Lindsay Corporation. a global manufacturer and distributor of irrigation and infrastructure equipment and technology, has announced results for its first quarter of fiscal 2022, which ended on Nov. 30, 2021.
First Quarter Summary
Revenues for the first quarter of fiscal 2022 were $166.2 million, an increase of $57.7 million, or 53%, compared to revenues of $108.5 million in the prior year first quarter. Net earnings for the quarter were $7.9 million, or $0.72 per diluted share, compared with net earnings of $7.1 million, or $0.65 per diluted share, for the prior year first 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.
“Positive market fundamentals continue to support solid demand for irrigation equipment across all geographies,” said Randy Wood, president and Chief Executive Officer. “Raw material cost inflation and supply chain issues continue to create challenges and limit margin expansion. Our teams are managing well in this dynamic environment in order to support our customers.”
First Quarter Segment Results
Irrigation segment revenues for the first quarter of fiscal 2022 were $145.9 million, an increase of $58.6 million, or 67%, compared to $87.4 million in the prior year first quarter. North America irrigation revenues of $79 million increased $26.2 million, or 50%, compared to the prior year first 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 $66.9 million increased $32.4 million, or 94%, compared to the prior year first 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 $1.1 million. The largest sales volume increases were in the Brazil, Middle East and Europe markets.
Irrigation segment operating income for the first quarter of fiscal 2022 was $17.2 million, an increase of $6.6 million, or 62%, compared to the prior year first quarter. Operating margin was 11.8% of sales, compared to 12.2% of sales in the prior year first quarter. The impact of higher irrigation system unit volume was partially offset by the impact of higher costs of raw materials and other inputs. First quarter operating results were also reduced by approximately $5 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.
The backlog of unfilled orders at Nov. 30, 2021 was $154.8 million compared with $89.2 million at Nov. 30, 2020. A higher backlog of orders in irrigation was partially offset by a lower backlog in infrastructure.
“Market conditions support continued solid demand for irrigation equipment, and we also expect raw material cost inflation and supply chain challenges to persist in the near term. We are focused on protecting and improving margins in this environment,” said Wood. “Regarding our infrastructure business, we continue to expect an increase in project activity in the second half of the fiscal year.” Mr. Wood concluded, “We are sharply focused on our innovation growth strategy that addresses the needs of a growing population and provides solutions that improve efficiency and promote sustainability.”