Attached files

file filename
8-K - FORM 8-K - LINDSAY CORPd699216d8k.htm

EXHIBIT 99.1

 

LOGO

For further information, contact:

 

LINDSAY CORPORATION:

Jim Raabe

  

HALLIBURTON INVESTOR RELATIONS:

Hala Elsherbini or Geralyn DeBusk

Vice President & Chief Financial Officer    972-458-8000
402-827-6579   

Lindsay Corporation Reports Fiscal 2014 Second Quarter Results

OMAHA, Neb., March 26, 2014—Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its second quarter ended February 28, 2014.

Second Quarter Results

Second quarter fiscal 2014 revenues were $152.8 million, versus $175.5 million of revenues in the same prior year period. Net earnings were $13.5 million or $1.04 per diluted share compared with $19.4 million or $1.50 per diluted share in the prior year.

Total irrigation equipment revenues decreased 16 percent to $135.9 million from $162.7 million in the prior fiscal year’s second quarter primarily due to lower crop prices. U.S. irrigation revenues of $92.8 million declined 21 percent while international irrigation revenues of $43.1 million decreased five percent. Infrastructure revenues increased 32 percent to $16.9 million with increases in all of its product lines.

Gross margin was 27.9 percent of sales compared to 28.7 percent of sales in the prior year’s second quarter. Gross margins in irrigation declined by approximately one percentage point due to fixed cost deleverage on lower sales and a higher mix of international sales. Infrastructure gross margins improved by approximately seven percentage points due to sales mix and leverage on higher sales.

Operating expenses were $21.8 million compared to $20.9 million in the same prior year period. The increase includes $2.2 million associated with the Lakos acquisition, offset by reductions in incentive compensation and advertising expenses. Operating expenses including Lakos were 14.2 percent of sales in the second quarter of fiscal 2014 compared with 11.9 percent of sales in the prior year period. Operating margins were 13.7 percent in the second quarter, versus 16.8 percent in the prior year period.

Cash and cash equivalents of $165.5 million were $5.9 million higher compared to the end of the second quarter in the prior fiscal year, while debt decreased $2.1 million. During the quarter the Company repurchased 78,520 shares for $6.6 million.

Backlog of unshipped orders at February 28, 2014 was $89.3 million compared with $159.3 million at February 28, 2013 and $86.6 million at November 30, 2013. Backlog declined in the U.S. and international irrigation markets, and infrastructure segment backlog increased over the same time last year. The current year infrastructure backlog includes a $12.8 million Road Zipper System order for the Golden Gate Bridge which will be recognized in revenue in fiscal 2015. The prior year irrigation backlog included a $39.1 million equipment and installation contract in Iraq, of which $3.0 million remained in backlog at the end of the second quarter of fiscal 2014.

 


Six Month Results

Total revenues for the six months ended February 28, 2014 were $300.5 million, a seven percent decrease from $322.9 million of revenues in the same prior year period. Net earnings were $23.7 million or $1.83 per diluted share compared with $34.1 million or $2.65 per diluted share in the prior year.

Total irrigation equipment revenues decreased 11 percent to $265.1 million from $296.9 million during the first six months of the prior fiscal year. U.S. irrigation revenues of $172.6 million declined 19 percent while international irrigation revenues of $92.4 million increased 11 percent on sales increases in South America and Australia. Infrastructure revenues increased 36 percent to $35.4 million.

Outlook

Rick Parod, president and chief executive officer, commented, “Irrigation sales declined in the second quarter driven by the lessening of drought conditions and the significant decline in agricultural commodity prices as compared to the same time last year. Lower grain prices and the political environment regarding Russia and Ukraine are likely to pressure irrigation demand in the second half of the year. Our focus for the balance of the year is on managing margins given the deleveraging impact, and maintaining momentum in the irrigation market.”

Parod added, “I’m pleased with the continued progress toward sustainable, profitable performance in our infrastructure segment, including more aggressive selling processes in the markets we serve. While we anticipate a decline from peak irrigation revenues for the near-term, drivers for the Company’s markets of population growth, expanded food production and efficient water use, support our expectation for long-term growth. In addition, we are committed to expanding shareholder returns through the continued execution of our capital allocation plan, as outlined in January 2014.”

Second-Quarter Conference Call

Lindsay’s fiscal 2014 second quarter investor conference call is scheduled for 11:00 a.m. Eastern Time today. Interested investors may participate in the call by dialing (888) 321-8161 in the U.S., or (706) 758-0065 internationally, and referring to conference ID # 9646534. 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 manufactures and markets irrigation equipment primarily used in agricultural markets which increase or stabilize crop production while conserving water, energy, and labor. The Company also manufactures and markets infrastructure and road safety products under the Lindsay Transportation Solutions trade name. At February 28, 2014 Lindsay had approximately 12.9 million shares outstanding, which are traded on the New York Stock Exchange under the symbol LNN.

For more information regarding Lindsay Corporation, see the Company’s Web site at 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 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 OPERATIONS

(Unaudited)

 

     Three months ended     Six months ended  
     February 28,     February 28,     February 28,     February 28,  

($ and shares in thousands, except per share amounts)

   2014     2013     2014     2013  

Operating revenues

   $ 152,804      $ 175,539      $ 300,475      $ 322,909   

Cost of operating revenues

     110,132        125,175        217,652        229,688   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     42,672        50,364        82,823        93,221   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

        

Selling expense

     9,534        8,000        19,290        15,321   

General and administrative expense

     9,354        10,155        21,097        20,273   

Engineering and research expense

     2,871        2,763        5,531        5,917   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     21,759        20,918        45,918        41,511   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     20,913        29,446        36,905        51,710   

Other income (expense):

        

Interest expense

     (56     (83     (95     (226

Interest income

     157        129        292        267   

Other income (expense), net

     (225     (4     (496     120   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings before income taxes

     20,789        29,488        36,606        51,871   

Income tax expense

     7,339        10,137        12,922        17,792   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings

   $ 13,450      $ 19,351      $ 23,684      $ 34,079   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per share:

        

Basic

   $ 1.04      $ 1.51      $ 1.84      $ 2.66   

Diluted

   $ 1.04      $ 1.50      $ 1.83      $ 2.65   

Shares used in computing earnings per share:

        

Basic

     12,910        12,842        12,899        12,799   

Diluted

     12,942        12,882        12,947        12,867   

Cash dividends declared per share

   $ 0.260      $ 0.115      $ 0.390      $ 0.230   


Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

($ and shares in thousands, except par values)

   February 28,
2014
    February 28,
2013
    August 31,
2013
 

ASSETS

      

Current Assets:

      

Cash and cash equivalents

   $ 165,509      $ 159,583      $ 151,927   

Receivables, net of allowance of $3,520, $1,915 and $2,853

     111,211        105,399        120,291   

Inventories, net

     80,994        78,071        68,607   

Deferred income taxes

     13,916        9,110        12,705   

Other current assets

     18,216        15,020        15,261   
  

 

 

   

 

 

   

 

 

 

Total current assets

     389,846        367,183        368,791   
  

 

 

   

 

 

   

 

 

 

Property, Plant and Equipment:

      

Cost

     158,948        141,973        153,422   

Less accumulated depreciation

     (93,502     (85,104     (88,358
  

 

 

   

 

 

   

 

 

 

Property, plant and equipment, net

     65,446        56,869        65,064   
  

 

 

   

 

 

   

 

 

 

Intangibles, net

     34,084        23,729        36,007   

Goodwill

     37,282        30,211        37,414   

Other noncurrent assets

     3,961        4,490        5,020   
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 530,619      $ 482,482      $ 512,296   
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

      

Current Liabilities:

      

Accounts payable

   $ 53,954      $ 63,651      $ 42,276   

Current portion of long-term debt

     —          2,143        —     

Other current liabilities

     54,204        45,724        59,816   
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     108,158        111,518        102,092   
  

 

 

   

 

 

   

 

 

 

Pension benefits liabilities

     6,202        6,676        6,324   

Deferred income taxes

     13,975        9,716        15,415   

Other noncurrent liabilities

     7,590        7,415        7,827   
  

 

 

   

 

 

   

 

 

 

Total liabilities

     135,925        135,325        131,658   
  

 

 

   

 

 

   

 

 

 

Shareholders’ Equity:

      

Preferred stock of $1 par value-

      

Authorized 2,000 shares; none issued

     —          —          —     

Common stock of $1 par value-

      

Authorized 25,000 shares; 18,633 issued

     18,633        18,553        18,571   

Capital in excess of stated value

     50,794        47,036        49,764   

Retained earnings

     424,241        372,242        405,580   

Less treasury stock (at cost, 5,777 shares)

     (97,566     (90,961     (90,961

Accumulated other comprehensive loss, net

     (1,408     287        (2,316
  

 

 

   

 

 

   

 

 

 

Total shareholders’ equity

     394,694        347,157        380,638   
  

 

 

   

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 530,619      $ 482,482      $ 512,296   
  

 

 

   

 

 

   

 

 

 


Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 
     Six months ended  

($ in thousands)

   February 28,
2014
    February 28,
2013
 

CASH FLOWS FROM OPERATING ACTIVITIES:

    

Net earnings

   $ 23,684     $ 34,079  

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

    

Depreciation and amortization

     7,384       6,240  

Provision for uncollectible accounts receivable

     618       530  

Deferred income taxes

     (2,696     (2,104

Share-based compensation expense

     2,191       2,351  

Other, net

     250       144  

Changes in assets and liabilities:

    

Receivables

     9,010       (22,880

Inventories

     (12,192     (24,827

Other current assets

     (2,400     (4,222

Accounts payable

     11,422       32,066  

Other current liabilities

     (5,410     5,331  

Current income taxes payable

     (168     (789

Other noncurrent assets and liabilities

     754       273  
  

 

 

   

 

 

 

Net cash provided by operating activities

     32,447       26,192  
  

 

 

   

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

    

Purchases of property, plant and equipment

     (5,353     (5,342

Proceeds from sale of property, plant and equipment

     35       14  

Proceeds from settlement of net investment hedges

     280       —     

Payments for settlement of net investment hedges

     (1,846     (1,919
  

 

 

   

 

 

 

Net cash used in investing activities

     (6,884     (7,247
  

 

 

   

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

    

Proceeds from exercise of stock options

     371       1,619  

Common stock withheld for payroll tax withholdings

     (2,027     (2,441

Principal payments on long-term debt

     —          (2,142

Excess tax benefits from share-based compensation

     695       2,629  

Repurchase of common shares

     (6,605     —     

Dividends paid

     (5,023     (2,952
  

 

 

   

 

 

 

Net cash used in financing activities

     (12,589     (3,287
  

 

 

   

 

 

 

Effect of exchange rate changes on cash and cash equivalents

     608       481  
  

 

 

   

 

 

 

Net change in cash and cash equivalents

     13,582       16,139  

Cash and cash equivalents, beginning of period

     151,927       143,444  
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

   $ 165,509     $ 159,583