|Lindsay Corporation Reports Fiscal 2016 First Quarter Results|
Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its first quarter ended November 30, 2015.
First Quarter Results
First quarter fiscal 2016 revenues were $121.6 million versus $134.8 million of revenues in the same prior year period. Net earnings were $6.9 million or $0.62 per diluted share compared with $7.6 million or $0.62 per diluted share in the prior year.
Total irrigation equipment revenues decreased 12 percent to $101.3 million from $114.7 million in the prior fiscal year's first quarter. U.S. irrigation revenues of $59.2 million decreased 6 percent due to a decrease in units sold partially offset by sales in Elecsys Corporation, which was acquired during the second quarter last year. International irrigation revenues of $42.1 million decreased 19 percent due to the impact of currency exchange rates and lower sales in Brazil and certain export markets. Infrastructure revenues increased 1 percent to $20.3 million with increases in road safety and Road Zipper products and leases offset by the impact of currency exchange rates and lower rail and contract product sales.
Gross margin was 28.3 percent of sales compared to 27.4 percent of sales in the prior year's first quarter. Gross margin in irrigation increased by approximately 1 percentage point and infrastructure gross margin also increased by approximately 1 percentage point. Irrigation gross margin increased primarily as a result of a change in sales mix with the addition of Elecsys in the current year. Competitive pricing persists, but has primarily consisted of passing-through the steel price declines realized. The increase in infrastructure gross margin was primarily due to sales mix.
Operating expenses decreased $2.3 million to $22.7 million compared to the first quarter of the prior fiscal year. The prior year included $2.1 million of expenses related to an increase in the estimated environmental liability and acquisition related expenses, while the current year includes $2.4 million of incremental expenses related to the operation of Elecsys Corporation. Excluding these items, operating expenses decreased by $2.6 million due primarily to reductions in personnel expenses and collections of accounts receivable that were reserved for in prior periods. Operating expenses were 18.6 percent of sales in the first quarter of fiscal 2016 compared with 18.5 percent of sales in the prior year period. Operating margins were 9.7 percent in the first quarter, versus 8.8 percent in the prior year period.
Cash and cash equivalents of $129.3 million were $10.0 million lower compared to the prior year first quarter. The Company repurchased 136,263 shares for $9.2 million during the first quarter. $102.8 million remains available under the Company's share repurchase program.
Backlog of unshipped orders at November 30, 2015 was $61.9 million compared with $68.3 million at November 30, 2014 and $48.0 million at August 31, 2015. The November 30, 2015 backlog included $8.1 million of backlog for Elecsys Corporation while the prior year backlog included $12.7 million related to the Golden Gate Bridge project.
Rick Parod, president and chief executive officer, commented, "The irrigation markets continue to be constrained by lower commodity prices, and foreign exchange rates continue to negatively affect international sales."
Parod continued, "While it appears we are at or near the bottom of the cycle, we expect the market environment will remain challenging at least through 2016. We do not expect to have visibility into the primary selling season until February or March. Longer term, drivers for the Company's markets of population growth, expanded food production, efficient water use, and infrastructure upgrades and expansion, support our expectation for growth."
First-Quarter Conference Call
Lindsay's fiscal 2016 first 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 # 2037724. 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 water management equipment and services including irrigation systems, pump stations, filtration, and M2M controls designed to increase or stabilize crop production while conserving water, energy, and labor, and that also provide efficiency benefits in various industrial applications. The Company also manufactures and markets infrastructure and road safety products under the Lindsay Transportation Solutions trade name. At November 30, 2015 Lindsay had approximately 11.2 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 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.
|Dec 23, 2015|