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United Rentals Inc, USA
COMPANY WATCH
Lindsay Corp, USA
United Rentals Inc, USA
Key Figures (US$ million) Three months ended 30.11 2016 2015
Operating Revenues
110.4
121.6
Cost of Operating Revenues
82.0
87.2
Gross Profit
28.4
34.4
4.3
3.7
Engineering and Research
Key Figures (US$ million) Three months ended 31.12 2016 2015
Revenues Of Which: Equipment Rentals Of Which: Trench, Power and Pump
1523 1523 1298
1278
199
181
866
875
Operating Income
2.7
11.7
Cost of Revenues
Earnings before Income Taxes
1.3
10.4
Operating Income
402
397
Net Earnings
0.9
6.9
Net Income
153
169
Year ended 31.12
8
Pump Industry Analyst
2016 2015
Revenues Of Which: Equipment Rentals Of Which: Trench, Power and Pump
5762 5817 4941
4949
775
708
Cost of Revenues
3359
3337
Operating Income
1415
1518
566
585
Net Income
COMMENT Lindsay Corp, a provider of irrigation systems and infrastructure products, reported a 9.2% drop in sales and an almost 87% drop in net earnings in its first quarter ended 30 November 2016. First quarter fiscal 2017 revenues were US$110.4 million compared to revenues of US$121.6 million in the prior year’s first quarter. Net earnings for the quarter were US$0.9 million, down from US$6.9 million a year earlier. The Irrigation segment, which includes pumping solutions and filtration, saw revenues fall 11% to US$89.9 million from last year’s US$101.3 million on continued weakness in agricultural markets. US irrigation revenues of US$50.3 million were down 15%, mainly due to a reduction in irrigation equipment unit volume as falling commodity prices and reduced farm income negatively impacted irrigation equipment demand. International irrigation revenues were US$39.5 million
in the first quarter, a decrease of 6% on the prior year, as improved sales in Brazil, Africa and the Middle East were more than offset by declines in other markets. The backlog of unshipped orders at 30 November 2016 was US$55.9 million compared with US$61.9 million at 30 November 2015. Improved backlogs in international irrigation and infrastructure were offset in part by a lower backlog in US irrigation. Rick Parod, president and CEO of Lindsay, said: “As the agricultural down cycle extends, weakness in demand for irrigation equipment is expected to continue. Accordingly, we are continuing to assess and take action on appropriate expense reductions. The longerterm drivers for our markets of population growth, expanded food production and efficient water use, and infrastructure upgrades and expansion support our expectations for growth.” n www.lindsay.com
COMMENT United Rental Inc’s fourth quarter 2016 rental revenue (which includes owned equipment rental revenue, re-rent revenue and ancillary items) increased 1.6% year-onyear. Within rental revenue, owned equipment rental revenue was 1.9% higher, reflecting a 4.3% lift in the volume of equipment on rent partially offset by a 1.8% decrease in rental rates. For the full year 2016, total revenue decreased 0.9%, and rental revenue was down 0.2%. Within rental revenue, owned equipment rental revenue slipped 0.3%, reflecting a 2.2% fall in rental rates largely offset by an increase of 3.1% in the volume of equipment on rent. For the fourth quarter and full year 2016, the company’s Trench, Power and Pump specialty segment’s rental revenue increased by
approximately 10%, primarily on a same store basis. Michael Kneeland, CEO of United Rentals, said 2017 should be a year of notable growth on several fronts. The company expects to close the acquisition of NES Rentals Holdings II Inc early in the second quarter. “In addition to M&A investment, we expect our performance to be driven by broad-based market opportunities and growing demand. Our confidence in the cycle is supported by internal data, customer sentiment, and the strength of key leading indicators. Longer-term, we expect our 2017 strategic investments in increased capital spending, sales and marketing, digital and Project XL to extend our market position and enhance future profitability,” said Kneeland. n www.unitedrentals.com
January 2017
Lindsay Corp, USA
United Rentals Inc, USA
Key Figures (US$ million) Three months ended 30.11 2016 2015
Operating Revenues
110.4
121.6
Cost of Operating Revenues
82.0
87.2
Gross Profit
28.4
34.4
4.3
3.7
Engineering and Research
Key Figures (US$ million) Three months ended 31.12 2016 2015
Revenues Of Which: Equipment Rentals Of Which: Trench, Power and Pump
1523 1523 1298
1278
199
181
866
875
Operating Income
2.7
11.7
Cost of Revenues
Earnings before Income Taxes
1.3
10.4
Operating Income
402
397
Net Earnings
0.9
6.9
Net Income
153
169
Year ended 31.12
8
Pump Industry Analyst
2016 2015
Revenues Of Which: Equipment Rentals Of Which: Trench, Power and Pump
5762 5817 4941
4949
775
708
Cost of Revenues
3359
3337
Operating Income
1415
1518
566
585
Net Income
COMMENT Lindsay Corp, a provider of irrigation systems and infrastructure products, reported a 9.2% drop in sales and an almost 87% drop in net earnings in its first quarter ended 30 November 2016. First quarter fiscal 2017 revenues were US$110.4 million compared to revenues of US$121.6 million in the prior year’s first quarter. Net earnings for the quarter were US$0.9 million, down from US$6.9 million a year earlier. The Irrigation segment, which includes pumping solutions and filtration, saw revenues fall 11% to US$89.9 million from last year’s US$101.3 million on continued weakness in agricultural markets. US irrigation revenues of US$50.3 million were down 15%, mainly due to a reduction in irrigation equipment unit volume as falling commodity prices and reduced farm income negatively impacted irrigation equipment demand. International irrigation revenues were US$39.5 million
in the first quarter, a decrease of 6% on the prior year, as improved sales in Brazil, Africa and the Middle East were more than offset by declines in other markets. The backlog of unshipped orders at 30 November 2016 was US$55.9 million compared with US$61.9 million at 30 November 2015. Improved backlogs in international irrigation and infrastructure were offset in part by a lower backlog in US irrigation. Rick Parod, president and CEO of Lindsay, said: “As the agricultural down cycle extends, weakness in demand for irrigation equipment is expected to continue. Accordingly, we are continuing to assess and take action on appropriate expense reductions. The longerterm drivers for our markets of population growth, expanded food production and efficient water use, and infrastructure upgrades and expansion support our expectations for growth.” n www.lindsay.com
COMMENT United Rental Inc’s fourth quarter 2016 rental revenue (which includes owned equipment rental revenue, re-rent revenue and ancillary items) increased 1.6% year-onyear. Within rental revenue, owned equipment rental revenue was 1.9% higher, reflecting a 4.3% lift in the volume of equipment on rent partially offset by a 1.8% decrease in rental rates. For the full year 2016, total revenue decreased 0.9%, and rental revenue was down 0.2%. Within rental revenue, owned equipment rental revenue slipped 0.3%, reflecting a 2.2% fall in rental rates largely offset by an increase of 3.1% in the volume of equipment on rent. For the fourth quarter and full year 2016, the company’s Trench, Power and Pump specialty segment’s rental revenue increased by
approximately 10%, primarily on a same store basis. Michael Kneeland, CEO of United Rentals, said 2017 should be a year of notable growth on several fronts. The company expects to close the acquisition of NES Rentals Holdings II Inc early in the second quarter. “In addition to M&A investment, we expect our performance to be driven by broad-based market opportunities and growing demand. Our confidence in the cycle is supported by internal data, customer sentiment, and the strength of key leading indicators. Longer-term, we expect our 2017 strategic investments in increased capital spending, sales and marketing, digital and Project XL to extend our market position and enhance future profitability,” said Kneeland. n www.unitedrentals.com
January 2017