Financial Data and Key Metrics Changes - Total revenues for Q1 FY2026 were $155.8 million, a decrease of 6% from $166.3 million in the same quarter last year [7] - Operating income for the quarter was $19.6 million, down 6% from $20.9 million in the prior year, with an operating margin of 12.6%, consistent with the prior year [8] - Net earnings were $16.5 million, or $1.54 per diluted share, slightly down from $17.2 million, or $1.57 per diluted share in the first quarter of last year [8] Business Line Data and Key Metrics Changes - Irrigation segment revenue decreased by 9% to $133.4 million compared to $147.1 million in the prior year, with North America irrigation revenues down 4% to $74.3 million [9] - International irrigation revenues were $59.1 million, down from $69.4 million, primarily due to project timing and lower sales volumes in Brazil [10] - Infrastructure segment revenues increased by 17% to $22.4 million, driven by higher sales of road safety products, while operating income rose 9% to $4.5 million [11] Market Data and Key Metrics Changes - North American irrigation market conditions are expected to remain soft, with a flat to down outlook for the full year [39] - International markets, particularly in Latin America, show potential for long-term growth despite current constraints on credit access for growers [5] - The U.S. administration announced a $12 billion Farmer Bridge assistance package to support farmers, but it is not expected to drive significant demand in the short term [4] Company Strategy and Development Direction - The company announced a supply agreement for Zimmatic irrigation systems in the MENA region, valued at approximately $80 million, reflecting its ability to compete in large-scale projects [3] - The infrastructure segment is expected to gain momentum as infrastructure funding and road project activity advance [4] - The company is focused on operational efficiencies and cost management to maintain profitability amid external headwinds [2] Management's Comments on Operating Environment and Future Outlook - Management acknowledges ongoing trade uncertainty, low commodity prices, and high input costs affecting customer profitability and sentiment [2] - There is cautious optimism regarding the international project market, particularly in the MENA region, with a robust project funnel [20] - Management does not foresee significant improvements in the domestic irrigation market in the near term but believes conditions will not worsen [17] Other Important Information - The company has a total available liquidity of $249.6 million, including $199.6 million in cash and cash equivalents [12] - Free cash flow was impacted by increased working capital and capital expenditures, but the company repurchased $30.3 million in shares during the quarter [12] Q&A Session Summary Question: Is the North American irrigation market at the trough? - Management agrees that the market is at the trough, with no significant upside expected until profitability improves [17] Question: What are the opportunities for international projects? - Management sees a robust funnel of opportunities in the MENA region, with both repeat and new customers [20] Question: What is the impact of elevated CapEx on profitability? - Management is investing in upgrades that will improve efficiency and productivity, with expected benefits in the future [22][24] Question: Is the new $80 million MENA project with the same customer as a previous project? - Yes, it is a repeat customer in the same region [27] Question: What margins are expected for the new project? - Margins for the new project are expected to be slightly below segment average, consistent with similar projects [29] Question: What drove the increase in interest income? - The increase is attributed to the regional mix of funds and interest rates, but future expectations are uncertain [43] Question: What is the outlook for Road Zipper projects? - Management indicates that the business remains lumpy, with ongoing discussions for future projects, but no immediate large projects expected [45][46]

Financial Data and Key Metrics Changes - Consolidated revenues for Q2 FY2025 increased by 23% to $187.1 million compared to $151.5 million in the prior year [14] - Net earnings for the quarter increased by 47% to $26.6 million or $2.44 per diluted share, compared to net earnings of $18.1 million or $1.64 per diluted share in the prior year, marking the highest quarterly net earnings in the company's history [15] Business Segment Data and Key Metrics Changes - Irrigation segment revenues increased by 11% to $148.1 million compared to $133 million in the prior year, with North America Irrigation revenues decreasing by 7% to $77.1 million [16] - International Irrigation revenues increased by 42% to $71 million, driven by large projects in the MENA region [17] - Infrastructure segment revenues more than doubled to $38.9 million from $18.5 million in the prior year, primarily due to the completion of a large Road Zipper project valued at over $20 million [19] Market Data and Key Metrics Changes - In North America, no meaningful improvement in market conditions is expected in the near term, with USDA forecasting a 29% increase in net farm income primarily due to higher government support payments [9] - Internationally, particularly in developing regions, continued growth is expected driven by project activity focused on food security and water resource conservation [10] Company Strategy and Development Direction - The company is focused on long-term growth in the Road Zipper system leasing business, which supports a higher and more stable margin profile [7] - A comprehensive action plan has been implemented to address potential cost impacts from tariffs, including supplier negotiation and strategic inventory placement [12] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the Road Zipper project sales pipeline despite challenges in predicting the timing of large projects [6] - The company anticipates stable demand for irrigation equipment in the second half of FY2025, pending any significant storm damage activity [9] Other Important Information - Total available liquidity at the end of Q2 was $236.7 million, including $186.7 million in cash and equivalents [20] - The company is evaluating the potential impact of additional or retaliatory tariffs and has the structure in place to react quickly [12] Q&A Session Summary Question: Insights on international revenue recognition timing - The company shipped more of the large project than originally anticipated, but this does not affect expectations for future quarters [26] Question: Details on tariff exposure and actions - The biggest impact is expected on the Irrigation business, with a marginal increase in cost of goods anticipated [30][32] Question: Margin performance in the Irrigation segment - Margins in North America remained comparable to last year, with volume leverage from international projects helping to offset gross margin dilution [40] Question: Impact of tariffs on agricultural economy and demand - Potential disruptions in US agricultural exports could impact pricing and customer sentiment, but government support is expected if needed [46][48] Question: Expectations on pricing in the domestic irrigation market - The company has already taken pricing actions based on increased steel costs and believes it can pass these costs along to customers [53]