EXHIBIT 99.1
RE: LINDSAY MANUFACTURING CO.
2707 NORTH 108TH STREET
SUITE 102
OMAHA, NEBRASKA 68164
402-428-2131
FOR FURTHER INFORMATION:
AT THE COMPANY: AT FRB/WEBER SHANDWICK:
Bruce C. Karsk Marilyn Windsor Diane Hettwer Tim Grace
Executive VP and CFO General Inquiries Analyst Inquiries Media Inquiries
402-829-6803 702-515-1260 312-640-6760 312-640-6667
FOR IMMEDIATE RELEASE
MONDAY, DECEMBER 22, 2003
LINDSAY MANUFACTURING CO. REPORTS FISCAL FIRST-QUARTER 2004 RESULTS
OMAHA, NEB., DECEMBER 22, 2003--LINDSAY MANUFACTURING CO. (NYSE: LNN), a leading
manufacturer of center pivot, lateral move, and hose reel irrigation systems,
today announced results for its fiscal first quarter ended November 30, 2003.
Revenues grew 9 percent from the same period a year ago, and earnings per
diluted share were $0.09 compared with $0.10 in the year ago period. The company
also reported its strongest first-quarter order backlog in over five years.
FIRST-QUARTER RESULTS
First-quarter fiscal 2004 total revenues were $36.5 million, up 9 percent from
$33.5 million for the prior year's first quarter. Irrigation equipment revenues
increased 11 percent to $34.0 million, while diversified products revenues
declined 10 percent as one large customer continued to transition its
outsourcing business to internal production and rescheduled orders from the
first fiscal quarter to the second fiscal quarter.
"Our domestic irrigation equipment revenues were robust as our dealers saw good
traffic that converted to orders at a high rate. We also continued to make
strong gains in our South Africa and South America operations," said Rick Parod,
president and chief executive officer. "Expanding our diversified manufacturing
revenues profitably remains part of our strategy. We are continuing our efforts
to seek additional suitable business that contributes to efficient utilization
of our manufacturing capabilities."
Gross profit rose to $7.4 million from $7.0 million; however, gross margin
decreased to 20.1 percent from 21.0 percent, reflecting increases in steel
costs, a less favorable domestic product mix, and a shift in revenues. Sales
from the company's foreign facilities, which currently carry lower gross
margins, comprised 14 percent of total sales compared with 11 percent in the
prior-year period. Operating expenses were $804,000 higher than in the fiscal
2003 period, primarily reflecting increases in health insurance
costs, full operation of the South African unit, and new product development
expenses. The increase in operating expenses, combined with the softer gross
margin, reduced operating income to $734,000 compared with $1.2 million during
the same period last year. Other income increased to $873,000 from $519,000,
reflecting higher foreign currency transaction gains. Net earnings were $1.1
million, or $0.09 per diluted share, compared with $1.2 million, or $0.10 per
diluted share, in last year's first quarter.
Lindsay's order backlog at November 30, 2003, improved significantly to $38.7
million compared with $21.9 million at August 31, 2003 and $19.4 million at
November 30, 2002.
"We instituted a price increase that will affect orders after the end of the
quarter. As a result, our irrigation backlog doubled from a year ago.
Additionally, our European operations have realized an increase in backlog for
hose reels in response to the severe drought experienced in the region this past
summer. The significant increase in the backlog, coupled with the benefits of
the price increase, should boost revenues, improve gross margin, and position us
well for the second quarter and remainder of the year," Parod said.
Shareholders' equity at November 30, 2003, was $105.6 million, or $8.99 per
outstanding common share, compared with $93.2 million, or $7.95 per outstanding
common share, at November 30, 2002.
OUTLOOK
Parod commented, "Our strong backlog and order flow, combined with the recent
price increase, support our continued positive outlook for the year. We continue
to anticipate double-digit earnings growth on revenue growth of approximately 8
to 10 percent, excluding acquisitions, for fiscal 2004. On the domestic front,
commodity prices are good, farmer profitability is strong, and there remain
areas that continue to suffer from drier-than-normal conditions. Our
international operations continue to grow and are expected to leverage their
operating expenses through higher volumes. We expect to continue to make
progress on this front and by the end of fiscal 2004 bring international margins
up near the levels earned in the domestic and export markets."
FIRST-QUARTER CONFERENCE CALL
Lindsay's first-quarter fiscal 2004 investor conference call is scheduled for 11
a.m. ET today. This call will be simulcast and available over the Internet via
the web site www.vcall.com. The webcast will be available for replay for a
period of 30 days. Lindsay will have a slide presentation available to augment
management's formal
presentation, which will be accessible via the company's website at
www.lindsaymanufacturing.com.
ABOUT THE COMPANY
Lindsay manufactures and markets Zimmatic, Greenfield, and Perrot center pivot,
lateral move and hose reel irrigation systems and GrowSmart controls, all of
which are used by farmers to increase or stabilize crop production while
conserving water, energy, and labor. The Company also produces large diameter
steel tubing and provides outsourced manufacturing and production services for
other companies. At November 30, 2003, Lindsay had approximately 11.8 million
shares outstanding, which are traded on the New York Stock Exchange under the
symbol LNN.
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. Forward-looking statements include the information concerning
possible or assumed future results of operations of the Company and those
statements preceded by, followed by or including the words "expectation,"
"outlook," "could," "may," "should," 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.
FOR MORE INFORMATION REGARDING LINDSAY MANUFACTURING CO.,
SEE LINDSAY'S WEBSITE AT www.lindsaymanufacturing.com
- Financial Tables Follow -
LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
NOVEMBER 30, 2003 AND 2002 AND AUGUST 31, 2003
(UNAUDITED) (UNAUDITED)
NOVEMBER NOVEMBER AUGUST
($ IN THOUSANDS, EXCEPT PAR VALUES) 2003 2002 2003
- ----------------------------------- -------- -------- --------
ASSETS
Current Assets:
Cash and cash equivalents $ 6,263 $ 3,906 $ 15,368
Marketable securities 5,730 15,279 8,770
Receivables, net 29,691 28,589 22,970
Inventories, net 21,728 18,736 20,019
Deferred income taxes 2,398 2,798 2,301
Other current assets 1,538 1,175 1,010
--------- --------- ---------
Total current assets 67,348 70,483 70,438
Long-term marketable securities 43,971 27,333 38,674
Property, plant and equipment, net 14,157 14,453 13,889
Other noncurrent assets 8,259 6,793 8,219
--------- --------- ---------
Total assets $ 133,735 $ 119,062 $ 131,220
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 10,172 $ 9,822 $ 8,228
Other current liabilities 15,020 13,917 16,053
--------- --------- ---------
Total current liabilities 25,192 23,739 24,281
Pension benefits liabilities 2,315 1,862 2,315
Noncurrent liabilities 632 246 333
--------- --------- ---------
Total liabilities 28,139 25,847 26,929
--------- --------- ---------
Commitments and Contingencies
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, 17,475,748, 17,452,621 and
17,459,561 shares
issued in November 2003 and 2002, and August 17,476 17,453 17,460
2003)
Capital in excess of stated value 2,574 2,454 2,484
Retained earnings 174,840 164,047 174,333
Less treasury stock, (at cost, 5,724,069 shares) (89,898) (89,898) (89,898)
Accumulated other comprehensive gain (loss) 604 (841) (88)
--------- --------- ---------
Total shareholders' equity 105,596 93,215 104,291
--------- --------- ---------
Total liabilities and shareholders' equity $ 133,735 $ 119,062 $ 131,220
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LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED NOVEMBER 30, 2003 AND 2002
(UNAUDITED)
THREE MONTHS ENDED
---------------------------------------
NOVEMBER NOVEMBER
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 2003 2002
- ---------------------------------------- ----- ----
Operating revenues $36,513 $33,462
Cost of operating revenues 29,159 26,451
------- -------
Gross profit 7,354 7,011
------- -------
Operating expenses:
Selling expense 2,867 2,640
General and administrative expense 2,993 2,578
Engineering and research expense 760 598
------- -------
Total operating expenses 6,620 5,816
------- -------
Operating income 734 1,195
Interest income, net 424 423
Other income, net 449 96
------- -------
Earnings before income taxes 1,607 1,714
Income tax provision 514 521
------- -------
Net earnings $ 1,093 $ 1,193
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Basic net earnings per share $ 0.09 $ 0.10
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Diluted net earnings per share $ 0.09 $ 0.10
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Average shares outstanding 11,741 11,713
Diluted effect of stock options 224 217
------- -------
Average shares outstanding assuming dilution 11,965 11,930
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Cash dividends per share $ 0.050 $ 0.035
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LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED NOVEMBER 30, 2003 AND 2002
(UNAUDITED)
NOVEMBER NOVEMBER
($ IN THOUSANDS) 2003 2002
- ---------------- ---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 1,093 $ 1,193
Adjustments to reconcile net earnings to net cash used
in operating activities:
Depreciation and amortization 774 871
Amortization of marketable securities premiums, net 40 (43)
Loss on sale of fixed assets 8 -
Provision for uncollectible accounts receivable (60) (60)
Deferred income taxes (135) (225)
Equity in net earnings of equity method investments 7 (178)
Other, net (28) 264
Changes in assets and liabilities:
Receivables, net (6,244) (5,264)
Inventories, net (1,217) (3,153)
Other current assets (565) (393)
Accounts payable, trade 1,176 3,754
Other current liabilities (934) (866)
Current taxes payable (197) 1,144
Other noncurrent assets and liabilities 543 (509)
-------- --------
Net cash used in operating activities (5,739) (3,465)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment (743) (784)
Proceeds from sale of property, plant and equipment 11 -
Purchases of marketable securities held to maturity (2,982) (4,324)
Proceeds from maturities of marketable securities held
to maturity 2,785 460
Purchases of marketable securities available for sale (3,288) -
Proceeds from maturities of marketable securities
available for sale 1,315 -
-------- --------
Net cash used in investing activities (2,902) (4,648)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of options under stock option plan 110 4
Dividends paid (586) (410)
-------- --------
Net cash used in financing activities (476) (406)
-------- --------
Effect of exchange rate changes on cash 12 -
Net decrease in cash and cash equivalents (9,105) (8,519)
Cash and cash equivalents, beginning of period 15,368 12,425
-------- --------
Cash and cash equivalents, end of period $ 6,263 $ 3,906
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