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LINDSAY CORP (LNN)·Q2 2025 Earnings Summary

Executive Summary

  • Record quarter: revenue $187.1M (+23% y/y), operating margin 17.2% (+260 bps y/y), EPS $2.44 (+49% y/y), driven by MENA irrigation project deliveries and a >$20M Road Zipper System sale; North America irrigation was soft but in line with expectations .
  • Significant beats vs S&P Global consensus: revenue beat by ~$9.7M ($187.1M vs $177.4M*) and EPS beat by ~$0.55 ($2.44 vs $1.89*); both segments contributed, with Infrastructure operating margin expanding to 34.1% .
  • Guidance tone: no formal numeric guidance; management expects tempered North America irrigation demand near-term, continued developing-market project growth, and full-year Infrastructure growth; tariffs likely a marginal COGS increase to be passed through via pricing .
  • Stock reaction catalysts: record EPS/net income, backlog up to $127.0M from $94.2M y/y, execution on large projects, and tariff mitigation plan underscoring margin resilience .

What Went Well and What Went Wrong

What Went Well

  • International irrigation strength: MENA project deliveries and broader regional sales drove +42% international irrigation revenue and supported overall irrigation growth .
  • Infrastructure outperformance: revenues +110% y/y to $38.9M on a >$20M Road Zipper sale; operating margin expanded to 34.1% and operating income +278% y/y .
  • Management execution and resiliency: “Our strong execution on these projects allowed us to deliver margin expansion and net earnings growth despite a tempered demand environment in core irrigation markets.” — Randy Wood, CEO .

What Went Wrong

  • North America irrigation: -7% y/y revenue on lower equipment unit volumes, slightly lower ASPs, and lower replacement parts sales; demand expected to remain tempered .
  • Margin dilution mix: higher percentage of large project revenues diluted irrigation operating margin y/y (18.5% vs 19.3%) despite higher operating income .
  • Tariff and macro uncertainty: management expects a marginal increase to COGS from new tariffs and potential retaliatory actions; passing through pricing is planned, but sector-wide uncertainty may dampen farmer sentiment and capex .

Financial Results

Consolidated Results (Q1–Q3 FY2025)

MetricQ1 2025Q2 2025Q3 2025
Revenue ($USD Millions)$166.3 $187.1 $169.5
Operating Income ($USD Millions)$20.9 $32.1 $23.8
Operating Margin (%)12.6% 17.2% 14.0%
Net Earnings ($USD Millions)$17.2 $26.6 $19.5
Diluted EPS ($USD)$1.57 $2.44 $1.78

Q2 FY2025 vs Prior Year and Estimates

MetricQ2 2024Q2 2025 ActualQ2 2025 Consensus*
Revenue ($USD Millions)$151.5 $187.1 $177.4*
Operating Income ($USD Millions)$22.1 $32.1 n/a
Operating Margin (%)14.6% 17.2% n/a
Net Earnings ($USD Millions)$18.1 $26.6 n/a
Diluted EPS ($USD)$1.64 $2.44 $1.89*

Note: Values with asterisk (*) are retrieved from S&P Global.

Segment Breakdown

Segment MetricQ1 2025Q2 2025Q3 2025
Irrigation North America Revenue ($USD Millions)$77.7 $77.1 $69.1
Irrigation International Revenue ($USD Millions)$69.4 $71.0 $74.7
Irrigation Total Revenue ($USD Millions)$147.1 $148.1 $143.7
Irrigation Operating Income ($USD Millions)$24.7 $27.4 $27.2
Irrigation Operating Margin (%)16.8% 18.5% 18.9%
Infrastructure Revenue ($USD Millions)$19.2 $38.9 $25.7
Infrastructure Operating Income ($USD Millions)$4.1 $13.3 $5.4
Infrastructure Operating Margin (%)21.5% 34.1% 21.1%

KPIs

KPIQ1 2025Q2 2025Q3 2025
Backlog ($USD Millions)$168.2 $127.0 $117.1
Available Liquidity ($USD Millions)n/a$236.7 n/a
Cash & Equivalents ($USD Millions)$194.1 $172.0 $196.1

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue / EPS (formal guidance)FY2025n/aNo formal numeric guidance; qualitative outlook reiterated: tempered NA irrigation demand near-term; continued MENA/developing-market project activity; full-year Infrastructure growth expected Maintained qualitative
Tariffs – COGS ImpactFY2025n/aMarginal increase to COGS; plan to pass through via pricing; supply chain actions underway New disclosure
Road Zipper PipelineFY2025Active, timing uncertain Pipeline strong; timing of large projects challenging to predict Maintained tone
Dividend per share (quarterly)Q2 FY2025$0.35 (prior-year quarterly dividend) $0.36 declared Jan 10, 2025; payable Feb 28, 2025 Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 FY2025)Previous Mentions (Q3 FY2025)Current Period (Q2 FY2025)Trend
International irrigation/MENA projectGrowth driven by MENA project; Brazil softer; FX headwind ~$2.1M Continued MENA deliveries; international revenue +60%; Brazil improving; FX headwind ~$2.5M MENA deliveries slightly above internal cadence; broad MENA non-project growth; Brazil unit volume comparable y/y; FX headwind ~$4.7M Strengthening and broadening
North America irrigation demandSoft near-term on lower net farm income; stabilization signs Tempered demand until net farm income outlook improves; drought may support parts and service Demand stable vs prior year; management does not expect meaningful improvement near-term Flat/tempered
Infrastructure – Road ZipperQ1: large >$20M contract finalized post-quarter; margin execution Revenues +6%; margin lower on mix; sales funnel strong >$20M project delivery drives revenue +110% and margin to 34.1%; leasing and safety product sales slightly lower Positive; project-driven
Tariffs/supply chainNo formal impact quantified; cost/efficiency focus Pricing actions to offset; leveraging global footprint Mid-single-digit COGS impact expected; pass-through pricing; supplier shifts and inventory build; monitoring retaliatory tariffs Uncertainty but mitigated
Technology/regulatoryN/AN/AFHWA approval of TAU-XR Xpress Repair Crash Cushion; focus on safety/maintenance efficiency Positive product innovation

Management Commentary

  • “Strength in international irrigation more than offset expected softness in the North America irrigation market, driving overall irrigation revenue growth in our fiscal second quarter.” — Randy Wood, CEO .
  • “Our infrastructure business delivered outstanding results… driven by the execution of a large Road Zipper System project that we delivered in the period.” — Randy Wood, CEO .
  • “We anticipate the impact of the proposed tariffs to result in a marginal increase to our cost of goods, which we would expect to pass through to the market through increased pricing of our products.” — Randy Wood, CEO .
  • “Our total available liquidity at the end of the second quarter was $236.7 million…” — Brian Ketcham, CFO .
  • “Operating margin [Irrigation] was 18.5%… a larger percentage of project revenues resulted in some dilution to operating margin...” — Brian Ketcham, CFO .

Q&A Highlights

  • International project cadence: Q2 shipments were slightly above plan; cadence expected to normalize in Q3/Q4 (~$20M/quarter previously indicated) .
  • Tariff impact and mitigation: expected mid-single-digit COGS increase; pass-through pricing; supplier shifts, inventory builds, and global sourcing; electrical components noted as exposure; domestic steel price movements observed .
  • Irrigation margins: North America margins held comparable; international pressure from Brazil stabilized; project volume leverage helped offset dilution .
  • Macro/trade risks: potential retaliatory tariffs on U.S. ag exports could dampen sentiment and capex; management expects potential government support to farmers as seen historically .
  • Pricing power: actions already taken in response to steel costs; industry-wide dynamics support pricing pass-through .
  • Geographic shifts: if trade tensions escalate, Brazil could benefit from shifted global grain supply; company has capacity and global footprint to react quickly .

Estimates Context

  • Q2 FY2025 results vs consensus: revenue $187.1M vs $177.4M*; EPS $2.44 vs $1.89* — both meaningful beats .
  • Q1 FY2025: revenue $166.3M vs $169.8M* (slight miss); EPS $1.57 vs $1.40* (beat) .
  • Q3 FY2025: revenue $169.5M vs $157.9M* (beat); EPS $1.78 vs $1.41* (beat) .

Note: Values with asterisk (*) are retrieved from S&P Global.

Estimates Table (Actual vs Consensus)

MetricQ1 2025 Consensus*Q1 2025 ActualQ2 2025 Consensus*Q2 2025 ActualQ3 2025 Consensus*Q3 2025 Actual
Revenue ($USD Millions)$169.8*$166.3 $177.4*$187.1 $157.9*$169.5
Primary EPS ($USD)$1.395*$1.57 $1.8925*$2.44 $1.405*$1.78

Note: Values with asterisk (*) are retrieved from S&P Global.

Key Takeaways for Investors

  • Q2 FY2025 was a record EPS/net income quarter with broad-based strength: international irrigation and a major Infrastructure project drove revenue and margin expansion; both revenue and EPS beat Street estimates materially .
  • Near-term North America irrigation demand likely remains tempered despite USDA’s net farm income forecast; watch tariffs and potential retaliatory actions as sentiment dampeners — but pricing pass-through and global sourcing are in place .
  • Project mix drives margin dynamics: large project deliveries can dilute Irrigation margins but still lever fixed costs; Infrastructure margin profile benefits from Road Zipper sales; leasing remains a focus for stable margins .
  • Backlog stepped down from Q1 to Q2 as projects delivered but remains healthy; monitor MENA project cadence normalization in Q3/Q4 and the Road Zipper funnel timing .
  • Liquidity is strong ($236.7M), supporting capital allocation and tariff mitigation; quarterly dividend raised to $0.36 maintains shareholder returns .
  • Tactical positioning: short-term upside catalysts include additional project wins, drought-driven parts demand, and continued tariff cost pass-through; risks include ag export retaliation and NA irrigation softness .
  • Medium-term thesis: secular megatrends (food security, water scarcity, infrastructure investment) plus innovation (e.g., TAU‑XR crash cushion) support multi-year growth across both segments; watch Brazil rate/credit normalization for cyclical recovery .