Lindsay Corporation Reports Fiscal 2012 First Quarter Results

Lindsay Corporation (NYSE: LNN), a leading provider of irrigation systems and infrastructure products, today announced results for its first quarter ended November 30, 2011.

First Quarter Results

First quarter fiscal 2012 total revenues of $119.2 million increased 34 percent from $89.2 million in the same prior year period. Net earnings were $2.9 million or $0.23 per diluted share compared with $4.3 million or $0.34 per diluted share in the prior fiscal year’s first quarter. First quarter fiscal 2012 results included $7.2 million of accrued expense, or $0.37 per diluted share on an after tax basis, relating to an estimated increase in the Company’s liability for environmental remediation at its Lindsay, Nebraska facility. Comparatively, fiscal 2011 included environmental remediation expense of $0.7 million, or $0.04 per diluted share after tax.

Total irrigation equipment revenues increased 68 percent to $100.8 million from $60.0 million in the prior fiscal year’s first quarter. Domestic irrigation revenues of $60.7 million increased 66 percent, while international irrigation revenues of $40.1 million increased 71 percent as compared to the same prior year period. Infrastructure revenues decreased 37 percent to $18.4 million due to lower sales and leases of Quickchange Moveable Barrier (QMB) systems. Infrastructure revenues, excluding QMB system sales, increased by 7 percent as compared to the same prior year period.

Gross margin was 25.4 percent compared to 27.2 percent in the prior year’s first quarter. Total gross margin was lower primarily due to lower revenues of higher-margin QMB product as compared to the same period last year. Infrastructure margins excluding QMB improved compared to the year ago period and irrigation gross margin improved from the same quarter last year due to cost leverage and productivity gains on higher sales volumes.

Operating expenses were $25.2 million in the quarter, inclusive of the accrued environmental remediation expenses, compared to $17.6 million in the first quarter of the prior fiscal year. Of the $7.6 million increase in operating expenses, $6.5 million is attributable to the increase in the Company’s environmental accrual, over the same quarter last year. The Company increased its accrual after it received preliminary cost estimates for potential remediation options at the site. These costs are expected to be incurred over a period of 5 to 10 years. Accrued costs of remediation in connection with environmental liabilities are estimates subject to a high degree of judgment and a variety of uncertainties and are therefore subject to change.

Operating margin was 4.3 percent in the quarter as compared to 7.4 percent in the prior year period. Excluding environmental accruals, operating margin was 10.3 percent in the quarter as compared to 8.2 percent in the prior year period.

Cash and cash equivalents of $108.7 million were $28.2 million higher compared with the end of the first quarter last year, while debt decreased $4.3 million over the same period.

Lindsay’s backlog of unshipped orders at November 30, 2011 was $52.8 million compared with $59.7 million at November 30, 2010 and $46.0 million at August 31, 2011.

Outlook

Rick Parod, president and chief executive officer, commented, "We are pleased to report that strong sales results continued into the first quarter with significant growth in our domestic and international irrigation markets. Excluding the incremental environmental accrual, our operating margin improved in the first quarter, despite lower QMB sales. And while the sales environment for the infrastructure segment continues to be challenging, we have made progress in improving the margins in our non-QMB product lines.”

Parod added, "Farm incomes remain relatively high, supporting continued positive farmer sentiment and irrigation equipment sales. We remain positive as the growth drivers of expanded food production and efficient water use remain intact for our business, and demand for our unique offering of transportation safety products will continue to be driven by population growth and the need for improved road safety. Over the course of fiscal 2012, our business will remain subject to the volatility we have seen in agriculture commodity prices recently, and government spending decisions in infrastructure.”

Fourth-Quarter Conference Call

Lindsay’s fiscal 2012 first quarter investor conference call is scheduled for 11:00 a.m. Eastern Time today. Interested investors may participate in the call by dialing (888) 748-0479 domestically, or (706) 758-9823 internationally, and referring to conference ID #34487312. 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. 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 irrigation equipment primarily used in agricultural markets which increase or stabilize crop production while conserving water, energy, and labor. The Company also manufactures and markets infrastructure and road safety products through its wholly owned subsidiaries, Barrier Systems Inc. and Snoline S.P.A. At November 30, 2011, Lindsay had approximately 12.7 million shares outstanding, which are traded on the New York Stock Exchange under the symbol LNN.

For more information regarding Lindsay Corporation, see Lindsay's Web site at www.lindsay.com. For more information on the Company's infrastructure products, visit www.barriersystemsinc.com and www.snoline.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.