Lindsay Corporation Reports Fiscal 2013 Third Quarter Results

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Lindsay Corporation Reports Fiscal 2013 Third Quarter Results

OMAHA, Neb.--(BUSINESS WIRE)-- Lindsay Corporation (NYS: LNN) , a leading provider of irrigation systems and infrastructure products, today announced results for its third quarter ended May 31, 2013.

Third Quarter Results


Third quarter fiscal 2013 revenues were a record $219.5 million, increasing 28 percent from $172.1 million in the same prior year period. Net earnings were $26.1 million or $2.01 per diluted share compared with $18.8 million or $1.47 per diluted share in the prior year.

Total irrigation equipment revenues increased 34 percent to $200.9 million from $149.6 million in the prior fiscal year's third quarter due to increased demand resulting from higher commodity prices and farm incomes along with robust demand in international markets. U.S. irrigation revenues of $118.3 million increased 12 percent, while international irrigation revenues of $82.6 million increased 88 percent. Infrastructure revenues decreased 17 percent to $18.6 million.

Gross margin was 28.7 percent compared to 28.5 percent in the prior year's third quarter. Gross margins in irrigation improved modestly while infrastructure gross margins declined by approximately 3 percentage points on lower mix of Road Zipper sales. U.S. irrigation gross margins increased due to strong pricing and manufacturing productivity and leverage, offset by the increased mix of lower margin international irrigation sales.

Operating expenses were $23.5 million compared to $20.2 million in the same prior year period. Current year expenses included higher personnel related expenses, accounts receivable reserves and research and development expenses. Operating expenses were 10.7 percent of sales in the third quarter of fiscal 2013 compared with 11.8 percent of sales in the prior year period. Operating margins of 18.0 percent increased from 16.7 percent in the prior year period.

Cash and cash equivalents of $170.2 million were $50.4 million higher compared to the end of the third quarter in the prior fiscal year, while debt decreased $4.3 million.

Backlog of unshipped orders at May 31, 2013 was $80.0 million compared with $44.5 million at May 31, 2012 and $159.3 million at February 28, 2013. Current backlog includes $23 million remaining from the $39 million order in the Middle East (Iraq) announced in the second quarter, as well as modest year over year increases in U.S. irrigation and infrastructure.

Nine Month Results

Total revenues for the nine months ended May 31, 2013 were $542.5 million, a 28 percent increase from $423.4 million in the same prior year period. Net earnings were $60.1 million or $4.66 per diluted share compared with $34.5 million or $2.70 per diluted share in the prior year. Fiscal 2012 operating costs included $7.2 million of accrued expenses, or $0.37 per diluted share on an after tax basis, relating to an increase in the Company's estimated liability for environmental remediation at its Lindsay, Nebraska facility.

Total irrigation equipment revenues increased 36 percent to $497.9 million from $367.4 million during the first nine months of the prior fiscal year. U.S. irrigation revenues of $331.9 million increased 33 percent, while international irrigation revenues of $166.0 million increased 40 percent due to sales increases in most all markets, and most significantly in South America and the Middle East. Infrastructure revenues decreased 20 percent to $44.6 million.

Outlook

Rick Parod, president and chief executive officer, commented, "Record sales in our U.S. and international irrigation markets have led to record results through the first nine months of fiscal 2013. We expect a heavier mix of lower margin international sales in the fourth quarter as we continue to recognize revenue on the $39 million order in Iraq, which entered backlog in the second quarter."

Parod added, "Drivers for the Company's markets of population growth, expanded food production and efficient water use provide a solid backdrop for long-term growth. In the near term, we have seen downward pressure on key agricultural commodity prices in anticipation of an improved harvest over last year's drought conditions. However, recent reports cast doubt on the quality of the crop, raising concern over forecasted ending-stocks, particularly for corn. In addition, the environment for infrastructure sales remains difficult, although we are seeing indications for modest improvement from recent sales trends."

Third-Quarter Conference Call

Lindsay's fiscal 2013 third 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 # 91367297. 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 May 31, 2013 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 atwww.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 endedNine months ended
May 31, May 31,May 31,May 31,
($ and shares in thousands, except per share amounts)2013201220132012
 
Operating revenues$219,542$172,099$542,451$423,438
Cost of operating revenues 156,506 123,071  386,194  307,668 
Gross profit 63,036 49,028  156,257  115,770 
 
Operating expenses:
Selling expense8,6747,32423,99521,136
General and administrative expense11,78310,39032,05627,764
Engineering and research expense3,0292,5278,9466,827
Environmental remediation expense - -  -  7,225 
Total operating expenses 23,486 20,241  64,997  62,952 
 
Operating income39,55028,78791,26052,818
 
Other income (expense):
Interest expense(32)(103)(258)(376)
Interest income100137367327
Other income (expense), net 132 (234) 252  (314)
 
Earnings before income taxes39,75028,58791,62152,455
 
Income tax expense 13,687 9,764  31,479  17,937 
 
Net earnings$26,063 $18,823 $60,142 $34,518 
 
Earnings per share:
Basic$2.03$1.48$4.69$2.72
Diluted$2.01$1.47$4.66$2.70
 
Shares used in computing earnings per share:
Basic12,85812,71412,81912,700
Diluted12,94712,81412,89412,799
 
Cash dividends declared per share$0.115$0.090$0.345$0.270
 

Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
    
Three months endedNine months ended
May 31,May 31,May 31,May 31,
($ in thousands) 2013  2012  2013  2012 
 
Net earnings$26,063 $18,823 $60,142 $34,518 
Other comprehensive income (loss):
Defined benefit pension plan adjustment, net of tax33269977
Unrealized gain on cash flow hedges, net of tax15576177
Foreign currency translation adjustment, net of
hedging activities and tax (1,389) (4,599) (282) (7,386)
Total other comprehensive loss, net of tax (benefit)
expense of ($10), $530, ($128) and $885 (1,341) (4,516) (177) (7,132)
Total comprehensive income$24,722 $14,307 $59,965 $27,386 
 

Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
   
May 31,May 31,August 31,
($ and shares in thousands, except par values) 2013  2012  2012 
 
ASSETS
Current Assets:
Cash and cash equivalents$170,215$119,785$143,444
Receivables, net of allowance of $2,847, $1,786 and $1,717130,92495,69382,565
Inventories, net72,45862,11952,873
Deferred income taxes11,8109,3999,505
Other current assets 18,307  13,177  10,478 
Total current assets 403,714  300,173  298,865 
 
Property, Plant and Equipment:
Cost144,199134,508136,695
Less accumulated depreciation (87,293) (78,365) (80,515)
Property, plant and equipment, net 56,906  56,143  56,180 
 
Intangibles, net22,97425,70925,070
Goodwill30,11129,86629,961
Other noncurrent assets 4,416  5,057  5,455 
Total assets$518,121 $416,948 $415,531 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable$56,902$38,820$31,372
Current portion of long-term debt1,0714,2864,285
Other current liabilities 65,259  45,502  44,781 
Total current liabilities 123,232  88,608  80,438 
 
Pension benefits liabilities6,6036,0576,821
Long-term debt-1,071-
Deferred income taxes8,80910,4589,984
Other noncurrent liabilities 7,715  8,573  7,450 
Total liabilities 146,359  114,767  104,693 
 
Shareholders' Equity:
Preferred stock of $1 par value-
Authorized 2,000 shares; none issued---
Common stock of $1 par value-
Authorized 25,000 shares; 18,560 issued18,56018,41318,421
Capital in excess of stated value Read Full Story

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