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LINDSAY CORP : Lindsay Corporation Reports Fiscal 2011 Third Quarter Results

06/29/2011 | 08:05am US/Eastern
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Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its fiscal third quarter ended May 31, 2011.

Third Quarter Results

Third quarter fiscal 2011 revenues of $153.4 million increased 53 percent from $100.1 million in the same prior year period. Net earnings were $15.3 million or $1.20 per diluted share compared with $6.2 million or $0.50 per diluted share, in the prior fiscal year's third quarter.

Total irrigation equipment revenues increased 58 percent to $126.9 million from $80.4 million in the prior fiscal year's third quarter. U.S. irrigation revenues of $76.7 million increased 60 percent, while international irrigation revenues of $50.2 million increased 55 percent compared to the same prior year period. Infrastructure revenues for the third quarter increased 35 percent to $26.5 million.

Gross margin was 27.0 percent compared to 25.2 percent in the prior year's third quarter. During the fiscal third quarter overall gross margins improved on higher international irrigation margins and on improved margins in diversified manufacturing which includes railroad signals and structures, commercial tubing and contract manufacturing.

Operating expenses increased $3.2 million to $18.4 million compared to the third quarter of the prior fiscal year. The increase in operating expenses included higher personnel related costs, an incremental increase in expenses from the acquisitions of Digitec Inc., and WMC Technology Limited, and additional expenses for environmental monitoring and remediation as part of ongoing development and implementation of the EPA work plan at the Lindsay, Nebraska facility. Operating expenses were 12.0 percent of revenue compared to 15.2 percent of revenue in the prior fiscal year's third quarter. Operating income was $23.1 million compared to $10.0 million in the same prior year period.

Cash and cash equivalents of $100.6 million were $17.1 million higher compared with last year. Debt decreased $4.3 million over the same period and $7.7 million of cash was used in acquisitions completed in the past year. At May 31, 2011, accounts receivable and inventory balances were $36.5 million higher compared to the prior year due to increased business activity.

Lindsay's backlog of unshipped orders at May 31, 2011 was $43.3 million compared with $64.3 million at February 28, 2011 and $33.9 million at May 31, 2010.

Nine Month Results

Total revenues for the nine months ended May 31, 2011 were $362.8 million, a 34 percent increase from $271.2 million compared to the same prior year period. Total irrigation equipment revenues of $278.6 million increased 38 percent from a year ago, while infrastructure revenues increased 21 percent to $84.2 million. The Company's operating income for the nine-month period was $46.8 million compared to $28.1 million during the same prior year period. Net earnings were $30.9 million or $2.44 per diluted share, as compared to $18.9 million, or $1.50 per diluted share for the prior year period.

Outlook

Rick Parod, president and chief executive officer, commented, "Conditions in the global agriculture markets continued to be strong throughout the primary irrigation selling season. Agricultural commodity prices remain significantly higher compared to the previous year, creating favorable economic conditions for growers, worldwide."

Parod continued, "Infrastructure operating margin increased in the quarter due to operational improvements implemented and leveraging expenses on a higher base revenue."

Parod added, "For our business overall, the global, long-term drivers of water use efficiency, population growth, increasing importance of biofuels, and improvements in infrastructure safety and security remain positive."

Third-Quarter Conference Call

Lindsay's fiscal 2011 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) 748-0479 domestically, or (706) 758-9823 internationally, and referring to conference ID # 75449355. 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. 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 through its wholly owned subsidiaries, Barrier Systems Inc. and Snoline S.P.A. At May 31, 2011, Lindsay had approximately 12.6 million shares outstanding, which are traded on the New York Stock Exchange under the symbol LNN.

For more information regarding Lindsay Corporation, see Lindsay's Web site at www.lindsay.com. For more information on the Company's infrastructure products, visit www.barriersystemsinc.com and www.snoline.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 Nine months ended
May 31, May 31,
(in thousands, except per share amounts) 2011 2010 2011 2010
 
Operating revenues $ 153,446 $ 100,073 $ 362,780 $ 271,239
Cost of operating revenues   111,947     74,818     263,049     198,051  
Gross profit   41,499     25,255     99,731     73,188  
 
Operating expenses:
Selling expense 6,929 5,909 20,858 16,683
General and administrative expense 8,640 7,348 23,936 22,963
Engineering and research expense   2,789     1,949     8,125     5,418  
Total operating expenses   18,358     15,206     52,919     45,064  
 
Operating income 23,141 10,049 46,812 28,124
 
Other income (expense):
Interest expense (192 ) (474 ) (591 ) (1,291 )
Interest income 71 49 150 215
Other income (expense), net   139     12     366     72  
 
Earnings before income taxes 23,159 9,636 46,737 27,120
 
Income tax provision   7,870     3,388     15,837     8,217  
 
Net earnings $ 15,289   $ 6,248   $ 30,900   $ 18,903  
 
 
Basic net earnings per share $ 1.22   $ 0.50   $ 2.46   $ 1.52  
 
Diluted net earnings per share $ 1.20   $ 0.50   $ 2.44   $ 1.50  
 
 
Weighted average shares outstanding 12,564 12,486 12,538 12,439
Diluted effect of stock equivalents   139     124     139     138  
Weighted average shares outstanding assuming dilution   12,703     12,610     12,677     12,577  
 
 
Cash dividends per share $ 0.085   $ 0.080   $ 0.255   $ 0.240  
 
Lindsay Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
         
 
(Unaudited) (Unaudited)
May 31, May 31, August 31,
($ in thousands, except par values) 2011 2010 2010
ASSETS
Current Assets:
Cash and cash equivalents $ 100,568 $ 83,509 $ 83,418
Receivables, net of allowance of $2,464, $2,246 and $2,244, respectively 87,588 56,804 63,629
Inventories, net 52,833 47,070 45,296
Deferred income taxes 6,798 5,974 6,722
Other current assets   12,177     9,071     8,946  
Total current assets 259,964 202,428 208,011
 
Property, plant and equipment, net 57,279 56,379 57,646
Other intangible assets, net 27,430 26,728 27,715
Goodwill, net 28,815 23,292 27,395
Other noncurrent assets   4,318     5,652     4,714  
Total assets $ 377,806   $ 314,479   $ 325,481  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 42,966 $ 29,547 $ 26,501
Current portion of long-term debt 4,286 4,286 4,286
Other current liabilities   40,445     29,981     36,295  
Total current liabilities 87,697 63,814 67,082
 
Pension benefits liabilities 6,233 6,192 6,400
Long-term debt 5,357 9,643 8,571
Deferred income taxes 10,947 9,431 10,816
Other noncurrent liabilities   1,790     2,053     3,005  
Total liabilities   112,024     91,133     95,874  
 
Shareholders' equity:
Preferred stock, ($1 par value, 2,000,000 shares authorized, no shares
issued and outstanding) - - -
Common stock, ($1 par value, 25,000,000 shares authorized,
18,268,549, 18,184,620 and 18,184,820 shares issued at May 31, 2011
and 2010 and August 31, 2010, respectively) 18,269 18,185 18,185
Capital in excess of stated value 34,162 30,515 30,756
Retained earnings 297,971 265,373 270,272
Less treasury stock (at cost, 5,698,448 shares at
May 31, 2011 and 2010 and August 31, 2010, respectively) (90,961 ) (90,961 ) (90,961 )
Accumulated other comprehensive income, net   6,341     234     1,355  
Total shareholders' equity   265,782     223,346     229,607  
Total liabilities and shareholders' equity $ 377,806   $ 314,479   $ 325,481  
 
Lindsay Corporation and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
     
 
($ in thousands) Nine Months Ended

May 31,

2011 2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 30,900 $ 18,903
Adjustments to reconcile net earnings to net cash provided by
operating activities:
Depreciation and amortization 8,820 8,027
Provision for uncollectible accounts receivable 248 568
Deferred income taxes (2,001 ) (990 )
Stock-based compensation expense 2,384 1,755
Gain on disposal of fixed assets (43 ) (537 )
Other, net (307 ) 121
Changes in assets and liabilities:
Receivables (21,326 ) (16,095 )
Inventories (5,330 ) (2,280 )
Other current assets (2,929 ) (3,127 )
Accounts payable 15,441 10,439
Other current liabilities 2,642 (2,768 )
Current taxes payable 853 2,285
Other noncurrent assets and liabilities   (1,077 )   (1,513 )
Net cash provided by operating activities   28,275     14,788  
 
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment (5,315 ) (3,962 )
Proceeds from sale of property, plant and equipment 57 577
Acquisition of business, net of cash acquired (1,279 ) (132 )
Payment for settlement of net investment hedge   (1,261 )   565  
Net cash used in investing activities   (7,798 )   (2,952 )
 
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock under stock compensation plans 243 544
Principal payments on long-term debt (3,214 ) (11,697 )
Net borrowing on revolving line of credit 1,212 345
Excess tax benefits from stock-based compensation 1,068 368
Dividends paid   (3,201 )   (2,991 )
Net cash used in financing activities   (3,892 )   (13,431 )
 
Effect of exchange rate changes on cash   565     (825 )
Net increase (decrease) in cash and cash equivalents 17,150 (2,420 )
Cash and cash equivalents, beginning of period   83,418     85,929  
Cash and cash equivalents, end of period $ 100,568   $ 83,509  

Lindsay Corporation:
Jim Raabe, 402-827-6579
Vice President & Chief Financial Officer
or
Halliburton Investor Relations:
Hala Elsherbini or Geralyn DeBusk, 972-458-8000


© Business Wire 2011
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