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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 30, 2022 |
Lindsay Corporation
(Exact name of Registrant as Specified in Its Charter)
Delaware |
1-13419 |
47-0554096 |
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(State or Other Jurisdiction |
(Commission File Number) |
(IRS Employer |
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18135 Burke Street Suite 100 |
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Omaha, Nebraska |
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68022 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
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Registrant’s Telephone Number, Including Area Code: (402) 829-6800 |
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Trading |
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Common Stock, $1.00 par value |
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LNN |
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New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On June 30, 2022, Lindsay Corporation (the “Company”) issued a press release announcing the Company’s results of operations for its third quarter ended May 31, 2022. A copy of the press release is furnished herewith as Exhibit 99.1.
In addition, a copy of the slide presentation to be used during the Company’s fiscal 2022 third quarter investor conference call at 11:00 a.m. Eastern Time on June 30, 2022 is furnished herewith as Exhibit 99.2.
Item 9.01 Financial Statements and Exhibits.
99.1 Press Release, dated June 30, 2022, issued by the Company
99.2 Slide Presentation for Fiscal 2022 Third Quarter Investor Conference Call on June 30, 2022
104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
In accordance with General Instruction B.2 of Form 8-K, the information contained in Item 2.02 of this Current Report on Form 8-K, including Exhibits 99.1 and 99.2 relating to Item 2.02 and attached hereto, is being “furnished” and, as such, shall not be deemed to be “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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LINDSAY CORPORATION |
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Date: |
June 30, 2022 |
By: |
/s/ Brian L. Ketcham |
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Brian L. Ketcham, Senior Vice President and Chief Financial Officer |
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Exhibit 99.1
18135 BURKE ST. OMAHA, NE 68022 TEL: 402-829-6800 FAX: 402-829-6836 |
For further information, contact:
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LINDSAY CORPORATION: |
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THREE PART ADVISORS: |
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Brian Ketcham |
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Jeff Elliott 972-423-7070 |
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Senior Vice President & Chief Financial Officer |
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Gary Guyton 214-442-0016 |
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402-827-6579 |
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Lindsay Corporation Reports Fiscal 2022 Third Quarter Results
OMAHA, Neb., June 30, 2022—Lindsay Corporation (NYSE: LNN), a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology, today announced results for its third quarter of fiscal 2022, which ended on May 31, 2022.
Third Quarter Summary
Revenues for the third quarter of fiscal 2022 were $214.3 million, an increase of $52.3 million, or 32 percent, compared to revenues of $161.9 million in the prior year third quarter. Net earnings for the quarter were $25.1 million, or $2.28 per diluted share, compared with net earnings of $17.8 million, or $1.60 per diluted share, for the prior year third quarter.
“Global demand for irrigation equipment remained strong in our third quarter, particularly in our international markets. While inflationary pressures continue to persist, we were pleased to see improved price realization across the business,” said Randy Wood, President and Chief Executive Officer. “In the infrastructure business, we are starting to see an increase in road construction activity in the U.S., and we also began delivery of one of the Road Zipper System projects we have been expecting in the second half of our year.”
Third Quarter Segment Results
Irrigation segment revenues for the third quarter of fiscal 2022 were $188.7 million, an increase of $48.5 million, or 35 percent, compared to $140.2 million in the prior year third quarter. North America irrigation revenues of $96.2 million increased $8.8 million, or 10 percent, compared to the prior year third quarter. The increase in North America irrigation revenues resulted primarily from the impact of higher average selling prices, which was partially offset by lower unit sales volume. International irrigation revenues of $92.5 million increased $39.7 million, or 75 percent, compared to the prior year third quarter. The increase resulted from a combination of higher average selling prices and higher unit sales volumes in most international markets. Revenues in Brazil more than doubled compared to the prior year third quarter. Also contributing were favorable effects of foreign currency translation of approximately $2.5 million compared to the prior year third quarter.
Irrigation segment operating income for the third quarter of fiscal 2022 was $39.6 million, an increase of $15.6 million, or 65 percent, compared to the prior year third quarter. Operating margin was 21.0 percent of sales, compared to 17.1 percent of sales in the prior year third quarter. The increase in operating margin resulted from improved price realization and additional volume leverage, which more than offset the impact of inflationary cost increases.
Infrastructure segment revenues for the third quarter of fiscal 2022 were $25.6 million, an increase of $3.8 million, or 17 percent, compared to $21.7 million in the prior year third quarter. The increase resulted from higher sales of road safety products and Road Zipper System project sales, which were partially offset by lower Road Zipper System lease revenue.
1
Infrastructure segment operating income for the third quarter of fiscal 2022 was $3.8 million, which was comparable to the prior year third quarter. Operating margin was 14.8 percent of sales, compared to 17.3 percent of sales in the prior year third quarter. Current year results reflect a less favorable margin mix of revenues compared to the prior year third quarter and under absorbed fixed overhead costs.
The backlog of unfilled orders at May 31, 2022 was $98.3 million compared with $120.8 million at May 31, 2021. The backlog in the prior year included an irrigation project order of $36.0 million. Excluding the impact of this order, the irrigation backlog is higher compared to the prior year while the infrastructure backlog is lower.
Outlook
“Global agriculture market fundamentals remain positive; however, grower sentiment in the U.S. is being tempered somewhat by inflationary pressures they are experiencing with their input costs and operational expenses. We continue to see increased activity levels in international project markets as concerns over food security and global grain supplies have been heightened by the ongoing conflict between Russia and Ukraine,” said Mr. Wood. “In the infrastructure business, we expect to complete delivery of the Road Zipper System project that began in the third quarter, and we also expect to begin delivery of another significant project in the fourth quarter. We remain optimistic regarding growth opportunities for this business based on the quality of our sales funnel and increasing commercial activity.”
Third Quarter Conference Call
Lindsay’s fiscal 2022 third quarter investor conference call is scheduled for 11:00 a.m. Eastern Time today. Interested investors may participate in the call by dialing (833) 535-2202 in the U.S., or (412) 902-6745 internationally, and requesting the Lindsay Corporation call. 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. Replays of the conference call will remain on our Web site through the next quarterly earnings release. 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 Corporation (NYSE: LNN) is a leading global manufacturer and distributor of irrigation and infrastructure equipment and technology. Established in 1955, the company has been at the forefront of research and development of innovative solutions to meet the food, fuel, fiber and transportation needs of the world’s rapidly growing population. The Lindsay family of irrigation brands includes Zimmatic® center pivot and lateral move agricultural irrigation systems, FieldNET® remote irrigation management and scheduling technology, and industrial IoT solutions. Also a global leader in the transportation industry, Lindsay Transportation Solutions manufactures equipment to improve road safety and keep traffic moving on the world’s roads, bridges and tunnels, through the Barrier Systems®, Road Zipper® and Snoline™ brands. For more information about Lindsay Corporation, visit www.lindsay.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 and planned financing 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.
2
LINDSAY CORPORATION AND SUBSIDIARIES |
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CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS |
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(Unaudited) |
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Three months ended |
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Nine months ended |
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(in thousands, except per share amounts) |
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May 31, |
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May 31, |
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May 31, |
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May 31, |
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Operating revenues |
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$ |
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214,259 |
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$ |
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161,936 |
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$ |
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580,547 |
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$ |
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413,998 |
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Cost of operating revenues |
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152,579 |
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117,880 |
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438,486 |
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297,360 |
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Gross profit |
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61,680 |
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44,056 |
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142,061 |
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116,638 |
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Operating expenses: |
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Selling expense |
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8,148 |
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7,570 |
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24,070 |
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22,680 |
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General and administrative expense |
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14,647 |
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12,043 |
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40,548 |
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39,770 |
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Engineering and research expense |
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3,723 |
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3,102 |
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10,582 |
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9,504 |
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Total operating expenses |
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26,518 |
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22,715 |
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75,200 |
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71,954 |
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Operating income |
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35,162 |
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21,341 |
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66,861 |
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44,684 |
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Other income (expense): |
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Interest expense |
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(1,006 |
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(1,178 |
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(3,345 |
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(3,584 |
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Interest income |
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118 |
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227 |
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456 |
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798 |
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Other income, net |
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1,282 |
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764 |
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264 |
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699 |
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Total other income (expense) |
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394 |
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(187 |
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(2,625 |
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(2,087 |
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Earnings before income taxes |
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35,556 |
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21,154 |
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64,236 |
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42,597 |
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Income tax expense |
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10,483 |
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3,357 |
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16,696 |
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5,829 |
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Net earnings |
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$ |
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25,073 |
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$ |
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17,797 |
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$ |
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47,540 |
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$ |
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36,768 |
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Earnings per share: |
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Basic |
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$ |
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2.28 |
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$ |
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1.63 |
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$ |
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4.34 |
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$ |
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3.38 |
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Diluted |
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$ |
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2.28 |
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$ |
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1.61 |
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$ |
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4.31 |
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$ |
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3.35 |
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Shares used in computing earnings per share: |
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Basic |
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10,978 |
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10,907 |
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10,960 |
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10,879 |
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Diluted |
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11,021 |
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11,033 |
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11,020 |
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10,967 |
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Cash dividends declared per share |
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$ |
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0.33 |
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$ |
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0.33 |
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$ |
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0.99 |
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$ |
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0.97 |
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3
LINDSAY CORPORATION AND SUBSIDIARIES |
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SUMMARY OPERATING RESULTS |
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(Unaudited) |
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Three months ended |
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Nine months ended |
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(in thousands) |
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May 31, |
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May 31, |
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May 31, |
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May 31, |
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Operating revenues: |
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Irrigation: |
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North America |
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$ |
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96,153 |
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$ |
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87,364 |
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$ |
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275,601 |
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$ |
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220,332 |
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International |
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92,540 |
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52,811 |
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239,759 |
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125,772 |
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Irrigation segment |
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188,693 |
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140,175 |
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515,360 |
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346,104 |
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Infrastructure segment |
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25,566 |
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21,761 |
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65,187 |
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67,894 |
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Total operating revenues |
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$ |
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214,259 |
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$ |
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161,936 |
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$ |
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580,547 |
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$ |
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413,998 |
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Operating income: |
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Irrigation segment |
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$ |
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39,567 |
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$ |
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23,925 |
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$ |
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81,513 |
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$ |
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52,603 |
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Infrastructure segment |
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3,779 |
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3,767 |
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6,869 |
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14,364 |
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Corporate |
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(8,184 |
) |
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(6,351 |
) |
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(21,521 |
) |
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(22,283 |
) |
Total operating income |
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$ |
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35,162 |
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$ |
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21,341 |
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$ |
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66,861 |
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$ |
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44,684 |
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The Company manages its business activities in two reportable segments as follows:
Irrigation - This reporting segment includes the manufacture and marketing of center pivot, lateral move, and hose reel irrigation systems, as well as various innovative technology solutions such as GPS positioning and guidance, variable rate irrigation, remote irrigation management and scheduling technology, irrigation consulting and design and industrial IoT solutions.
Infrastructure – This reporting segment includes the manufacture and marketing of moveable barriers, specialty barriers, crash cushions and end terminals, and road marking and road safety equipment.
4
LINDSAY CORPORATION AND SUBSIDIARIES |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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(Unaudited) |
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(in thousands) |
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May 31, |
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May 31, |
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August 31, |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
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81,757 |
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$ |
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120,801 |
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$ |
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127,107 |
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Marketable securities |
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13,930 |
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19,663 |
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19,604 |
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Receivables, net |
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155,518 |
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107,713 |
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93,609 |
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Inventories, net |
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195,566 |
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136,601 |
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145,244 |
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Other current assets, net |
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28,663 |
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32,947 |
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30,539 |
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Total current assets |
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475,434 |
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|
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|
417,725 |
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416,103 |
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Property, plant, and equipment, net |
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94,441 |
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92,517 |
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91,997 |
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Intangibles, net |
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18,769 |
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21,893 |
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|
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20,367 |
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Goodwill |
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67,476 |
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68,134 |
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|
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67,968 |
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Operating lease right-of-use assets |
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20,263 |
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19,360 |
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|
18,281 |
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Deferred income tax assets |
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7,857 |
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10,247 |
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|
8,113 |
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Other noncurrent assets, net |
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27,676 |
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|
|
|
12,341 |
|
|
|
|
14,356 |
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Total assets |
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$ |
|
711,916 |
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$ |
|
642,217 |
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$ |
|
637,185 |
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LIABILITIES AND SHAREHOLDERS' EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
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72,350 |
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$ |
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49,351 |
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$ |
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45,209 |
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Current portion of long-term debt |
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|
221 |
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|
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|
216 |
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|
217 |
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Other current liabilities |
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101,243 |
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94,589 |
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|
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|
92,814 |
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Total current liabilities |
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173,814 |
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144,156 |
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138,240 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Pension benefits liabilities |
|
|
|
5,474 |
|
|
|
|
6,086 |
|
|
|
|
5,754 |
|
Long-term debt |
|
|
|
115,384 |
|
|
|
|
115,557 |
|
|
|
|
115,514 |
|
Operating lease liabilities |
|
|
|
20,688 |
|
|
|
|
19,369 |
|
|
|
|
18,301 |
|
Deferred income tax liabilities |
|
|
|
730 |
|
|
|
|
881 |
|
|
|
|
832 |
|
Other noncurrent liabilities |
|
|
|
15,056 |
|
|
|
|
19,995 |
|
|
|
|
20,099 |
|
Total liabilities |
|
|
|
331,146 |
|
|
|
|
306,044 |
|
|
|
|
298,740 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Shareholders' equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|||
Preferred stock |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
Common stock |
|
|
|
19,063 |
|
|
|
|
18,991 |
|
|
|
|
18,991 |
|
Capital in excess of stated value |
|
|
|
92,516 |
|
|
|
|
85,257 |
|
|
|
|
86,495 |
|
Retained earnings |
|
|
|
564,805 |
|
|
|
|
525,926 |
|
|
|
|
528,130 |
|
Less treasury stock - at cost |
|
|
|
(277,238 |
) |
|
|
|
(277,238 |
) |
|
|
|
(277,238 |
) |
Accumulated other comprehensive loss, net |
|
|
|
(18,376 |
) |
|
|
|
(16,763 |
) |
|
|
|
(17,933 |
) |
Total shareholders' equity |
|
|
|
380,770 |
|
|
|
|
336,173 |
|
|
|
|
338,445 |
|
Total liabilities and shareholders' equity |
|
$ |
|
711,916 |
|
|
$ |
|
642,217 |
|
|
$ |
|
637,185 |
|
5
LINDSAY CORPORATION AND SUBSIDIARIES |
|
|||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
|||||||||
(Unaudited) |
|
|||||||||
|
|
|
|
|
|
|
|
|
||
|
|
Nine months ended |
|
|||||||
(in thousands) |
|
|
May 31, 2022 |
|
|
|
May 31, 2021 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
||
Net earnings |
|
$ |
|
47,540 |
|
|
$ |
|
36,768 |
|
Adjustments to reconcile net earnings to net cash (used in) provided by operating activities: |
|
|
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
14,930 |
|
|
|
|
14,688 |
|
Provision for uncollectible accounts receivable |
|
|
|
734 |
|
|
|
|
304 |
|
Deferred income taxes |
|
|
|
514 |
|
|
|
|
205 |
|
Share-based compensation expense |
|
|
|
4,061 |
|
|
|
|
5,021 |
|
Unrealized foreign currency transaction gain |
|
|
|
(754 |
) |
|
|
|
(1,934 |
) |
Other, net |
|
|
|
645 |
|
|
|
|
(2,123 |
) |
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
||
Receivables |
|
|
|
(63,365 |
) |
|
|
|
(22,934 |
) |
Inventories |
|
|
|
(49,209 |
) |
|
|
|
(28,612 |
) |
Other current assets |
|
|
|
1,669 |
|
|
|
|
(14,025 |
) |
Accounts payable |
|
|
|
26,319 |
|
|
|
|
20,828 |
|
Other current liabilities |
|
|
|
822 |
|
|
|
|
20,149 |
|
Other noncurrent assets and liabilities |
|
|
|
(8,840 |
) |
|
|
|
2,325 |
|
Net cash (used in) provided by operating activities |
|
|
|
(24,934 |
) |
|
|
|
30,660 |
|
|
|
|
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
||
Purchases of property, plant, and equipment |
|
|
|
(12,222 |
) |
|
|
|
(22,532 |
) |
Purchases of marketable securities |
|
|
|
(18,468 |
) |
|
|
|
(13,067 |
) |
Proceeds from maturities of marketable securities |
|
|
|
23,592 |
|
|
|
|
12,592 |
|
Other investing activities, net |
|
|
|
(2,952 |
) |
|
|
|
(1,960 |
) |
Net cash used in investing activities |
|
|
|
(10,050 |
) |
|
|
|
(24,967 |
) |
|
|
|
|
|
|
|
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
||
Proceeds from exercise of stock options |
|
|
|
2,894 |
|
|
|
|
3,892 |
|
Common stock withheld for payroll tax obligations |
|
|
|
(1,181 |
) |
|
|
|
(1,269 |
) |
Proceeds from employee stock purchase plan |
|
|
|
319 |
|
|
|
|
— |
|
Principal payments on long-term debt |
|
|
|
(163 |
) |
|
|
|
(141 |
) |
Dividends paid |
|
|
|
(10,865 |
) |
|
|
|
(10,566 |
) |
Net cash used in financing activities |
|
|
|
(8,996 |
) |
|
|
|
(8,084 |
) |
|
|
|
|
|
|
|
|
|
||
Effect of exchange rate changes on cash and cash equivalents |
|
|
|
(1,370 |
) |
|
|
|
1,789 |
|
Net change in cash and cash equivalents |
|
|
|
(45,350 |
) |
|
|
|
(602 |
) |
Cash and cash equivalents, beginning of period |
|
|
|
127,107 |
|
|
|
|
121,403 |
|
Cash and cash equivalents, end of period |
|
$ |
|
81,757 |
|
|
$ |
|
120,801 |
|
6
3rd Quarter Fiscal 2022 Earnings Slide Deck Exhibit 99.2
Safe-Harbor Statement This presentation 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, financial results and planned financing. 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. Investors should understand that a number of factors (including but not limited to the lingering effects of the COVID-19 pandemic and related public health measures on plant operations, workforce availability, supply chain availability, and product demand) could cause future economic and industry conditions and the Company’s actual financial condition and results of operations to differ materially from management’s beliefs expressed in the forward-looking statements contained in this presentation. These factors include those outlined in the “Risk Factors” section of the Company’s most recent annual report on Form 10-K filed with the Securities and Exchange Commission, and investors are urged to review these factors when considering the forward-looking statements contained in this presentation. 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. For full financial statement information, please see the Company’s earnings release dated June 30, 2022.
Third Quarter Summary Revenues increased $52.3 million compared to prior year Irrigation increased $48.5 million Infrastructure increased $3.8 million Operating income increased $13.8 million compared to prior year Irrigation increased $15.6 million Infrastructure was $3.8 million and comparable to prior year Corporate expense increased $1.8 million Primarily due to higher incentive compensation and travel expense compared to the prior year Amounts in millions, except per share amounts Revenue Operating Income (with operating margin) Diluted EPS +32% +42% +65%
Third Quarter and YTD Financial Summary
Current Market Factors May 2022 U.S. corn prices have increased 18 percent and soybean prices have increased 11 percent from a year ago. The sustained increases are due to constrained supply levels globally, coupled with higher demand. The continued conflict between Russia and Ukraine continues to put pressure on the availability of agricultural commodities, further increasing corn, wheat and soybean prices. As of February 2022, the USDA projected net farm income to be $113.7 billion, a decrease of 4.5 percent from 2021. A projected increase in cash receipts has been more than offset by a decrease in government support payments and higher cash expenses. If realized, projected 2022 net farm income would be at its second-highest level since 2013. Inflationary pressure on input and logistics costs are expected to continue, requiring further price increases. Supply chain and logistics challenges are expected to persist in the near term. Irrigation Infrastructure The Infrastructure Investment and Jobs Act (IIJA) was signed into law on November 15, 2021 and marked the largest infusion of federal investment into infrastructure projects in more than a decade. It includes a five-year reauthorization of the Fixing America’s Surface Transportation (FAST) Act. This legislation introduced $110 billion in incremental federal funding to repair roads, bridges, and support other transformational projects, which the Company anticipates will translate into higher demand for its transportation safety products. On March 10, 2022, the first allocations of the IIJA funds were approved with the signing of the 2022 omnibus appropriations bill. Cost inflation and constraints in availability of labor resources are impacting the timing and scope of certain construction projects.
Irrigation Segment North America revenue increased $8.8 million Increase primarily from higher average selling prices Unit sales volume was lower compared to the prior year Unit sales volume breakdown by category: Replacement 48%, Conversion 25%, Dryland 27% International revenue increased $39.7 million Increase from a combination of higher average selling prices and higher unit sales volume in most international markets Revenue in Brazil more than doubled compared to prior year Favorable foreign currency translation impact of $2.5 million Operating income increased $15.6 million Improved price realization Higher unit sales volume in international markets Inflationary cost pressures persist but are moderating Revenue North America International FY21 FY22 Amounts in millions +75% +65% +10% Operating Income (with operating margin)
Infrastructure Segment Total revenue increased $3.8 million Higher sales of road safety products Increase in Road Zipper System® sales revenue Began delivery on a Road Zipper project in Australia Lower Road Zipper lease revenue due to timing of projects Operating income was comparable to prior year third quarter Current year results reflect a less favorable margin mix of revenues Under absorbed fixed overhead costs A barrier replacement project in Massachusetts has been approved and is expected to be awarded in the fourth quarter The value of our portion of the project is approximately $24 million We anticipate delivering two-thirds of the project in Q4 with the remainder delivering in Q1 of fiscal 2023 Revenue Amounts in millions +17% n/a Operating Income (with operating margin)
Innovation Leadership: Addressing Global Megatrends Capitalizingon globalmegatrends Key Trends FoodSecurity WaterScarcity LandAvailability MobilitySafety ReducingEmissions Labor Savings
Strong Commitment to Sustainable Practices Our mission is to provide solutions that conserve natural resources, enhance the quality of life for people, and expand our world’s potential. Investing in sustainable technologies Improving our operational footprint Empowering and protecting our people Engaging inour local communities Operatingwithintegrity 1 2 3 4 5
Summary Balance Sheet and Liquidity As of May 31, 2022: Available liquidity of $145.7 million, with $95.7 million in cash, cash equivalents and marketable securities and $50.0 million available under revolving credit facility Total debt of $116.0 million, of which $115.0 million matures in 2030 A funded debt to EBITDA leverage ratio (as defined in our credit agreements) of 1.2 compared to a covenant limit of 3.0
Summary of Cash Flow
Capital Allocation – A Balanced Approach Allocation History Other includes debt repayments, net cash sources/uses from note receivables, net investment hedges, stock compensation and related tax benefits. Ending cash includes marketable securities. Targeted cash balance of $60-75 million, including international accounts To support cyclical and seasonal fluctuations in working capital and projected capital expenditures $115 million in Senior Notes maturing on 2/19/30 at annual interest rate of 3.82% The Company’s prioritization for cash use: Working capital to support organic growth New product development Capital expenditures - expected to be $15-20 million in fiscal 2022 Acquisitions that align with strategic priorities Dividend payments Opportunistic share repurchases Allocation Plan
Appendix
U.S. Net Farm Income and Net Cash Farm IncomeInflation adjusted, 2001-22F 2001-20 average NCFI Note: F = forecast. Values are adjusted for inflation using the U.S. Bureau of Economic Analysis Gross Domestic Product Price Index (BEA API series code: A191RG) rebased to 2022 by USDA, Economic Research Service. Source: USDA, Economic Research Service, Farm Income and Wealth Statistics. Data as of February 4, 2022 $ billion (2022) 2001-20 average NFI
Commodity Prices Soybean Prices Source: Trading Economics Corn Prices
United States Drought Condition Source: US Drought Monitor, June 2022
