LINDSAY CORP

Previous wording

The Company’s accounting policies that are most important to the presentation of its results of operations and financial condition, and which require the greatest use of judgments and estimates by management, are designated as its critical accounting policies. See discussion of the Company’s critical accounting policies under Item 7 in the Company’s Annual Report on Form 10-K for the Company’s fiscal year ended August 31, 2023. Management periodically re-evaluates and adjusts its critical accounting policies as circumstances change. There were no significant changes in the Company’s critical accounting policies during the six months ended February 29, 2024.

Current wording

The Company’s accounting policies that are most important to the presentation of its results of operations and financial condition, and which require the greatest use of judgments and estimates by management, are designated as its critical accounting policies. See discussion of the Company’s critical accounting policies under Item 7 in the Company’s Annual Report on Form 10-K for the Company’s fiscal year ended August 31, 2023. Management periodically re-evaluates and adjusts its critical accounting policies as circumstances change. There were no significant changes in the Company’s critical accounting policies during the nine months ended May 31, 2024.

Previous wording

Operating revenues for the three months ended February 29, 2024 were $151.5 million, a decrease of 9 percent compared to $166.2 million for the three months ended February 28, 2023. Irrigation segment revenues for the three months ended February 29, 2024 decreased 10 percent to $133.0 million from the same prior year period, while infrastructure segment revenues of $18.5 million were equivalent during both periods. Net earnings for the three months ended February 29, 2024 were $18.1 million, or $1.64 per diluted share, compared to net earnings of $18.1 million, or $1.63 per diluted share, for the three months ended February 28, 2023.

Current wording

Operating revenues for the three months ended May 31, 2024 were $139.2 million, a decrease of 15 percent compared to $164.6 million for the three months ended May 31, 2023. Irrigation segment revenues for the three months ended May 31, 2024 decreased 19 percent to $114.8 million from the same prior year period, while infrastructure segment revenues increased 11 percent to $24.4 million. Net earnings for the three months ended May 31, 2024 were $20.4 million, or $1.85 per diluted share, compared to net earnings of $16.9 million, or $1.53 per diluted share, for the three months ended May 31, 2023.

Previous wording

Agricultural commodity prices – As of February 2024, U.S. corn prices have decreased approximately 35 percent and U.S. soybean prices have decreased approximately 25 percent from price levels prevailing in February 2023. The reduction in commodity prices is due primarily to higher production levels in calendar 2023 that resulted in increased supply and higher inventory levels at the end of the year. Agriculture commodity prices fluctuate based on supply factors, such as global production and inventory levels and the ongoing conflict between Ukraine and Russia, and demand factors such as food and feed consumption, biofuel production and the level of China's demand for agricultural imports.

Current wording

Agricultural commodity prices – As of May 2024, U.S. corn prices have decreased approximately 24 percent and U.S. soybean prices have decreased approximately 7 percent from price levels prevailing in May 2023. The reduction in commodity prices is due primarily to higher production levels in calendar 2023 that resulted in increased supply and higher inventory levels at the end of the year. Agriculture commodity prices fluctuate based on supply factors, such as global production and inventory levels and the ongoing conflict between Ukraine and Russia, and demand factors such as food and feed consumption, biofuel production and the level of China's demand for agricultural imports.

Previous wording

Demand for irrigation equipment in the U.S. has remained stable during the first half of fiscal 2024 compared to the same prior year period. Net farm income levels in calendar 2023, although lower than historically high 2022 levels, supported farmer profitability and demand for investment so far in our fiscal 2024. However, the forecasted decline in estimated 2024 net farm income, if realized, could negatively affect demand for irrigation equipment during the remainder of our fiscal 2024. The Company has been able to maintain its pricing for irrigation equipment while inflationary pressure on steel and other raw material costs as well as freight and logistics costs, have moderated compared to the same prior year period.

Current wording

U.S. net farm income levels in calendar 2023, although lower than historically high 2022 levels, supported farmer profitability and demand for investment in the first half of fiscal 2024. However, the forecasted decline in estimated 2024 net farm income has led to tempered demand for irrigation equipment during the third quarter of fiscal 2024, which is expected to continue until the outlook for net farm income improves. The Company has been able to maintain its pricing for irrigation equipment while inflationary pressure on steel and other raw material costs, as well as freight and logistics costs, have moderated compared to the same prior year period.

Previous wording

The most significant opportunities for growth in irrigation sales over the next several years continue to be in international markets where irrigation use is less developed and demand is driven not only by commodity prices and net farm income, but also by food security, water scarcity and population growth. While international irrigation markets remain active with opportunities for further development and expansion, regional political and economic factors, including armed conflict, currency conditions and other factors can create a challenging environment. The Company continues to monitor Ukraine and Russia conflict for both short and long-term implications and has suspended new business activity in Russia and Belarus since February 2022. Sales with Russian, Ukrainian and Belarusian customers historically have represented less than 5 percent of consolidated revenues. Additionally, international results are heavily dependent upon project sales which tend to fluctuate and can be difficult to forecast accurately.

Current wording

The most significant opportunities for growth in irrigation sales over the next several years continue to be in international markets where irrigation use is less developed and demand is driven not only by commodity prices and net farm income, but also by food security, water scarcity and population growth. While international irrigation markets remain active with opportunities for further development and expansion, regional political and economic factors, including armed conflict, currency conditions and other factors can create a challenging environment. The Company continues to monitor the Ukraine and Russia conflict for both short and long-term implications and has suspended new business activity in Russia and Belarus since February 2022. Sales with Russian, Ukrainian and Belarusian customers historically have represented less than 5 percent of consolidated revenues. Additionally, international results are heavily dependent upon project sales which tend to fluctuate and can be difficult to forecast accurately. In May 2024, the Company announced a multi-year supply agreement to provide irrigation systems and remote management and scheduling technology for a large project in the Middle East and North Africa (MENA) region. The project is valued at more than $100 million in revenue, and is expected to be recognized over the period beginning in the fourth quarter of fiscal 2024 and continuing through the first quarter of fiscal 2026.

Previous wording

The backlog of unshipped orders at February 29, 2024 was $94.2 million compared with $95.2 million at February 28, 2023. Included in these backlogs are amounts of $20.3 million and $5.4 million, respectively, for orders that are not expected to be fulfilled within the subsequent twelve months. The irrigation backlog was lower and the infrastructure backlog was higher compared to the prior year. The Company’s backlog can fluctuate from period to period due to the seasonality, cyclicality, timing and execution of contracts. Backlog typically represents long-term projects as well as short lead-time orders, and therefore is generally not a good indication of the next fiscal quarter’s revenues.

Current wording

The backlog of unshipped orders at May 31, 2024 was $246.9 million compared with $94.5 million at May 31, 2023. Included in these backlogs are amounts of $62.0 million and $5.2 million, respectively, for orders that are not expected to be fulfilled within the subsequent twelve months. The backlog in both segments was higher compared to the prior year, with the increase in irrigation backlog resulting from the addition of the large project in the MENA region. The Company’s backlog can fluctuate from period to period due to the seasonality, cyclicality, timing and execution of contracts. Backlog typically represents long-term projects as well as short lead-time orders, and therefore is generally not a good indication of the next fiscal quarter’s revenues.

Previous wording

Includes $7.1 million and $7.6 million of corporate operating expenses for the three months ended February 29, 2024 and February 28, 2023, respectively.

Current wording

Includes $5.9 million and $7.3 million of corporate operating expenses for the three months ended May 31, 2024 and May 31, 2023, respectively.

Previous wording

Operating revenues for the three months ended February 29, 2024 decreased 9 percent to $151.5 million from $166.2 million for the three months ended February 28, 2023, as irrigation revenues decreased $14.8 million while infrastructure revenues were equivalent to revenues during the prior year period. The irrigation segment provided 88 percent of the Company’s revenue during the three months ended February 29, 2024 as compared to 89 percent for the three months ended February 28, 2023.

Current wording

Operating revenues for the three months ended May 31, 2024 decreased 15 percent to $139.2 million from $164.6 million for the three months ended May 31, 2023, as irrigation revenues decreased $27.7 million and infrastructure revenues increased $2.4 million compared to the prior year period. The irrigation segment provided 83 percent of the Company’s revenue during the three months ended May 31, 2024 as compared to 87 percent for the three months ended May 31, 2023.

Previous wording

North America irrigation revenues for the three months ended February 29, 2024 of $82.8 million decreased $7.6 million, or 8 percent, from $90.4 million for the three months ended February 28, 2023. The decrease resulted from lower sales of replacement parts, the impact of a less favorable mix of shorter machines, and slightly lower average selling prices compared to the same prior year period. This decrease was partially offset by the impact of slightly higher unit sales volume compared to the same prior year period.

Current wording

North America irrigation revenues for the three months ended May 31, 2024 of $68.2 million decreased $6.8 million, or 9 percent, from $75.0 million for the three months ended May 31, 2023. Lower commodity prices, a projected decline in U.S. net farm income, and wet field conditions in the midwest that delayed deliveries and irrigation start up all contributed to lower unit sales volume for irrigation equipment and sales of replacement parts for the current year period. Revenues were also impacted by slightly lower average selling prices compared to the same prior year period.

Previous wording

International irrigation revenues for the three months ended February 29, 2024 of $50.2 million decreased $7.2 million, or 13 percent, from $57.4 million for the three months ended February 28, 2023. The decrease resulted primarily from lower sales volumes in Brazil and other Latin America markets compared to the same prior year period. In Brazil, order activity declined due to a significant drop in local commodity prices during the quarter which has negatively impacted the outlook for grower profitability and available liquidity. This dynamic has also resulted in a more constrained credit environment which is limiting growers' ability to invest in irrigation equipment. This decrease was partially offset by the favorable effects of foreign currency translation of approximately $0.9 million compared to the same prior year period.

Current wording

International irrigation revenues for the three months ended May 31, 2024 of $46.6 million decreased $20.9 million, or 31 percent, from $67.5 million for the three months ended May 31, 2023. The decrease resulted primarily from lower sales volumes in Brazil and other Latin America markets compared to the same prior year period. In Brazil, order activity remains constrained due to the impact lower commodity prices have on grower profitability and available liquidity, which is reducing growers' ability to invest in irrigation equipment in the near term. The decrease in revenues was partially offset by the favorable effects of foreign currency translation of approximately $0.7 million compared to the same prior year period.

Previous wording

Infrastructure segment revenues were $18.5 million for both of the three months ended February 29, 2024 and February 28, 2023. An increase in Road Zipper System lease revenue in the three months ended February 29, 2024 was offset by lower Road Zipper System sales and lower sales of road safety products compared to the same prior year period.

Current wording

Infrastructure segment revenues were $24.4 million for the three months ended May 31, 2024 compared to $22.0 million for the three months ended May 31, 2023. The increase resulted primarily from an increase in both Road Zipper System sales and lease revenue as compared to the same prior year period. The impact of higher sales of road safety products in the U.S. was offset by lower sales in international markets.

Previous wording

Gross profit for the three months ended February 29, 2024 of $49.0 million decreased 10 percent from $54.3 million for the three months ended February 28, 2023. The decrease in gross profit resulted primarily from lower irrigation revenues. Gross margin was 32.3 percent of sales for the three months ended February 29, 2024 compared with 32.6 percent of sales for the three months ended February 28, 2023. Increased gross margin in infrastructure resulted primarily from a more favorable margin mix of revenues with higher Road Zipper System lease revenues. This favorable impact was offset by lower irrigation gross margin resulting from a decrease in revenues without a corresponding reduction in fixed costs.

Current wording

Gross profit for the three months ended May 31, 2024 of $46.5 million decreased 13 percent from $53.2 million for the three months ended May 31, 2023. The decrease in gross profit resulted primarily from lower irrigation revenues. Gross margin was 33.4 percent of sales for the three months ended May 31, 2024 compared with 32.3 percent of sales for the three months ended May 31, 2023. Increased gross margin in infrastructure resulted primarily from a more favorable margin mix of revenues with higher Road Zipper System sales and lease revenues. This favorable impact was partially offset by lower irrigation gross margin resulting from a decrease in revenues without a corresponding reduction in fixed costs.

Previous wording

Operating expenses of $26.9 million for the three months ended February 29, 2024 decreased $0.1 million, or 1 percent, compared with $27.0 million for the three months ended February 28, 2023. Increased selling expense was offset by lower engineering and research expense and cost reductions in other areas.

Current wording

Operating expenses of $26.6 million for the three months ended May 31, 2024 increased $0.3 million, or 1 percent, compared with $26.3 million for the three months ended May 31, 2023. Increased selling expense was partially offset by cost reductions in other areas.

Previous wording

The Company recorded other income of $0.6 million for the three months ended February 29, 2024 compared to other expense of $1.5 million for the three months ended February 28, 2023. The change resulted primarily from foreign currency transaction gains of $0.1 million in the current year compared to foreign currency transaction losses of $1.1 million in the same prior year period and a $0.8 million increase in interest income.

Current wording

The Company recorded other income of $0.2 million for the three months ended May 31, 2024 compared to other expense of $1.2 million for the three months ended May 31, 2023. The change resulted primarily from foreign currency transaction losses of $0.1 million in the current year compared to foreign currency transaction losses of $0.9 million in the same prior year period, along with a $0.3 million increase in interest income.

Previous wording

The Company recorded income tax expense of $10.6 million and $13.5 million for the six months ended February 29, 2024 and February 28, 2023, respectively. The effective income tax rate was 24.1 percent and 27.1 percent for the six months ended February 29, 2024 and February 28, 2023, respectively. The lower effective tax rate in the current year period reflects a decreased proportion of earnings in higher rate foreign jurisdictions as well as a discrete income tax benefit of approximately $1.1 million realized in Brazil.

Current wording

The Company recorded an income tax benefit of $0.2 million and income tax expense of $8.9 million for the three months ended May 31, 2024 and 2023, respectively. The effective income tax rate was -1.0 percent and 34.4 percent for the three months ended May 31, 2024 and 2023, respectively. The lower effective tax rate in the current year period resulted from a discrete tax benefit of $4.8 million related to the recognition of an income tax credit in Brazil. This discrete benefit is not expected to repeat in future periods. The impact of discrete items in the same prior year period was not significant.

Previous wording

The following section presents an analysis of the Company’s operating results displayed in the condensed consolidated statements of earnings for the six months ended February 29, 2024 and February 28, 2023. It should be read together with the industry segment information in Note 14 to the condensed consolidated financial statements:

Current wording

The following section presents an analysis of the Company’s operating results displayed in the condensed consolidated statements of earnings for the nine months ended May 31, 2024 and 2023. It should be read together with the industry segment information in Note 14 to the condensed consolidated financial statements:

Previous wording

Includes $14.9 million and $15.0 million of corporate operating expenses for the six months ended February 29, 2024 and February 28, 2023, respectively.

Current wording

Includes $20.8 million and $22.3 million of corporate operating expenses for the nine months ended May 31, 2024 and May 31, 2023, respectively.

Previous wording

Operating revenues for the six months ended February 29, 2024 decreased 9 percent to $312.9 million from $342.4 million for the six months ended February 28, 2023, as irrigation revenues decreased $26.7 million and infrastructure revenues decreased $2.8 million. The irrigation segment provided 87 percent of the Company’s revenue during the six months ended February 29, 2024 as compared to 88 percent for the six months ended February 28, 2023.

Current wording

Operating revenues for the nine months ended May 31, 2024 decreased 11 percent to $452.1 million from $507.0 million for the nine months ended May 31, 2023, as irrigation revenues decreased $54.4 million and infrastructure revenues decreased $0.5 million. The irrigation segment provided 86 percent of the Company’s revenue during the nine months ended May 31, 2024 as compared to 87 percent for the nine months ended May 31, 2023.

Previous wording

North America irrigation revenues for the six months ended February 29, 2024 of $172.2 million decreased $2.1 million, or 1 percent, from $174.3 million for the six months ended February 28, 2023. Higher unit sales volume in the current year period was more than offset by lower sales of replacement parts, the impact of a less favorable mix of shorter machines, and slightly lower average selling prices compared to the same prior year period.

Current wording

North America irrigation revenues for the nine months ended May 31, 2024 of $240.4 million decreased $8.9 million, or 4 percent, from $249.3 million for the nine months ended May 31, 2023. Slightly higher unit sales volume in the current year period was more than offset by lower sales of replacement parts, the impact of a less favorable mix of shorter machines, and slightly lower average selling prices compared to the same prior year period.

Previous wording

International irrigation revenues for the six months ended February 29, 2024 of $101.0 million decreased $24.6 million, or 20 percent, from $125.6 million for the six months ended February 28, 2023. The decrease resulted primarily from lower sales volumes in Brazil and other Latin America markets compared to the same prior year period. In Brazil, market demand has declined due to a significant drop in local commodity prices that has had a negative impact on farmer profitability and liquidity. This decrease was partially offset by the favorable effects of foreign currency translation of approximately $2.7 million compared to the same prior year period.

Current wording

International irrigation revenues for the nine months ended May 31, 2024 of $147.6 million decreased $45.6 million, or 24 percent, from $193.1 million for the nine months ended May 31, 2023. The decrease resulted primarily from lower sales volumes in Brazil and other Latin America markets compared to the same prior year period. In Brazil, market demand has declined due to a significant drop in local commodity prices that has had a negative impact on farmer profitability and liquidity. This decrease was partially offset by the favorable effects of foreign currency translation of approximately $3.9 million compared to the same prior year period.

Previous wording

Gross profit for the six months ended February 29, 2024 of $98.9 million decreased 8 percent from $107.3 million for the six months ended February 28, 2023. The decrease in gross profit resulted primarily from lower revenues in both segments. Gross margin was 31.6 percent of sales for the six months ended February 29, 2024 compared with 31.3 percent of sales for the six months ended February 28, 2023. Increased gross margin in infrastructure resulted primarily from a more favorable margin mix of revenues with higher Road Zipper System lease revenues. This favorable impact was offset by lower irrigation gross margin resulting from a decrease in revenues without a corresponding reduction in fixed costs.

Current wording

Gross profit for the nine months ended May 31, 2024 of $145.4 million decreased 9 percent from $160.5 million for the nine months ended May 31, 2023. The decrease in gross profit resulted primarily from lower revenues in irrigation. Gross margin was 32.2 percent of sales for the nine months ended May 31, 2024 compared with 31.7 percent of sales for the nine months ended May 31, 2023. Increased gross margin in infrastructure resulted primarily from a more favorable margin mix of revenues with higher Road Zipper System lease revenues. This favorable impact was offset by lower irrigation gross margin resulting from a decrease in revenues without a corresponding reduction in fixed costs.

Previous wording

Operating expenses of $55.7 million for the six months ended February 29, 2024 increased $0.3 million compared with $55.4 million for the six months ended February 28, 2023.

Current wording

Operating expenses of $82.2 million for the nine months ended May 31, 2024 increased $0.6 million compared with $81.7 million for the nine months ended May 31, 2023. Increased selling expense was partially offset by cost reductions in other areas.

Previous wording

The Company recorded other income for the six months ended February 29, 2024 of $0.5 million compared to other expense of 2.1 million the six months ended February 28, 2023. The current year period includes $0.2 million of foreign currency transaction losses compared to losses of $1.1 million in the same prior year period and $2.3 million of interest income compared to $0.9 million in the same prior year period.

Current wording

The Company recorded other income for the nine months ended May 31, 2024 of $0.8 million compared to other expense of $3.4 million for the nine months ended May 31, 2023. The current year period includes $0.3 million of foreign currency transaction losses compared to losses of $2.0 million in the same prior year period and $3.3 million of interest income compared to $1.6 million in the same prior year period.

Previous wording

The Company recorded income tax expense of $4.6 million and $7.7 million for the three months ended February 29, 2024 and February 28, 2023, respectively. The effective income tax rate was 20.2 percent and 29.8 percent for the three months ended February 29, 2024 and February 28, 2023, respectively. The lower effective tax rate in the current year period reflects a decreased proportion of earnings in higher rate foreign jurisdictions as well as a discrete income tax benefit of approximately $1.1 million realized in Brazil.

Current wording

The Company recorded income tax expense of $10.3 million and $22.3 million for the nine months ended May 31, 2024 and 2023, respectively. The effective income tax rate was 16.2 percent and 29.6 percent for the nine months ended May 31, 2024 and May 31, 2023, respectively. The lower effective tax rate in the current year period reflects a decreased proportion of earnings in higher rate foreign jurisdictions, along with the impact of discrete benefits totaling $6.1 million compared to discrete benefits totaling $0.8 million in the same prior year period.

Previous wording

The Company's cash, cash equivalents, and marketable securities totaled $150.6 million at February 29, 2024 compared with $106.4 million at February 28, 2023 and $166.3 million at August 31, 2023. The Company requires cash for financing its receivables and inventories, paying operating expenses and capital expenditures, and for dividends and share repurchases. The Company meets its liquidity needs and finances its capital expenditures from its available cash and funds provided by operations along with borrowings under its credit arrangements described below. The Company’s investments in marketable securities are primarily comprised of United States government securities and investment grade corporate securities. The Company believes its current cash resources, investments in marketable securities, projected operating cash flow, and remaining capacity under its continuing bank lines of credit are sufficient to cover all its expected working capital needs, planned capital expenditures and dividends. The Company may require additional borrowings to fund potential acquisitions in the future.

Current wording

The Company's cash, cash equivalents, and marketable securities totaled $152.7 million at May 31, 2024 compared with $144.4 million at May 31, 2023 and $166.3 million at August 31, 2023. The Company requires cash for financing its receivables and inventories, paying operating expenses and capital expenditures, and for dividends and share repurchases. The Company meets its liquidity needs and finances its capital expenditures from its available cash and funds provided by operations along with borrowings under its credit arrangements described below. The Company’s investments in marketable securities are primarily comprised of United States government securities and investment grade corporate securities. The Company believes its current cash resources, investments in marketable securities, projected operating cash flow, and remaining capacity under its continuing bank lines of credit are sufficient to cover all its expected working capital needs, planned capital expenditures and dividends. The Company may require additional borrowings to fund potential acquisitions in the future.

Previous wording

The Company’s total cash and cash equivalents held by foreign subsidiaries were approximately $57.3 million, $51.2 million, and $64.6 million as of February 29, 2024, February 28, 2023, and August 31, 2023, respectively. The Company considers earnings in foreign subsidiaries to be indefinitely reinvested and would need to accrue and pay incremental state, local, and foreign taxes if such earnings were repatriated to the United States. The Company does not intend to repatriate the funds and does not expect these funds to have a significant impact on the Company’s overall liquidity.

Current wording

The Company’s total cash and cash equivalents held by foreign subsidiaries were approximately $62.9 million, $54.6 million, and $64.6 million as of May 31, 2024, May 31, 2023, and August 31, 2023, respectively. The Company considers earnings in foreign subsidiaries to be indefinitely reinvested and would need to accrue and pay incremental state, local, and foreign taxes if such earnings were repatriated to the United States. The Company does not intend to repatriate the funds and does not expect these funds to have a significant impact on the Company’s overall liquidity.

Previous wording

Net working capital was $371.4 million at February 29, 2024, as compared with $347.3 million at February 28, 2023 and $351.4 million at August 31, 2023. Cash provided by operating activities totaled $12.1 million during the six months ended February 29, 2024, compared to cash provided by operating activities of $7.9 million during the six months ended February 28, 2023. The increase was primarily driven by favorable improvements in working capital, mainly receivables and other current liabilities, partially offset by an increase in inventory during the current year period.

Current wording

Net working capital was $365.0 million at May 31, 2024, as compared with $358.3 million at May 31, 2023 and $351.4 million at August 31, 2023. Cash provided by operating activities totaled $42.7 million during the nine months ended May 31, 2024, compared to cash provided by operating activities of $59.2 million during the nine months ended May 31, 2023. The decrease resulted primarily from an increase in inventories that was partially offset by a decrease in receivables compared to the same prior year period.

Previous wording

Cash flows used in investing activities totaled $30.8 million during the six months ended February 29, 2024 compared to $5.7 million during the six months ended February 28, 2023. Cash proceeds from the maturities of marketable securities amounted to $15.0 million in the current year compared to zero in the same prior year period. Purchases of property, plant, and equipment were $18.8 million, compared to $7.2 million in the same prior year period.

Current wording

Cash flows used in investing activities totaled $32.4 million during the nine months ended May 31, 2024 compared to $18.9 million during the nine months ended May 31, 2023. Purchases of marketable securities amounted to $15.0 million in the current year compared to $4.9 million in the same prior year period. Purchases of property, plant, and equipment were $23.5 million, compared to $13.3 million in the same prior year period.

Previous wording

Cash flows used in financing activities totaled $8.6 million during the six months ended February 29, 2024 compared to cash flows used in financing activities of $9.8 million during the six months ended February 28, 2023. The change was primarily the result of lower common stock withheld for payroll tax obligations compared to the same prior year period.

Current wording

Cash flows used in financing activities totaled $30.2 million during the nine months ended May 31, 2024 compared to cash flows used in financing activities of $13.5 million during the nine months ended May 31, 2023. During the current year period, the Company repurchased $17.9 million of common stock.

Previous wording

Capital expenditures for fiscal 2024 are expected to be between $35.0 million and $40.0 million, including equipment replacement, productivity improvements, new product development and commercial growth investments. The increase over recent levels of capital expenditures is primarily related to modernization and productivity improvements planned at certain manufacturing facilities. The Company’s management does maintain flexibility to modify the amount and timing of some of the planned expenditures in response to economic conditions.

Current wording

Capital expenditures for fiscal 2024 are expected to be approximately $30.0 million, including equipment replacement, productivity improvements, new product development and commercial growth investments. The increase over recent levels of capital expenditures is primarily related to modernization and productivity improvements planned at certain manufacturing facilities. The Company’s management does maintain flexibility to modify the amount and timing of some of the planned expenditures in response to economic conditions.

Previous wording

In the second quarter of fiscal 2024, the Company paid a quarterly cash dividend to stockholders of $0.35 per common share, or $3.9 million, compared to a quarterly cash dividend of $0.34 per common share, or $3.7 million, in the second quarter of fiscal 2023.

Current wording

In the third quarter of fiscal 2024, the Company paid a quarterly cash dividend to stockholders of $0.35 per common share, or $3.8 million, compared to a quarterly cash dividend of $0.34 per common share, or $3.7 million, in the third quarter of fiscal 2023.

Previous wording

The Company’s Board of Directors authorized a share repurchase program of up to $250.0 million of common stock with no expiration date. Under the program, shares may be repurchased in privately negotiated and/or open market transactions as well as under formalized trading plans in accordance with the guidelines specified under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. There were no shares repurchased during the six months ended February 29, 2024 or 2023. The remaining amount available under the repurchase program was $63.7 million as of February 29, 2024.

Current wording

The Company’s Board of Directors authorized a share repurchase program of up to $250.0 million of common stock with no expiration date. Under the program, shares may be repurchased in privately negotiated and/or open market transactions as well as under formalized trading plans in accordance with the guidelines specified under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended.

Previous wording

Revolving Credit Facility. The Company has outstanding a $50.0 million unsecured Amended and Restated Revolving Credit Facility (the “Revolving Credit Facility”) with Wells Fargo Bank, National Association (“Wells Fargo”) expiring August 26, 2026. The Company intends to use borrowings under the Revolving Credit Facility for working capital purposes and to fund acquisitions. At February 29, 2024 and February 28, 2023, the Company had no outstanding borrowings under the Revolving Credit Facility. The amount of borrowings available at any time under the Revolving Credit Facility is reduced by the amount of standby letters of credit issued by Wells Fargo then outstanding. At February 29, 2024, the Company had the ability to borrow up to $50.0 million under the Revolving Credit Facility. The Revolving Credit Facility may be increased by up to an additional $50.0 million at any time, subject to additional commitment approval. Borrowings under the Revolving Credit Facility bear interest at a variable rate equal to the Secured Overnight Financing Rate ("SOFR") plus a margin of between 100 and 210 basis points depending on the Company’s leverage ratio then in effect (which resulted in a variable rate of 6.67 percent at February 29, 2024), subject to adjustment as set forth in the loan documents for the Revolving Credit Facility. Interest is paid on a monthly to quarterly basis depending on loan type. The Company currently pays an annual commitment fee on the unused portion of the Revolving Credit Facility. The fee is between 0.125 percent and 0.2 percent on the unused balance depending on the Company’s leverage ratio then in effect (which resulted in a fee of 0.125 percent at February 29, 2024).

Current wording

Revolving Credit Facility. The Company has outstanding a $50.0 million unsecured Amended and Restated Revolving Credit Facility (the “Revolving Credit Facility”) with Wells Fargo Bank, National Association (“Wells Fargo”) expiring August 26, 2026. The Company intends to use borrowings under the Revolving Credit Facility for working capital purposes and to fund acquisitions. At May 31, 2024 and 2023, the Company had no outstanding borrowings under the Revolving Credit Facility. The amount of borrowings available at any time under the Revolving Credit Facility is reduced by the amount of standby letters of credit issued by Wells Fargo then outstanding. At May 31, 2024, the Company had the ability to borrow up to $50.0 million under the Revolving Credit Facility. The Revolving Credit Facility may be increased by up to an additional $50.0 million at any time, subject to additional commitment approval. Borrowings under the Revolving Credit Facility bear interest at a variable rate equal to the Secured Overnight Financing Rate ("SOFR") plus a margin of between 100 and 210 basis points depending on the Company’s leverage ratio then in effect (which resulted in a variable rate of 6.69 percent at May 31, 2024), subject to adjustment as set forth in the loan documents for the Revolving Credit Facility. Interest is paid on a monthly to quarterly basis depending on loan type. The Company currently pays an annual commitment fee on the unused portion of the Revolving Credit Facility. The fee is between 0.125 percent and 0.2 percent on the unused balance depending on the Company’s leverage ratio then in effect (which resulted in a fee of 0.125 percent at May 31, 2024).