Lindsay Q3 2025 Earnings Report

Lindsay EPS Results

• Actual EPS: $1.78
• Consensus EPS: $1.36
• Beat/Miss: Beat by +$0.42
• One Year Ago EPS: $1.85

Lindsay Revenue Results

• Actual Revenue: $169.46 million
• Expected Revenue: $157.87 million
• Beat/Miss: Beat by +$11.60 million
• YoY Revenue Growth: +21.80%

Lindsay Announcement Details

• Quarter: Q3 2025
• Date: 6/26/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, June 26, 2025
• Conference Call Time: 11:00AM ET

Lindsay (NYSE:LNN) (NYSE:LNN), founded in 1955 and headquartered in Omaha, Nebraska, specializes in precision irrigation and infrastructure management solutions. The company has a long-standing reputation for engineering durable, high-performance equipment designed to optimize agricultural productivity and ensure roadway safety. Over its history, Lindsay has grown through innovation and strategic acquisitions, expanding its product portfolio to serve a diverse global customer base.

In its Irrigation segment, Lindsay offers center pivot and lateral-move irrigation systems under the Zimmatic and FieldNET brands. These systems incorporate advanced technologies—such as remote monitoring, variable-rate water application, and data analytics—that help growers conserve water, improve yields and reduce operational costs. The company also develops mobile and cloud-based control platforms, enabling precision management of irrigation assets from planting through harvest.

The Infrastructure segment provides roadway maintenance and safety products, including guardrail solutions, end terminals and traffic control devices. Lindsay’s Road Zipper system, a moveable barrier designed to improve traffic flow and reduce congestion, highlights the company’s focus on innovative approaches to transportation challenges. Through ongoing research and development, the business unit seeks to enhance motorist safety, extend pavement life and streamline construction zone operations.

Operating in more than 20 countries across North and South America, Europe, the Middle East and Asia, Lindsay supports its global network through manufacturing facilities, regional sales offices and service centers. The company is guided by a seasoned executive team and a board of directors committed to sustainable growth, responsible governance and customer-centric innovation. Under its leadership, Lindsay continues to explore new technologies and partnerships that address evolving needs in agriculture and infrastructure management.

Lindsay Q3 2025 Earnings Call Transcript

Key Takeaways

• Consolidated Q3 revenue increased 22% to $169.5 million, and adjusted EPS rose 26% year-over-year, marking a third consecutive quarter of growth.
• Irrigation segment revenue grew 25% to $143.7 million, led by a 60% jump in international sales and securing a new >$20 million MENA project that begins shipping in Q4.
• North American irrigation volumes were flat year-over-year and Q4 demand is expected to soften as crop revenue declines and net farm income relies more on government payments.
• Infrastructure revenue rose 6% on strong road safety product sales, while operating margin slid to 21.1% due to a less favorable Road Zipper mix and uncertain timing of complex projects.
• Tariff-driven cost pressures have been largely mitigated through global supply chain strategies, and a technology partnership with Pessl Instruments is expanding the company’s precision irrigation offerings.

Presentation

[Operator]

Good day, and welcome to the Lindsay Corporation's Fiscal Third Quarter twenty twenty five Earnings Conference Call. All participants will be in listen only mode. Please note this event is being recorded. I would now like to turn the conference over to Randy Wood, President and CEO. Please go ahead.

[Randy Wood, President and CEO at Lindsay]

Thank you, and good morning, everyone. Welcome to our fiscal twenty twenty five third quarter earnings call. With me today is Brian Ketchum, our Chief Financial Officer. I'm extremely proud of our team and their execution, delivering our third consecutive quarter of year over year growth in both revenue and operating income. Our employees are diligently focused on supporting our customers and each other.

[Randy Wood, President and CEO at Lindsay]

These results reflect the strength of our global business and our team's commitment to execution excellence. Our Irrigation business delivered year over year revenue growth led by strength in our international markets including Latin America and the Mid East and North Africa region, while the domestic Irrigation volume was comparable to the prior year. We continue to deliver our large project in The Middle East and are pleased to announce we have secured a new project in the territory valued at over $20,000,000 This project will begin shipping in our fiscal fourth quarter and will continue into our first quarter of fiscal year twenty twenty six. Turning to our Infrastructure segment. Our team delivered another solid quarter, primarily driven by road safety products as we enter the road construction season here in North America.

[Randy Wood, President and CEO at Lindsay]

Our focus remains on growing both our road safety products and Road Zipper system businesses, particularly leasing as this supports a more stable revenue profile for the segment and our overall results. Shifting gears to market outlook. In North America irrigation, we're now in the primary growing season where weather conditions influence crop yields, prices and net farm income for the year. These factors play a large role in determining future demand for irrigation equipment. While the USDA is projecting an increase in net farm income for this year, most of that growth is related to direct government payments for disaster relief and commodity price support.

[Randy Wood, President and CEO at Lindsay]

Crop revenue is projected to decline and at this point of the storm season, we have seen softer demand relative to the prior year. This tempers demand expectations for North American irrigation heading into our fourth quarter. In our international irrigation markets, particularly Brazil, we're encouraged by continued signs of improving market conditions. I traveled across Mato Grosso and Goias states earlier this month and can confirm that customers in this region are ready to expand irrigated acres as the availability of affordable credit expands and the country's energy infrastructure grows. The federal government raised the benchmark interest rate by 25 basis points earlier this month and it now sits at 15%, which is the highest rate since February.

[Randy Wood, President and CEO at Lindsay]

We do expect next year's crop plan to be released in July and the market outlook will be impacted by the rate and amount of funds made available through the program. We continue to see a strong project funnel in The Mideast and North Africa. And as I mentioned earlier, we did secure another project in this region and expect to see continued growth as countries across the territory prioritize food security and water resource conservation. In infrastructure, we continue to see opportunities develop across Road Zipper system sales, leasing and road safety products. Infrastructure funding in The U.

[Randy Wood, President and CEO at Lindsay]

S. Remains steady. And while project timing can shift quarter to quarter, our funnel of project opportunities remains robust. While additional project sales are on the horizon, the timing of these more complex sales remains uncertain. Our global operations and supply chain team continue to navigate an evolving tariff environment, while leveraging our global footprint to mitigate the impact on our business.

[Randy Wood, President and CEO at Lindsay]

Actions including supplier collaboration, strategic inventory placement, resourcing and pricing have allowed us to manage through this period well. In the area of technology, our collaboration with Pessil Instruments continues to create customer value. By combining FieldNET Advisor with Pessil's infield environmental sensors, we are providing more precise and real time agronomic insights that allow for more accurate irrigation scheduling decisions. This integrated approach has driven notable growth in cross selling opportunities. The partnership is deepening our expertise in agronomic decision support, strengthening our data driven product suite and advancing our position as a leader in precision irrigation.

[Randy Wood, President and CEO at Lindsay]

I'd like to now turn the call over to Brian to discuss our third quarter financial results. Brian?

[Brian Ketcham, SVP & CFO at Lindsay]

Thank you, Randy, and good morning, everyone. Consolidated revenues for the third quarter of fiscal twenty twenty five increased 22% to $169,500,000 compared to $139,200,000 in the prior year. Revenues grew in both the Irrigation and Infrastructure segments compared to the prior year. Net earnings for the quarter were $19,500,000 or $1.78 per diluted share compared to net earnings of $20,400,000 or $1.85 per diluted share in the prior year. This year over year decrease in net earnings resulted primarily from the recognition of a one time income tax credit in the prior year of $4,800,000 or $0.44 per diluted share.

[Brian Ketcham, SVP & CFO at Lindsay]

Excluding the impact of the tax credit on prior year results, current year earnings per share represents an increase of 26% over the prior year. Turning to our segment results, Irrigation segment revenues for the quarter increased 25% to $143,700,000 compared to $114,800,000 in the prior year. North America irrigation revenues of $69,100,000 increased 1% compared to $68,200,000 in the prior year. Unit sales volume of irrigation equipment was comparable to the prior year, while average selling prices were up slightly. This increase was partially offset by the mix impact of slightly shorter machines on average compared to the prior year.

[Brian Ketcham, SVP & CFO at Lindsay]

Increased demand for irrigation equipment in specialty crop markets in the Pacific Northwest offset softer demand in corn and soybean markets and a lower level of storm damage replacement activity compared to the prior year. In international irrigation markets, revenues increased 60% to $74,700,000 compared to $46,600,000 in the prior year. The majority of the increase resulted from revenues related to our large project in the MENA region along with higher sales volumes in Brazil and other parts of South America. These increases were partially offset by unfavorable effects of foreign currency translation of approximately $2,500,000 compared to the prior year. Irrigation segment operating income for the quarter of $27,200,000 increased 39% compared to the prior year and operating margin was 18.9% of sales compared to 17% of sales in the prior year.

[Brian Ketcham, SVP & CFO at Lindsay]

Operating income increased due to higher revenues and favorable leverage of fixed operating expenses, while being partially offset by a higher amount of international project revenues, which resulted in some dilution to operating margin compared to the prior year. Infrastructure segment revenues for the quarter of $25,700,000 increased 6% compared to twenty four point four million dollars in the prior year. The increase resulted primarily from higher sales of road safety products, while Road Zipper project sales and lease revenues in total were comparable to the prior year. Infrastructure segment operating income for the quarter was $5,400,000 compared to $6,300,000 in the prior year. And Infrastructure operating margin for the quarter was 21.1% of sales compared to 25.8% of sales in the prior year.

[Brian Ketcham, SVP & CFO at Lindsay]

Lower operating income and operating margin resulted primarily from a less favorable margin mix within Road Zipper system revenues compared to the prior year. Turning to the balance sheet and liquidity. Our total available liquidity at the end of the third quarter was $261,000,000 which includes $211,000,000 in cash, cash equivalents and marketable securities and $50,000,000 available under our revolving credit facility. The strength of our balance sheet and ample access to liquid capital resources continue to serve as a strategic asset for Lindsay as we execute our capital allocation strategy to create enhanced and sustained value for our shareholders. This concludes my remarks.

[Brian Ketcham, SVP & CFO at Lindsay]

And at this time, I'll turn the call over to the operator to take your questions.

[Operator]

Thank you. We will now begin the question and answer session. And your first question comes from Kristen Owen with Oppenheimer. Please go ahead.

[Mason Manware, Equity Research Associate at Oppenheimer & Co. Inc.]

Good morning. This is Mason Manmore on for Kristen. We wanted to ask about your international business. Over the short term, can you help us understand what, if any, impact the recent flare up in The Middle East could have on your large project activity? And then on the longer term, I'm wondering if you can help us understand what you're thinking about the long term growth opportunity in Brazil.

[Mason Manware, Equity Research Associate at Oppenheimer & Co. Inc.]

We're hearing a lot of optimism around the rebound in sentiment in the region, but also acreage expansion from a competitive standpoint.

[Randy Wood, President and CEO at Lindsay]

Yes. Good morning, Mason. This is Randy. I'll go ahead and take that one. And I guess I'll start by stating obviously like everyone else, we're hoping for peaceful resolution on the complex in The Middle East and transitioning to the impact on large project activity.

[Randy Wood, President and CEO at Lindsay]

We don't see a lot of direct impact in the short term. And certainly, the long term fundamental drivers there related to food security remain intact. So we don't expect at this point any significant disruption in our ability to deliver existing projects or continue working the funnel to exit new projects in the region. And relative to Brazil, you broke up a little bit there in the middle, but I'll cover what I think I heard. The long term growth opportunity in Brazil from our perspective is significant and we've made that comment before.

[Randy Wood, President and CEO at Lindsay]

We still have that view. I was fortunate to travel in the region earlier this month and it really does confirm what we hear, what we read, what we see from our dealers and our sales teams in the region. And right now we would put Brazil kind of mid single digits in terms of irrigation adoption. So we're not only projecting growth on new ground coming into production, but certainly improving the yield and productivity of ground that's already under production. And we've often said, as credit conditions become more attractive, we'll certainly see continued investment in growth.

[Randy Wood, President and CEO at Lindsay]

We're hearing a lot of territory now where energy has to catch up so that they've got the ability to power pumps and pivots in the region. But if we had to rank where we see the strong sustainable consistent growth opportunities in the world, Brazil is certainly going to be near the top of that list.

[Mason Manware, Equity Research Associate at Oppenheimer & Co. Inc.]

Thank you for that. A quick follow-up. One of the things we're watching across both ag and infrastructure markets is the extension of the Trump tax credits and in particular the reinstatement of bonus depreciation. Can you provide your thoughts on how it might impact your demand outlook in both irrigation and Road Zipper business?

[Brian Ketcham, SVP & CFO at Lindsay]

Yes, Mason, this is Brian. I think the tax credits and the accelerated depreciation bonus depreciation, it's going to be more impactful for the irrigation business, probably not as much on the Road Zipper side of the business. And really it's all about farmer income and the ability to shelter that from taxes. And I think from our standpoint, maybe not an overall increase in demand, but I think the timing of that demand, as you see, you could if the bill gets passed this year, you could see some demand later in the calendar year this year that might have been projected to be in the spring of next year. So I think it can shift the timing around.

[Brian Ketcham, SVP & CFO at Lindsay]

But overall, it's still definitely supportive of investment in our equipment.

[Mason Manware, Equity Research Associate at Oppenheimer & Co. Inc.]

Thank you for taking my questions.

[Operator]

And your next question comes from Ryan Connors with Northcoast Research. Please go ahead.

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Good morning. Thanks for taking my questions.

[Randy Wood, President and CEO at Lindsay]

Good morning, Ryan.

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

So wanted to stick on the ag business for a few. And first off, on the pricing front, you talked about price being a slight tailwind. That seems like a bit more constructive than we've had the last few quarters. So any color there? Was that regional in nature?

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

You mentioned that Northwest was strong. Just any additional color on the pricing would be helpful.

[Brian Ketcham, SVP & CFO at Lindsay]

Yes, Ryan. I would say, we've stated before when the tariff information came out and then some we saw some of the steel market in The U. S. Go up. We've been proactive at addressing price and taking pricing actions.

[Brian Ketcham, SVP & CFO at Lindsay]

So I think at this point, I would say it's a slight impact on revenues. And but I think, if we're kind of getting ahead a little bit of the cost impact there. Certainly some support on the margin side there, but that's been really in The U. S. Is where we've seen the pricing actions.

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Understood. Okay. And then you mentioned in the press release and you mentioned it as well Brian, this notion of shorter machines as I guess a tailwind to or excuse me a headwind rather. So anything that's driving that? Anything to note in the mix that's structural that's changing there?

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Or is that just sort of happenstance at the moment or that's the way it's going? Or is there anything we read into that? Because I noticed you mentioned it a couple of times.

[Brian Ketcham, SVP & CFO at Lindsay]

Yes. And it's really a regional thing primarily and mentioned pretty strong demand in the Pacific Northwest in our third quarter. And that's where we're seeing some of the shorter machines, which influences the overall average. And there you've got large farms that had pivots in and as they add land and maybe they cover the corners with shorter machines, that's kind of what's really driving it. You don't see that as much across the Broad Corn Belt, but in the Pacific Northwest region and some in the Southeast as well. You got some shorter machines.

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Got it. Okay. And then kind of a bigger picture question. Randy, you alluded to the fact that net farm income is going to be up this year, but a lot of that is government supports and that the adages that growers aren't going to spend that money the same as they will spend crop receipts. But in a drought scenario like we have going on in parts of the Midwest, especially a pivot heavy region like Nebraska, could we actually end up seeing a lot of that money flow into irrigation?

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Mean, if the money is coming in from the government and you sort of need, it is certainly a priority at the moment, I would think for some of these growers to make sure they can get crop up.

[Randy Wood, President and CEO at Lindsay]

Yes. Ryan, I wouldn't say, in our view, that the drought is going to drive a lot of new machine purposes. We're a pretty mature market here in the Midwest. So we I know we had some machines start up maybe a little earlier to germinate a crop when we didn't have those early spring rains. So we might see more hours this year that could lead to more parts business, certainly some service business for our dealers.

[Randy Wood, President and CEO at Lindsay]

But I wouldn't correlate that to a significant or noticeable increase in machine demand. And I can say in the eastern part of the state at least, we've had a significant amount of rain here over the last seven to ten days. So I think the longer term threat of drought could be abating slightly as well.

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Sure. And then just one last one, if I could sneak it in. On the new $20,000,000 MENA project, should we assume the margins on that are roughly equivalent to the margins on the other big MENA project you've been shipping?

[Brian Ketcham, SVP & CFO at Lindsay]

Yes. I think a fair assumption. I mean it's a smaller project. But I would say given the fact that we're going to start delivering that at the same time we still have the larger project I think we'll see comparable margins.

[Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC]

Yes. Okay. Great. Thanks for your time.

[Brian Ketcham, SVP & CFO at Lindsay]

Thank you.

[Operator]

And your next question comes from Brian Drab with William Blair. Please go ahead.

[Brian Drab, Co-Group Head–Industrials at William Blair]

Hey, good morning. Thanks for taking my questions. And I just wanted to start with following up to that last question. The $20,000,000 project is a little bit smaller than as you pointed out than some of the other ones that you've been doing in that region. Is that the beginning of a trend possibly?

[Brian Drab, Co-Group Head–Industrials at William Blair]

Why is it coming in maybe smaller pieces in this case? And do you in winning that project, were there discussions of other pieces to maybe a larger project? And do you have visibility to the next phases?

[Randy Wood, President and CEO at Lindsay]

Yes. Good morning, Brian. This is Randy. Thanks for the question. I'd probably answer the question this way.

[Randy Wood, President and CEO at Lindsay]

And we talk a lot about the funnel and I think others that are active in the region have as well. And when you look at the kind of the Pareto and everything that's in there, there's going to be more of these $50,000,000 $40,000,000 projects than there are the 100,000,000 150,000,000 plus projects. Those mega projects are going to be certainly a smaller number. So if you look at a trend, I wouldn't say it's a trend where the mega projects are getting broken down into smaller projects. These are different customers, different parts of the region with maybe different availability of landmass to them.

[Randy Wood, President and CEO at Lindsay]

So not a trend where we'd say everything is going to shift to these small ones. We still see some of those mega projects working their way through the funnel. From a quantity perspective, I think we are going to see more of these smaller projects over time. But it's not big customers getting small, it's different customers, different parts of the region.

[Brian Drab, Co-Group Head–Industrials at William Blair]

Okay. Thanks very much. And then on Brazil, your comments today and what we're seeing in Brazil kind of has me slightly feeling slightly more cautious about the near term outlook in Brazil. I'm wondering if that's what your sense is as well. I mean you talked about the rate being the highest it's been since 02/2006, 15%.

[Brian Drab, Co-Group Head–Industrials at William Blair]

I guess the question is just are you incrementally more cautious on Brazil here for the second half of calendar twenty twenty five?

[Randy Wood, President and CEO at Lindsay]

I think as we see in a lot of markets, there's a combination of tailwinds and headwinds that are kind of battling it out. And I think in Brazil, we still see the fundamental market there when you can grow three crops, when you irrigate and two when you don't. Soy prices remain strong and that access to affordable capital. That's the one thing right now that's maybe keeping a lid on that market. So in the near term, near term being today maybe slightly more cautious, but we also commented that next year's crop plan should be released in the July.

[Randy Wood, President and CEO at Lindsay]

That's going to be a major source of affordable funding for our customers. So depending on where that rate is and the amount of total funding that's available, I think that short term cautious optimism could transition quite quickly. And we know that that market from a long term perspective is going to continue to see growth and ongoing investments. So I don't think it's tempered demand to the point that we're even remotely concerned, Brian. But until we see what next year's crop plan looks like, I think it's the most part a lot of customers are kind of in a wait and see approach now.

[Randy Wood, President and CEO at Lindsay]

But that wait and see is ten to fourteen days.

[Brian Drab, Co-Group Head–Industrials at William Blair]

Okay. Thanks. Appreciate it very much.

[Randy Wood, President and CEO at Lindsay]

You bet.

[Operator]

And your next question comes from Jon Braatz with Kansas City Capital. Please go ahead.

[Jon Braatz, Equity Analyst at Kansas City Capital Associates]

Good morning, Randy, Brian.

[Randy Wood, President and CEO at Lindsay]

Good morning, Jon.

[Jon Braatz, Equity Analyst at Kansas City Capital Associates]

Brian, can you tell us a little bit about I mean, tell us how much was delivered on large project this quarter and what remains? And then from a bigger picture standpoint, is there enough opportunities out there for you to offset sort of the completion of the large project as we look into next year?

[Brian Ketcham, SVP & CFO at Lindsay]

Sure. Yes, first of all, we were able to deliver a little bit ahead of schedule in the third quarter. So I think we've been talking about $20,000,000 a quarter. We did about $24,000,000 in the third quarter. So that potentially pulls forward what we were expecting to do in the fourth quarter.

[Brian Ketcham, SVP & CFO at Lindsay]

So maybe there's 16,000,000 in the fourth quarter. And then the remainder, which could be another $15,000,000 $16,000,000 that rolls into the first quarter of next year. So that's been really delivering as expected. Like I said, we were able to get a little bit more of that out in the third quarter. But the second part of your question, I mean, think as Randy talked about the project pipeline and both combination of large and small, I mean, I kind of have to laugh when we talk about a $20,000,000 project being small.

[Brian Ketcham, SVP & CFO at Lindsay]

I mean, in the past, a $20,000,000 project would be a pretty good sized project. But there's enough projects in the funnel to fill the gap from the large project that we've had we have this year. I think the big question is, as we always talk about is the timing and the unpredictability there and a lot of factors go into when a project can get started, whether it's infrastructure or whether it's getting the funding in place and things like that. But we there's ample opportunity there to certainly fill that gap and continue to have a project business in that part of the world.

[Jon Braatz, Equity Analyst at Kansas City Capital Associates]

Okay. Second question is, in the past or speaking of North America, North American pivot sales seem to have been somewhat correlated with what we're seeing in terms of volumes at John Deere and the big equipment manufacturers. And this year, there certainly hasn't been a disconnect. Your volumes have been flattish and their volumes have been off considerably. What might be driving that?

[Jon Braatz, Equity Analyst at Kansas City Capital Associates]

And I know you talked a little bit about Pacific Northwest. Is it sort of more irrigation, more pivot sales in regional markets and outside of the big row crops?

[Randy Wood, President and CEO at Lindsay]

Yes. I'll take that one, John. I think there's a couple of things. The mix that you're talking about regionally, I think, plays into it. One of the other factors is that just fundamentally, we've got different go to market models.

[Randy Wood, President and CEO at Lindsay]

And when you talk about John Deere and their calls, they'll talk about destocking the channel. So their revenue is recognized when it ships to a dealer. The dealer is going hold inventory and sell that at retail. And for us, we basically ship from the factory to the field. So we don't have that destocking mechanism through our channel that I think a lot of those equipment OEMs have to deal with when we start to see the market downturn.

[Jon Braatz, Equity Analyst at Kansas City Capital Associates]

Okay. Okay. All right. That's it. Thank you very much.

[Randy Wood, President and CEO at Lindsay]

Thank you, John.

[Brian Ketcham, SVP & CFO at Lindsay]

Thanks, John.

[Operator]

And your next question comes from Nathan Jones with Stifel. Please go ahead.

[Adam Farley, Associate Analyst at Stifel Financial Corp]

Good morning. This is Adam Farley on for Nathan. I wanted to follow-up on the price cost discussion. Are you seeing any impact from the increase in the steel and aluminum tariff? And then do have any expectation for near term steel costs?

[Brian Ketcham, SVP & CFO at Lindsay]

Yes, Adam, this is Brian. I would say at this point we've had little to no impact from the steel cost. I mean we had seen initially when the tariffs were announced, the domestic steel suppliers increasing price. Some of that was some artificial demand created with companies stocking up on inventory and things like that. But this most recent announcement of the 50% tariffs, we just haven't seen any price increases sticking at this point in time.

[Brian Ketcham, SVP & CFO at Lindsay]

Don't think the demand is there to support the domestic steel increases. So I would say from a cost standpoint, as it relates to steel at this point limited impact.

[Brian Ketcham, SVP & CFO at Lindsay]

And as it relates to the other tariffs, think it's still in that what we talked about before in that mid single digit kind of impact. And as we mentioned earlier, we have taken some pricing actions in anticipation of that cost impact.

[Adam Farley, Associate Analyst at Stifel Financial Corp]

Thanks, Brian. That's helpful. And then I wanted to follow-up on the progress around the modernization of your Lindsay, Nebraska manufacturing facility. I'm asking the question because margins have been pretty robust this year. And I'm wondering if you're seeing realized savings from that modernization?

[Randy Wood, President and CEO at Lindsay]

Yes. I'll maybe start, Adam, and kind of give you an update on the progress and Brian can maybe go a little deeper on some of the numbers. And we had the opportunity to take our board there earlier this week and kind of do a tour on the investment progress and things are going extremely well. We've been blessed with good weather. We've been blessed with a great team, supplier support working on execution.

[Randy Wood, President and CEO at Lindsay]

And I can say that everything is on track on the timelines that we expected. And I think the quality of the equipment of the facilities, the worker environment, the improvements in safety, the improvements of efficiency, everything looks like it's going to deliver quite well versus our expectations. Maybe turn it over to Brian to be a little more specific.

[Brian Ketcham, SVP & CFO at Lindsay]

Yes. Adam, in terms of the margin improvement that we're seeing and specifically to the third quarter here, If I were to characterize it in order of magnitude, I would say, first of all, the volume leverage that we have in the international business and the leverage in our Turkey facility is probably the largest single driver. But operational efficiencies, I would say would be the next contributor to the margin expansion and you're seeing that in our main factories in Brazil, Turkey and in The U. S. We're seeing some operational efficiencies.

[Brian Ketcham, SVP & CFO at Lindsay]

And then a third thing that's contributing to margin expansion that we've talked about at some point as being supportive. I think our growth in subscriptions and the recurring revenue there we are seeing that start to impact and help from a margin standpoint.

[Adam Farley, Associate Analyst at Stifel Financial Corp]

Okay. Thank you for taking my questions.

[Brian Ketcham, SVP & CFO at Lindsay]

Thank you.

[Operator]

Seeing no additional questions, this concludes our question and answer session. I would like to turn the conference back over to Randy Wood for any closing remarks.

[Randy Wood, President and CEO at Lindsay]

Thank you all for joining us today. We are very pleased with our year to date results and our third quarter performance. Our teams continue to execute well and we are positioned to manage through the market headwinds in our domestic U. S. Irrigation market, while leveraging opportunities in the expanding international irrigation regions.

[Randy Wood, President and CEO at Lindsay]

Our Road Zipper funnel will continue to drive long term growth and our global footprint and supply chain will allow us to effectively manage through tariff uncertainty. This concludes our third quarter earnings call. We look forward to updating you on our continued progress following the close of our fiscal twenty twenty five year. Thanks for joining us.

[Operator]

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Randy Wood, President and CEO
• Brian Ketcham, SVP & CFO

Analysts

• Mason Manware, Equity Research Associate at Oppenheimer & Co. Inc.
• Ryan Connors, Senior Managing Director and Research Analyst at Northcoast Research Partners LLC
• Brian Drab, Co-Group Head–Industrials at William Blair
• Jon Braatz, Equity Analyst at Kansas City Capital Associates
• Adam Farley, Associate Analyst at Stifel Financial Corp