Irrigation segment revenues for the second quarter increased 3% to $106.2 million from $103.1 million in the prior year's second quarter. U.S. irrigation revenues of $61.5 million declined 15%, as harsh winter weather conditions in the Northwest resulted in lower irrigation equipment unit volume and lower revenue from other irrigation businesses.
International irrigation revenues were $44.7 million, an increase of 46% compared to the second quarter of the prior year, driven primarily by improved demand and project activity in South America, Africa and the Commonwealth of Independent States region.
Infrastructure segment revenues for the second quarter increased two% to $17.9 million, as increased demand for road safety products and higher Road Zipper system sales and lease revenue was offset in part by a decline in sales volume for rail products.
Gross margin for the second quarter of fiscal 2017 was 26.5% of sales compared to 26.9% of sales in the prior year's second quarter. Improved margin in the infrastructure segment was more than offset by lower margin in the irrigation segment, as improved. U.S. irrigation margin was offset by a higher mix of international revenue at comparatively lower margins. Improved infrastructure margin resulted from increased cost absorption in Road Zipper system production and volume leverage from road safety product sales.
The company said, "In the irrigation segment, orders and project levels improved in the second quarter after experiencing a slow start to the year in the first quarter. Strong sales growth in international irrigation reflects improving demand and increased project activity. I am pleased with the U.S. irrigation gross margin improvement achieved, especially in view of raw material inflation experienced in the quarter. In the infrastructure segment, second quarter revenues were modestly improved over the prior year in a seasonally lower period, and we continue to see improved operating performance in the segment."
"We are currently in the midst of the primary selling season for irrigation equipment in North America where overall market conditions, affected by lower commodity prices and reduced farm incomes, are resulting in seasonal demand similar to the prior year. I am encouraged by the improving activity levels we are seeing in the international irrigation and infrastructure markets. The longer-term drivers for our markets of population growth, expanded food production and efficient water use, and infrastructure upgrades and expansion support our expectations for growth."