OMAHA, Neb.--(BUSINESS WIRE)--Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its fourth quarter ended August 31, 2015.
Fourth Quarter Results
Fourth quarter fiscal 2015 revenues were $123.5 million versus $147.5 million of revenues in the same prior year period. Net earnings (loss) were ($3.2 million) or ($0.28) per diluted share compared with $11.3 million or $0.89 per diluted share in the prior year. 2015 fourth quarter results included a bad debt reserve of $5.0 million on an account receivable and a reserve of $2.9 million against foreign income tax assets, both related to our business unit in China. Additionally, the effect of currency exchange rates on operating earnings and non-operating expenses was $2.0 million. The after tax impact on earnings for these items was $8.0 million or $0.70 per diluted share.
Total irrigation equipment revenues decreased 23 percent to $96.9 million from $125.8 million in the prior fiscal year’s fourth quarter. U.S. irrigation revenues of $54.6 million decreased 23 percent primarily due to sales resulting from storm damage contributing an estimated $20 million to prior year fourth quarter revenue. International irrigation revenues of $42.3 million decreased 23 percent due to the impact of currency exchange rates and lower sales in the Middle East. Infrastructure revenues increased 23 percent to $26.7 million due to increases in sales of road safety products and Barrier Transfer Machines.
Gross margin was 27.1 percent of sales, equal to the prior year’s fourth quarter. Gross margin in irrigation decreased by less than 1 percentage point while infrastructure gross margins increased by approximately 2 percentage points primarily due to sales mix.
Operating expenses were $30.7 million compared to $23.7 million in the same prior year period. The current period operating expenses include $2.9 million of Elecsys Corporation operating expenses and a $5.0 million bad debt charge. Operating expenses were 24.8 percent of sales in the fourth quarter of fiscal 2015 compared with 16.1 percent of sales in the prior year period. Operating margins were 2.2 percent in the fourth quarter, versus 11.0 percent in the prior year period.
Cash and cash equivalents of $139.1 million were $32.7 million lower than the end of the prior fiscal year. During the quarter the Company repurchased 220,277 shares for $18.4 million. In fiscal 2015 the Company repurchased 1,198,089 shares for $96.9 million. At August 31, 2015, $112.1 million remains authorized under the Company’s share repurchase program.
Backlog of unshipped orders at August 31, 2015 was $48.0 million compared with $79.6 million at August 31, 2014 and $53.2 million at May 31, 2015. The backlog at August 31, 2014 included $12.7 million for the Golden Gate Bridge which was completed in the second quarter of 2015. The current period includes $9.5 million of backlog from Elecsys Corporation.
Twelve Month Results
Total revenues for the year ended August 31, 2015 were $560.2 million, a 9 percent decrease from $617.9 million of revenues in the same prior year period. Net earnings were $26.3 million or $2.22 per diluted share compared with $51.5 million or $4.00 per diluted share in the prior year. The current year includes charges for the items noted in quarterly results above along with $1.5 million of environmental expenses, $1.8 million of acquisition and integration expenses, and the full year effect of currency exchange rates on operating earnings and non-operating expenses of $3.8 million. The after tax impact on earnings for these items was $11.4 million or $0.96 per diluted share.
Total irrigation equipment revenues decreased 16 percent to $451.2 million from $539.9 million during the prior fiscal year. U.S. irrigation revenues of $273.7 million declined 17 percent with approximately half of the decline due to lower storm damage related sales compared to 2014. International irrigation revenues of $177.5 million decreased 15 percent with slightly more than half of the decline due to the impact of currency exchange rates. Infrastructure revenues increased 40 percent to $109.0 million due to the Golden Gate Bridge project in the second quarter and increased sales of road safety products.
Rick Parod, president and chief executive officer, commented, “It has been a challenging year as lower grain prices, falling currency rates relative to the dollar, and accounting adjustments to asset valuations have impacted sales and earnings in the fourth quarter and year. While commodity prices appear to have stabilized, farmer sentiment is mixed and U.S. and international irrigation equipment demand remains challenged.”
Parod continued, “Longer term, drivers for the Company’s markets of population growth, expanded food production and efficient water use, and infrastructure upgrades and expansion support our expectation for growth. In fiscal 2016 we plan to manage our cost structure while continuing to invest in longer term growth initiatives such as product and project solution development as well as geographic expansion in key markets. In addition, we will continue to execute against the capital allocation plan announced in January 2014.”
Fourth-Quarter Conference Call
Lindsay’s fiscal 2015 fourth quarter investor conference call is scheduled for 11:00 a.m. Eastern Time today. Interested investors may participate in the call by dialing (888) 321-8161 in the U.S., or (706) 758-0065 internationally, and referring to conference ID # 45154892. 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 manufactures and markets water management equipment and services including irrigation systems, pump stations, filtration, and M2M controls designed to increase or stabilize crop production while conserving water, energy, and labor, and that also provide efficiency benefits in various industrial applications. The Company also manufactures and markets infrastructure and road safety products under the Lindsay Transportation Solutions trade name. At August 31, 2015 Lindsay had approximately 11.3 million shares outstanding, which are traded on the New York Stock Exchange under the symbol LNN.
For more information regarding Lindsay Corporation, see the Company’s Web site at 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 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|
|CONSOLIDATED STATEMENTS OF OPERATIONS|
|Three months ended August 31,||Years ended August 31,|
|(in thousands, except per share amounts)||2015||2014||2015||2014|
|Cost of operating revenues||90,075||107,599||403,860||446,938|
|General and administrative expense||16,991||12,129||52,261||43,228|
|Engineering and research expense||3,519||2,523||12,849||11,125|
|Total operating expenses||30,696||23,692||105,626||92,637|
|Other (expense) income, net||(1,201||)||223||(1,949||)||(245||)|
|Earnings before income taxes||529||16,549||46,751||78,655|
|Income tax expense||3,710||5,220||20,442||27,143|
|Net earnings (loss)||$||(3,181||)||$||11,329||$||26,309||$||51,512|
|Earnings (loss) per share:|
|Shares used in computing earnings per share:|
|Cash dividends declared per share||$||0.280||$||0.270||$||1.090||$||0.920|
|Lindsay Corporation and Subsidiaries|
|CONSOLIDATED BALANCE SHEETS|
|August 31,||August 31,|
|(in thousands, except par values)||2015||2014|
|Cash and cash equivalents||$||139,093||$||171,842|
|Deferred income taxes||15,807||17,714|
|Other current assets||13,077||14,939|
|Total current assets||322,167||374,058|
|Property, plant and equipment, net||78,656||72,457|
|Intangible assets, net||51,920||31,980|
|Other noncurrent assets||6,924||11,035|
|LIABILITIES AND SHAREHOLDERS' EQUITY|
|Current portion of long-term debt||193||-|
|Other current liabilities||56,105||73,943|
|Total current liabilities||95,112||116,367|
|Pension benefits liabilities||6,569||6,600|
|Deferred income taxes||18,971||12,992|
|Other noncurrent liabilities||10,083||7,945|
|Capital in excess of stated value||55,184||52,866|
|Less treasury stock||(228,903||)||(132,020||)|
|Accumulated other comprehensive loss, net||(15,308||)||(2,201||)|
|Total shareholders' equity||288,560||382,647|
|Total liabilities and shareholders' equity||$||536,468||$||526,551|
|Lindsay Corporation and Subsidiaries|
|CONSOLIDATED STATEMENTS OF CASH FLOWS|
|(in thousands)||Years Ended August 31,|
|CASH FLOWS FROM OPERATING ACTIVITIES:|
|Adjustments to reconcile net earnings to net cash provided by operating activities:|
|Depreciation and amortization||16,412||14,793|
|Provision for uncollectible accounts receivable||5,840||2,225|
|Deferred income taxes||278||(8,195||)|
|Share-based compensation expense||3,332||4,207|
|Changes in assets and liabilities:|
|Other current assets||(3,984||)||(3,092||)|
|Other current liabilities||(9,467||)||8,954|
|Current taxes payable||(8,011||)||5,706|
|Other noncurrent assets and liabilities||1,558||(5,251||)|
|Net cash provided by operating activities||48,682||91,798|
|CASH FLOWS FROM INVESTING ACTIVITIES:|
|Purchases of property, plant and equipment||(15,244||)||(17,715||)|
|Acquisition of business, net of cash acquired||(69,521||)||-|
|Proceeds from settlement of net investment hedges||7,473||1,245|
|Payments for settlement of net investment hedges||(1,202||)||(2,040||)|
|Other investing activities, net||(1,091||)||34|
|Net cash used in investing activities||(79,585||)||(18,476||)|
|CASH FLOWS FROM FINANCING ACTIVITIES:|
|Proceeds from exercise of stock options||394||455|
|Common stock withheld for payroll tax withholdings||(1,706||)||(2,027||)|
|Proceeds from issuance of long-term debt||115,000||-|
|Principal payments on long-term debt||(112||)||-|
|Issuance costs related to debt||(620||)||-|
|Excess tax benefits from share-based compensation||611||762|
|Repurchase of common shares||(96,883||)||(41,059||)|
|Net cash provided by (used) in financing activities||3,912||(53,595||)|
|Effect of exchange rate changes on cash and cash equivalents||(5,758||)||188|
|Net change in cash and cash equivalents||(32,749||)||19,915|
|Cash and cash equivalents, beginning of period||171,842||151,927|
|Cash and cash equivalents, end of period||$||139,093||$||171,842|