Business Wire | Jan 7, 2021 06:47AM EST

Lindsay Corporation Reports Fiscal 2021 First Quarter Results

Jan. 07, 2021

OMAHA, Neb.--(BUSINESS WIRE)--Jan. 07, 2021--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 2021, which ended on November 30, 2020.

First Quarter Summary

Revenues for the first quarter of fiscal 2021 were $108.5 million, a decrease of $0.9 million, or 1 percent, compared to revenues of $109.4 million in the prior year first quarter. Net earnings for the quarter were $7.1 million, or $0.65 per diluted share, compared with net earnings of $8.3 million, or $0.77 per diluted share, for the prior year first quarter. Net earnings for the quarter include an income tax benefit of approximately $1.7 million, or $0.16 per diluted share, related to the release of a valuation allowance in a foreign jurisdiction.

"Irrigation market conditions improved during the quarter with rising agricultural commodity prices and higher projected net farm income. This resulted in stronger than expected order flow for irrigation equipment, particularly in the latter part of the quarter." said Randy Wood, President and Chief Executive Officer. "Our infrastructure business performed well, although results were lower than a very strong first quarter in the prior year."

First Quarter Segment Results

Irrigation segment revenues for the first quarter of fiscal 2021 increased $4.1 million, or 5 percent to $87.4 million, compared to $83.3 million in the prior year first quarter. North America irrigation revenues of $52.8 million decreased $0.8 million, or 2 percent, compared to the prior year first quarter. The decrease resulted primarily from lower engineering services revenue related to a project in the prior year that did not repeat that was partially offset by higher irrigation equipment unit volume. International irrigation revenues of $34.6 million increased $4.8 million, or 16 percent, compared to the prior year first quarter. The increase resulted from higher unit sales volumes in several regions which were partially offset by the unfavorable effects of foreign currency translation of approximately $2.4 million compared to the prior year first quarter.

Irrigation segment operating margin was 12.2 percent of sales, compared to 11.7 percent of sales in the prior year first quarter. The increase resulted primarily from the impact of higher irrigation system unit volume and was partially offset by the impact of higher raw material and freight costs.

Infrastructure segment revenues for the first quarter of fiscal 2021 were $21.1 million, a decrease of $5.0 million, or 19 percent, compared to $26.1 million in the prior year first quarter. The decrease resulted primarily from a large order delivered in the prior year that did not repeat and from lower road construction activity in the current year.

Infrastructure segment operating margin was 20.1 percent of sales, compared to 33.5 percent of sales in the prior year first quarter. The decrease resulted primarily from lower revenue in higher margin product lines and an increase in raw material and other costs compared to the prior year.

The backlog of unfilled orders at November 30, 2020 was $89.2 million compared with $69.2 million at November 30, 2019. Included in these backlogs are amounts of $5.4 million and $5.2 million, respectively, that are not expected to be fulfilled within the subsequent twelve months. The increase in backlog is primarily attributable to higher order activity in North America irrigation.

Outlook

"Our backlog of irrigation equipment orders in North America supports solid revenue growth for our second quarter. We also expect improved activity levels to continue in international irrigation markets. At the same time, we are seeing rapid and significant increases in steel and freight costs that will pressure margins in the short term until pricing actions are fully implemented." said Mr. Wood. "In our infrastructure business, we continue to be encouraged by the quality of our Road Zipper(r) sales funnel. However, the timing of those projects can be difficult to predict, particularly in the current environment with coronavirus-related effects on road construction activity.

"Our financial position remains strong, providing support for our innovation growth strategy across our businesses that address global megatrends and provide solutions that conserve natural resources."

First Quarter Conference Call

Lindsay's fiscal 2021 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(r) center pivot and lateral move agricultural irrigation systems and FieldNET(r) remote irrigation management and scheduling technology, as well as irrigation consulting and design 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(r), Road Zipper(r) and Snoline(tm) 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

November November(in thousands, except per share amounts) 30, 30,

2020 2019



Operating revenues $ 108,485 $ 109,393

Cost of operating revenues 77,077 75,319

Gross profit 31,408 34,074



Operating expenses:

Selling expense 7,331 6,492

General and administrative expense 13,452 11,804

Engineering and research expense 3,090 3,502

Total operating expenses 23,873 21,798



Operating income 7,535 12,276



Other (expense) income:

Interest expense (1,201 ) (1,186 )

Interest income 303 615

Other income (expense), net 246 (450 )

Total other (expense) income (652 ) (1,021 )



Earnings before income taxes 6,883 11,255



Income tax (benefit) expense (212 ) 2,910



Net earnings $ 7,095 $ 8,345



Earnings per share:

Basic $ 0.65 $ 0.77

Diluted $ 0.65 $ 0.77



Shares used in computing earnings per share:

Basic 10,845 10,795

Diluted 10,888 10,828



Cash dividends declared per share $ 0.32 $ 0.31

LINDSAY CORPORATION AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Unaudited)

Three months ended

(in thousands)

November 30,

2020

November 30,

2019

Operating revenues:

Irrigation:

North America

$

52,790

$

53,588

International

34,566

29,739

Irrigation segment

87,356

83,327

Infrastructure segment

21,129

26,066

Total operating revenues

$

108,485

$

109,393

Operating income (loss):

Irrigation segment

$

10,633

$

9,784

Infrastructure segment

4,256

8,741

Corporate

(7,354

)

(6,249

)

Total operating income

$

7,535

$

12,276

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 and large diameter steel tubing 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.

Certain immaterial reclassifications have been made to the prior year operating results to conform with current year presentation, as revenues and operating income from certain product lines previously included within the Infrastructure reporting segment are now included within the Irrigation reporting segment.

LINDSAY CORPORATION AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Unaudited)



Three months ended

November 30, November 30,(in thousands) 2020 2019

Operating revenues:

Irrigation:

North America $ 52,790 $ 53,588

International 34,566 29,739

Irrigation segment 87,356 83,327

Infrastructure segment 21,129 26,066

Total operating revenues $ 108,485 $ 109,393



Operating income (loss):

Irrigation segment $ 10,633 $ 9,784

Infrastructure segment 4,256 8,741

Corporate (7,354 ) (6,249 )

Total operating income $ 7,535 $ 12,276

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 and large diameter steel tubing 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.

Certain immaterial reclassifications have been made to the prior year operating results to conform with current year presentation, as revenues and operating income from certain product lines previously included within the Infrastructure reporting segment are now included within the Irrigation reporting segment.

LINDSAY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)





November 30, November 30, August 31,(in thousands) 2020 2019 2020



ASSETS

Current assets:

Cash and cash equivalents $ 126,802 $ 120,910 $ 121,403

Marketable securities 19,624 - 19,511

Receivables, net 74,909 79,317 84,604

Inventories, net 114,278 97,284 104,792

Assets held-for-sale - 2,744 -

Other current assets, net 20,837 16,376 17,625

Total current assets 356,450 316,631 347,935



Property, plant, and equipment, 81,295 70,305 79,581 net

Intangibles, net 22,817 23,739 23,477

Goodwill 68,027 64,358 68,004

Operating lease right-of-use 26,008 25,764 27,457 assets

Deferred income tax assets 9,924 9,902 9,935

Other noncurrent assets, net 10,681 16,112 14,137

Total assets $ 575,202 $ 526,811 $ 570,526



LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable $ 36,263 $ 30,097 $ 29,554

Current portion of long-term 214 210 195 debt

Other current liabilities 65,910 54,494 72,646

Total current liabilities 102,387 84,801 102,395



Pension benefits liabilities 6,293 5,948 6,374

Long-term debt 115,641 115,805 115,682

Operating lease liabilities 24,863 25,323 25,862

Deferred income tax liabilities 902 845 889

Other noncurrent liabilities 21,215 21,089 20,806

Total liabilities 271,301 253,811 272,008



Shareholders' equity:

Preferred stock - - -

Common stock 18,948 18,897 18,918

Capital in excess of stated 78,026 71,706 77,686 value

Retained earnings 503,342 479,732 499,724

Less treasury stock - at cost (277,238 ) (277,238 ) (277,238 )

Accumulated other comprehensive (19,177 ) (20,097 ) (20,572 )loss, net

Total shareholders' equity 303,901 273,000 298,518

Total liabilities and $ 575,202 $ 526,811 $ 570,526 shareholders' equity

LINDSAY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Three months ended

(in thousands)

November 30, 2020

November 30, 2019

CASH FLOWS FROM OPERATING ACTIVITIES:

Net earnings

$

7,095

$

8,345

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

Depreciation and amortization

5,140

4,748

Provision for uncollectible accounts receivable

158

248

Deferred income taxes

140

1,987

Share-based compensation expense

1,583

1,160

Foreign currency transaction (gain) loss

(203

)

668

Other, net

36

(294

)

Changes in assets and liabilities:

Receivables

8,896

(4,122

)

Inventories

(8,294

)

(4,931

)

Other current assets

(3,068

)

(2,466

)

Accounts payable

7,286

725

Other current liabilities

(7,146

)

(1,901

)

Other noncurrent assets and liabilities

3,750

(2,626

)

Net cash provided by operating activities

15,373

1,541

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property, plant, and equipment

(5,614

)

(4,322

)

Purchases of marketable securities available-for-sale

(3,844

)

-

Proceeds from maturities of marketable securities available-for-sale

3,616

-

Proceeds from settlement of net investment hedges

-

1,092

Other investing activities, net

-

24

Net cash used in investing activities

(5,842

)

(3,206

)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from exercise of stock options

56

-

Common stock withheld for payroll tax obligations

(1,269

)

(1,111

)

Principal payments on long-term debt

(35

)

(52

)

Dividends paid

(3,477

)

(3,353

)

Net cash used in financing activities

(4,725

)

(4,516

)

Effect of exchange rate changes on cash and cash equivalents

593

(113

)

Net change in cash and cash equivalents

5,399

(6,294

)

Cash and cash equivalents, beginning of period

121,403

127,204

Cash and cash equivalents, end of period

$

126,802

$

120,910

View source version on businesswire.com: https://www.businesswire.com/news/home/20210107005177/en/

CONTACT: LINDSAY CORPORATION: Brian Ketcham Senior Vice President & Chief Financial Officer 402-827-6579 THREE PART ADVISORS: Hala Elsherbini 972-458-8000