sales volume that was partially offset by the impact of a less favorable mix of shorter machines compared to the prior year first quarter. Average selling prices remained stable and were comparable to the prior year first quarter.

International irrigation revenues of $50.8 million decreased $17.3 million, or 25 percent. The decrease resulted primarily from lower sales in Brazil and Argentina compared to record sales in those markets in the prior year first quarter. Changes in the timing of funding under the financing program in Brazil contributed to lower sales in the quarter relative to the prior year first quarter. Revenue in the current year also benefited from the favorable effects of foreign currency translation of approximately $1.8 million compared to the prior year first quarter.

Irrigation segment operating income for the quarter was $25.3 million, a decrease of $3.3 million, or 12 percent, compared to the prior year first quarter. Operating margin was 18.1 percent of sales, compared to 18.8 percent of sales in the prior year first quarter. Lower operating income and operating margin resulted primarily from lower international irrigation revenues and the resulting impact from deleverage of fixed operating expenses. Gross margin remained consistent with the prior year first quarter.

Infrastructure Segment

 

First Quarter

(dollars in millions)

 

FY2024

 

FY2023

 

$ Change

 

% Change

 

 

 

 

 

 

 

 

 

Total revenues

 

$21.2

 

$24.1

 

($2.9)

 

(12%)

Operating income

 

$3.6

 

$3.4

 

$0.2

 

7%

Operating margin

 

17.1%

 

14.0%

 

 

 

 

Infrastructure segment revenues for the quarter were $21.2 million, a decrease of $2.9 million, or 12 percent, compared to $24.1 million in the prior year first quarter. The decrease resulted from lower Road Zipper System sales, which were largely offset by higher Road Zipper System lease revenue and higher sales of road safety products.

Infrastructure segment operating income for the quarter was $3.6 million, an increase of $0.2 million or 7 percent compared to the prior year first quarter. Operating margin was 17.1 percent of sales, compared to 14.0 percent of sales in the prior year first quarter. Increased operating income and operating margin resulted primarily from a more favorable margin mix of revenue with higher lease revenue compared to the prior year first quarter.

The backlog of unfilled orders at November 30, 2023 was $86.8 million compared with $129.6 million at November 30, 2022. The irrigation backlog was lower compared to the prior year while the infrastructure backlog was comparable to the prior year.

Outlook

Mr. Wood concluded, “While customers will invest cautiously, current farm income projections, moderating inflation and an anticipation of flat to lower interest rates provide a stable backdrop for irrigation equipment demand in North America. We expect sales volume levels in developed international markets, particularly Brazil, to improve over the balance of the year, and we continue to see project opportunities in developing markets supported by continuing global concerns over food security and global grain supplies.”

“In our infrastructure business, we are beginning to see the positive impact of increased U.S. infrastructure spending, particularly in Road Zipper System leasing and sales of road safety products. We also continue to actively manage projects through our Road Zipper System project sales funnel, however the timing of project implementation remains challenging to predict.”

First Quarter Conference Call

Lindsay’s fiscal 2024 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® and FieldWise® remote irrigation management technology, FieldNET Advisor™ irrigation 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,

2023

 

 

 

November 30,

2022

 

 

 

 

 

 

 

 

 

 

 

 

Operating revenues

 

$

 

161,358

 

 

$

 

176,159

 

 

Cost of operating revenues

 

 

 

111,453

 

 

 

 

123,139

 

 

Gross profit

 

 

 

49,905

 

 

 

 

53,020

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Selling expense

 

 

 

9,817

 

 

 

 

9,677

 

 

General and administrative expense

 

 

 

14,662

 

 

 

 

14,437

 

 

Engineering and research expense

 

 

 

4,352

 

 

 

 

4,308

 

 

Total operating expenses

 

 

 

28,831

 

 

 

 

28,422

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

 

21,074

 

 

 

 

24,598

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

Interest expense

 

 

 

(877

)

 

 

 

(909

)

 

Interest income

 

 

 

1,068

 

 

 

 

373

 

 

Other income (expense), net

 

 

 

(270

)

 

 

 

(57

)

 

Total other income (expense)

 

 

 

(79

)

 

 

 

(593

)

 

 

 

 

 

 

 

 

 

 

 

Earnings before income taxes

 

 

 

20,995

 

 

 

 

24,005

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

 

5,976

 

 

 

 

5,788

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings

 

$

 

15,019

 

 

$

 

18,217

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

$

 

1.36

 

 

$

 

1.66

 

 

Diluted

 

$

 

1.36

 

 

$

 

1.65

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

 

 

11,017

 

 

 

 

10,989

 

 

Diluted

 

 

 

11,059

 

 

 

 

11,073

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per share

 

$

 

0.35

 

 

$

 

0.34

 

 

 

LINDSAY CORPORATION AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

(in thousands)

 

 

November 30,

2023

 

 

 

November 30,

2022

 

 

Operating revenues:

 

 

 

 

 

 

 

 

 

Irrigation:

 

 

 

 

 

 

 

 

 

North America

 

$

 

89,377

 

 

$

 

83,934

 

 

International

 

 

 

50,791

 

 

 

 

68,149

 

 

Irrigation segment

 

 

 

140,168

 

 

 

 

152,083

 

 

Infrastructure segment

 

 

 

21,190

 

 

 

 

24,076

 

 

Total operating revenues

 

$

 

161,358

 

 

$

 

176,159

 

 

 

 

 

 

 

 

 

 

 

 

Operating income:

 

 

 

 

 

 

 

 

 

Irrigation segment

 

$

 

25,307

 

 

$

 

28,641

 

 

Infrastructure segment

 

 

 

3,619

 

 

 

 

3,372

 

 

Corporate

 

 

 

(7,852

)

 

 

 

(7,415

)

 

Total operating income

 

$

 

21,074

 

 

$

 

24,598

 

 

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,

2023

 

 

November 30,

2022

 

 

August 31,

2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

 

159,381

 

 

$

 

99,168

 

 

$

 

160,755

 

Marketable securities

 

 

 

16,278

 

 

 

 

11,424

 

 

 

 

5,556

 

Receivables, net

 

 

 

143,049

 

 

 

 

157,116

 

 

 

 

144,774

 

Inventories, net

 

 

 

164,144

 

 

 

 

188,404

 

 

 

 

155,932

 

Other current assets, net

 

 

 

18,450

 

 

 

 

25,295

 

 

 

 

20,467

 

Total current assets

 

 

 

501,302

 

 

 

 

481,407

 

 

 

 

487,484

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant, and equipment, net

 

 

 

103,818

 

 

 

 

93,518

 

 

 

 

99,681

 

Intangibles, net

 

 

 

27,005

 

 

 

 

17,760

 

 

 

 

27,719

 

Goodwill

 

 

 

84,029

 

 

 

 

67,295

 

 

 

 

83,121

 

Operating lease right-of-use assets

 

 

 

17,544

 

 

 

 

18,477

 

 

 

 

17,036

 

Deferred income tax assets

 

 

 

12,712

 

 

 

 

8,117

 

 

 

 

10,885

 

Other noncurrent assets, net

 

 

 

17,508

 

 

 

 

21,722

 

 

 

 

19,734

 

Total assets

 

$

 

763,918

 

 

$

 

708,296

 

 

$

 

745,660

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

 

52,242

 

 

$

 

58,535

 

 

$

 

44,278

 

Current portion of long-term debt

 

 

 

227

 

 

 

 

223

 

 

 

 

226

 

Other current liabilities

 

 

 

89,502

 

 

 

 

89,827

 

 

 

 

91,604

 

Total current liabilities

 

 

 

141,971

 

 

 

 

148,585

 

 

 

 

136,108

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension benefits liabilities

 

 

 

4,308

 

 

 

 

4,812

 

 

 

 

4,382

 

Long-term debt

 

 

 

115,120

 

 

 

 

115,297

 

 

 

 

115,164

 

Operating lease liabilities

 

 

 

17,746

 

 

 

 

19,161

 

 

 

 

17,689

 

Deferred income tax liabilities

 

 

 

695

 

 

 

 

693

 

 

 

 

689

 

Other noncurrent liabilities

 

 

 

17,218

 

 

 

 

14,960

 

 

 

 

15,977

 

Total liabilities

 

 

 

297,058

 

 

 

 

303,508

 

 

 

 

290,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

 

19,115

 

 

 

 

19,090

 

 

 

 

19,094

 

Capital in excess of stated value

 

 

 

98,628

 

 

 

 

93,079

 

 

 

 

98,508

 

Retained earnings

 

 

 

647,455

 

 

 

 

593,475

 

 

 

 

636,297

 

Less treasury stock - at cost

 

 

 

(277,238

)

 

 

 

(277,238

)

 

 

 

(277,238

)

Accumulated other comprehensive loss, net

 

 

 

(21,100

)

 

 

 

(23,618

)

 

 

 

(21,010

)

Total shareholders' equity

 

 

 

466,860

 

 

 

 

404,788

 

 

 

 

455,651

 

Total liabilities and shareholders' equity

 

$

 

763,918

 

 

$

 

708,296

 

 

$

 

745,660

 

 

LINDSAY CORPORATION AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

Three months ended

 

(in thousands)

 

November 30, 2023

 

 

 

November 30, 2022

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

Net earnings

$

 

15,019

 

 

$

 

18,217

 

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

 

5,307

 

 

 

 

4,871

 

Provision for uncollectible accounts receivable

 

 

71

 

 

 

 

704

 

Deferred income taxes

 

 

(1,666

)

 

 

 

1,129

 

Share-based compensation expense

 

 

1,603

 

 

 

 

1,473

 

Unrealized foreign currency transaction loss (gain)

 

 

79

 

 

 

 

(83

)

Other, net

 

 

73

 

 

 

 

289

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

Receivables

 

 

1,689

 

 

 

 

(19,828

)

Inventories

 

 

(7,970

)

 

 

 

4,803

 

Other current assets

 

 

2,762

 

 

 

 

3,526

 

Accounts payable

 

 

7,087

 

 

 

 

123

 

Other current liabilities

 

 

(4,263

)

 

 

 

(11,898

)

Other noncurrent assets and liabilities

 

 

2,081

 

 

 

 

1,356

 

Net cash provided by operating activities

 

 

21,872

 

 

 

 

4,682

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

Purchases of property, plant, and equipment

 

 

(6,941

)

 

 

 

(3,798

)

Purchases of marketable securities

 

 

(12,992

)

 

 

 

 

Proceeds from maturities of marketable securities

 

 

2,325

 

 

 

 

 

Other investing activities, net

 

 

(593

)

 

 

 

(384

)

Net cash used in investing activities

 

 

(18,201

)

 

 

 

(4,182

)

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

Dividends paid

 

 

(3,861

)

 

 

 

(3,742

)

Common stock withheld for payroll tax obligations

 

 

(1,575

)

 

 

 

(2,471

)

Other financing activities, net

 

 

56

 

 

 

 

43

 

Net cash used in financing activities

 

 

(5,380

)

 

 

 

(6,170

)

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

335

 

 

 

 

(210

)

Net change in cash and cash equivalents

 

 

(1,374

)

 

 

 

(5,880

)

Cash and cash equivalents, beginning of period

 

 

160,755

 

 

 

 

105,048

 

Cash and cash equivalents, end of period

$

 

159,381

 

 

$

 

99,168

 

 

Contacts

For further information, contact:



LINDSAY CORPORATION:

Alicia Pfeifer

Senior Director, Investor Relations & Treasury

402-933-6429

Alicia.Pfeifer@lindsay.com



Alpha IR:

Joe Caminiti or Stephen Poe

312-445-2870

LNN@alpha-ir.com

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