EXHIBIT 99.1
[LINDSAY LOGO]
MANUFACTURING CO. 2707 NO. 108TH ST. OMAHA, NE 68164 TEL: 402-829-6800
FAX: 402-829-6836
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 2006
SECOND QUARTER, SIX MONTH RESULTS
OMAHA, NEB., MARCH 22, 2006 -- LINDSAY MANUFACTURING CO. (NYSE: LNN), a leading
manufacturer of center pivot, lateral move, and hose reel irrigation systems,
today announced results for its fiscal second quarter ended February 28, 2006.
Revenues increased 32 percent from the same period a year ago, and earnings per
diluted share were $0.15 compared with $0.05 in the comparable prior year
period.
SECOND QUARTER RESULTS
Second quarter fiscal 2006 total revenues were $54.9 million compared with $41.5
million for the year-ago period. Net earnings were $1.7 million or $0.15 per
diluted share, versus $600,000, or $0.05 per diluted share, in the prior year's
second quarter. The current period includes a $0.02 unfavorable impact to
diluted earnings per share related to expensing of stock-based compensation.
Total irrigation equipment revenues increased 36 percent to $49.2 million from
$36.2 million in the prior fiscal year's second quarter, as farmer sentiment
improved with stabilized worldwide agricultural commodity prices and input
costs. Domestic irrigation revenues increased 42 percent, while international
irrigation revenues increased 22 percent. Diversified products revenues were
$5.7 million compared with $5.3 million in the year-ago period, an increase of 8
percent.
Rick Parod, president and chief executive officer, commented, "We are pleased
that demand for irrigation equipment continued to rebound from the prior year
when growers deferred purchases. While demand in most markets strengthened, the
markets in Western Europe, South Africa and Brazil remain depressed and we
continued our cost reduction actions in those markets during the period."
Gross margin declined to 18.0 percent from 18.7 percent a year ago. Gross
selling margins in the domestic market were slightly lower compared with the
second quarter of fiscal 2005 as a result of higher zinc and structural steel
costs. International gross margins were impacted by competitive intensity
particularly in the Western European market. The quarter's operating income was
$2.1 million versus $710,000 in the comparable fiscal 2005 quarter, driven by
the higher revenues. Operating expenses rose 10 percent to $7.8 million from
$7.1 million, due principally to inclusion of stock-based compensation expenses
of $421,000 and inclusion of factory consolidation costs in South Africa of
$186,000. Interest and other income totaled
$416,000 in the quarter compared to $363,000 in the fiscal 2005 quarter.
Parod stated, "We continue to take actions to reduce expenses and improve
efficiency across the global organization. I am also pleased with the continued
improvements in our global management of working capital."
Lindsay's order backlog at February 28, 2006, was $23.9 million compared with
$20.9 million at November 30, 2005, and $15.3 million at February 28, 2005.
SIX MONTH RESULTS
Total revenues for the six months were $94.4 million, a 16 percent increase from
$81.3 million for the prior year's six-month period. Total irrigation equipment
revenues of $83.3 million rose 16 percent from a year ago, while diversified
products revenues grew 14 percent, rising to $11.1 million. Net earnings were
$2.2 million, or $0.19 per diluted share, compared with $775,000, or $0.06 per
diluted share, for the first six months of fiscal 2005. The six month results
include a $0.04 unfavorable impact to diluted earnings per share related to
expensing of stock based compensation.
Shareholders' equity at February 28, 2006 was $111.9 million, or $9.70 per
outstanding common share, compared with $110.2 million, or $9.45 per outstanding
common share at February 28, 2005. Cash and marketable securities at February
28, 2006 were $50.9 million compared with $43.8 million at February 28, 2005.
OUTLOOK
Parod stated, "In the United States, the USDA projects net farm income to be
lower in 2006 due to lower production, lower commodity prices and higher input
costs; yet, irrigation equipment demand remains strong due to improved farmer
sentiment and dry conditions. Globally, long-term drivers remain positive as
population growth, the need for productivity improvements and fresh water
constraints drive demand for our irrigation technology."
"Strengthening our margins during a period of rising steel and zinc prices
remains a challenge given the short-term competitive environment. We have taken
actions to tightly control production costs while maximizing our throughput
during our peak selling months. We are also continuing growth initiatives
related to finding accretive acquisitions in infrastructure and water products.
We will continue to pursue our growth initiatives and leverage our strong cash
flow and financial flexibility to create shareholder value through a balance of
organic growth opportunities, accretive acquisitions, share repurchases and
dividend payments."
SECOND QUARTER CONFERENCE CALL
Lindsay's second quarter fiscal 2006 investor conference call is scheduled for
11:00 a.m. ET today. The conference call will be simulcast live on the Internet,
and can be accessed by logging onto www.lindsaymanufacturing.com or
www.vcall.com. A replay of the call will be available for 30 days. Lindsay 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 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 February 28, 2006, 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 SIX-MONTHS ENDED FEBRUARY 28, 2006 AND 2005
(UNAUDITED) (UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
----------------------------- -------------------------
FEBRUARY FEBRUARY FEBRUARY FEBRUARY
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 2006 2005 2006 2005
- ------------------------------------------------ -------------- ------------- -------------- ---------
Operating revenues.............................. $ 54,912 $ 41,487 $ 94,416 $ 81,254
Cost of operating revenues...................... 45,048 33,721 77,125 66,915
-------------- ------------- -------------- ---------
Gross profit.................................... 9,864 7,766 17,291 14,339
-------------- ------------- -------------- ---------
Operating expenses:
Selling expense............................... 2,884 2,999 5,732 5,746
General and administrative expense............ 4,285 3,397 7,854 6,994
Engineering and research expense.............. 607 660 1,254 1,356
-------------- ------------- -------------- ---------
Total operating expenses........................ 7,776 7,056 14,840 14,096
-------------- ------------- -------------- ---------
Operating income................................ 2,088 710 2,451 243
Interest income, net............................ 436 295 863 556
Other (loss) income, net........................ (20) 68 (18) 452
-------------- ------------- -------------- ---------
Earnings before income taxes.................... 2,504 1,073 3,296 1,251
Income tax provision............................ 787 473 1,068 476
-------------- ------------- -------------- ---------
Net earnings.................................... $ 1,717 $ 600 $ 2,228 $ 775
============== ============= ============== =========
Basic net earnings per share.................... $ 0.15 $ 0.05 $ 0.19 $ 0.07
============== ============= ============== =========
Diluted net earnings per share.................. $ 0.15 $ 0.05 $ 0.19 $ 0.06
============== ============= ============== =========
Average shares outstanding...................... 11,522 11,710 11,521 11,741
Diluted effect of stock options................. 174 168 163 188
-------------- ------------- -------------- ---------
Average shares outstanding assuming dilution.... 11,696 11,878 11,684 11,929
============== ============= ============== =========
Cash dividends per share........................ $ 0.060 $ 0.055 $ 0.120 $ 0.110
============== ============= ============== =========
Net income for the three-months and six-months ended February 28, 2006, included
stock-based compensation expense under SFAS 123(R) of $275,000 and $519,000,
respectively, net of tax. There was no stock-based compensation expense under
SFAS 123 in the first or second quarters of fiscal 2005 because the Company did
not adopt the recognition provisions of SFAS 123.
LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
FEBRUARY 28, 2006 AND 2005 AND AUGUST 31, 2005
(UNAUDITED) (UNAUDITED)
FEBRUARY FEBRUARY AUGUST
($ IN THOUSANDS, EXCEPT PAR VALUES) 2006 2005 2005
---------------- ----------- -------------
ASSETS
Current Assets:
Cash and cash equivalents..................................... $ 26,907 $ 7,571 $ 25,564
Marketable securities......................................... 13,104 11,720 14,101
Receivables, net.............................................. 35,999 35,680 28,919
Inventories, net.............................................. 26,292 29,858 19,311
Deferred income taxes.......................................... 3,948 1,288 3,276
Other current assets.......................................... 4,539 3,343 3,042
---------------- ----------- -------------
Total current assets.......................................... 110,789 89,460 94,213
Long-term marketable securities.................................. 10,925 24,517 15,157
Property, plant and equipment, net............................... 17,551 16,724 17,268
Other noncurrent assets.......................................... 6,933 9,158 8,201
---------------- ----------- -------------
Total assets..................................................... $ 146,198 $ 139,859 $ 134,839
================ =========== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable.............................................. $ 14,215 $ 11,010 $ 6,704
Other current liabilities...................................... 14,743 13,849 13,434
---------------- ----------- -------------
Total current liabilities..................................... 28,958 24,859 20,138
Pension benefits liabilities..................................... 5,217 4,664 5,142
Other noncurrent liabilities..................................... 169 161 229
---------------- ----------- -------------
Total liabilities.................................................. 34,344 29,684 25,509
---------------- ----------- -------------
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, 17,573,531, 17,521,272 and 17,568,084
shares issued in February 2006 and 2005
and August 2005, respectively)........................... 17,573 17,521 17,568
Capital in excess of stated value........................... 4,500 3,092 3,690
Retained earnings........................................... 184,290 180,700 183,444
Less treasury stock, (at cost, 6,048,448, 5,862,569 and
6,048,448 shares, respectively)........................ (96,547) (93,073) (96,547)
Accumulated other comprehensive income, net................. 2,038 1,935 1,175
---------------- ----------- -------------
Total shareholders' equity....................................... 111,854 110,175 109,330
---------------- ----------- -------------
Total liabilities and shareholders' equity....................... $ 146,198 $ 139,859 $ 134,839
================ =========== =============
LINDSAY MANUFACTURING CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTHS ENDED FEBRUARY 28, 2006 AND 2005
(UNAUDITED)
FEBRUARY FEBRUARY
($ IN THOUSANDS) 2006 2005
- ------------------------------------------------------------------------------ ------------ --------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings............................................................... $ 2,228 $ 775
Adjustments to reconcile net earnings to net cash provided by
operating activities:
Depreciation and amortization......................................... 1,661 1,783
Amortization of marketable securities, net............................ 126 110
Loss on sale of property, plant and equipment......................... 30 -
Provision for uncollectible accounts receivable....................... 36 53
Equity in net earnings of equity method investments................... (4) (230)
Deferred income taxes................................................. (239) (332)
Stock option tax expense.............................................. (24) -
Stock-based compensation expense...................................... 741 -
Other, net............................................................ (37) (50)
Changes in assets and liabilities:
Receivables, net...................................................... (6,448) (427)
Inventories, net...................................................... (6,824) (8,914)
Other current assets.................................................. (1,392) (521)
Accounts payable, trade............................................... 7,503 1,425
Other current liabilities............................................. 1,223 (2,616)
Current taxes payable................................................. (251) 351
Other noncurrent assets and liabilities............................... 292 2,528
------------ --------------
Net cash used in operating activities...................................... (1,379) (6,065)
------------ --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment.................................. (1,772) (1,769)
Sale of an equity investment............................................... 354 -
Proceeds from sale of property, plant and equipment........................ 81 7
Purchases of marketable securities available-for-sale...................... - (1,841)
Proceeds from maturities or sales of marketable securities
available-for-sale....................................................... 5,113 12,360
------------ --------------
Net cash provided by investing activities.................................. 3,776 8,757
------------ --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock under option plan................... 93 208
Repurchases of common stock................................................ - (3,175)
Dividends paid............................................................. (1,382) (1,284)
------------ --------------
Net cash used in financing activities...................................... (1,289) (4,251)
------------ --------------
------------ --------------
Effect of exchange rate changes on cash.................................... 235 157
------------ --------------
Net increase (decrease) in cash and cash equivalents....................... 1,343 (1,402)
Cash and cash equivalents, beginning of period............................. 25,564 8,973
------------ --------------
Cash and cash equivalents, end of period................................... $ 26,907 $ 7,571
============ ==============