Valmont® Industries, Inc. (NYSE: VMI), a leading global provider of engineered products and services for infrastructure development and irrigation equipment and services for agriculture, today announced it has entered into a supply agreement to provide mechanized irrigation equipment, technology solutions, pump design, and services for a large agricultural development project in Africa. The agreement demonstrates the growing global demand for more efficient and reliable food production, and national investments in agriculture to feed growing populations and address food security issues, further exacerbated by the COVID-19 crisis.
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“We are excited to be partnering with progressive thought leaders who see the need and value for fresh water conservation and modern agriculture,” said Stephen G. Kaniewski, Valmont President and Chief Executive Officer. “Projects like these are highly transformative to local economies, bringing much-needed infrastructure and modern agricultural systems that enhance the food supply chain.”
Len Adams, Group President, Valmont Irrigation, added, “This multi-year engagement with a long-standing customer came about after many years of collaboration and their confidence in the strong technology and project execution capabilities of our Valley® Irrigation team and the local dealer. Our global manufacturing footprint and flexible supply chain allows us to strategically serve the African market quickly and effectively. As the market leader, we are well-positioned to execute and deliver large, complex projects of this scale.”
The approximately 200,000-hectare (500,000-acre) project will provide irrigation for highly efficient crop production, significantly minimizing the use of previously-marginal agricultural land and enabling double-cropping to produce world-class yields, while conserving approximately half the water currently used with traditional irrigation methods. Utilizing Valley Irrigation’s latest, most innovative technology solutions to maximize yields and minimize inputs, this project will become the largest connected irrigation project on the planet upon completion, further confirming Valmont’s technology leadership on the irrigated farm. Valmont introduced the center pivot to the U.S. market and this unique solution has transformed irrigated farming. Since that time, other large agricultural markets such as Brazil, Australia, and New Zealand have also implemented these technologies to become food baskets to the world.
Project deliveries are scheduled to begin in fourth quarter 2020 and expected to be completed at the end of 2022. Payment terms include a combination of a cash down payment and confirmed letter of credit. Importantly, the project is not expected to impact Valmont’s ability to serve existing global market demand, nor will further capacity additions be required.
Kaniewski continued, “This multi-year engagement is a testament to our ability to secure large-scale projects that address the critical need to increase food production to serve a growing population. We speak often about the strength of our international project pipeline, and we are very excited to be awarded this opportunity, which provides meaningful momentum heading into 2021. Projects like these advance our market growth strategy to provide technologically-advanced irrigation solutions to customers who are taking bold and aggressive steps to minimize the use of natural resources while maximizing food production. Enhancing food security and strengthening local economies remains a priority for many nations and customers around the world.”
“As countries look to diversify from traditional revenue sources to feed their growing populations, our products and technologies will become even more critical for improving crop production and addressing the continued scarcity of fresh water,” added Kaniewski. “I want to congratulate our entire team on this opportunity.”
The Company plans to provide further details during its third quarter 2020 earnings call on October 22, 2020.
About Valmont Industries, Inc.
Valmont® is a global leader, designing and manufacturing engineered products that support global infrastructure development and agricultural productivity. Its products for infrastructure serve highway, transportation, wireless communication, electric transmission, and industrial construction and energy markets. Its irrigation equipment and services for large-scale agriculture improves farm productivity while conserving fresh water resources. In addition, Valmont provides coatings services that protect against corrosion and improve the service lives of steel and other metal products. For more information, visit valmont.com.
About Valley Irrigation
Valley® Irrigation founded the center pivot irrigation industry in 1954, and our brand is the worldwide leader in sales, service, quality and innovation. With historical sales of more than 250,000 center pivots and linears, Valmont-built equipment annually irrigates approximately 25 million acres (10 million hectares) around the world. We remain dedicated to providing innovative, precision irrigation solutions now and into the future. For more information, please visit valleyirrigation.com.
Concerning Forward-Looking Statements
This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions that management has made in light of experience in the industries in which Valmont operates, as well as management’s perceptions of historical trends, current conditions, expected future developments and other factors believed to be appropriate under the circumstances. As you read and consider this release, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond Valmont’s control) and assumptions. Although management believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect Valmont’s actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. These factors include among other things, the continuing and developing effects of COVID-19 including the effects of the outbreak on the general economy and the specific economic effects on the Company’s business and that of its customers and suppliers, risk factors described from time to time in Valmont’s reports to the Securities and Exchange Commission, as well as future economic and market circumstances, industry conditions, company performance and financial results, operating efficiencies, availability and price of raw material, availability and market acceptance of new products, product pricing, domestic and international competitive environments, and actions and policy changes of domestic and foreign governments. The Company cautions that any forward-looking statement included in this press release is made as of the date of this press release and the Company does not undertake to update any forward-looking statement.