EX-99.1 2 d895457dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO 2222 NO. 111TH  ST. OMAHA, NE 68164 TEL: 402-829-6800 FAX: 402-829-6836

 

 

For further information, contact:

 

LINDSAY CORPORATION: HALLIBURTON INVESTOR RELATIONS:
Jim Raabe Hala Elsherbini or Geralyn DeBusk
Vice President & Chief Financial Officer 972-458-8000
402-827-6579

Lindsay Corporation Reports Fiscal 2015 Second Quarter Results

OMAHA, Neb., March 25, 2015—Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its second quarter ended February 28, 2015.

Second Quarter Results

Second quarter fiscal 2015 revenues were $141.1 million versus $152.8 million of revenues in the same prior year period. Net earnings were $9.0 million or $0.75 per diluted share compared with $13.5 million or $1.04 per diluted share in the prior year.

Total irrigation equipment revenues decreased 20 percent to $108.3 million from $135.9 million in the prior fiscal year’s second quarter. U.S. irrigation revenues of $68.0 million, which includes $3.5 million of revenues from the newly acquired Elecsys Corporation, decreased 27 percent primarily due to a decline in the number of irrigation systems sold as a result of the reduction in commodity prices. International irrigation revenues of $40.3 million decreased 6 percent most notably in the Middle East and Europe. Excluding the effect of currency translation, international irrigation sales were approximately equal to the same period in the prior year. Infrastructure revenues increased 94 percent to $32.8 million with the completion of the Golden Gate Bridge Road Zipper project and increases in road safety product sales.

Gross margin was 28.0 percent of sales compared to 27.9 percent of sales in the prior year’s second quarter. Gross margin in irrigation decreased by approximately 3 percentage points and infrastructure gross margin increased by approximately 14 percentage points. The decrease in irrigation gross margins is primarily a result of pricing pressure and cost deleverage from lower sales. The increase in infrastructure gross margin was primarily due to sales mix from increases in Road Zipper and road safety product sales.

Operating expenses increased $3.3 million to $25.0 million compared to the second quarter of the prior fiscal year. The increase includes $1.0 million of Elecsys Corporation operating expenses, $1.0 million of acquisition and integration expenses, $0.7 million in incremental health benefit expenses and $0.3 million of commissions related to increased infrastructure project sales. Operating expenses were 17.7 percent of sales in the second quarter of fiscal 2015 compared with 14.2 percent of sales in the prior year period. Operating margins were 10.3 percent in the second quarter, versus 13.7 percent in the prior year period.

Cash and cash equivalents of $167.2 million were $1.7 million higher compared to the prior year second quarter. During the quarter the Company completed a $115.0 million private placement of long term debt, expanded its revolving credit agreement with Wells Fargo Bank from $30.0 million to $50.0 million, and completed the acquisition of Elecsys Corporation for $67.2 million, net of cash acquired. The long term debt is due for payment in February 2030 and bears interest at 3.82 percent. The Company also repurchased 224,307 shares for $19.4 million during the second quarter and a total of 605,926 shares for $49.4 million during the first six months of fiscal 2015. Since the initiation of the share repurchase plan, the Company has purchased a total of 1.1 million shares for $90.4 million, with $59.6 million remaining authorized as of February 28, 2015 for additional repurchases.

Backlog of unshipped orders at February 28, 2015 was $74.3 million compared with $89.3 million at February 28, 2014 and $68.3 million at November 30, 2014. The backlog at February 28, 2014 and November 30, 2014 included $12.7 million for the Golden Gate Bridge project, now completed. The current period includes $7.9 million of backlog from Elecsys Corporation.


Six Month Results

Total revenues for the six months ended February 28, 2015 were $275.9 million versus $300.5 million in the same prior year period. Foreign currency translation as compared to the prior year reduced year to date revenues by $5.6 million. Net earnings were $16.6 million or $1.36 per diluted share compared with $23.7 million or $1.83 per diluted share in the prior year. The current year includes $1.5 million of estimated environmental expenses and $1.5 million of acquisition and integration expenses. These expenses reduced earnings by $0.16 per diluted share on an after tax basis.

Total irrigation equipment revenues decreased 16 percent to $223.0 million from $265.1 million during the first six months of the prior fiscal year. U.S. irrigation revenues of $129.1 million decreased 25 percent, while international irrigation revenues of $93.9 million increased 2 percent. Infrastructure revenues increased 49 percent to $52.9 million.

Outlook

Rick Parod, president and chief executive officer, commented, “While the longer term drivers to our markets remain positive, the cyclical contraction for irrigation equipment has continued. The U.S. irrigation market has been impacted by lower commodity prices and lower farm incomes, while international irrigation markets have remained more stable, although competitive pressure is increasing. The infrastructure segment made a significant contribution to the quarter with the installation of a Road Zipper System on the Golden Gate Bridge, and we remain optimistic about additional growth opportunities.”

Parod continued, “In January we completed the acquisition of Elecsys Corporation and have begun the integration with our irrigation business. In addition, in February we completed a $115 million private placement of debt to improve our capital structure and position us for additional growth through acquisitions and other initiatives in driving improved returns for shareholders.”

Second-Quarter Conference Call

Lindsay’s fiscal 2015 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 # 8407317. 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, 2015 Lindsay had approximately 11.9 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 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.


Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

     Three months ended     Six months ended  

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

   February 28,
2015
    February 28,
2014
    February 28,
2015
    February 28,
2014
 

Operating revenues

   $ 141,089      $ 152,804      $ 275,934      $ 300,475   

Cost of operating revenues

     101,533        110,132        199,464        217,652   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

  39,556      42,672      76,470      82,823   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

Selling expense

  10,231      9,534      19,648      19,290   

General and administrative expense

  11,680      9,354      24,551      21,097   

Engineering and research expense

  3,109      2,871      5,833      5,531   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

  25,020      21,759      50,032      45,918   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

  14,536      20,913      26,438      36,905   

Other income (expense):

Interest expense

  (209   (56   (280   (95

Interest income

  162      157      334      292   

Other expense, net

  (351   (225   (693   (496
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings before income taxes

  14,138      20,789      25,799      36,606   

Income tax expense

  5,143      7,339      9,236      12,922   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net earnings

$ 8,995    $ 13,450    $ 16,563    $ 23,684   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per share:

Basic

$ 0.75    $ 1.04    $ 1.37    $ 1.84   

Diluted

$ 0.75    $ 1.04    $ 1.36    $ 1.83   

Shares used in computing earnings per share:

Basic

  11,982      12,910      12,103      12,899   

Diluted

  12,008      12,942      12,141      12,947   

Cash dividends declared per share

$ 0.270    $ 0.260    $ 0.540    $ 0.390   


Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

($ and shares in thousands, except par values)

   February 28,
2015
    February 28,
2014
    August 31,
2014
 

ASSETS

      

Current Assets:

      

Cash and cash equivalents

   $ 167,165      $ 165,509      $ 171,842   

Receivables, net

     93,293        111,211        94,135   

Inventories, net

     82,263        80,994        71,696   

Deferred income taxes

     16,224        13,916        17,714   

Other current assets

     21,936        18,216        18,671   
  

 

 

   

 

 

   

 

 

 

Total current assets

  380,881      389,846      374,058   
  

 

 

   

 

 

   

 

 

 

Property, plant and equipment, net

  75,663      65,446      72,457   

Intangibles, net

  53,900      34,084      31,980   

Goodwill

  74,808      37,282      37,021   

Other noncurrent assets, net

  13,528      3,961      11,035   
  

 

 

   

 

 

   

 

 

 

Total assets

$ 598,780    $ 530,619    $ 526,551   
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current Liabilities:

Accounts payable

$ 50,293    $ 53,954    $ 42,424   

Other current liabilities

  59,030      54,204      73,943   
  

 

 

   

 

 

   

 

 

 

Total current liabilities

  109,323      108,158      116,367   
  

 

 

   

 

 

   

 

 

 

Pension benefits liabilities

  6,460      6,202      6,600   

Long-term debt

  117,270      —        —     

Deferred income taxes

  20,940      13,975      12,992   

Other noncurrent liabilities

  8,846      7,590      7,945   
  

 

 

   

 

 

   

 

 

 

Total liabilities

  262,839      135,925      143,904   
  

 

 

   

 

 

   

 

 

 

Shareholders’ Equity:

Preferred stock

  —        —        —     

Common stock

  18,675      18,633      18,636   

Capital in excess of stated value

  53,618      50,794      52,866   

Retained earnings

  455,439      424,241      445,366   

Less treasury stock

  (181,383   (97,566   (132,020

Accumulated other comprehensive loss, net

  (10,408   (1,408   (2,201
  

 

 

   

 

 

   

 

 

 

Total shareholders’ equity

  335,941      394,694      382,647   
  

 

 

   

 

 

   

 

 

 

Total liabilities and shareholders’ equity

$ 598,780    $ 530,619    $ 526,551   
  

 

 

   

 

 

   

 

 

 


Lindsay Corporation and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

     Six months ended  

($ in thousands)

   February 28,
2015
    February 28,
2014
 

CASH FLOWS FROM OPERATING ACTIVITIES:

    

Net earnings

   $ 16,563      $ 23,684   

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

    

Depreciation and amortization

     8,017        7,384   

Asset impairment

     270        —     

Provision for uncollectible accounts receivable

     418        618   

Deferred income taxes

     28        (2,696

Share-based compensation expense

     2,051        2,191   

Other, net

     3,381        250   

Changes in assets and liabilities:

    

Receivables

     (4,439     9,010   

Inventories

     (3,583     (12,192

Other current assets

     (2,647     (2,400

Accounts payable

     9,778        11,422   

Other current liabilities

     (8,744     (5,410

Current income taxes payable

     (6,987     (168

Other noncurrent assets and liabilities

     1,478        754   
  

 

 

   

 

 

 

Net cash provided by operating activities

  15,584      32,447   
  

 

 

   

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property, plant and equipment

  (6,576   (5,353

Acquisition of business, net of cash acquired

  (67,176   —     

Proceeds from settlement of net investment hedges

  3,310      280   

Payments for settlement of net investment hedges

  (329   (1,846

Other investing activities

  (2,554   35   
  

 

 

   

 

 

 

Net cash used in investing activities

  (73,325   (6,884
  

 

 

   

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from exercise of stock options

  66      371   

Common stock withheld for payroll tax withholdings

  (1,703   (2,027

Proceeds from issuance of long-term debt

  115,000      —     

Principal payments on long-term debt

  (16   —     

Issuance costs related to debt

  (679   —     

Excess tax benefits from share-based compensation

  510      695   

Repurchase of common shares

  (49,363   (6,605

Dividends paid

  (6,490   (5,023
  

 

 

   

 

 

 

Net cash provided by (used in) financing activities

  57,325      (12,589
  

 

 

   

 

 

 

Effect of exchange rate changes on cash and cash equivalents

  (4,261   608   
  

 

 

   

 

 

 

Net change in cash and cash equivalents

  (4,677   13,582   

Cash and cash equivalents, beginning of period

  171,842      151,927   
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

$ 167,165    $ 165,509