LINDSAY CORP Q2 FY2025 earnings call

• Irrigation: International markets drove growth, with strength in MENA region and Brazil unit sales volumes returning to prior year levels. - Infrastructure: Strong results from Road Zipper project, optimism in Road Depot sales pipeline, FHWA approval of TAO XR Express Repair crash cushion. - Market Outlook: North America irrigation demand stable in H2 2025; international irrigation growth in developing regions; Brazil impacted by rising interest rates. - Tariffs: Implemented action plan including supplier negotiation and inventory placement, expecting marginal COGS increase passed through via pricing.

Irrigation Segment: Q2 2025 revenues were $148.1 million, up 11% year-over-year. International irrigation revenues were $71 million, up 42% year-over-year, but offset by foreign currency translation of ~$4.7 million. North America irrigation had lower revenues due to lower unit sales volume, slightly lower average selling prices, and lower replacement parts sales. Operating income was $27.4 million, up 7%, with an operating margin of 18.5% of sales. Infrastructure Segment: Revenues were $38.9 million, more than doubling year-over-year, driven by a $20 million Road Zipper project. Operating income was $13.3 million, up over 3x, with an operating margin of 34.1% of sales. Revenue contribution: Irrigation was the larger segment, with infrastructure showing significant growth.

• North America irrigation demand expected to be stable in H2 2025 barring significant storm damage. - International irrigation in developing regions to continue growth from project activity. - Infrastructure expects full-year growth in 2025, with second half activity comparable to last year. - Tariffs expected to result in marginal COGS increase, to be passed through via pricing.

• Tariffs causing marginal increase in cost of goods sold. - Potential retaliatory tariffs impacting agricultural exports and customer sentiment. - Rising interest rates and challenging credit environment in Brazil tempering demand.

Q: On the international side, how was the revenue timing for the quarter, and what to expect in future quarters?

A: Shipped more of a large project than originally anticipated in Q2, but back to original cadence for Q3/Q4. Brazil unit volume flat, currency impact related to Brazil. Other markets like Western Europe and Australia slightly down.

Q: Elaborate on tariffs, significant exposures, and other actions besides passing on price?

A: Biggest impact on irrigation, significant exposures in electrical components. Implemented inventory build and supplier shifts, cost impact mid-single-digit on COGS.

Q: On irrigation margin and tariffs impact on agriculture?

A: North America irrigation margins stable; Brazil had margin pressure but stabilized in Q2. Tariffs impact agricultural exports, government aid and support expected but uncertainty impacts customer sentiment.

Q: Expectation on domestic irrigation pricing and trade war impact on Brazil?

A: Able to pass along cost increases like with steel in past. Brazil demand can be offset by global company's ability to react quickly to increased grain demand in other regions