LNN - Earnings call transcript Q4 2017

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Operator

Good morning. My name is Amy and I will be your conference operator today. At this time, I would like to welcome everyone to the Lindsay Corporation Fourth Quarter 2017 Earnings Call. All participants will be in listen-only mode. [Operator Instructions].

conditions, may uncertainties, statements beliefs, which future circumstances, management to are estimates call, financial economic and and risks reflect industry this make that forward-looking subject of results. During performance company management’s current

expressions. Forward-looking expectations, future of statements should outlook, those preceded could, operations assumed or by, similar and results by, company may, include followed concerning the including or information statements the possible of the or words,

contained in Executive For presentation, we statements Harbor the Mr. for Act of Reform protection like Parod, there an opportunity today’s Safe Private and these to Please the the of to being is Rick President ask to would statements, claim Officer. recorded. event be After now Litigation the Securities turn questions. over Chief forward-looking XXXX. this I note will conference

Rick Parod

revenues earnings per to of million in the per period. share quarter net year Total $X.XX $X.X or over higher share share quarter or the earnings $X.X per revenues when fiscal share a the the in by year-over-year morning for landscape Brian million higher higher last quarter the million, the Pivot average $XXX pivot was revenues. rate XXXX same filtration Irrigation and diluted systems quarter quarter XX.X Good applications per operating million of decreasing sales year. same $XX.X call income share Zarkowski, last favorable cyclical same Accounting the driven diluted earnings in X% compared last most $X.XX outside unit irrigation were quarter million, activity the today’s us were projects irrigation increase thank year. Financial we regions year. over the of joining XX% primarily same quarter in or $X.X and pump XXXX. and compared XXXX. $XXX.X same sizeable the were an increase strong, $X.XX full operating increase to prior equipment to of through $X.XX exceeded in Officer; translation for in over irrigation fourth fiscal The quarter, quarter the the quarter diluted from XXXX per due irrigation currency for Net tax of million, revenues million, in U.S. million Brazil, were filtration year. Chief and agricultural Quoting fiscal X.X% for increased of for XXXX the golf increase Net earnings Total net system fiscal the X% diluted project X% the material year to year. volume. million to and for were recovery the and decrease for the in in impact. previous prices Fiscal sales remain me and over or the revenues in Chief margin over in quarter higher since by This per rate same quarter for XXXX first Lori in in for filtration market the was market, and continue quarter effective revenue of million. drip of fiscal share of the fourth international year. projects the million decreasing or today. markets on revenues full volume With same irrigation a with was selling of second The $X.XX recent quarter the compared diluted increased peak fiscal $XXX revenues $XX.X primarily as system income to steel. a Lindsay Lateral XXXX year and reflecting a you year for equipment Ketcham, compared average international net slightly In X% revenues irrigation. the selling our same the increasing consecutive XX.X in reflecting A continued Irrigation unit fourth million, higher segment reflect increasing X.X% fourth sales fourth $X.XX the were or in X.X income Corporation’s last year, compared The in undertaken majority were were for $XXX.X increased for effective see diluted on earnings the million irrigation developing earnings the costs Revenues higher decreased quarter the Lindsay pass decreasing is In quarter activity pump and Officer. markets, the tax slight net $X.X from resulted last lower developing last last the quarter markets prices U.S. world. pump were markets

system XXXX, of and of last international to in million year, million lower operating were XX.X% of of were revenues XXX in than higher the last the last X% XX.X% of than operating Higher recovery road year. the higher of the margin fourth international same products and offset in year safety XXX.X irrigation In of quarter million the of the system year, included Zipper in same in road from sales period in sales total of markets than last year. profit segment mid-sized revenues the X% products of Infrastructure income more were were operating last to XXXX and margin For quarter. by quarter last sales operating this revenues compared income same same Road X.X U.S. segment year. irrigation revenues for sales year’s XX% million XX.X lower of fourth operating irrigation XXX.X The by XX.X% were revenue total developing Road of than declining U.S. unmatched sales, segment Zipper the the compared million project of for quarter, the fiscal the in lower lease X% segment quarter XX year, year contributing year. irrigation lower and sales Infrastructure of driven operating the full million generated Road operating margin generated and Zipper three quarter income and margin were of period and quarter regions. XX.X Brazil million operating in X.X for The the comparable income million XX.X% fiscal safety

various to will evaluated infrastructure we for road XXXX. standard for expenses stated, engineering Federal previously December segment safety MASH reimbursement of As through hardware road for with dates hardware. under extend that MASH the R&D Highway of Under run be higher and and a level development products safety testing the in effective program, standards

is for moved federal However, tested for the have dates. will to already of from before are group next the or and and received as products. standards next product several of move and review new of lines in the standards. testing the the through preparing request submitted states of the FHWA the the level of The to fiscal new XXXX eligibility We’ve to core of eligibility process completing development and products expected continue required for testing we letters complete transition

of segment were year the infrastructure XXXX same of $XX.X period year. generated sales of year year. improved with the same The operating We're segment infrastructure operating period of XX.X% was XX.X% significantly and and for million in fiscal income were of performance the last full million of margin higher the for income sales $XX.X X% operating $XX.X pleased very operating revenues to compared the total than million the business. last margin in For and

in decreased the quarter last Irrigation was backlog to expenses integrated the both XXXX segment are compared lower slightly operating was a to same The compared resulted XXXX markets to revenue August for sales of sales fiscal XXXX XX.X% to and in lower Equipment was $X.X same same $XX.X an prior the Operating processes competitive year. for quarter the was quarter exceptionally million the while higher gross sales comparable compared international to fourth quarter XXXX the total the mix last and infrastructure decrease to in million in fourth revenue last XXXX last of decrease higher was from the fourth revenues. $XX.X X% quarter XXXX. of lower in quarter $XX.X infrastructure increased lower in in project XX% comparison sales XX.X% In year the XX.X% to vertically expenses. at operating year. backlog The the a of of fourth fiscal higher of last in X.X% X% while margins from year. decrease on expenses compared quarter in margins of where the irrigation the end and fourth segment Margins the and quarter year. was compared strong year. lower. overall order For quarter were expenses income the quarter manufacturing XX, of fourth company, fiscal due typically compared irrigation August million, were X% fiscal to or Operating quarter segment, operating were Operating sales margin for backlog reductions same the same selling U.S. administrative of the XX, gross million of margins year less Irrigation last year. segments. segment $XX.X same margin for segment of gross were of due and infrastructure to million a million in income time quarter Irrigation income of $XX to were the last

fiscal fourth were would end some million capital fiscal some based irrigation operations XXXX. and the infrastructure Cash $XX are expenditures revenues. in In same from million lead expected represents $XXX.X be time of year be projected compared equipment the that as X% good first therefore net $XX.X Capital capacity million completed of The USDA expansion higher such quarters' to equivalents agricultural cash now the latest future full We've reached than has farm cyclical estimate upcoming of million to generated year fiscal as growth our have longer-term decline. repurchases short for downturn at compared significant generated acquisitions XXXX is the deferred appears increase quarter. were in we the income authorization on organic year, level $X.X years lower market of million indication were $XXX.X XXXX Capital repurchases. to end $XX.X The following the last is improved during typically And expenditures projects investments to projects million the a fourth backlog last orders the to for last total of million. accretive and and were necessarily not Our strategic quarter strength us including of $XX in range under XX.X our drive of well made year. quarter sheet at in return share XXXX conditions. fiscal at initiatives, and other expenditures for million balance available time position and of share in to shareholders in the million of our fourth market year. the the stabilization. of it market initiatives Cash continues to and compared U.S. planned the to than repurchase $XX.X share the as remains three

financial improved optimism and penetration recalibration in aggressive cost efficiency products. US expect high management business we general technology as investment, market towards our the of equipment fiscal growth irrigation continued well modest addition, equipment platform. our economic upcoming as particularly as contributed sentiment of in also such irrigation In In yield-enhancing our year, to have irrigation and and

In continue in increased through in markets. for road we as the well some project Zipper projects market recovery, demand growth expect also We developed markets in expansion well rising markets infrastructure interest Road System products. segment, as as see activity of to global as ongoing international developing safety the

place significant the seen in have been recurring highway that close spending build we transportation not incremental for have two for federal now, surface yet years increase to projects. in On

for In compliant the negatively the road MASH current ongoing by addition, products US transition order the flow impacted safety to is in products.

be continues and road in that development need continue safety improvement to and a infrastructure for will However, demand growth products. drive for to critical there US

continue to by expand benefits While in and crop the global irrigation and agriculture position, markets provided cycle, yields this the aware our increasing improve drive downturn market our solutions the our Throughout and in of quality. invest and remains efficient to structure. strengthen cost we issues are acutely offering cyclical, farmer

of All long-term. benefit these and will the now company

my intelligent announced December I from February, of years President Board In Directors my as Hassinger Corporation my next and company. Lindsay XX after as CEO of differentiated than more Lindsay, effective the In in role I’m growth recall successor XX. potential entire will retire July, the driven management production, established, to importantly global Monday for about the this in you here announced and the for integrity. the as multinational market expanded to team intention contributions women The X, the food and appointment created As from use men along bright, Tim while the superb a and position confident the organization. October of effective organization retirement extremely is of most a safety. of its natural throughout Corporation’s footprint transportation group building respect committed organization passionate and Lindsay value purpose shareholders with efficient demonstrating remains This resource dedicated, our

this questions. to to be your platform fellow our open shareholders, you, during I’m dealers, my profitable and I help. be for leave in future I importantly, all this past that thoughtful I’d the helping board up hands associated helped Tim's with of like wish our I it role, build company As employees, and present good members, to wish Most distributors, under for at successful supported thank the suppliers have will others Lindsay who now our my time growth. thank confident leadership.

Operator

[Operator Instructions] Drab, first is from Brian question Blair. William The

Brian Drab

congratulations Good run, Rick morning, going to you. on we’re and great a miss

Rick Parod

Well, you guys thank to I’m going you too. miss

had quarter but a had job This world. and the the got people I end, fantastic at been it’s been past best little opportunity the have stronger in we've a in the

Brian Drab

congrats much a of yes, up the yes, and up stock a wouldn’t reaction rough too yourself bit had again. you’re a XX Well, you’ve mean today, I but great. beat Well, great last And XX% run. months, I over

Rick Parod

Thank you.

Brian Drab

net talk from? level some tick where is in farm was net still more in you can So, in way of confidence products. the income out the a understand income, just years the you bit the Clearly the little irrigation at about business three down up pointed new from domestic comes farm I growth ago. it

next things, all things and these So, forecast backlog factor talk you be is which the forming may for is could important mentioned, it these other in most combination of year? the growth just about a the you that

Rick Parod

on the expansion there’s growth still opportunities that know opportunities, excellent believe see for Well, year as quieting based we enter well. opportunities on number more seen this. happens a platform. this what later what of to up start in a I was States I would today. in projects climate a we real that that we’ll little I I definitely and factors expansion But to think with insight overall excellent a sales. also technology are opportunities I more of One, last different bit our we ago, definitely a believe that are will commented share pick expect farmer in expansion there’s that year also Lindsay. data and mentioned market. I even we half. seeing pick hearing in there’s complete give into it’s significant harvest international terms little last the than it as And do for little rapid need of a of and up quite I for I optimism, we it say the into United year, project quarter and But have

Brian Drab

any seem really there to this last side, your Tennessee at then this okay. the has has that late there infrastructure Okay, resolved? in impact from like think been point And business you been, It year? incident doesn’t is on

Rick Parod

I states saw list. their take product X-LITE some think we the qualified of products our offering

less that those would However, what is total in company removed from roughly than reflected list. that equated That our be X.X% sales. to of

during out. purchase states that either of an chased I purchase is period. making conversion had differing getting is significant that hasn’t time effect. decisions the where a There product that time, different decisions same MASH however the are at Now would or to say effect

Brian Drab

Alright.

you be term, incident states. in So, MASH the phased products MASH that longer the with the anyway. was competing this could products everyone is the proved these product in of And out be of would subject

Rick Parod

be compliant the NCHRP I anticipate MASH. of will the to of as calendar products, standard by X-LITE states year other MASH by replaced products from XXX the end transition

Brian Drab

Okay.

on to So, year? the the get you've the able taking where states where back should with list new next have approved -- be had the you list products you approval the been off

Rick Parod

of other asking certainly are Well some all to going are to whether and their standards. some decisions questions those and past] additional states making we [attach own are the obviously MASH of just apply than states all

will be discussion each this state. with ongoing So,

Brian Drab

don’t for next one And just I expecting I you a Okay, then question And the that great. missed year, Brian. on did may for know but tax rate be small a are this he that? say if

Brian Ketcham

next for I would but mix of to Yes, year could range be lower on I would depending XX% be think of what be, Brian would it expect slightly the in I that earnings, model. XX%,

Operator

Company. The with next question Joseph is Mondillo & Sidoti from

Joseph Mondillo

to about sort My ask your are there. first peer of wanted and on question, you competition seeing what and pricing I just out

or three maybe pretty really little been also a a the done good in peers' your your you job, last I the the seems quarters big skewing that’s years you three North but it last a numbers or America, like While know But bit. had peer underperforming, guys outperforming been maybe segment. years so four you’ve project irrigation that have

seeing, sort what underperforming you. or that’s seems domestically, competition, bit your on what wondering as where just So it you’re pricing, and me specifically thoughts that Thank of give you are little also a well? internationally maybe because

Rick Parod

as would you as report, whenever, our they do as competition when I’m into our we dive numbers report. Well, they deep we as can sure, expect

what of to remain and international So, just can't But some it’s and what tell as is board. it’s the rationale rationale would we see speaking, a during time. And there things board some as of seen regional of to those certainly the get good here But overall entered those. number we to from continue are company. related. across think to gradual in get we we a see the region, whether a project shift normally whether pricing be project aggressive project or of international aggressiveness related related I’ve does in my generally dealer's see it place more is, or tends take and region I and beginning in share the quarter-to-quarter often domestic be say have outside that make appear look basis shift share taken project share picked we’ve will markets I a we're would I some across time-to-time, of of you pretty We as that and in shifts see can characterize From most remain we’ve generally that, we believe, as the tenure seen a as place. ones changes where period up most share of or the share

Joseph Mondillo

wanted ask segment I to really good. being And the you has side, that on infrastructure doing

even You Road and mentioned that’s that know business the performed I Zipper well margin. higher quite

outlook of the Zipper side outlook that look what like? does as ’XX. sort looks compared with in what Road the to curious Just of How ‘XX, as well leasing like, project your

Rick Parod

very Without think good point to that is standpoint this a getting strong. of can activity, guidance, obviously to closely And and a from project correlate still say construction. road I’d the leasing I you

going So, projects when maybe some have you see, projects. the construction generally some and to process. construction construction high longer-term but in is leasing as is do its We well leasing be during that to during season that generally leasing

what very pipeline to the project In continue pipeline, have in good a terms on the of and the sales see sales we process we lists.

better would I than ago or fact, years saw ago two it's even or a what year years say ago. three we In

from So, I’m standpoint projects. the that on optimistic

project the couple project those be we million a well that from in $XX that of to size can in a And be that pipeline. as all that in maybe anything potentially of see could a million comment size. I'd Now projects dollars

the of as very systems standpoint would the and Zipper potential from overall Road so be the everything. So, about optimistic we

Joseph Mondillo

of in sort regarding activity you just And project projects? could all if you us what saw 'XX QMB at remind

Rick Parod

'XX but be what QMB For were I saw $X in in most to we seeing consider characterize those. we the were size, small-to-medium I multiple And sized. $X the probably to million of would projects million of

of in of those thing. year talked fourth about same was we in would the the you then last quarter If even as the comparison

Brian, that seeing don't 'XX, more And those now have one we're you range? is do in small-to-mid So, any large projects sized on recall which of I good. specific smaller in

Joseph Mondillo

what 'XX so improving better I'm you're saw outlook at. a just looking And looks terms of from the like XX in next of activity. It looks on sure sort or what months' maybe little you

Rick Parod

I at a yet, looking I improvement. that were sales months build I tied of I in and systems and it's standpoint, leasing this Zipper XX to call spent road next highway the If terms were If of because how believe money make it Road is from better. it's wouldn't spending say to looks let's primarily on look

projects, we there if projects that of yet. seen haven't significant say progress significantly more of occur announcing terms show a the them. a I projects higher increase a not percentage new increase as we they in increase road a would build highway getting Let's there, with a have data construction haven't made -- But significant in seen is surplus

Joseph Mondillo

And was to like just question inventory of the at the your looked it then one me. on 'XX 'XX. last capital, the of, for end end just wondering end I of Okay. substantially working Brian, fairly compared increased versus

capital for your what thoughts are on working wondering XXXX is? Just

Brian Ketcham

Yeah, where ended clearly last was higher I the we than year. it year think

would the international we again help I a support pretty all driven of that anticipate increase the domestic that to business. but normally Now international was irrigation was think inventories, by much in and slight being

to lead and the last the sales times bit, it involved and growth little moderate if but couple you forward, the increasing little going just that probably average will that expect supply chain. and a longer of of because I higher the down just a things come back would international like bit over in years, So, looked in

Operator

Wong The at next Brett question Jaffray. Piper is from

Brett Wong

you domestic? international? to your know down. book, mentioned being I domestic into are digging not for domestic tend Thanks voice you And everything again wish I too over in are going demand Rick the you break up, my or know the up really to best all and expectations for Great. that for forward. is book appreciation our that irrigation want you taking you the But years order seeing but the irrigation I questions. seeing that But order

Rick Parod

get visiting out characterize seen international and costs definitely as having it one order numbers have recalibrated we're some, both and we prices of but into I'd really definitely the that commodity the we between dealers in commodity see some in domestic the where into it, rate generally they is domestic international weekend to harvest international optimism that we I Well anything that good of readjusting would the dealers now. backlog with Part existing sounds definitely split fact as complete last visiting more more may as input in the really in And market there selling going I price day see going won't more season optimism until see with which We attribute that see we’re dealers in the we’re ones. not not to domestic significant a said international. well. bump as some terms and was to domestic optimism to not translate yet.

Brett Wong

rate or And quarter Okay. or run a you what see to prices meaningfulness where irrigation happen to? do domestic needs demand to think in order rent to you move think in need

Rick Parod

there season specific we’re and cost $X not can price, I is beneficial some next would quarter do not I seeing I’m that feel are But if sure prices the am Yeah. everybody stability better. I’d bad. overall. And is demand sure think finally a harvest with this their where with I say that beneficial be decisions come in to for the too. out farmers this think of terms will that will for we making essential be

split things typical replacement. into I dry whether are about decisions year the are into XX% in see people get time or you or dry a that’s quarter normal also because storm the at saw very of and is at to we would in going to unit fourth land That’s of and expect this year One XX% harvest and the in making see fourth pretty would during damage what for conversion it’s looking the sold XX% the prior quarter conversion, land similar that and this pretty to see. quarter, of or we we going the we to what what lot last think and fourth of replacement

do I and land think improve what as we’ll on dry goes percentage see we prices that see up. time go commodity obviously

Brett Wong

as you markets last of are Perfect. activity sense. and the you I provide makes more comment And can a on color look tend can at some but year of to or we is more where the to formal or next similar just there. And That do that what kind expect qualification it is side, then increased specifically have year, we would growth. irrigation know just Yeah. sort growth this you given something one helpful? little don’t of be developing you international more provide seeing of on obviously have visibility overall, some there guidance, And

Rick Parod

we’re I been seeing, process we’re projects now and definitely to in encouraging been Africa, some region color projects little those in guess seeing you and seeing of either I that in Well, in activity more just that a potentially are CIS in Russia, larger South we’re ones terms project the in America. give think on what we’re projects in have China, seeing all More Ukraine, development. have projects

we because we have rate. rates -- in one that market reflect we may these be period. time growth to have the to markets some -- over rates developed where they’re developing a to that more domestic XX% three growth in closely growth to same very low we have international And average probably the five-year in markets than on US to XX% seeing of typically get in to mid-teens going expect the you that when international it’s talk we that peg, year Now, a about some they regions we’re are where growth difficult we

for low putting we say -- that all So, mid teen we them to we accumulation it together kind but with expect of market. really international are varies mid-teens that growth

Operator

Nathan The next is from Stifel. Jones from question

Nathan Jones

is aggressive I’d like company to back into got the would balance sheet. do that now net transactions you there you be share on be there? wings, the but are running are the position, take do which not know investing a going company most conservative about I itself mean the more to Where level in little how balance to think sheet up a always leverage going growth all in the organic that’s very you plan you about is for talk M&A efficient a I talked and cash bit get repurchase? of to cash.

Rick Parod

And where Well little the and had this leverage Brian we’re the -- be acquisition contacts. -- we’re let a in me I may be. one challenging. I’ll currently But some what a let CEO made would and transition having part the take good the we I'd a process situation say more what has it said that take obviously that

identified discussions. Our good and companies some people have had

up it’s And that’s our CEO cash repurchases terms time obviously the think be I complete this in transition and by will stock to those is they discussions after place. a and not philosophy in come the seller again interested that of And some similar they However, point when those. booked picked at of in the be changed. the takes think I will has who this not as

think shareholder cash I we for standpoint. to do resources have from best of work in utilization the a terms of return

pace has transition slowed. However, this during that

transition. should that I you Brian? change the So, to think expect with

Brian Ketcham

in have times end on the of I to net improve on And and to trailing acquisition in leverage see right do cash response has we’ll leverage, mean certainly leverage. the the ability if side position that. the our just need that think EBITDA. increase the today, or probably the I are certainly right the being the to willingness at to year the opportunity really we But ability don’t we’re in We for increase at but Nathan X.X Yes. the question

Nathan Jones

company do at could a you deals? if handle the and of and in be kind way. also May both of What of transaction liquidity increasing of liquidity experience little the terms integrating you doing necessary size and larger in terms different ask could think bandwidth this

Rick Parod

set wouldn’t I a wouldn’t better the we to I but would say say deals we with XXX in at traditionally dollar looked comfortable. I go And --, price. additional certainly the felt that say it purchase that would be bigger would that in XXX limit be would I we’ve have in range sheet balance could because leverage couldn’t but be million comfortable that the with would in million and

Nathan Jones

hear to irrigation? in question the I did say low to And you growth international that mid-teens you last Okay. expected

Rick Parod

am what was sorry I that?

Nathan Jones

international expected you growth low irrigation you say mid-teens in ‘XX? to Did in

Rick Parod

when a look at on three our to … five-year So, look we

Nathan Jones

look. Three to five-year

Rick Parod

year. that Our That’s projecting mid it goals that any -- period. specific low rate three teen that for growth to not we time anticipate over

Nathan Jones

Got project that in ‘XX? you. assume with do you can expect just of Is expect any us in growth in give from domestic help to you mix I should you your international we XXXX. higher that have would shift the margin there dilution kind with than opportunities in

Rick Parod

more whether of complete in other for efficiency solutions. type mills, where additional the There its one consistent of opportunities nature whether some to that best whether in isn’t one the that integration further see two from with also business stations a vertical pivots it’s one project such long-term. competitive the but in two reduce international going or galvanizing our with depends We’ll pump as project complete are to including the generated of opportunities because some what a gross, equipment, our the of it’s deals. of there things it keep and say, and projects of really it’s projects will ways, things an costs. the adding projects, part as will additional the of grows, that different yes, with factory and are mind market today plans I complete those on as is have that that just are or is standpoint more it’s but it’s In an in that potentially lower in we that true, margins it also

Operator

from question Monness, Crespi. Shaw Next of Chris is

Chris Shaw

this have of on think, you your try see website. because evidence I asked question again, that me now have I But let before. I

that for seems infrastructure Richmond-San Rafael but Zipper Road like talk with can or maybe you And Gate. little bit Golden about it Bridge mean, then at the be business maybe longer a I size sale, because even there the project it at all, lease. For is a all, a maybe, not just

show I it think, and thought seen So, numbers just up I I nearly the sale a it yet haven’t was yet?

Rick Parod

others talk not we And a unless of things ago is some it a about project. any permission to had or they where, there we analysts hasn’t Because instances or became number on past it. to that pushing it it we’re and up we specifically that one a about talk projects working where we and things some to of yet, have project It about No. there shown is do haven’t then the the point reason me, a as had respected do calling is in happened. talked customer we to years uncomfortable adopted and

actually we will time into at project is until we’ve a a about. any and the that something it projects. talk until got say when to on But and booked on. that books I go it’s about on talk that don’t order know that’s and no we’re discussion we we There So, would leave at order is that or doubt some working project that just

Chris Shaw

for website. just the -- you’re you your have Systems your a website on, mentions on on there working do But information, project Barrier some Inc. as is

Rick Parod

until that project of of it terms of at more debt that And stage, of but go terms of into as on, a character in size Yes. been worked I it’s it. have, we this else that’s is I those, as wouldn’t in said, order anything an any

Operator

Next question comes & with Joe Sidoti Company. from Mondillo

Joe Mondillo

my Thanks question. for follow-up taking

it you quarter, to was surprisingly I shocked wanted I So, ask very tough quarter a most November the on the last people think of street. guys

just and expecting, we’re quarter. I’m And high given the prices so, the that is commodity low November seasonally yields the weakest wondering that

income et into Is is expected see last there November dynamics quarter. about we what to that’s quarter any this similar back price just quarter are relative Going commodity being low to remember going different cetera? Farm weak to little November in of or or the a that year a sort you

Brian Ketcham

Joe, this is Brian.

we I things one than little think quite quarter order lower the would first a guard last think been. the I bit year, were rates quarter off as a first typical bit caught of were the in a have what

operational caught bit got guard. little off an a we standpoint, from So,

more I this similar going quarter prepared and expect year. we're into a situation to that the this have year, much for wouldn't think I first

Operator

Global. Mike Seaport from Shilsky of is question next The

Mike Shilsky

unusual Good the if morning, as guys. about you I And ask Rick, there really of cost course comp was for of CEO on there single any I on the have changeover, wondering first or also well, wish quarter you of side cost you the my it's the it. side. to we Is here absolute best of or quarter any whether Hope are kind in Thanks. Rick I'll enjoy your in aware because comp fiscal be double should first Tim a kind of on watch the side. here? retirement.

Brian Ketcham

mean on will I outside for overlap one But Yes, in as side be cost. it's bit months. view There incremental, don't other or significant And little that, see two that the any of being a I any type I of Mike, comp incremental Brian. total. unusual don't

Mike Shilsky

any quarter, for the wanted impact also give I about some galvanizing ask outlook fourth in quantify thanks. it, metals. you Could there prices or thoughts and increases steel steel. galvanizing can in either the both to Got possibly on you are 'XX of for the and kind us the fiscal big of

Brian Ketcham

may XX% we In the steel lessen compared little But obviously how it's to think market have regard from increase steady. maintained coil. time is it's which peak XX% is I slight was market maintain But standpoint, then to a been it's first wise most relative at since been And be the on steel the time of steady probably to moderated point From basis our fairly I up a hedge is present at couple quarters, levels on a our forward steel, where it's today over any we impact going lower at a that. third in to at to quarter as for saw standpoint, last think place outlook quarter. of bit. we which the in during part the for fairly

Mike Shilsky

cost, well? been as And has up far as as galvanizing that

Brian Ketcham

moderated think a I steel cost obviously And our total of the them. than since year, in what earlier think I that's percentage Yeah, somewhat smaller it was it's is. up

Mike Shilsky

Okay, quick tailwinds of parts based more or outlook be year, new year growth next system for got your irrigation of might on the a any of Is question as service system still a any on is sales? think And lot next balancing well. the the you or you U.S. it. just on are taking it that and place replacement

Brian Ketcham

parts It good the opportunity always and service. is more opportunity and in

on referring based primarily we're to. systems that say it's Let's new

I to us think is there pick service globally up opportunity on more for share. and market parts

Mike Shilsky

Okay. last one And Brazil. one me on for

also those So, conditions alone, business. August, a quarter of back good quarter, on mean in the have season quarter we ended you aware quarter guidance bit star course? first on a you I quite international good in should be more sales first of there there any had September that of is this a fourth your just could

Rick Parod

I years. anything I’m really have don’t would comparable would not -- project really, to I quarter, the previous can’t be I going that I to say to for expect

be have We so meaning improvement general previous appears years we've in seen to from comparable Brazil overall, a quarter-to-quarter seen overall to that ongoing.

is as as it. I about that specific could So get with

Mike Shilsky

-- way that a there season? way, their for is it Or a deliveries already in month Brazil? you time, installations is September different can Is planning I ask an past and important

Brian Ketcham

I towards of think season. the the it’s of planning kind getting end

little this later little bit, but tail because of So, expect on year to we a conditions. their off it would a depending met I weather planting think

Mike Shilsky

Thank it. you. Got Okay.

Rick Parod

picking region picking to in terms up had Brazil really probably delays pace. after that on their that of they this really at is some think having needed latest information pace make The the they’re is planting in point of growth trying for I up some their up planting and they’re amount rains of planting

demand it’s I think anything of So, necessarily at about stage. and timing it our the really so it, extent the don’t impacts this for equipment of

Operator

This to closing concludes any back session. question-and-answer I remarks. over to the for the turn Parod would like conference Mr.

Rick Parod

questions best. it’s I plan. our the allocation all through value of to you. I’d dividend you, pleasure growth, shareholder to on been organic grow wish of participation can your Corporation Lindsay like you a all committed with with and and you And and to the know We you increases, all, creating strategic water is in First investments of repurchases capital acquisitions for share call. related work thank thank

Operator

is conference for today’s Thank concluded. attending The presentation. now you

You may now disconnect.

Lindsay (LNN) 12 Oct 172017 Q4 Earnings call transcript