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May 31, 2023
Lindsay Q3 2023 Earnings Report
Operational execution and diligent price management helped drive strong operating margin performance amid softer aggregate demand.
Key Takeaways
Lindsay Corporation reported a decrease in revenue by 23% to $164.6 million, primarily due to lower irrigation segment sales. Despite the revenue decline, the company maintained a strong operating margin of 16.4% due to disciplined price management and cost control. Net earnings decreased to $16.9 million, or $1.53 per diluted share.
Near record operating margin performance in irrigation as market fundamentals remain generally positive
Revenue decline reflects investment delays for irrigation equipment and projects
Infrastructure results supported by increased Road Zipper System® leasing
Commercial teams have demonstrated the ability to maintain pricing discipline in order to preserve strong operating margin performance
Lindsay
Lindsay
Lindsay Revenue by Segment
Lindsay Revenue by Geographic Location
Revenue by Segment
Irrigation Revenue
CapyFin.comInfrastructure Revenue
CapyFin.comRevenue by Geographic Location
North America Revenue
CapyFin.comInternational Revenue
CapyFin.com Forward Guidance
Demand in the fourth quarter is expected to be driven primarily by summer crop harvest and storm damage replacement, which is expected to be lower than the exceptional demand experienced in last year's strong fourth quarter. Sales volume in Brazil is expected to increase in the fourth quarter, supported by the new government financing program that was recently announced. The timing of project execution at the state level can be difficult to predict and, because of delayed startups, a limited positive impact is expected on fiscal 2023 results and a more meaningful positive impact in fiscal 2024 and beyond.
Positive Outlook
- Potential impact from continuing drought conditions could provide additional demand support.
- Expect sales volume in Brazil to increase in the fourth quarter, supported by the new government financing program that was recently announced.
- Demand across other international markets continues to be supported by positive agricultural market fundamentals
- Demand across other international markets continues to be supported by continuing global concerns over food security
- Demand across other international markets continues to be supported by continuing global grain supplies.
Challenges Ahead
- Demand in our fourth quarter is expected to be driven primarily by summer crop harvest and storm damage replacement, which we are expecting to be lower than the exceptional demand we experienced in last year's strong fourth quarter.
- The timing of project execution at the state level can be difficult to predict
- Because of delayed startups we have experienced to date, we expect a limited positive impact on our fiscal 2023 results
- A more meaningful positive impact in fiscal 2024 and beyond.
- General economic uncertainty has negatively impacted farmer sentiment, tempering order activity and driving some customers to delay capital investment decisions
Revenue & Expenses
Visualization of income flow from segment revenue to net income