Lindsay (LNN) Q3 2025 Earnings Name Transcript

DATE

• Thursday, June 26, 2025 at 11 a.m. ET

CALL PARTICIPANTS

• President & Chief Govt Officer — Randy Wooden
• Senior Vice President & Chief Monetary Officer — Brian Ketcham

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RISKS

• Administration acknowledged, “We have now seen softer demand relative to the prior yr” in North American irrigation for Q3 FY2025, tempering demand expectations for the upcoming quarter.
• The benchmark rate of interest in Brazil was elevated to fifteen% as of June 2025, described by administration as “the best price since February,” which has prompted a “wait and see” method amongst prospects, presumably limiting short-term market exercise till crop funding plans are clarified.
• Infrastructure phase working margin declined to 21.1% in Q3 FY2025 from 25.8% within the prior yr because of “much less favorable margin combine inside Highway Zipper System revenues in comparison with the prior yr.”

TAKEAWAYS

• Consolidated Revenues: $169.5 million in Q3 FY2025, up 22% yr over yr, with contributions from each the Irrigation and Infrastructure segments.
• Web Earnings: $19.5 million, or $1.78 per diluted share, in comparison with $20.4 million, or $1.85 per diluted share, within the prior yr (GAAP), with the lower pushed by a one-time $4.8 million earnings tax credit score in Q3 FY2024.
• Normalized EPS Development: Excluding the prior yr’s tax credit score, administration reported a 26% improve in earnings per share.
• Irrigation Section Income: $143.7 million, up 25%, with worldwide irrigation income up 60% to $74.7 million and North America up 1% to $69.1 million.
• Irrigation Working Revenue: $27.2 million, up 39%, with phase working margin growing to 18.9% from 17% within the third quarter of fiscal yr 2025.
• Worldwide Challenge Contribution: Nearly all of the worldwide irrigation income improve in Q3 FY2025 was pushed by a big undertaking within the Center East and North Africa area, in addition to greater gross sales volumes in Brazil and South America, partially offset by a $2.5 million unfavorable impression from international foreign money translation.
• Infrastructure Section Income: $25.7 million, up 6%, led by elevated highway security product gross sales, whereas Highway Zipper gross sales and lease revenues had been similar to the prior yr.
• Infrastructure Working Margin: 21.1% versus 25.8% within the prior yr, because of a much less favorable Highway Zipper margin combine.
• Giant Challenge Execution: Delivered $24 million associated to the MENA undertaking in Q3 FY2025, forward of the everyday $20 million per quarter tempo, with $16 million anticipated in This fall FY2025 and as much as $16 million projected to roll into Q1 FY2026.
• New Challenge Win: Secured a brand new undertaking valued at over $20 million within the Center East, with shipments beginning in This fall FY2025 and persevering with into Q1 FY2026; administration expects its margin profile to be similar to current tasks within the MENA area.
• Liquidity: $261 million whole obtainable at quarter-end, together with $11 million in money, money equivalents, and marketable securities, and $50 million unused on the revolving credit score facility.
• Operational Efficiencies: Margin enlargement in Q3 FY2025 was attributed to worldwide quantity leverage, plant effectivity beneficial properties at services in Brazil, Turkey, and the U.S, and the growing impression of development in subscription-based recurring revenues.
• Pricing Motion and Price Impression: Administration acknowledged U.S. irrigation pricing actions are “slight” and metal tariffs had not produced materials price strain.
• Expertise Partnerships: Strategic partnership with Pessl Devices, integrating FieldNET Advisor and infield sensors, is leading to elevated cross-selling and enhanced agronomic choice assist.

SUMMARY

Lindsay (LNN 2.34%) reported accelerated top-line development in Q3 FY2025, supported by strong worldwide irrigation demand, main undertaking execution within the Center East and North Africa, and regular efficiency in highway security merchandise. Administration particularly highlighted the profitable development and earlier-than-expected transport of its flagship MENA undertaking, in addition to new undertaking wins anticipated to assist future income. Secure liquidity and continued capital self-discipline had been emphasised as strategic benefits.

• President Randy Wooden characterised present U.S. irrigation demand as “softer,” with restricted storm-driven alternative exercise, and famous the mature home market’s stock channel construction as a differentiator from massive agricultural tools friends.
• In Brazil, administration indicated that short-term demand could also be constrained by a “wait and see” sentiment till authorities crop funding parameters are clarified, anticipated in July 2025.
• Administration indicated the worldwide undertaking pipeline stays lively, with the combination shifting to a higher variety of mid-sized tasks, although the quantity and timing of very massive tasks (“mega tasks”) stay unsure.
• Manufacturing modernization in Lindsay, Nebraska, is on schedule, with effectivity beneficial properties evident, however margin development in Q3 was pushed primarily by worldwide leverage and operational enhancements throughout a number of factories.
• The partnership with Pessl Devices is driving elevated worth for patrons by deeper integration of real-time agronomic insights and is contributing to margin enlargement from greater subscription income.

INDUSTRY GLOSSARY

• Highway Zipper System: A moveable barrier system utilized in freeway building and upkeep to facilitate visitors stream and work zone security.
• FieldNET Advisor: Lindsay’s precision irrigation administration platform that makes use of real-time information and modeling for scheduling and choice assist.
• MENA: An acronym for Center East and North Africa, referencing a key area for Lindsay’s irrigation tasks.

Full Convention Name Transcript

Randy Wooden: Thanks, and good morning, everybody. Welcome to our fiscal 2025 third quarter earnings name. With me at present is Brian Ketcham, our Chief Monetary Officer. I’m extraordinarily pleased with our staff and their execution, delivering our third consecutive quarter of year-over-year development in each income and working earnings. Our staff are diligently targeted on supporting our prospects and one another. These outcomes mirror the power of our international enterprise and our staff’s dedication to execution excellence. Our Irrigation enterprise delivered year-over-year income development led by power in our worldwide markets, together with Latin America and the Center East and North Africa area, whereas the home irrigation quantity was similar to the prior yr.

We proceed to ship our massive undertaking within the Center East and are happy to announce we’ve secured a brand new undertaking within the territory valued at over $20 million. This undertaking will start transport in our fiscal fourth quarter and can proceed into our first quarter of fiscal yr 2026. Turning to our Infrastructure phase, our staff delivered one other strong quarter, primarily pushed by highway security merchandise as we enter the highway building season right here in North America. Our focus stays on rising each our highway security merchandise and Highway Zipper system enterprise, significantly leasing, as this helps a extra steady income profile for the phase and our general outcomes.

Shifting gears to market outlook, in North America irrigation, we at the moment are within the main rising season the place climate situations affect crop yields, costs, and web farm earnings for the yr. These elements play a big function in figuring out future demand for irrigation tools. Whereas the USDA is projecting a rise in web farm earnings for this yr, most of that development is said to direct authorities funds for catastrophe reduction and commodity value assist. Crop income is projected to say no at this level of the storm season, we’ve seen softer demand relative to the prior yr. This tempers demand expectations for North American irrigation heading into our fourth quarter.

In our worldwide irrigation markets, significantly Brazil, we’re inspired by continued indicators of bettering market situations. I traveled throughout Mato Grosso and Goias states earlier this month and may affirm that prospects on this area are able to develop irrigated acres as the supply of reasonably priced credit score expands and the nation’s power infrastructure grows. The federal authorities raised the benchmark rate of interest by 25 foundation factors earlier this month, and it now sits at 15%, which is the best price since February. We do count on subsequent yr’s crop plan to be launched in July. The market outlook can be impacted by the speed and quantity of funds made obtainable by this system.

We proceed to see a robust undertaking funnel within the Center East and North Africa, and as I discussed earlier, we did safe one other undertaking on this area and count on to see continued development as international locations throughout the territory prioritize meals safety and water useful resource conservation. In infrastructure, we proceed to see alternatives develop throughout Highway Zipper techniques gross sales, leasing, and highway security merchandise. Infrastructure funding within the U.S. stays regular, and whereas undertaking timing can shift quarter to quarter, our funnel of undertaking alternatives stays strong. Whereas extra undertaking gross sales are on the horizon, the timing of those extra complicated gross sales stays unsure.

Our international operations and provide chain staff proceed to navigate an evolving tariff setting whereas leveraging our international footprint to mitigate the impression on our enterprise. Actions, together with provider collaboration, strategic stock placement, resourcing, and pricing, have allowed us to handle by this era properly. Within the space of expertise, our collaboration with Pessil Devices continues to create buyer worth. By combining FieldNET Advisor with Pessl’s infield environmental facilities, we’re offering extra exact and real-time agronomic insights that enable for extra correct irrigation scheduling choices. This built-in method has pushed notable development in cross-selling alternatives.

The partnership is deepening our experience in agronomic choice assist, strengthening our data-driven product suite, and advancing our place as a frontrunner in precision irrigation. I want to now flip the decision over to Brian to debate our third quarter monetary outcomes.

Brian Ketcham: Thanks, Randy, and good morning, everybody. Consolidated revenues for the third quarter of fiscal 2025 elevated 22% to $169.5 million in comparison with $139.2 million within the prior yr. Revenues grew in each the Irrigation and Infrastructure segments in comparison with the prior yr. Web earnings for the quarter had been $19.5 million or $1.78 per diluted share, in comparison with web earnings of $20.4 million or $1.85 per diluted share within the prior yr. This year-over-year lower in web earnings resulted primarily from the popularity of a one-time earnings tax credit score within the prior yr of $4.8 million or $0.44 per diluted share.

Excluding the impression of the tax credit score on prior yr outcomes, present yr earnings per share represents a rise of 26% over the prior yr. Turning to our phase outcomes, Irrigation phase revenues for the quarter elevated 25% to $143.7 million in comparison with $114.8 million within the prior yr. North America irrigation revenues of $69.1 million elevated 1% in comparison with $68.2 million within the prior yr. Unit gross sales quantity of irrigation tools was similar to the prior yr, whereas common promoting costs had been up barely. This improve was partially offset by the combination impression of barely shorter machines on common in comparison with the prior yr.

Elevated demand for irrigation tools and specialty crop markets within the Pacific Northwest offset softer demand in corn and soybean markets and a decrease degree of storm harm alternative exercise in comparison with the prior yr. In worldwide irrigation markets, revenues elevated 60% to $74.7 million in comparison with $46.6 million within the prior yr. Nearly all of the rise resulted from revenues associated to our massive undertaking within the MENA area together with greater gross sales volumes in Brazil and different components of South America. These will increase had been partially offset by unfavorable results of international foreign money translation of roughly $2.5 million in comparison with the prior yr.

Irrigation phase working earnings for the quarter of $27.2 million elevated 39% in comparison with the prior yr, and working margin was 18.9% of gross sales, in comparison with 17% of gross sales within the prior yr. Working earnings elevated because of greater revenues and favorable leverage of fastened working bills, whereas being partially offset by a better quantity of worldwide undertaking revenues, which resulted in some dilution to working margin in comparison with the prior yr. Infrastructure phase revenues for the quarter of $25.7 million elevated 6% in comparison with $24.4 million within the prior yr. The rise resulted primarily from greater gross sales of highway security merchandise, whereas Highway Zipper undertaking gross sales and lease revenues in whole had been similar to the prior yr.

Infrastructure phase working earnings for the quarter was $5.4 million in comparison with $300,000 within the prior yr. And Infrastructure working margin for the quarter was 21.1% of gross sales in comparison with 25.8% of gross sales within the prior yr. Decrease working earnings and working margin resulted primarily from a much less favorable margin combine inside Highway Zipper System revenues in comparison with the prior yr. Turning to the steadiness sheet and liquidity, our whole obtainable liquidity on the finish of the third quarter was $261 million, which incorporates $11 million in money, money equivalents, and marketable securities and $50 million obtainable underneath our revolving credit score facility.

The power of our steadiness sheet and ample entry to liquid capital sources proceed to function a strategic asset for Lindsay Company as we execute our capital allocation technique to create enhanced and sustained worth for our shareholders. This concludes my remarks. And presently, I’ll flip the decision over to the operator to take your questions.

Operator: Thanks. We are going to now start the question-and-answer session. And your first query comes from Kristen Owen with Oppenheimer. Please go forward.

Mason Banwar: Good morning. That is Mason Banwar on for Kristen. We wished to ask about your worldwide enterprise. Over the quick time period, are you able to assist perceive what, if any, impression the current flare-up within the Center East might have in your massive undertaking exercise? Then, on the long term, I’m questioning for those who will help us perceive what you might be occupied with the long-term development alternative in Brazil. We’re listening to plenty of optimism across the rebound and sentiment within the area, but additionally acreage and enlargement from a aggressive standpoint.

Randy Wooden: Sure. Good morning, Mason. That is Randy. I’ll go forward and take that one. And I suppose I’ll begin by stating, clearly like everybody else, we hope for a peaceable decision on the complicated within the Center East, and transitioning to the impression on massive undertaking exercise, we don’t see plenty of direct impression within the quick time period. And positively, the long-term basic drivers there associated to meals safety stay intact. So we don’t count on at this level any vital disruption in our means to ship current tasks or proceed working the funnel to exit new tasks within the area.

And relative to Brazil, you broke up slightly bit there within the center, however I’ll cowl what I feel I had heard. The long-term development alternative in Brazil from our perspective is important, and we’ve made that remark earlier than. We nonetheless have that view. I used to be lucky to journey within the area earlier this month, and it actually does affirm what we hear, what we learn, what we see from our sellers and our gross sales groups within the area. And proper now, we glance put Brazil mid-single digits by way of irrigation adoption. So, not solely projecting development on new floor coming into manufacturing, definitely bettering the yield and productiveness of floor that’s already underneath manufacturing.

And we’ve usually mentioned, as credit score situations turn into extra engaging, we will definitely see continued funding in development. We’re listening to plenty of territory now the place power has to catch up so that they have the flexibility to energy pumps and pivots within the area. But when we needed to rank the place we see the robust, sustainable constant development alternatives on this planet, Brazil is definitely going to be close to the highest of that listing.

Mason Banwar: Thanks for that. A fast follow-up. One of many issues we’re watching throughout each ag and infrastructure markets is the extension of the Trump tax credit and, specifically, the reinstatement of bonus depreciation. In each irrigation and Highway Zipper enterprise? Are you able to present your ideas on the way it may impression your demand outlook?

Brian Ketcham: Sure, Mason, that is Brian. I feel the tax credit and the accelerated depreciation bonus depreciation, it’ll be extra impactful for the irrigation enterprise most likely not as a lot on the Highway Zipper facet of the enterprise. And actually, it’s all about farmer earnings and the flexibility to shelter that from taxes. And I feel from our standpoint, perhaps not an general improve in demand, however I feel the timing of that demand, as you see, might if the invoice will get handed this yr, you can see some demand later within the calendar yr this yr which may have been projected to be within the spring of subsequent yr.

So I feel it might probably shift the timing round, however, general it’s nonetheless positively supportive of funding in our tools.

Mason Banwar: Thanks for taking my questions.

Operator: And your subsequent query comes from Ryan Connors with Northcoast Analysis. Please go forward.

Ryan Connors: Good morning. Thanks for taking my questions. Good morning, Brian. So one of many stick on the Ag enterprise for just a few. And first off, simply on the pricing entrance, you talked about value being a slight tailwind. That looks like a bit extra constructive than we’ve had the previous couple of quarters. So any shade there? Was that regional in nature? You talked about that Northwest was robust. Simply any extra shade on the pricing can be useful.

Brian Ketcham: Sure, Ryan. I might say we’ve acknowledged earlier than when the tariff info got here out after which some we noticed a few of this deal market within the U.S. Go up. We have now been proactive at addressing value and taking pricing actions. So I feel at this level, I might say it’s a slight impression on revenues. And however I feel we’re sort of getting forward slightly little bit of the fee impression there. So definitely some assist on the margin facet there, however that has been actually within the U.S. Is the place we’ve seen the pricing actions.

Ryan Connors: Understood. Okay. And then you definitely talked about within the press launch and also you talked about it as properly, Brian, it’s this notion of shorter machines as, I suppose, a tailwind to or excuse me, headwind reasonably. So something that’s driving that, something to notice within the combine that’s structural that’s altering there? Or is that simply type of happenstance for the time being or that’s the manner it’s going? Or is there something we learn into that? As a result of I observed you talked about it a few instances.

Brian Ketcham: Sure. And it’s actually a regional factor primarily and talked about fairly robust demand within the Pacific Northwest in our third quarter. And that’s the place we’re seeing a number of the shorter machines, which influences the general common. And there you’ve got massive farms that had pivots in and as they add land and perhaps they cowl the corners with shorter machines, that’s variety of what’s actually driving it. You don’t see that as a lot throughout the broad corn belt, however within the Pacific Northwest area and a few within the Southeast as properly. You bought some shorter machines.

Ryan Connors: Bought it. Okay. After which sort of an even bigger image query. Randy, you alluded to the truth that web farm earnings goes to be up this yr, however plenty of that’s authorities helps. And that the adages that growers are usually not going to spend that cash the identical as they’ll spend crop receipts. However in a drought situation like we’ve occurring in components of the Midwest, particularly a pivot-heavy area like Nebraska, might we really find yourself seeing plenty of that cash stream into irrigation?

I imply, these the cash is coming in from the federal government and also you type of want it’s definitely a precedence for the time being I might assume for a few of these growers to verify they’ll get crop up.

Randy Wooden: Sure, Ryan, I might not say in our view that the drought goes to drive plenty of new machine functions. We’re a reasonably mature market right here. Within the Midwest. So we I do know we had some machines begin up perhaps slightly earlier germinate a crop once we didn’t have these early spring rains. So we would see extra hours as yr that would result in extra components enterprise, definitely some service enterprise for our sellers. However I might not correlate that to a big or noticeable improve in machine demand.

And I can say within the japanese a part of the state at the least we’ve had a big quantity of rain right here over the past seven to 10 days. So I feel the longer-term menace of drought might be abating barely as properly.

Ryan Connors: Certain. After which only one final one, if I might sneak it in. On the brand new $20 million imply undertaking, ought to we assume the margins on which are roughly equal to the margins on the opposite huge MENA undertaking you may have been transport?

Randy Wooden: Sure. I feel that could be a truthful assumption. I imply, it’s a smaller undertaking, however I might say given the truth that we’re going to begin delivering that on the similar time, we nonetheless have the bigger undertaking, I feel we’ll see comparable margins. Sure.

Ryan Connors: Okay, nice. Thanks on your time.

Operator: Thanks. And your subsequent query comes from Brian Drab with William Blair. Please go forward.

Brian Drab: Hey, good morning. Thanks for taking my questions. And I simply wished to start out with following as much as that final query. The $20 million undertaking is slightly bit smaller than, as you identified than a number of the different ones that you’ve been doing. In that area. Is that’s there’s that the start of a development presumably? Why is it coming in perhaps smaller items on this case? And do you in successful that undertaking, had been there discussions of different items to perhaps a bigger undertaking? And do you may have visibility to the following phases?

Randy Wooden: Sure. Good morning, Brian. That is Randy. Thanks for the query. I might most likely reply the query this fashion. And we discuss lots concerning the funnel and I feel others which are lively within the area have as properly. And while you take a look at the sort of the Pareto on the whole lot that’s in there, there’s going to be extra of those $20 million, $30 million, $40 million tasks than there are the $250 million plus tasks. These mega tasks going to be definitely a smaller quantity. So for those who take a look at a development, I might not say it’s a development the place the mega tasks are getting damaged down into smaller tasks.

These are completely different prospects, completely different components of the area. With perhaps completely different availability of land mass to them. So not a development the place we might say the whole lot goes to shift to those small ones. We nonetheless see a few of these mega tasks working their manner by the funnel. From a amount perspective, I feel we’re going to see extra of those smaller tasks over time. However it isn’t huge prospects getting small. It’s completely different prospects, completely different components of the area.

Brian Drab: Okay. Thanks very a lot. After which on Brazil, your feedback at present and what we’re seeing in Brazil sort of has me barely feeling barely extra cautious concerning the near-term outlook in Brazil. I’m questioning if that’s what your sense is as properly. I imply, talked concerning the price being the best it has been since 2006. 15%. I suppose the query is simply are you incrementally extra cautious on Brazil right here for the second half of calendar 2025.

Randy Wooden: I feel as we see in plenty of markets, there’s a mixture of tailwinds and headwinds which are sort of battling it out. And I feel in Brazil, we nonetheless see the elemental market there when you possibly can develop three crops. Once you irrigate after which two, when you don’t. Soy costs stay robust and that entry to reasonably priced capital, the one factor proper now that’s perhaps preserving a lid on that market. So within the close to time period, close to time period being at present, perhaps barely extra cautious, however we additionally commented that subsequent yr’s crop plan ought to be launched within the July. That’s going to be a significant supply of reasonably priced funding for our prospects.

So, relying on the place that price is and the quantity of whole funding that’s obtainable, I feel that short-term cautious optimism might transition fairly rapidly. And we all know that market from a long-term perspective goes proceed to see development and ongoing investments. So I don’t assume it’s tempered demand to the purpose that we’re even remotely involved, Brian. However till we see what subsequent yr’s crop plan seems to be like, I feel it’s, for essentially the most half, plenty of prospects are sort of in a wait-and-see method now. However that wait and see is ten to 14 days.

Brian Drab: Okay. Thanks. Recognize it very a lot.

Randy Wooden: You wager.

Operator: And your subsequent query comes from Jon Braatz with Kansas Metropolis Capital. Please go forward.

Jon Braatz: Good morning, Randy, Brian.

Randy Wooden: Good morning, John.

Jon Braatz: Brian, are you able to inform us slightly bit about, I imply, inform us how a lot was delivered on massive undertaking this quarter and what stays? After which from an even bigger image standpoint, is there sufficient alternatives on the market so that you can offset the type of the completion of the massive undertaking as we glance into subsequent yr?

Brian Ketcham: Certain. Sure, initially, we had been in a position to ship slightly bit forward of schedule within the third quarter. So assume we’ve been speaking about $20 million 1 / 4. We did about $24 million within the third quarter. In order that probably pulls ahead what we had been anticipating to do within the fourth quarter. So perhaps there’s 16 within the fourth quarter after which the rest, which might be one other $15 million, $16 million that rolls into the primary quarter of subsequent yr. In order that has been actually delivering as anticipated. Like I mentioned, we had been in a position to get slightly bit extra of that out within the third quarter.

However the second a part of your query, I imply, assume as Randy talked concerning the undertaking pipeline and each mixture of huge and small, I imply small, I sort of must chortle once we speak about a $20 million undertaking being small. I imply, up to now, the $20 million undertaking can be fairly good-sized undertaking. However there’s sufficient tasks within the funnel to fill the hole from the massive undertaking that we’ve had we’ve this yr.

I feel the large query is, as we all the time speak about is the timing and the unpredictability there and plenty of elements go into when a undertaking can get began, whether or not infrastructure or whether or not it’s getting the funding in place and issues like that. However we there’s ample alternative there to definitely fill that hole and proceed to have a undertaking enterprise in that a part of the world.

Jon Braatz: Okay. Second query is, up to now, or talking of North America, North America pivot gross sales appear to have been considerably correlated with what we’re seeing by way of volumes at John Deere and the large tools producers, this yr, there definitely has not been a disconnect. Your volumes have been flattish. And their volumes have been off significantly. What is perhaps driving that? And I do know you talked slightly bit about Pacific Northwest. Is it type of extra irrigation, extra pivot gross sales in regional markets exterior of the large row crops?

Randy Wooden: Sure. I’ll take that one, John. I feel there’s a few issues. The combo that you’re speaking about regionally, I feel definitely performs into it. One of many different elements is that simply basically, we’ve acquired completely different go-to-market fashions. And while you talked about John Deere and their calls, they’ll speak about destocking the channel. So their income is acknowledged when it ships to a vendor. The vendor goes to carry stock and promote that at retail. And for us, we mainly ship from the manufacturing unit to the sector.

So we shouldn’t have that destocking mechanism by our channel that I feel plenty of these tools OEMs must take care of once we begin to see the market downturn.

Jon Braatz: Okay. Okay. Alright. That’s it. Thanks very a lot.

Randy Wooden: Thanks, John. Thanks, John.

Operator: And your subsequent query comes from Nathan Jones with Stifel. Please go forward.

Adam Farley: Good morning. That is Adam Farley on for Nathan. Hey, I wished to follow-up on the value price dialogue. Are you seeing any impression from the rise within the metal and aluminum tariff? After which do you may have any expectation for near-term metal prices?

Brian Ketcham: Sure, Adam, that is Brian. I might say at this level we’ve had little to no impression from the metal price. I imply, we had seen initially when the tariffs had been introduced, the home metal suppliers growing value, a few of that was some synthetic demand created with firms stocking up on stock and issues like that. However this most up-to-date announcement of the 50% tariffs, we simply haven’t seen any value will increase sticking at this cut-off date. Don’t assume the demand is there to assist the home metal will increase.

So I might say from a price standpoint, because it pertains to metal, at this level, restricted impression and because it pertains to the opposite tariffs, I feel it’s nonetheless in that what we talked about earlier than in that mid-single-digit sort of impression. And we talked about earlier, we’ve taken some pricing actions in anticipation of that price impression.

Adam Farley: Thanks, Brian. That’s useful. After which I wished to follow-up on the progress surrounding the modernization of your Lindsay, Nebraska manufacturing facility. I’m asking the query as a result of margins have been fairly strong this yr. And I’m questioning if you’re seeing realized financial savings from that modernization.

Randy Wooden: Yeah. I’ll perhaps begin, Adam, and sort of offer you an replace on the progress and Brian can perhaps go slightly deeper on a number of the numbers. And we had the chance to take our Board there earlier this week and sort of do a tour on the funding progress and issues are going extraordinarily properly. We have now been blessed with good climate. We have now been blessed with an important staff. Provider assist engaged on execution. And I can say that the whole lot is on observe on the timelines that we anticipated.

And I feel the standard of the tools of the services, the employee setting, the enhancements within the enhancements of effectivity, the whole lot seems to be like it’ll ship fairly properly versus our expectations. Possibly flip it over to Brian to be slightly extra particular.

Brian Ketcham: Sure. Adam, by way of the margin enchancment that we’re seeing and particularly to the third quarter right here. If I had been to characterize it so as of magnitude, I might say, initially, the amount leverage that we’ve within the worldwide enterprise and the leverage in our Turkey facility might be the biggest single driver. However operational efficiencies, I might say can be the following contributor to the margin enlargement and you might be seeing that in our major factories in Brazil, Turkey, and within the U.S. We’re seeing some operational efficiencies. After which a 3rd factor that’s contributing to margin enlargement that we’ve talked about sooner or later as being supportive.

Suppose our development in subscriptions and the recurring income there, we’re seeing that begin to impression and assist from a margin standpoint.

Adam Farley: Okay. Thanks for taking my questions.

Brian Ketcham: Thanks.

Operator: Seeing no extra questions, this concludes our query and reply session. I want to flip the convention again over to Randy Wooden for any closing remarks.

Randy Wooden: Thanks all for becoming a member of us at present. We’re more than happy with our year-to-date outcomes and our third quarter efficiency. Our groups proceed to execute properly and we’re positioned to handle by the market headwinds in our home U.S. Irrigation market whereas leveraging alternatives within the increasing worldwide irrigation areas. Our Highway Zipper funnel will proceed to drive long-term development, our international footprint and provide chain will enable us to successfully handle by tariff uncertainty. This concludes our third quarter earnings name. We sit up for updating you on our continued progress following the shut of our fiscal 2025 yr. Thanks for becoming a member of us.

Operator: The convention has now concluded. Thanks for attending at present’s presentation. It’s possible you’ll now disconnect.