OMAHA - Lindsay Corporation (NYSE: NYSE:LNN), a global leader in irrigation and infrastructure equipment and technology, reported third-quarter earnings that surpassed analyst expectations, but revenues fell short, sending shares down 3.4%.
The company announced diluted earnings per share (EPS) of $1.85, which was significantly higher than the analyst estimate of $1.17. However, revenue for the quarter was $139.2 million, below the consensus estimate of $144.38 million.
The company's earnings were bolstered by a $4.8 million income tax credit in Brazil, contributing to a net earnings increase of 21% compared to the same quarter last year. Despite the EPS outperformance, the revenue miss was the primary driver of the stock's decline.
Lindsay's President and CEO, Randy Wood, acknowledged the challenges faced in the irrigation segment due to global market conditions and high precipitation levels in North America. He stated, "Market conditions in our irrigation segment continue to weigh on farmer sentiment, resulting in demand softness." Wood also noted that the market in Brazil remains affected by lower commodity prices and tight credit availability.
On a positive note, the infrastructure segment of Lindsay's business saw an 11% increase in revenues, driven by higher Road Zipper System sales and lease revenues. The company also highlighted the completion of $17.9 million in share repurchases during the quarter, reflecting confidence in its financial position and commitment to shareholder value.
Looking ahead, Lindsay anticipates continued softness in North American demand until the outlook for net farm income improves. However, the company remains optimistic about growth opportunities in international markets, particularly following a significant supply agreement in the Middle East and North Africa region valued at over $100 million.
Wood concluded with a cautious but hopeful outlook, emphasizing the potential for growth in U.S. infrastructure spending and international markets, despite the unpredictable timing of project recognition.
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