Lindsay Corporation Reports Fiscal 2021 Fourth Quarter and Full Year Results

Rhea-AI Summary

Lindsay Corporation (NYSE: LNN) reported a 63% increase in fourth-quarter irrigation revenues, hitting $125.3 million, contributing to overall quarterly revenues of $153.6 million, up 20% year-over-year. However, the infrastructure segment saw a 45% decline in revenue to $28.4 million. Net earnings fell to $5.8 million or $0.53 per diluted share, adversely impacted by $4.5 million after-tax LIFO effects. Despite challenges, including raw material costs and project delays, a backlog of orders rose to $149.1 million, suggesting future growth potential.

Positive

• Fourth quarter irrigation revenues increased 63% to $125.3 million.
• Overall quarterly revenues rose 20% to $153.6 million.
• Annual revenues increased 20% year-over-year to $567.6 million.
• Backlog of unfilled orders grew to $149.1 million, indicating strong future demand.

Negative

• Fourth quarter net earnings decreased to $5.8 million, down from $14.7 million year-over-year.
• Infrastructure revenues dropped 45% to $28.4 million, largely due to project delays.
• Operating income for the infrastructure segment fell 71% to $5.8 million.

• Improved demand for irrigation equipment continued in the fourth quarter across all geographies
• Fourth quarter irrigation revenues increase 63 percent to $125.3 million
• Fourth quarter infrastructure revenues decline 45 percent compared to record results in prior year
• Fourth quarter net earnings reduced by after-tax LIFO impact of $4.5 million, or $0.41 per diluted share

OMAHA, Neb.--(BUSINESS WIRE)-- Lindsay Corporation (NYSE: LNN), a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology, today announced results for its fourth quarter and fiscal year, which ended on August 31, 2021.

Fourth Quarter and Full Year Summary

Revenues for the fourth quarter of fiscal 2021 were $153.6 million, an increase of $25.2 million, or 20 percent, compared to revenues of $128.4 million in the prior year fourth quarter. Net earnings for the quarter were $5.8 million, or $0.53 per diluted share, compared with net earnings of $14.7 million, or $1.35 per diluted share, for the prior year fourth quarter. Net earnings for the quarter were reduced by an after-tax LIFO impact of approximately $4.5 million, or $0.41 per diluted share.

Revenues for the year ended August 31, 2021, were $567.6 million, an increase of $93.0 million, or 20 percent, compared to revenues of $474.7 million in the prior year. Net earnings for the year were $42.6 million, or $3.88 per diluted share, compared with net earnings of $38.6 million, or $3.56 per diluted share, in the prior year.

“Fiscal 2021 was an extraordinary year in which our team demonstrated agility and resiliency in the face of the ongoing global pandemic,” said Randy Wood, President and Chief Executive Officer. “We were able to capitalize on market tailwinds in irrigation while navigating persistent headwinds created by pandemic-related project delays in our infrastructure business, significant raw material inflation, logistics challenges, and a tight labor market. We also remained highly focused on innovation, maintaining strong organizational health and safety, and increasing our commitment to sustainability initiatives.”

Fourth Quarter Segment Results

Irrigation segment revenues for the fourth quarter of fiscal 2021 were $125.3 million, an increase of $48.2 million, or 63 percent, compared to $77.0 million in the prior year fourth quarter. North America irrigation revenues of $53.5 million increased $12.3 million, or 30 percent, compared to the prior year fourth quarter. The increase in North America irrigation revenues resulted from a combination of higher irrigation equipment unit sales volume and higher average selling prices. International irrigation revenues of $71.7 million increased $35.9 million, or 100 percent, compared to the prior year fourth quarter. The increase in international irrigation revenues resulted primarily from higher unit sales volumes, along with higher selling prices and a favorable foreign currency translation impact of $2.8 million. The largest sales volume increases were in the Brazil and Middle East markets.

Irrigation segment operating income for the fourth quarter of fiscal 2021 was $10.6 million, an increase of $4.6 million, or 78 percent, compared to the prior year fourth quarter. Operating margin was 8.4 percent of sales, compared to 7.8 percent of sales in the prior year fourth quarter. The impact of higher irrigation system unit volume was partially offset by the impact of higher raw material and other costs. Fourth quarter operating results were also reduced by approximately $5.0 million resulting from the impact of the LIFO method of accounting for inventory, under which higher raw material costs are recognized in cost of goods sold rather than in ending inventory values.

Infrastructure segment revenues for the fourth quarter of fiscal 2021 were $28.4 million, a decrease of $23.0 million, or 45 percent, compared to $51.4 million in the prior year fourth quarter. The decrease resulted primarily from lower Road Zipper System^® sales compared to the prior year. Road Zipper System^® sales in the fourth quarter of fiscal 2020 included a large project in the United Kingdom that did not repeat in fiscal 2021. In addition, during fiscal 2021 the timing of certain projects has been impacted by coronavirus-related delays.

Infrastructure segment operating income for the fourth quarter of fiscal 2021 was $5.8 million, a decrease of $14.1 million, or 71 percent, compared to the prior year fourth quarter. Operating margin was 20.5 percent of sales, compared to 38.8 percent of sales in the prior year fourth quarter. Current year results reflect lower revenues and a less favorable margin mix of revenues compared to the prior year fourth quarter and were also reduced by approximately $1.0 million resulting from the impact of the LIFO method of accounting for inventory.

The backlog of unfilled orders at August 31, 2021 was $149.1 million compared with $58.7 million at August 31, 2020. A higher backlog of orders in irrigation was partially offset by a lower backlog in infrastructure.

Outlook

“Although agricultural commodity prices have come down from their peak earlier in the year, they remain at multi-year highs,” said Mr. Wood. “This supports a solid outlook for North America irrigation equipment demand for the fall selling season. We expect growth in international irrigation to be led by continued momentum in Brazil and other markets and from new agricultural development being driven by increased concerns regarding food security.”

Mr. Wood continued, “In our infrastructure business, we expect a slower start to fiscal 2022 due to specific project delays. However, prospects for year-over-year growth are supported by the quality of our project sales funnel.”

Fourth Quarter Conference Call

Lindsay’s fiscal 2021 fourth quarter investor conference call is scheduled for 11:00 a.m. Eastern Time today. Interested investors may participate in the call by dialing (833) 535-2202 in the U.S., or (412) 902-6745 internationally, and requesting the Lindsay Corporation call. 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. Replays of the conference call will remain on our Web site through the next quarterly earnings release. 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 Corporation (NYSE: LNN) is a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology. Established in 1955, the company has been at the forefront of research and development of innovative solutions to meet the food, fuel, fiber and transportation needs of the world’s rapidly growing population. The Lindsay family of irrigation brands includes Zimmatic^® center pivot and lateral move agricultural irrigation systems, FieldNET^® remote irrigation management and scheduling technology, and industrial IoT solutions. Also a global leader in the transportation industry, Lindsay Transportation Solutions manufactures equipment to improve road safety and keep traffic moving on the world’s roads, bridges and tunnels, through the Barrier Systems^®, Road Zipper^® and Snoline™ brands. For more information about Lindsay Corporation, visit www.lindsay.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 and planned financing 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, the Company claims 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 EARNINGS
(Unaudited)
		Three Months Ended August 31,								Years Ended August 31,
(in thousands, except per share amounts)		2021				2020				2021				2020
Operating revenues		$	153,648			$	128,405			$	567,646			$	474,692
Cost of operating revenues			120,081				83,038				417,441				322,149
Gross profit			33,567				45,367				150,205				152,543
Operating expenses:
Selling expense			8,136				9,343				30,816				31,444
General and administrative expense			12,153				14,921				51,923				52,947
Engineering and research expense			3,855				3,647				13,359				13,950
Total operating expenses			24,144				27,911				96,098				98,341
Operating income			9,423				17,456				54,107				54,202
Other (expense) income:
Interest expense			(1,167	)			(1,185	)			(4,751	)			(4,759	)
Interest income			285				544				1,083				1,956
Other (expense) income, net			(752	)			1,641				(53	)			(2,556	)
Total other (expense) income			(1,634	)			1,000				(3,721	)			(5,359	)
Earnings before income taxes			7,789				18,456				50,386				48,843
Income tax expense			1,985				3,782				7,814				10,214
Net earnings		$	5,804			$	14,674			$	42,572			$	38,629
Earnings per share:
Basic		$	0.53			$	1.35			$	3.91			$	3.57
Diluted		$	0.53			$	1.35			$	3.88			$	3.56
Shares used in computing earnings per share:
Basic			10,907				10,835				10,886				10,823
Diluted			11,039				10,880				10,985				10,861
Cash dividends declared per share		$	0.33			$	0.32			$	1.30			$	1.26

LINDSAY CORPORATION AND SUBSIDIARIES
SUMMARY OPERATING RESULTS
(Unaudited)
		Three months ended								Twelve months ended
(in thousands)		August 31, 2021				August 31, 2020				August 31, 2021				August 31, 2020
Operating revenues:
Irrigation:
North America		$	53,539			$	41,201			$	273,871			$	224,771
International			71,715				35,824				197,487				124,575
Irrigation total			125,254				77,025				471,358				349,346
Infrastructure			28,394				51,380				96,288				125,346
Total operating revenues		$	153,648			$	128,405			$	567,646			$	474,692
Operating income:
Irrigation		$	10,578			$	5,979			$	63,181			$	41,263
Infrastructure			5,810				19,934				20,174				42,722
Corporate			(6,965	)			(8,457	)			(29,248	)			(29,783	)
Total operating income		$	9,423			$	17,456			$	54,107			$	54,202

The Company manages its business activities in two reportable segments as follows:

Irrigation - This reporting segment includes the manufacture and marketing of center pivot, lateral move, and hose reel irrigation systems, as well as various innovative technology solutions such as GPS positioning and guidance, variable rate irrigation, remote irrigation management and scheduling technology, irrigation consulting and design and industrial IoT solutions.

Infrastructure – This reporting segment includes the manufacture and marketing of moveable barriers, specialty barriers, crash cushions and end terminals, and road marking and road safety equipment.

LINDSAY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)		August 31, 2021				August 31, 2020
ASSETS
Current assets:
Cash and cash equivalents		$	127,107			$	121,403
Marketable securities			19,604				19,511
Receivables, net of allowance of $3,422 and $2,780, respectively			93,609				84,604
Inventories, net			145,244				104,792
Other current assets			30,539				17,625
Total current assets			416,103				347,935
Property, plant, and equipment, net			91,997				79,581
Intangible assets, net			20,367				23,477
Goodwill			67,968				68,004
Operating lease right-of-use assets			18,281				27,457
Deferred income tax assets			8,113				9,935
Other noncurrent assets			14,356				14,137
Total assets		$	637,185			$	570,526
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	45,209			$	29,554
Current portion of long-term debt			217				195
Other current liabilities			92,814				72,646
Total current liabilities			138,240				102,395
Pension benefits liabilities			5,754				6,374
Long-term debt			115,514				115,682
Operating lease liabilities			18,301				25,862
Deferred income tax liabilities			832				889
Other noncurrent liabilities			20,099				20,806
Total liabilities			298,740				272,008
Shareholders' equity:
Preferred stock			—				—
Common stock			18,991				18,918
Capital in excess of stated value			86,495				77,686
Retained earnings			528,130				499,724
Less treasury stock - at cost			(277,238	)			(277,238	)
Accumulated other comprehensive loss, net			(17,933	)			(20,572	)
Total shareholders' equity			338,445				298,518
Total liabilities and shareholders' equity		$	637,185			$	570,526

LINDSAY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
		Years Ended August 31,
(in thousands)		2021				2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings		$	42,572			$	38,629
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization			19,177				19,396
(Gain) on sale of business			(1,087	)			—
Provision for uncollectible accounts receivable			771				589
Deferred income taxes			1,911				1,384
Share-based compensation expense			6,186				5,616
Foreign currency transaction (gain) loss			(1,934	)			1,102
Other, net			259				288
Changes in assets and liabilities:
Receivables			(11,535	)			(9,523	)
Inventories			(38,158	)			(14,039	)
Other current assets			(8,132	)			(6,612	)
Accounts payable			17,993				(691	)
Other current liabilities			18,433				16,673
Other noncurrent assets and liabilities			(2,488	)			(6,778	)
Net cash provided by operating activities			43,968				46,034
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment			(26,511	)			(21,445	)
Proceeds from sale of assets held-for-sale			—				3,955
Purchases of marketable securities available-for-sale			(19,356	)			(28,041	)
Proceeds from maturities of marketable securities available-for-sale			18,825				8,548
Acquisition of business, net of cash acquired			—				(3,034	)
Other investing activities, net			(577	)			1,503
Net cash used in investing activities			(27,619	)			(38,514	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options			3,965				1,545
Common stock withheld for payroll tax obligations			(1,269	)			(1,111	)
Principal payments on long-term debt			(195	)			(227	)
Dividends paid			(14,166	)			(13,645	)
Net cash used in financing activities			(11,665	)			(13,438	)
Effect of exchange rate changes on cash and cash equivalents			1,020				117
Net change in cash and cash equivalents			5,704				(5,801	)
Cash and cash equivalents, beginning of period			121,403				127,204
Cash and cash equivalents, end of period		$	127,107			$	121,403

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20211021005213/en/

LINDSAY CORPORATION:

Brian Ketcham

Senior Vice President & Chief Financial Officer

402-827-6579

THREE PART ADVISORS:

Hala Elsherbini

972-458-8000

Source: Lindsay Corporation

FAQ

What were Lindsay Corporation's fourth quarter earnings for fiscal 2021?

Lindsay Corporation reported fourth quarter net earnings of $5.8 million, or $0.53 per diluted share.

How did Lindsay Corporation's irrigation segment perform in Q4 2021?

The irrigation segment revenues increased by 63% to $125.3 million in the fourth quarter of 2021.

What was the reason for the decline in infrastructure revenues for LNN in Q4 2021?

Infrastructure revenues declined by 45% mainly due to lower Road Zipper System sales and project delays.

What is the outlook for Lindsay Corporation's irrigation equipment demand?

The outlook for irrigation equipment demand is positive, supported by high agricultural commodity prices and growth in international markets.

What is Lindsay Corporation's stock symbol?

The stock symbol for Lindsay Corporation is LNN.