EXHIBIT 99.1
For further information, contact: | ||
LINDSAY CORPORATION: | HALLIBURTON INVESTOR RELATIONS: | |
Dave Downing | Jeff Elliott or Geralyn DeBusk | |
CFO and President – International Operations | 972-458-8000 | |
402-827-6235 |
Lindsay Corporation Reports Fiscal 2010 Second Quarter Results
OMAHA, Neb., March 31, 2010—Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its fiscal second quarter ended February 28, 2010.
Second Quarter Results
Second quarter fiscal 2010 total revenues increased 31 percent to $85.2 million from $65.1 million for the year-ago period. Net earnings were $6.0 million or $0.48 per diluted share compared with $0.2 million or $0.01 per diluted share in the prior year’s second quarter. Included in net earnings is an after-tax net benefit of $2.0 million, or $0.16 per diluted share, from cumulative state investment credits.
Total irrigation equipment revenues increased 40 percent to $67.9 million from $48.4 million in the prior fiscal year’s second quarter. Domestic irrigation revenues increased 16 percent from the prior year’s second quarter while international irrigation revenues increased 93 percent over the same period. Infrastructure revenues were $17.3 million compared with $16.7 million in the prior year period, an increase of 4 percent.
Gross margin was 26.0 percent compared to 20.4 percent for the same prior year period. Irrigation margins increased from improved factory efficiencies at our Lindsay, Nebraska facility and favorable regional sales mix compared to the same period last year. Infrastructure margins improved primarily due to increased revenues of moveable barrier product. Before cumulative investment credits of $0.6 million, the gross margin was 25.2 percent.
Operating expenses were $15.2 million, increasing $1.5 million as compared to the second quarter of the prior year. The increase in operating expenses was due primarily to $0.7 million of incremental expenses for environmental monitoring and remediation which is part of the continuing compliance work at our Lindsay, Nebraska facility and $0.7 million of higher employee medical expenses. An increase in incentive compensation expense was essentially offset by other personnel related expense reductions and $0.3 million of cumulative investment credits. Operating income of $6.9 million increased $7.4 million compared with an operating loss of $0.4 million for the prior year period.
Nebraska’s state economic development incentive wage and investment credits significantly contributed to earnings during the quarter. In addition to contributing toward operating income, the cumulative investment credits reduced income tax expense by a net $1.1 million resulting in a total after tax benefit of $2.0 million.
Cash and cash equivalents of $91.6 million, increased $50.5 million from the comparable prior year period. Long-term debt decreased $6.2 million over the same time last year.
Lindsay’s backlog of unshipped orders at February 28, 2010 was $33.6 million compared with $36.1 million at November 30, 2009 and $45.5 million at February 28, 2009. February 2009 backlog included $19.6 million for the Mexico City barrier project that was completed in the first half of fiscal 2010.
Six Month Results
Total revenues for the six months ended February 28, 2010 were $171.2 million, a 4 percent decrease from $178.3 million for the prior year’s six-month period. Total irrigation equipment revenues of $121.2 million declined 10 percent from a year ago, while infrastructure revenues increased 14 percent to $50.0 million. The Company’s operating income for the six-month period was $18.1 million compared to $11.3 million during the prior year period. Net earnings were $12.7 million or $1.01 per diluted share, as compared to $6.5 million, or $0.52 per diluted share for the prior year period.
Outlook
Rick Parod, president and chief executive officer, commented, “Strong irrigation sales in Mexico, Brazil and Latin America along with solid domestic demand drove improved irrigation results. While commodity prices declined during the quarter, causing farmers to remain cautious regarding investments, global irrigation equipment demand for the remainder of fiscal 2010 appears to be slightly better than fiscal 2009 at this time. In the infrastructure segment, completion of the Mexico City project by our Barrier Systems team contributed toward improved performance in the first half of fiscal 2010. Infrastructure spending continues to be uncertain due to government budget constraints.”
Parod added, “For our business overall, the global, long-term drivers of water conservation, population growth, increasing importance of biofuels, and improvements in infrastructure remain positive.”
Second Quarter Conference Call
Lindsay’s fiscal 2010 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) 748-0479 domestically, or (706) 758-9823 internationally, and referring to conference ID # 63381470. 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 February 28, 2010, Lindsay had approximately 12.5 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, we claim 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)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three months ended | Six months ended | |||||||||||||||
February 28, | February 28, | |||||||||||||||
(in thousands, except per share amounts) | 2010 | 2009 | 2010 | 2009 | ||||||||||||
Operating revenues | $ | 85,196 | $ | 65,146 | $ | 171,166 | $ | 178,267 | ||||||||
Cost of operating revenues | 63,067 | 51,870 | 123,233 | 136,342 | ||||||||||||
Gross profit | 22,129 | 13,276 | 47,933 | 41,925 | ||||||||||||
Operating expenses: | ||||||||||||||||
Selling expense | 5,251 | 5,618 | 10,774 | 12,381 | ||||||||||||
General and administrative expense | 8,279 | 6,488 | 15,615 | 14,837 | ||||||||||||
Engineering and research expense | 1,685 | 1,619 | 3,469 | 3,360 | ||||||||||||
Total operating expenses | 15,215 | 13,725 | 29,858 | 30,578 | ||||||||||||
Operating income (loss) | 6,914 | (449 | ) | 18,075 | 11,347 | |||||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (356 | ) | (480 | ) | (817 | ) | (1,105 | ) | ||||||||
Interest income | 83 | 225 | 166 | 541 | ||||||||||||
Other income (expense), net | (85 | ) | 238 | 60 | (1,468 | ) | ||||||||||
Earnings (loss) before income taxes | 6,556 | (466 | ) | 17,484 | 9,315 | |||||||||||
Income tax provision (benefit) | 578 | (616 | ) | 4,829 | 2,843 | |||||||||||
Net earnings | $ | 5,978 | $ | 150 | $ | 12,655 | $ | 6,472 | ||||||||
Basic net earnings per share | $ | 0.48 | $ | 0.01 | $ | 1.02 | $ | 0.53 | ||||||||
Diluted net earnings per share | $ | 0.48 | $ | 0.01 | $ | 1.01 | $ | 0.52 | ||||||||
Weighted average shares outstanding | 12,452 | 12,285 | 12,415 | 12,268 | ||||||||||||
Diluted effect of stock equivalents | 127 | 135 | 145 | 185 | ||||||||||||
Weighted average shares outstanding assuming dilution | 12,579 | 12,420 | 12,560 | 12,453 | ||||||||||||
Cash dividends per share | $ | 0.080 | $ | 0.075 | $ | 0.160 | $ | 0.150 | ||||||||
Lindsay Corporation and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) | (Unaudited) | |||||||||||
February 28, | February 28, | August 31, | ||||||||||
($ in thousands, except par values) | 2010 | 2009 | 2009 | |||||||||
ASSETS | ||||||||||||
Current Assets: | ||||||||||||
Cash and cash equivalents | $ | 91,635 | $ | 41,139 | $ | 85,929 | ||||||
Receivables, net of allowance, $2,100, $1,248, and $1,864, respectively | 53,297 | 58,741 | 42,862 | |||||||||
Inventories, net | 47,197 | 66,658 | 46,255 | |||||||||
Deferred income taxes | 6,645 | 7,876 | 6,881 | |||||||||
Other current assets | 7,629 | 8,875 | 7,602 | |||||||||
Total current assets | 206,403 | 183,289 | 189,529 | |||||||||
Property, plant and equipment, net | 57,414 | 56,779 | 59,641 | |||||||||
Other intangible assets, net | 27,842 | 28,511 | 29,100 | |||||||||
Goodwill, net | 23,867 | 23,328 | 24,174 | |||||||||
Other noncurrent assets | 5,640 | 4,975 | 5,453 | |||||||||
Total assets | $ | 321,166 | $ | 296,882 | $ | 307,897 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
Current Liabilities: | ||||||||||||
Accounts payable | $ | 30,514 | $ | 23,066 | $ | 20,008 | ||||||
Current portion of long-term debt | 6,171 | 6,171 | 6,171 | |||||||||
Other current liabilities | 29,631 | 29,893 | 33,008 | |||||||||
Total current liabilities | 66,316 | 59,130 | 59,187 | |||||||||
Pension benefits liabilities | 6,407 | 5,603 | 6,407 | |||||||||
Long-term debt | 16,369 | 22,540 | 19,454 | |||||||||
Deferred income taxes | 8,916 | 12,345 | 10,391 | |||||||||
Other noncurrent liabilities | 3,101 | 3,682 | 4,800 | |||||||||
Total liabilities | 101,109 | 103,300 | 100,239 | |||||||||
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, 18,184,620, 18,114,503 and 18,128,743 shares issued at February 28, 2010 and 2009 and August 31, 2009, respectively) | 18,185 | 18,115 | 18,129 | |||||||||
Capital in excess of stated value | 29,972 | 27,615 | 28,944 | |||||||||
Retained earnings | 260,126 | 244,247 | 249,588 | |||||||||
Less treasury stock (at cost, 5,698,448, 5,813,448 and 5,763,448 shares at February 28, 2010 and 2009 and August 31, 2009, respectively) | (90,961 | ) | (92,796 | ) | (91,998 | ) | ||||||
Accumulated other comprehensive income, net | 2,735 | (3,599 | ) | 2,995 | ||||||||
Total shareholders’ equity | 220,057 | 193,582 | 207,658 | |||||||||
Total liabilities and shareholders’ equity | $ | 321,166 | $ | 296,882 | $ | 307,897 | ||||||
Lindsay Corporation and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended | ||||||||
February 28, | ||||||||
($ in thousands) | 2010 | 2009 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net earnings | $ | 12,655 | $ | 6,472 | ||||
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 5,350 | 5,311 | ||||||
Provision for uncollectible accounts receivable | 267 | 91 | ||||||
Deferred income taxes | (1,768 | ) | (318 | ) | ||||
Stock-based compensation expense | 1,182 | 938 | ||||||
Gain on disposal of fixed assets | (520 | ) | — | |||||
Other, net | (85 | ) | 369 | |||||
Changes in assets and liabilities: | ||||||||
Receivables | (11,025 | ) | 25,261 | |||||
Inventories | (1,940 | ) | (16,963 | ) | ||||
Other current assets | (1,755 | ) | 903 | |||||
Accounts payable | 10,747 | (5,722 | ) | |||||
Other current liabilities | (3,645 | ) | (13,178 | ) | ||||
Current taxes payable | 2,554 | (5,516 | ) | |||||
Other noncurrent assets and liabilities | (954 | ) | 340 | |||||
Net cash provided by (used in) operating activities | 11,063 | (2,012 | ) | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Purchases of property, plant and equipment | (1,985 | ) | (5,176 | ) | ||||
Proceeds from sale of property, plant and equipment | 547 | 6 | ||||||
Acquisition of business, net of cash acquired | (132 | ) | — | |||||
Proceeds from settlement of net investment hedge | 565 | 859 | ||||||
Net cash used in investing activities | (1,005 | ) | (4,311 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from issuance of common stock under stock compensation plan | 544 | 482 | ||||||
Principal payments on long-term debt | (3,086 | ) | (3,011 | ) | ||||
Net payments on revolving line of credit | — | 842 | ||||||
Excess tax benefits from stock-based compensation | 368 | 317 | ||||||
Dividends paid | (1,990 | ) | (1,841 | ) | ||||
Net cash used in financing activities | (4,164 | ) | (3,211 | ) | ||||
Effect of exchange rate changes on cash | (188 | ) | (87 | ) | ||||
Net increase (decrease) in cash and cash equivalents | 5,706 | (9,621 | ) | |||||
Cash and cash equivalents, beginning of period | 85,929 | 50,760 | ||||||
Cash and cash equivalents, end of period | $ | 91,635 | $ | 41,139 | ||||