Lindsay Earnings Drop on Environmental Costs

Lindsay (NYSE: LNN  ) reported earnings on Dec. 21. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Nov. 30 (Q1), Lindsay beat expectations on revenues and, excluding the environmental charge, crushed expectations on earnings per share.

Compared to the prior-year quarter, revenue increased significantly, and earnings per share dropped significantly.

Margins dropped across the board.

Revenue details
Lindsay reported revenue of $119 million. The seven analysts polled by S&P Capital IQ anticipated sales of $105 million. Sales were 34% higher than the prior-year quarter's $89 million

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at $0.60, not including a $0.37 per share environmental accrual charge. The eight earnings estimates compiled by S&P Capital IQ predicted $0.46 per share on the same basis. GAAP EPS of $0.23 for Q1 were 32% lower than the prior-year quarter's $0.34 per share.

Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 25.4%, 180 basis points worse than the prior-year quarter. Operating margin was 4.3%, 310 basis points worse than the prior-year quarter. Net margin was 2.5%, 230 basis points worse than the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods.

Source: S&P Capital IQ. Quarterly periods.

Looking ahead
What does the future hold?

Next quarter's average estimate for revenue is $127 million. On the bottom line, the average EPS estimate is $0.81.

Next year's average estimate for revenue is $513 million. The average EPS estimate is $3.17.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 313 members out of 343 rating the stock outperform, and 30 members rating it underperform. Among 95 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 87 give Lindsay a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Lindsay is hold, with an average price target of $65.33.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings. He is the co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On December 23, 2011, at 11:11 PM, newfoolrr wrote:

    Wonder why margins have come down so much in 2011 as compared to 2010

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