EXHIBIT 99.1
[LINDSAY MANUFACTURING CO. LOGO]
2707 NO. 108TH ST. OMAHA, NE 68164 TEL: 402-829-6800 FAX: 402-829-6835
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FOR FURTHER INFORMATION, CONTACT:
LINDSAY MANUFACTURING: HALLIBURTON INVESTOR RELATIONS:
David Downing Jeff Elliott or Geralyn DeBusk
VP and CFO 972-458-8000
402-827-6235
LINDSAY MANUFACTURING CO. REPORTS FISCAL 2005 FOURTH QUARTER, FULL-YEAR RESULTS
OMAHA, Neb., October 12, 2005 -- Lindsay Manufacturing Co. (NYSE: LNN ), a
leading manufacturer of center pivot, lateral move, and hose reel irrigation
systems, today announced results for its fiscal fourth quarter and full year
ended August 31, 2005.
FOURTH QUARTER RESULTS
Fourth quarter fiscal 2005 total revenues were $40.0 million, a 14 percent
decline from $46.4 million for the year-ago period. Net earnings were $293,000
or $0.03 per diluted share, compared with $345,000, or $0.03 per diluted share,
in the prior year's fourth quarter. A $1.5 million pre-tax expense incurred
during the fourth quarter of fiscal 2005 due to the previously announced repair
campaign of end gun solenoid valves on Lindsay's center pivot irrigation systems
resulted in a decrease of approximately $0.09 per diluted share to the quarter's
net income. Net income for the prior year period was unfavorably impacted by
$0.14 per diluted share due to inventory-related adjustments and the insolvency
of a dealership.
Total irrigation equipment revenues declined 18 percent to $34.8 million from
$42.4 million in the prior fiscal year's fourth quarter, as low worldwide
agricultural commodity prices, combined with higher farm input costs, reduced
demand for irrigation equipment globally. Domestic irrigation revenues declined
22 percent, while international irrigation revenues declined 11 percent from the
prior year's quarter. Diversified products again delivered a strong performance,
with revenues of $5.3 million compared with $4.0 million in the year-ago period,
an increase of 31 percent.
Rick Parod, president and chief executive officer, commented, "Demand for
irrigation equipment worldwide remains soft as higher costs for energy,
fertilizer, and other agricultural inputs, as well as low crop prices, continue
to impact the growers' investment decisions. However, I am pleased that the
diversified products business again realized strong revenue gains, reflecting
our initiatives to grow this business segment."
Gross margin improved to 17.6 percent from 16.3 percent a year ago, due to
improved international margins, factory cost controls and favorable
year-over-year inventory related adjustments partially offset by the above
mentioned repair campaign. We incurred an operating loss of $111,000 including
the repair campaign expenses, compared with operating income of $402,000 in the
comparable fiscal 2004 quarter, which was impacted by the previously mentioned
adjustments. Operating expenses were flat at $7.2 million due to Sarbanes-Oxley
compliance expenses in the current period and the dealer insolvency expense in
the prior period.
Lindsay's order backlog at August 31, 2005, was $14.2 million compared with
$16.5 million at August 31, 2004. "The lower ending backlog reflects the
continued cautious sentiment of farmers regarding capital equipment purchases,"
Parod said.
FULL-YEAR RESULTS
Total revenues for fiscal 2005 were $177.3 million, a 10 percent decrease from
$196.7 million a year ago. Total irrigation equipment revenues of $156.3 million
declined 15 percent from a year ago, while diversified products revenues grew 63
percent, rising to $21.0 million. Net earnings were $4.8 million, or $0.40 per
diluted share, compared with $9.3 million, or $0.78 per diluted share, for
fiscal year 2004.
Cash flow from operations for fiscal 2005 was $11.8 million, an increase of
$10.6 million from the year-ago period. During fiscal 2005, the company used
$6.6 million of internally generated cash to repurchase approximately 324,000
shares. At August 31, 2005, the remaining amount authorized under the company's
current share repurchase program was approximately 881,000 shares.
Cash and marketable securities at August 31, 2005 were $54.8 million compared
with $56.3 million at August 31, 2004. Shareholders' equity at August 31, 2005,
was $109.3 million, or $9.49 per outstanding common share, compared with $112.2
million, or $9.53 per outstanding common share, at August 31, 2004.
On July 12, 2005, Lindsay announced that it had increased its regular quarterly
cash dividend by 9 percent to $0.06 per share from $0.055 per share. The new
annual indicated rate is $0.24 per share, an increase in the previous annual
indicated rate of $0.22 per share.
OUTLOOK
Parod stated, "Uncertainty in the worldwide agricultural irrigation market
continues to adversely affect farmer psychology and short term demand. We have
taken action to reduce costs and improve capacity utilization while maintaining
our strong competitive position. The long-term drivers of our business remain
robust. Water continues to become more valuable and farmers are seeking ways to
reduce costs and increase productivity."
He added, "We will continue to leverage our strong cash flows and financial
flexibility to create shareholder value by seeking a balance of organic growth
opportunities, accretive acquisitions, share repurchases, and dividend payments.
Through these initiatives, we will continue to pursue our previously stated
long-term goals of sustainable growth in revenues, gross margins, operating
margins, and return on beginning equity."
FOURTH-QUARTER CONFERENCE CALL
Lindsay's fourth-quarter fiscal 2005 investor conference call is scheduled for
11:00 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, Stettyn 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 August 31, 2005, Lindsay had approximately 11.5 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 Web site
at www.lindsaymanufacturing.com.
LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE-MONTHS AND FISCAL YEARS ENDED AUGUST 31, 2005 AND 2004
THREE MONTHS ENDED FISCAL YEAR ENDED
------------------------- ------------------------
(UNAUDITED) (UNAUDITED)
AUGUST AUGUST AUGUST AUGUST
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 2005 2004 2005 2004
- ---------------------------------------- ---- ---- ---- ----
Operating revenues ............................. $ 40,032 $ 46,422 $177,271 $196,696
Cost of operating revenues ..................... 32,993 38,856 143,700 157,179
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Gross profit ................................... 7,039 7,566 33,571 39,517
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Operating expenses:
Selling expense .............................. 2,593 2,560 11,031 11,148
General and administrative expense ........... 3,962 3,892 14,377 13,419
Engineering and research expense ............. 595 712 2,665 2,910
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Total operating expenses ....................... 7,150 7,164 28,073 27,477
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Operating (loss) income ........................ (111) 402 5,498 12,040
Interest income, net ........................... 359 330 1,179 1,456
Other (expense) income, net .................... (42) (167) 273 270
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Earnings before income taxes ................... 206 565 6,950 13,766
Income tax (benefit) provision ................. (87) 220 2,112 4,480
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Net earnings ................................... $ 293 $ 345 $ 4,838 $ 9,286
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Basic net earnings per share ................... $ 0.03 $ 0.03 $ 0.41 $ 0.79
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Diluted net earnings per share ................. $ 0.03 $ 0.03 $ 0.40 $ 0.78
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Average shares outstanding ..................... 11,518 11,766 11,811 11,756
Diluted effect of stock options ................ 138 173 152 191
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Average shares outstanding assuming dilution ... 11,656 11,939 11,963 11,947
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Cash dividends per share ....................... $ 0.060 $ 0.055 $ 0.225 $ 0.205
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LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AUGUST 31, 2005 AND 2004
AUGUST AUGUST
2005 2004
---- ----
(UNAUDITED)
($ IN THOUSANDS, EXCEPT PAR VALUES)
ASSETS
Current Assets:
Cash and cash equivalents ...................................... $ 25,564 $ 8,973
Marketable securities .......................................... 14,101 14,802
Receivables .................................................... 28,919 34,369
Inventories .................................................... 19,311 19,780
Deferred income taxes .......................................... 3,276 1,026
Other current assets ........................................... 3,042 2,422
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Total current assets ........................................... 94,213 81,372
Long-term marketable securities ................................... 15,157 32,527
Property, plant and equipment, net ................................ 17,268 16,355
Other noncurrent assets ........................................... 8,201 8,747
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Total assets ...................................................... $ 134,839 $ 139,001
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable ............................................... $ 6,704 $ 9,117
Other current liabilities ...................................... 13,434 15,359
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Total current liabilities ...................................... 20,138 24,476
Pension benefits liabilities ...................................... 5,213 2,169
Noncurrent liabilities ............................................ 158 172
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Total liabilities ................................................. 25,509 26,817
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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, 17,568,084 and 17,493,841, shares issued in 2005
and 2004, respectively) .................................... 17,568 17,494
Capital in excess of stated value ............................ 3,690 2,966
Retained earnings ............................................ 183,444 181,209
Less treasury stock, (at cost, 6,048,448 and 5,724,069 shares
respectively) .............................................. (96,547) (89,898)
Accumulated other comprehensive income, net .................. 1,175 413
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Total shareholders' equity ........................................ 109,330 112,184
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Total liabilities and shareholders' equity ........................ $ 134,839 $ 139,001
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LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWELVE MONTHS ENDED AUGUST 31, 2005 AND 2004
(UNAUDITED)
AUGUST AUGUST
($ IN THOUSANDS) 2005 2004
- ---------------- ---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings ........................................................... $ 4,838 $ 9,286
Adjustments to reconcile net earnings to net cash provided by
operating activities:
Depreciation and amortization ....................................... 3,481 2,969
Amortization of marketable securities premiums (discounts), net ..... 248 149
Loss (gain) on sale of property, plant and equipment ................ 37 (29)
Provision for uncollectible accounts receivable ..................... 88 760
Deferred income taxes ............................................... (1,140) 1,034
Stock option tax benefits ........................................... 136 157
Equity in net (earnings) loss of equity method investments .......... (257) 73
Other, net .......................................................... 16 (204)
Changes in assets and liabilities:
Receivables ......................................................... 6,203 (11,507)
Inventories ......................................................... 828 920
Other current assets ................................................ (45) (1,428)
Accounts payable .................................................... (2,429) 749
Other current liabilities ........................................... (3,031) 436
Current taxes payable ............................................... 257 (1,443)
Other noncurrent assets and liabilities ............................. 2,548 (717)
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Net cash provided by operating activities .............................. 11,778 1,205
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment ............................. (4,122) (5,037)
Acquisitions of businesses ............................................. - (1,025)
Proceeds from sale of property, plant and equipment .................... 55 43
Purchases of marketable securities held-to-maturity .................... - (2,982)
Proceeds from maturities or sales of marketable securities
held-to-maturity .................................................... - 6,676
Purchases of marketable securities available-for-sale .................. (1,841) (11,817)
Proceeds from maturities or sales of marketable securities
available-for-sale ................................................... 19,100 8,456
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Net cash provided by (used in) investing activities .................... 13,192 (5,686)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock option plan ..................... 621 492
Repurchases of common shares ........................................... (6,649) -
Dividends paid ......................................................... (2,603) (2,410)
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Net cash used in financing activities .................................. (8,631) (1,918)
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Effect of exchange rate changes on cash ................................ 252 4
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Net increase (decrease) in cash and cash equivalents ................... 16,591 (6,395)
Cash and cash equivalents, beginning of period ......................... 8,973 15,368
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Cash and cash equivalents, end of period ............................... $ 25,564 $ 8,973
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