Aug. 30, 2021

In its first quarter since announcing an upcoming acquisition, Sioux Falls-based Raven Industries reported a quarterly earnings increase of 19 percent.

Net income was $6.9 million, or 19 cents per share, in the second quarter of fiscal 2022, compared with $5.8 million, or 16 cents per share, in the prior quarter. The quarterly results also included $4.9 million of expenses associated with the proposed acquisition by CNH Industrial NV.

“Our board and management team is excited about the partnership with CNH Industrial,” Dan Rykhus, president and CEO, said in a statement. “This partnership will further accelerate our ability to advance ag technology while also maximizing shareholder value. The process of completing the transaction is going well, and we remain on track to close during the fourth quarter of the current year.”

Consolidated net sales for the second quarter were $114.4 million, up 34 percent versus the same period a year ago.

The year-over-year growth was driven by increased sales in the applied technology and engineered films divisions. In applied technology, demand for its precision ag technology remained robust, leading to strong year-over-year growth despite global supply chain constraints, Raven said. In engineered films, the division experienced growth across all end markets, led by construction, agriculture and geomembrane, including the energy submarket, as market conditions continued to improve throughout the quarter. The Aerostar division’s growth in core stratospheric and radar platforms was offset by the conclusion of Google’s Project Loon activity and a decrease in aerostat sales because of the timing of contracts.

Raven’s  investment in Raven Autonomy — its growth strategy in the applied technology division related to autonomous technology in farming — reduced net income attributable to Raven by $4.1 million, or 11 cents per share, in the second quarter compared to $3.1 million, or 9 cents per diluted share, in the prior year.

“I am very proud of our performance in the first half of fiscal 2022,” Rykhus said.

“Our team in applied technology has done an outstanding job navigating significant supply chain challenges to drive year-over-year revenue growth both domestically and internationally through our OEM and aftermarket channels. In addition, we have taken key steps in our Raven Autonomy strategy through advancing the technology and commercializing the initial use case of the OmniDrive solution. In engineered films, volatility in resin pricing has created challenges, but we have executed extremely well in capitalizing on the economic rebound to drive substantial revenue growth across all of our end markets. In Aerostar, we successfully executed multiple flight campaigns for our Department of Defense customers as we continue to showcase the capabilities of our industry-leading technology.”

Rykhus elaborated on the acquisition and its potential impact in Sioux Falls at a recent speaking engagement. Click below for that story.

Raven CEO speaks on pending acquisition, potential job growth