Valmont Industries (VMI) Conference Call Summary Company Overview - Valmont Industries is a Fortune 1,000 company and a global leader in infrastructure and agriculture markets, generating approximately $4.1 billion in net sales last year [6][7] - The company is headquartered in Omaha, Nebraska, operates in over 100 countries, and has a market cap of about $6.5 billion [7] - The revenue mix is over 70% from the U.S. and Canada, with the rest from EMEA, Latin America, and Asia Pacific [8] Business Segments Infrastructure - Infrastructure is the largest segment with nearly $3 billion in sales, driven by strong demand for utility products due to rising electricity consumption and aging infrastructure [9][10] - Key product lines include utility infrastructure (nearly half of segment sales), lighting and transportation (30% of segment sales), and telecom components [10][11] - The company is making capacity investments to meet long-term growth in utility and telecom sectors [10][13] Agriculture - The agriculture segment accounts for just over $1 billion in sales, focusing on irrigation equipment and aftermarket parts [9][14] - Valmont is a market leader in irrigation, with a strong dealer network that enhances customer loyalty and aftermarket sales [15][16] - Demand drivers include net farm income, conversion to advanced irrigation solutions, and farm consolidation [16][19] Growth Strategies - The company aims to expand capacity by $700 million over the next three to four years, investing $100 million annually in CapEx [33] - Focus on growing higher-margin aftermarket products and technology services, including a new e-commerce platform for spare parts [34][35] - The agriculture segment is seeing strong international growth, particularly in the Middle East and Brazil, driven by food security initiatives [56][60] Financial Performance - Revenue growth has plateaued recently due to capacity constraints and a slowdown in the North American agriculture market, but operating income and earnings per share have doubled over the past six years [31][32] - The company has initiated a $700 million share buyback program, representing over 10% of its market cap, aiming to increase earnings per share from $18 to the mid-twenty dollar range over the next few years [39][46] Market Trends and Opportunities - Infrastructure investment is driven by the need for grid connectivity, electrification, and aging infrastructure [20][21] - Global food security concerns are leading to increased investments in agriculture, particularly in regions like the Middle East and North Africa [22][23] - The company is well-positioned to capitalize on these megatrends, with a focus on sustainable practices and resource conservation [24][25] Challenges and Considerations - The solar business, while a smaller part of total revenues, has faced challenges and is under review for potential restructuring [42][43] - The North American agriculture market has been difficult, but international markets, particularly Brazil, are showing growth [65][66] Conclusion - Valmont Industries is strategically positioned to leverage growth opportunities in both infrastructure and agriculture, with a focus on capacity expansion, higher-margin products, and international markets [68][69]

Valmont Industries (VMI) FY Conference Summary Company Overview - Valmont Industries is a Fortune 1,000 company headquartered in Omaha, Nebraska, with nearly 80 years of history [7] - Generated approximately $4.1 billion in net sales last year, with a current market cap around $6.5 billion [8] - Operates in over 100 countries with 83 manufacturing facilities and a workforce of about 11,000 [8] - Revenue distribution: over 70% from the US and Canada, with the remainder from EMEA, Latin America, and Asia Pacific [8] Industry Position - Holds a 40-45% market share in North American high voltage electricity transmission structures [3] - Global leader in irrigation with a 40% market share [4] - Significant presence in highway structures and telecommunications [4] Business Segments Infrastructure - Largest segment with nearly $3 billion in sales and a strong operating margin of 16.6% [8] - Strong demand driven by rising electricity consumption, aging grid infrastructure, and renewable energy build-out [11] - Focus on utility, lighting, transportation, and telecom products [10] - Telecom business benefits from carrier spending and 5G build-out [13] Agriculture - Accounts for just over $1 billion in sales, with a focus on irrigation equipment and parts [8] - Strong dealer network enhances customer loyalty and aftermarket parts sales [17] - Demand influenced by net farm income, commodity prices, and farm consolidation [18] - International sales are approximately 50% of total sales, with growth in regions like Brazil and the Middle East [22] Strategic Initiatives - Focus on expanding capacity to meet demand in the utility business, with a planned $100 million annual CapEx [37] - Emphasis on technology improvements, including a unified app for farmers and an e-commerce platform for parts [31][19] - Targeting higher-margin areas in agriculture, particularly international markets and technology products [39] Financial Performance - Revenue growth plateaued due to North American agriculture pullback and solar industry challenges [34] - Operating income and earnings per share have more than doubled over the last five years [36] - Corporate costs are being targeted for reduction to improve efficiency [40] Global Megatrends - Infrastructure investment driven by energy transition, aging infrastructure, and technology demands [23][24][25] - Agriculture trends focused on food security, sustainability, and population growth [26][27] Challenges and Opportunities - Addressing lower margins in international agriculture, particularly in the Middle East, through improved supply chain management [54][55] - Mitigating impacts of steel tariffs through strategic sourcing and customer negotiations [58][60] - Continuous improvement in factory throughput and productivity to enhance margins [68] Shareholder Returns - 50% of capital allocation focused on reinvestment in the business, with the other 50% on shareholder returns [45] - Announced a $700 million increase in share repurchase authorization, representing about 10% of market cap [46] - Aiming for consistent dividend increases, with a recent 13% year-over-year increase [47] Conclusion - Valmont Industries is well-positioned to capitalize on global megatrends in infrastructure and agriculture, with a focus on growth, margin expansion, and shareholder returns [28][47]

Core Viewpoint - Valmont Industries (VMI) shares have increased by approximately 9.3% since the last earnings report, outperforming the S&P 500, but there are concerns about whether this positive trend will continue leading up to the next earnings release [1] Estimates Movement - Estimates for Valmont have trended downward over the past month, indicating a potential shift in investor sentiment [2] VGM Scores - Valmont currently holds a Growth Score of B, a Momentum Score of D, and a Value Score of B, resulting in an aggregate VGM Score of B, which is relevant for investors not focused on a single strategy [3] Outlook - The downward trend in estimates suggests a negative shift, and Valmont holds a Zacks Rank of 3 (Hold), indicating expectations for an in-line return in the coming months [4]

Valmont Industries, Inc. (VMI) reported a first-quarter 2025 profit of $87.3 million or $4.32 per share. This compares to the profit of $87.8 million or $4.32 per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of $4.24.The company’s revenues were $969.3 million in the quarter, down 0.9% year over year. The top line missed the Zacks Consensus Estimate of $975.6 million.(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)VMI’s Segment ReviewThe first-quar ...

Disclosure Regarding Forward-Looking Statements These slides (and the accompanying oral discussion) contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on assumptions made by management, considering its experience in the industries where Valmont operates, perceptions of historical trends, current conditions, expected future developments, and other relevant factors. It is important to note that these statements are not guar ...

Core Insights - Valmont Industries reported quarterly earnings of $4.32 per share, exceeding the Zacks Consensus Estimate of $4.24 per share, with an earnings surprise of 1.89% [1] - The company posted revenues of $969.31 million for the quarter, missing the Zacks Consensus Estimate by 0.64%, compared to $977.83 million in the same quarter last year [2] - Valmont has surpassed consensus EPS estimates in all four of the last quarters, while it has topped revenue estimates twice during the same period [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $4.72 on revenues of $1.04 billion, and for the current fiscal year, it is $18.01 on revenues of $4.09 billion [7] - The estimate revisions trend for Valmont is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Steel - Pipe and Tube industry, to which Valmont belongs, is currently ranked in the bottom 24% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Valmont's stock performance [5]

Financial Data and Key Metrics Changes - Consolidated net sales for Q1 2025 were $969.3 million, a decrease of 0.9% year-over-year, but increased modestly on a constant currency basis [35][46] - Gross margin was 30%, down 130 basis points from the prior year, primarily due to a higher mix of international projects in the agriculture segment [35] - Operating income was $128.3 million, representing 13.2% of sales, with diluted earnings per share at $4.32, consistent with the prior year [35][46] Business Line Data and Key Metrics Changes - Infrastructure sales decreased by 2.4%, with utility sales increasing by 2.4% driven by higher volumes and average selling prices [37] - Agriculture sales increased by 3.3%, approximately 6% on a constant currency basis, with international sales significantly up, particularly in the EMEA region and Brazil [40][41] Market Data and Key Metrics Changes - North American market conditions for agriculture remain challenged, with projected declines in corn and soybean prices [26] - The telecommunications business saw strong sales growth of nearly 30%, driven by favorable carrier spending [39] Company Strategy and Development Direction - The company is focused on capturing the global infrastructure wave by expanding capabilities and optimizing capacity, with a $30 million investment in CapEx for Q1 2025 [11][12] - A local-for-local supply chain strategy has been implemented to reduce exposure to tariffs and better serve global customers [9][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating disruptions while positioning the business for long-term growth, despite slight declines in consolidated net sales [6][7] - The outlook for 2025 remains optimistic, with net sales projected between $4.0 billion and $4.2 billion and diluted earnings per share expected between $17.20 and $18.80 [46][53] Other Important Information - The company is actively mitigating near-term tariffs, with a comprehensive plan to offset an estimated $80 million in tariff exposure [48][50] - A 13% dividend increase was announced during the quarter, and a stock repurchase program of $700 million was initiated [44] Q&A Session Summary Question: Have price actions been implemented to offset all of the tariff impacts to date? - Management indicated that about half of the $80 million tariff exposure is being addressed through pricing actions, with expectations for higher pricing and possibly lower volumes included in guidance [58][60] Question: What is the outlook for the telecom business for the rest of the year? - Management expressed strong confidence in continued growth in telecom, driven by carrier investments in 5G upgrades and modernization [63][64] Question: What is the expectation for volume growth in the utility and lighting & transportation segments? - Management expects mid-single-digit volume growth for infrastructure, excluding solar, with improvements noted in order rates for lighting [108][117] Question: How is the company managing its tariff situation and USMCA compliance? - Management confirmed that their Mexico operations are USMCA compliant and emphasized ongoing efforts to manage tariffs and costs effectively [121][122]

Financial Performance - Net sales for Q1 2025 decreased by 0.9% to $969.3 million compared to $977.8 million in Q1 2024, with a 0.5% increase in constant currency[5]. - Operating income was $128.3 million, representing 13.2% of net sales, down from $131.6 million or 13.5% of net sales in the prior year[5]. - Diluted earnings per share remained unchanged at $4.32 compared to the previous year[5]. - Net earnings for the thirteen weeks ended March 29, 2025, were $86.663 million, slightly down from $88.429 million in the prior year, a decrease of about 2.0%[31]. - The adjusted EBITDA for the four fiscal quarters ended March 29, 2025, was $640.829 million, providing insights into the company's core operating performance[36]. Cash Flow and Liquidity - Operating cash flows increased significantly to $65.1 million from $23.3 million, with cash and cash equivalents at $184.4 million and a net leverage ratio of approximately 1.0x[5]. - Cash and cash equivalents increased to $184.399 million as of March 29, 2025, compared to $164.315 million at the end of 2024, marking an increase of approximately 12.5%[29]. - The leverage ratio as of March 29, 2025, was 0.97, indicating a stable financial position relative to debt levels[38]. - The company reported a net cash flow from operating activities of $65.130 million for the thirteen weeks ended March 29, 2025, compared to $23.332 million in the same period in 2024, showing a significant improvement[31]. Segment Performance - Infrastructure segment sales decreased by 2.4% to $706.2 million, while Agriculture segment sales increased by 3.3% to $267.3 million[7][10]. - Operating income in the Agriculture segment decreased by 11.6% to $36.2 million, or 13.6% of net sales, due to volume declines in North America[12]. - North America sales for the Infrastructure segment increased to $577.197 million from $568.572 million year-over-year, reflecting a growth of about 1.1%[27]. - The Infrastructure segment's sales totaled $706.221 million for the thirteen weeks ended March 29, 2025, down from $723.614 million in the prior year, a decline of approximately 2.4%[27]. - Net sales for the thirteen weeks ended March 29, 2025, totaled $969,314, with Infrastructure contributing $703,491 and Agriculture $265,823[42]. Outlook and Projections - The company reaffirmed its full-year 2025 financial outlook, projecting net sales between $4.0 billion and $4.2 billion and diluted earnings per share between $17.20 and $18.80[14]. - Capital expenditures for 2025 are expected to be between $140 million and $160 million[14]. - Fiscal 2025 net sales outlook ranges from $4,000,000 to $4,200,000, with a low end of $3,025,000 for Infrastructure and $975,000 for Agriculture[42]. - Year-over-year change in net sales is projected at (1.8)% for consolidated sales, with Infrastructure at 0.9% and Agriculture at (9.4)%[42]. - The company anticipates a net sales range of $3,160,000 to $4,060,000 in constant currency for Fiscal 2025[42]. Foreign Exchange Impact - The impact of foreign exchange on net sales for the same period was $13,153, with $6,070 for Infrastructure and $7,083 for Agriculture[42]. - The company expects a foreign exchange impact of $60,000 on net sales for Fiscal 2025, with $25,000 attributed to Infrastructure and $35,000 to Agriculture[42]. - The projected year-over-year change in net sales at constant currency is (1.1)% for consolidated sales, with Infrastructure at 2.1% and Agriculture at (7.1)%[42]. - The foreign exchange rates assumed for translation effects include BRL/USD at 5.90, AUD/USD at 1.58, and EUR/USD at 0.96[42]. - The company reported a net sales increase of 6.6% in constant currency for Agriculture in the thirteen weeks ended March 29, 2025[42]. Shareholder Returns - The company plans to return $12.0 million to shareholders in dividends, increasing the quarterly dividend by 13% to $0.68 per diluted share[5]. Backlog and Current Assets - The total backlog as of March 29, 2025, was $1,489.2 million, up from $1,436.7 million at the end of 2024, indicating an increase of approximately 3.6%[40]. - The company’s total current assets increased to $1,722.817 million as of March 29, 2025, from $1,683.392 million at the end of 2024, reflecting a growth of about 2.3%[29].

Company Overview - Valmont Industries (VMI) shares increased by 4.7% to $298.97 in the last trading session, following a significant volume of shares traded, contrasting with an 18.2% loss over the past four weeks [1] Tariff Impact and Mitigation Strategies - Valmont provided an update on the estimated impacts of U.S. tariffs on imports from Mexico, Canada, and China, as well as on imported steel and aluminum, detailing mitigation strategies such as pricing actions, cost control, productivity improvements, and supply-chain optimizations [2] - The company anticipates being cost-neutral on a dollar basis in the second half of fiscal 2025, even without USMCA tariff exclusions for imports from Mexico and Canada [3] Earnings Expectations - Valmont is expected to report quarterly earnings of $4.23 per share, reflecting a year-over-year decrease of 2.1%, with revenues projected at $977.37 million, down 0.1% from the previous year [4] - The consensus EPS estimate for the quarter has been revised 1.6% higher over the last 30 days, indicating a positive trend in earnings estimate revisions, which typically correlates with stock price appreciation [5] Industry Context - Valmont operates within the Zacks Steel - Pipe and Tube industry, where another company, Tenaris S.A. (TS), closed 0.7% higher at $39.63, with a 4.3% return over the past month [5] - Tenaris' consensus EPS estimate for the upcoming report has increased by 17.3% over the past month, although it represents a year-over-year decrease of 37.8% [6]

Core Viewpoint - Valmont Industries (VMI) shares have declined approximately 9.9% since the last earnings report, underperforming the S&P 500, raising questions about future performance leading up to the next earnings release [1] Group 1: Earnings and Estimates - Recent estimates for Valmont have trended upward over the past month, indicating a positive outlook [2][4] - The most recent earnings report highlighted important catalysts that may influence future performance [1] Group 2: VGM Scores - Valmont currently holds a strong Growth Score of A, while its Momentum Score is rated B, and it has a C grade for Value, placing it in the middle 20% for that investment strategy [3] - The aggregate VGM Score for Valmont is A, which is significant for investors not focused on a single strategy [3] Group 3: Outlook - The upward trend in estimates suggests a promising outlook for Valmont, with a Zacks Rank of 3 (Hold), indicating expectations for an in-line return in the coming months [4]