Lindsay Corp 10-Q for FY2021 Q2

Lindsay Corp (LNN)

10-Q 2021-04-06 For: 2021-02-28

Added on April 09, 2026

About this 10-Q

Lindsay Corp filed this 10-Q on April 6, 2021, covering the quarter ended February 28, 2021 (FY2021 Q2).

Headline figures

Quarter ended February 28, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $143.58M; up 26.2% from $113.79M a year earlier
Net income: $11.88M; up 115.3% from net income of $5.52M a year earlier
Diluted EPS: $1.08; up 111.8% from $0.51 a year earlier

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Delaware		47-0554096
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

18135 Burke Street, Suite 100, Omaha, Nebraska		68022
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.00 par value	LNN	New York Stock Exchange, Inc.

Large accelerated filer	☒	Accelerated filer	☐
Non‑accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

		Page

Part I – FINANCIAL INFORMATION		3

	ITEM 1 – Financial Statements	3

	Condensed Consolidated Statements of Earnings for the three and six months ended February 28, 2021 and February 29, 2020	3

	Condensed Consolidated Statements of Comprehensive Income for the three and six months ended February 28, 2021 and February 29, 2020	4

	Condensed Consolidated Balance Sheets as of February 28, 2021, February 29, 2020, and August 31, 2020	5

	Condensed Consolidated Statements of Shareholders’ Equity for the three and six months ended February 28, 2021 and February 29, 2020	6

	Condensed Consolidated Statements of Cash Flows for the six months ended February 28, 2021 and February 29, 2020	8

	Notes to the Condensed Consolidated Financial Statements	9

	ITEM 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	17

	ITEM 3 – Quantitative and Qualitative Disclosures about Market Risk	24

	ITEM 4 – Controls and Procedures	25

Part II – OTHER INFORMATION		26

	ITEM 1 – Legal Proceedings	26

	ITEM 1A – Risk Factors	26

	ITEM 2 – Unregistered Sales of Equity Securities and Use of Proceeds	26

	ITEM 3 – Defaults Upon Senior Securities	26

	ITEM 4 – Mine Safety Disclosures	26

	ITEM 5 – Other Information	26

	ITEM 6 – Exhibits	27

SIGNATURES		28

	Three months ended						Six months ended
($ and shares in thousands, except per share amounts)	February 28, 2021			February 29, 2020			February 28, 2021			February 29, 2020
Operating revenues	$	143,577		$	113,788		$	252,062		$	223,181
Cost of operating revenues		102,403			80,382			179,480			155,701
Gross profit		41,174			33,406			72,582			67,480

Operating expenses:
Selling expense		7,778			8,192			15,110			14,684
General and administrative expense		14,275			13,167			27,727			24,971
Engineering and research expense		3,312			3,405			6,402			6,907
Total operating expenses		25,365			24,764			49,239			46,562

Operating income		15,809			8,642			23,343			20,918

Other (expense) income:
Interest expense		(1,205	)		(1,191	)		(2,406	)		(2,377	)
Interest income		268			389			571			1,004
Other expense, net		(311	)		(973	)		(65	)		(1,423	)
Total other (expense) income		(1,248	)		(1,775	)		(1,900	)		(2,796	)

Earnings before income taxes		14,561			6,867			21,443			18,122

Income tax expense		2,685			1,351			2,472			4,261

Net earnings	$	11,876		$	5,516		$	18,971		$	13,861

Earnings per share:
Basic	$	1.09		$	0.51		$	1.75		$	1.28
Diluted	$	1.08		$	0.51		$	1.74		$	1.28

Shares used in computing earnings per share:
Basic		10,884			10,825			10,865			10,810
Diluted		10,981			10,857			10,934			10,843

Cash dividends declared per share	$	0.32		$	0.31		$	0.64		$	0.62

	Three months ended						Six months ended
($ in thousands)	February 28, 2021			February 29, 2020			February 28, 2021			February 29, 2020
Net earnings	$	11,876		$	5,516		$	18,971		$	13,861
Other comprehensive income (loss):
Defined benefit pension plan adjustment, net of tax		59			43			102			86
Foreign currency translation adjustment, net of hedging activities and tax		481			(895	)		1,864			(1,188	)
Unrealized gain (loss) on marketable securities, net of tax		(25	)		61			(56	)		61
Total other comprehensive income (loss), net of tax expense (benefit) of $20, ($449), ($12), and ($373), respectively		515			(791	)		1,910			(1,041	)
Total comprehensive income	$	12,391		$	4,725		$	20,881		$	12,820

($ and shares in thousands, except par values)	February 28, 2021			February 29, 2020			August 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	110,775		$	101,272		$	121,403
Marketable securities		19,555			18,740			19,511
Receivables, net of allowance of $3,021, $2,597, and $2,780, respectively		94,211			80,468			84,604
Inventories, net		121,566			105,454			104,792
Other current assets, net		29,509			19,083			17,625
Total current assets		375,616			325,017			347,935

Property, plant, and equipment:
Cost		223,418			191,688			208,107
Less accumulated depreciation		(134,197	)		(122,926	)		(128,526	)
Property, plant, and equipment, net		89,221			68,762			79,581

Intangibles, net		22,383			23,162			23,477
Goodwill		68,087			64,338			68,004
Operating lease right-of-use assets		20,173			27,257			27,457
Deferred income tax assets		10,347			10,162			9,935
Other noncurrent assets		10,821			15,632			14,137
Total assets	$	596,648		$	534,330		$	570,526

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	39,934		$	33,307		$	29,554
Current portion of long-term debt		215			211			195
Other current liabilities		74,687			54,303			72,646
Total current liabilities		114,836			87,821			102,395

Pension benefits liabilities		6,182			5,868			6,374
Long-term debt		115,599			115,765			115,682
Operating lease liabilities		20,174			25,919			25,862
Deferred income tax liabilities		900			839			889
Other noncurrent liabilities		19,933			20,791			20,806
Total liabilities		277,624			257,003			272,008

Shareholders' equity:

Preferred stock of $1 par value - authorized 2,000 shares; no shares issued and outstanding		—			—			—
Common stock of $1 par value - authorized 25,000 shares; 18,990, 18,918, and 18,918 shares issued, respectively		18,990			18,918			18,918
Capital in excess of stated value		84,206			74,645			77,686
Retained earnings		511,728			481,890			499,724
Less treasury stock - at cost, 8,083 shares		(277,238	)		(277,238	)		(277,238	)
Accumulated other comprehensive loss, net		(18,662	)		(20,888	)		(20,572	)
Total shareholders' equity		319,024			277,327			298,518
Total liabilities and shareholders' equity	$	596,648		$	534,330		$	570,526

Lindsay Corporation and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
($ and shares in thousands, except per share amounts)
(Unaudited)
	Shares of common stock		Shares of treasury stock		Common stock		Capital in excess of stated value		Retained earnings			Treasury stock			Accumulated other comprehensive loss, net			Total shareholders’ equity
Balance at August 31, 2019		18,870		8,083	$	18,870	$	71,684	$	474,740		$	(277,238	)	$	(19,847	)	$	268,209
Comprehensive income:
Net earnings		—		—		—		—		13,861			—			—			13,861
Other comprehensive loss		—		—		—		—		—			—			(1,041	)		(1,041	)
Total comprehensive income		—		—		—		—		—			—			—			12,820
Cash dividends ($.62) per share		—		—		—		—		(6,711	)		—			—			(6,711	)
Issuance of common shares under share compensation plans, net		48		—		48		386		—			—			—			434
Share-based compensation expense		—		—		—		2,575		—			—			—			2,575
Balance at February 29, 2020		18,918		8,083	$	18,918	$	74,645	$	481,890		$	(277,238	)	$	(20,888	)	$	277,327


Balance at August 31, 2020		18,918		8,083	$	18,918	$	77,686	$	499,724		$	(277,238	)	$	(20,572	)	$	298,518
Comprehensive income:
Net earnings		—		—		—		—		18,971			—			—			18,971
Other comprehensive income		—		—		—		—		—			—			1,910			1,910
Total comprehensive income		—		—		—		—		—			—			—			20,881
Cash dividends ($.64) per share		—		—		—		—		(6,967	)		—			—			(6,967	)
Issuance of common shares under share compensation plans, net		72		—		72		2,473		—			—			—			2,545
Share-based compensation expense		—		—		—		4,047		—			—			—			4,047
Balance at February 28, 2021		18,990		8,083	$	18,990	$	84,206	$	511,728		$	(277,238	)	$	(18,662	)	$	319,024

See accompanying notes to condensed consolidated financial statements.

	Six months ended
($ in thousands)	February 28, 2021			February 29, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	18,971		$	13,861
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization		9,878			9,418
Gain on sale of assets held-for-sale		—			(1,191	)
Provision for uncollectible accounts receivable		246			213
Deferred income taxes		206			1,806
Share-based compensation expense		4,047			2,575
Unrealized foreign currency transaction (gain) loss		(754	)		1,515
Other, net		1,804			(2,153	)
Changes in assets and liabilities:
Receivables		(10,769	)		(5,716	)
Inventories		(16,245	)		(14,153	)
Other current assets		(9,492	)		(4,539	)
Accounts payable		10,962			3,540
Other current liabilities		334			(2,183	)
Other noncurrent assets and liabilities		1,940			(5,178	)
Net cash provided by (used in) operating activities		11,128			(2,185	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and equipment		(16,556	)		(5,335	)
Proceeds from sale of property and equipment held-for-sale		—			3,955
Purchases of marketable securities available-for-sale		(8,313	)		(19,978	)
Proceeds from maturities of marketable securities available-for-sale		8,043			1,250
Other investing activities, net		(860	)		1,092
Net cash used in investing activities		(17,686	)		(19,016	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options		3,814			1,545
Common stock withheld for payroll tax obligations		(1,269	)		(1,111	)
Principal payments on long-term debt		(88	)		(104	)
Dividends paid		(6,967	)		(6,711	)
Net cash used in financing activities		(4,510	)		(6,381	)

Effect of exchange rate changes on cash and cash equivalents		440			1,650
Net change in cash and cash equivalents		(10,628	)		(25,932	)
Cash and cash equivalents, beginning of period		121,403			127,204
Cash and cash equivalents, end of period	$	110,775		$	101,272

SUPPLEMENTAL CASH FLOW INFORMATION
Income taxes paid, net of refunds	$	2,397		$	2,294
Interest paid	$	2,347		$	2,334

	Three months ended				Six months ended
(Units and options in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Restricted stock units		—		4		—		11
Stock options		5		12		42		6
Performance stock units		3		—		6		10

Due within	$ in thousands
1 year	$	215
2 years		219
3 years		224
4 years		228
5 years		232
Thereafter		115,138
	$	116,256

	February 28, 2021
($ in thousands)	Level 1		Level 2		Level 3			Total
Cash and cash equivalents	$	110,775	$	—	$	—		$	110,775
Marketable securities:
Corporate bonds		—		15,501		—			15,501
U.S. treasury securities		—		4,054		—			4,054
Earn-out liability		—		—		(1,098	)		(1,098	)

	February 29, 2020
($ in thousands)	Level 1		Level 2		Level 3			Total
Cash and cash equivalents	$	101,272	$	—	$	—		$	101,272
Marketable securities:
Corporate bonds		—		14,555		—			14,555
U.S. treasury securities		—		4,185		—			4,185
Derivative assets		—		247		—			247

	August 31, 2020
($ in thousands)	Level 1		Level 2		Level 3			Total
Cash and cash equivalents	$	121,403	$	—	$	—		$	121,403
Marketable securities:
Corporate bonds		—		14,426		—			14,426
U.S. treasury securities		—		5,085		—			5,085
Derivative assets		—		21		—			21
Earn-out liability		—		—		(1,112	)		(1,112	)

	Three months ended						Percent
($ in thousands)	February 28, 2021			February 29, 2020			Increase (Decrease)
Consolidated
Operating revenues	$	143,577		$	113,788		26%
Gross profit	$	41,174		$	33,406		23%
Gross margin		28.7	%		29.4	%

Operating expenses⁽¹⁾	$	25,365		$	24,764		2%
Operating income	$	15,809		$	8,642		83%
Operating margin		11.0	%		7.6	%

Other expense, net	$	(1,248	)	$	(1,775	)	-30%
Income tax expense	$	2,685		$	1,351		99%
Overall income tax rate		18.4	%		19.7	%
Net earnings	$	11,876		$	5,516		115%

Irrigation Segment
Segment operating revenues	$	118,572		$	93,494		27%
Segment operating income	$	18,045		$	10,084		79%
Segment operating margin		15.2	%		10.8	%

Infrastructure Segment
Segment operating revenues	$	25,005		$	20,294		23%
Segment operating income	$	6,341		$	5,888		8%
Segment operating margin		25.4	%		29.0	%

Exhibit
No.		Description

3.1		Restated Certificate of Incorporation of the Company, incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed on December 14, 2006.
3.2		Amended and Restated By‑Laws of the Company, effective October 17, 2018, incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on October 19, 2018.
4.1		Specimen Form of Common Stock Certificate, incorporated by reference to Exhibit 4(a) of the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended November 30, 2006.
31.1*		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 18 U.S.C. Section 1350.
31.2*		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 18 U.S.C. Section 1350.
32.1*		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 18 U.S.C. Section 1350.
101*		Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline Extensible Business Reporting Language ("Inline XBRL").
104*		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).

			LINDSAY CORPORATION

	By:		/s/ BRIAN L. KETCHAM
	Name:		Brian L. Ketcham
	Title:		Senior Vice President and Chief Financial Officer
			(on behalf of the registrant and as principal financial officer)

	Three months ended						Three months ended
	February 28, 2021						February 29, 2020
($ in thousands)	Irrigation		Infrastructure		Total		Irrigation		Infrastructure		Total
Point in time	$	110,814	$	20,819	$	131,633	$	73,844	$	17,334	$	91,178
Over time		7,758		1,535		9,293		19,650		1,426		21,076
Revenue from the contracts with customers		118,572		22,354		140,926		93,494		18,760		112,254

Lease revenue		—		2,651		2,651		—		1,534		1,534
Total operating revenues	$	118,572	$	25,005	$	143,577	$	93,494	$	20,294	$	113,788


	Six months ended						Six months ended
	February 28, 2021						February 29, 2020
($ in thousands)	Irrigation		Infrastructure		Total		Irrigation		Infrastructure		Total
Point in time	$	190,926	$	36,269	$	227,195	$	147,661	$	38,498	$	186,159
Over time		15,003		3,174		18,177		29,159		3,550		32,709
Revenue from the contracts with customers		205,929		39,443		245,372		176,820		42,048		218,868

Lease revenue		—		6,690		6,690		—		4,313		4,313
Total operating revenues	$	205,929	$	46,133	$	252,062	$	176,820	$	46,361	$	223,181

($ in thousands)	February 28, 2021			February 29, 2020			August 31, 2020
Raw materials and supplies	$	62,404		$	50,240		$	51,205
Work in process		8,993			6,746			6,464
Finished goods and purchased parts, net		58,682			53,496			51,684
Total inventory value before LIFO adjustment		130,079			110,482			109,353
Less adjustment to LIFO value		(8,513	)		(5,028	)		(4,561	)
Inventories, net	$	121,566		$	105,454		$	104,792

	Three months ended						Six months ended
($ in thousands)	February 28, 2021			February 29, 2020			February 28, 2021			February 29, 2020
Product warranty accrual balance, beginning of period	$	10,858		$	8,788		$	10,765		$	8,960
Liabilities accrued for warranties during the period		2,247			2,135			3,981			3,616
Warranty claims paid during the period		(1,378	)		(1,933	)		(3,019	)		(3,586	)
Changes in estimates		59			—			59			—
Product warranty accrual balance, end of period	$	11,786		$	8,990		$	11,786		$	8,990

($ in thousands)	February 28, 2021		February 29, 2020		August 31, 2020
Other current liabilities:
Contract liabilities	$	19,982	$	12,323	$	17,296
Compensation and benefits		16,717		13,398		20,945
Warranties		11,786		8,990		10,765
Operating lease liabilities		3,965		4,790		5,123
Dealer related liabilities		3,873		3,681		3,664
Deferred revenue - lease		3,301		2,190		1,822
Tax related liabilities		2,033		1,709		3,726
Accrued insurance		1,320		1,624		1,348
Accrued environmental liabilities		1,105		1,243		1,115
Other		10,605		4,355		6,842
Total other current liabilities	$	74,687	$	54,303	$	72,646


/s/ RANDY A. WOOD		President and Chief Executive Officer
Randy A. Wood		April 6, 2021