Lindsay Corporation Reports Fiscal 2013 Fourth Quarter and Full Year Results

Lindsay Corporation Reports Fiscal 2013 Fourth Quarter and Full Year Results

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

Fourth Quarter Results


Fourth quarter fiscal 2013 revenues were a record $148.4 million, increasing 16 percent from $127.8 million in the same prior year period. Net earnings were $10.4 million or $0.81 per diluted share compared with $8.8 million or $0.68 per diluted share in the prior year.

Total irrigation equipment revenues increased 19 percent to $128.2 million from $107.9 million in the prior fiscal year's fourth quarter due to strong demand in international markets. U.S. irrigation revenues of $53.9 million decreased 4 percent off of drought driven sales increases in the corn belt last year, while international irrigation revenues of $74.3 million increased 44 percent including $17.4 million sales from a contract to provide irrigation equipment in Iraq. Infrastructure revenues increased 2 percent to $20.2 million.

Gross margin was 26.0 percent of sales compared to 25.6 percent of sales in the prior year's fourth quarter. Gross margins in irrigation declined by approximately 1 percentage point as U.S. margins improved but were offset by a higher mix of international sales. Infrastructure gross margins improved by approximately 8 percentage points primarily due to a larger mix of Road Zipper sales.

Operating expenses were $22.8 million compared to $20.1 million in the same prior year period. Current year expenses included higher personnel and incentive compensation, acquisition expenses and selling expenses associated with higher revenues. Operating expenses were 15.3 percent of sales in the fourth quarter of fiscal 2013 compared with 15.7 percent of sales in the prior year period. Operating margins of 10.6 percent increased from 9.9 percent in the prior year period.

Cash and cash equivalents of $151.9 million were $8.5 million higher compared to the end of the fourth quarter in the prior fiscal year, while debt decreased $4.3 million.

Backlog of unshipped orders at August 31, 2013 was $66.5 million compared with $57.1 million at August 31, 2012 and $80.0 million at May 31, 2013. Current backlog includes $4.7 million remaining from the Iraq order announced in the second quarter. Backlog increased year over year in other international irrigation markets and infrastructure, while backlog in U.S. irrigation markets declined.

Twelve Month Results

Total revenues for the year ended August 31, 2013 were $690.8 million, a 25 percent increase from $551.3 million in the same prior year period. Net earnings were $70.6 million or $5.47 per diluted share compared with $43.3 million or $3.38 per diluted share in the prior year. Fiscal 2012 operating costs included $7.2 million of 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 32 percent to $626.0 million from $475.3 million during the prior fiscal year. U.S. irrigation revenues of $385.7 million increased 26 percent, while international irrigation revenues of $240.3 million increased 41 percent due to sales growth in most markets, and most significantly in the Middle East and South America. Infrastructure revenues decreased 15 percent to $64.8 million.

Outlook

Rick Parod, president and chief executive officer, commented, "Record sales in our U.S. and international irrigation markets have led to an outstanding year in 2013. The fourth quarter results also reflected strong growth in sales and profit, although we experienced a slowing of orders in the U.S. irrigation markets in our traditionally slower fourth quarter, as compared to the drought effect on demand at the same time last year."

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. We anticipate lower U.S. irrigation sales in 2014 due to lower commodity prices and challenging comparisons to the prior year. Demand in international markets appears more stable due to lower mechanized irrigation penetration, and the acquisition of the Lakos brand of filtration products reinforces our positioning and provides additional growth opportunities. Regarding the infrastructure business, with the recent restructuring implemented we are positioned for profitable growth as those markets improve."

Fourth-Quarter Conference Call

Lindsay's fiscal 2013 fourth 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 # 69955879. 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 August 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
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
   
Three months ended August 31,Years ended August 31,
(in thousands, except per share amounts)2013 201220132012
 
Operating revenues$148,397$127,817$690,848$551,255
Cost of operating revenues 109,820  95,069  496,014  402,737 
Gross profit 38,577  32,748  194,834  148,518 
 
Operating expenses:
Selling expense8,9426,96832,93728,104
General and administrative expense11,38510,43443,44138,198
Engineering and research expense2,4492,65411,3959,481
Environmental remediation expense -  -  -  7,225 
Total operating expenses 22,776  20,056  87,773  83,008 
 
Operating income15,80112,692107,06165,510
 
Interest expense(46)(116)(304)(492)
Interest income129177496504
Other (expense) income, net (198) (100) 54  (414)
 
Earnings before income taxes15,68612,653107,30765,108
 
Income tax expense 5,258  3,894  36,737  21,831 
 
Net earnings$10,428 $8,759 $70,570 $43,277 
 
Earnings per share:
Basic$0.81$0.69$5.50$3.41
Diluted$0.81$0.68$5.47$3.38
 
Shares used in computing earnings per share:
Basic12,86512,71812,83012,704
Diluted12,94312,84312,90112,810
 
Cash dividends declared per share$0.130$0.115$0.475$0.385
 
 
Lindsay Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(unaudited)
  
August 31,August 31,
(in thousands, except par values)20132012
ASSETS
Current Assets:
Cash and cash equivalents$151,927$143,444
Receivables, net120,29182,565
Inventories, net68,60752,873
Deferred income taxes12,7059,505
Other current assets 15,261  10,478 
Total current assets368,791298,865
 
Property, plant and equipment, net65,06456,180
Intangible assets, net36,00725,070
Goodwill37,41429,961
Other noncurrent assets 5,020  5,455 
Total assets$512,296 $415,531 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable$42,276$31,372
Current portion of long-term debt-4,285
Other current liabilities 59,816  44,781 
Total current liabilities102,09280,438
 
Pension benefits liabilities6,3246,821
Deferred income taxes15,4159,984
Other noncurrent liabilities 7,827  7,450 
Total liabilities 131,658  104,693 
 
Shareholders' equity:
Preferred stock--
Common stock18,57118,421
Capital in excess of stated value49,76443,140
Retained earnings405,580341,115
Less treasury stock(90,961)(90,961)
Accumulated other comprehensive loss, net (2,316) (877)
Total shareholders' equity 380,638  310,838 
Total liabilities and shareholders' equity$512,296 $415,531 
 
 
Lindsay Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
  
(in thousands)Years Ended August 31,
20132012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings$70,570$43,277

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

Depreciation and amortization12,60012,468
Provision for uncollectible accounts receivable1,543379
Deferred income taxes(5,048)(3,868)
Share-based compensation expense4,5733,939
Other, net(859)959
Changes in assets and liabilities:
Receivables(36,557)(7,570)
Inventories(10,020)(5,609)
Other current assets(4,054)(641)
Accounts payable9,188723
Other current liabilities14,578(1,602)
Current taxes payable7645,408
Other noncurrent assets and liabilities 227  4,576 
Net cash provided by operating activities 57,505  52,439 
 
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment(11,136)(9,890)
Proceeds from sale of property, plant and equipment22116
Acquisition of business, net of cash acquired(29,007)-
Proceeds from settlement of net investment hedges1,9443,378
Payments for settlement of net investment hedges (2,904) (453)
Net cash used in investing activities (41,081) (6,849)
 
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options2,036567
Common stock withheld for payroll tax withholdings(2,441)(577)
Principal payments on long-term debt(4,285)(4,286)
Excess tax benefits from share-based compensation2,800387
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