Financial Performance - Net sales for the three months ended December 31, 2024, were $147.734 million, a 35.5% increase from $109.005 million in the same period of 2023[10] - Gross profit for the six months ended December 31, 2024, was $68.508 million, slightly up from $68.125 million in 2023, indicating a stable gross margin[10] - Operating income for the three months ended December 31, 2024, was $8.459 million, compared to $7.819 million in 2023, reflecting an 8.2% increase[10] - Net income for the six months ended December 31, 2024, was $12.329 million, down from $13.934 million in 2023, representing a decrease of 11.5%[10] - Basic earnings per share for the three months ended December 31, 2024, was $0.19, a decrease from $0.20 in the same period of 2023[10] - For the three months ended December 31, 2024, total revenue was $58.2 million, a decrease of 34.9% compared to $89.5 million for the same period in 2023[36] - For the six months ended December 31, 2024, total revenue was $116.6 million, down 30.9% from $169.2 million for the same period in 2023[36] Assets and Liabilities - Total current assets as of December 31, 2024, were $163.405 million, slightly up from $162.499 million as of June 30, 2024[16] - Total liabilities as of December 31, 2024, were $127.430 million, down from $129.438 million as of June 30, 2024[19] - The company’s total assets as of December 31, 2024, were $344.545 million, a decrease from $348.800 million as of June 30, 2024[19] - The company’s long-term debt decreased to $34,615,000 as of December 31, 2024, from $50,658,000 in June 2024[19] - The Company reported a total debt of $38,186,000 as of December 31, 2024, down from $54,229,000 as of June 30, 2024[63] Shareholders' Equity - Shareholders' equity increased to $217.115 million as of December 31, 2024, compared to $204.355 million as of June 30, 2024, indicating a growth of 6.2%[19] - The balance of shareholders' equity at December 31, 2024, was $217,115,000, reflecting an increase from $204,355,000 at June 30, 2024, which is an increase of approximately 6.2%[23] Cash Flow and Dividends - Cash flows provided by operating activities increased to $21,737,000 for the six months ended December 31, 2024, compared to $19,868,000 in 2023, representing an increase of about 9.0%[26] - Total cash and cash equivalents at the end of the period increased to $4,712,000 from $2,660,000, marking a significant increase of approximately 77.0%[26] - Cash dividends paid increased to $2,973,000 in 2024 from $2,826,000 in 2023, representing an increase of approximately 5.2%[26] - Cash dividends paid for the six months ended December 31, 2024, were $3,000,000, compared to $2,800,000 for the same period in 2023[65] Acquisition and Goodwill - The company acquired EMI for $59,000 during the period, indicating ongoing market expansion efforts[26] - The company acquired EMI Industries, LLC for $50.0 million, funded by cash on hand and a $75 million revolving line of credit, expected to expand market reach in grocery and restaurant sectors[42] - The acquisition of EMI resulted in a preliminary allocation of $49.9 million to identifiable assets and liabilities, with $12.4 million recorded as goodwill[43] - Goodwill from the acquisition of EMI is $15.67 million, with significant components including customer relationships valued at $7.49 million and tradename at $4.88 million[44] - The gross amount of accounts receivable acquired from EMI was $11.9 million[43] - The company incurred acquisition-related costs of $1.0 million included in selling and administrative expenses[42] Segment Performance - The Lighting Segment reported net sales of $58.21 million for the three months ended December 31, 2024, down from $64.80 million in 2023, a decline of approximately 10.5%[54] - The Display Solutions Segment saw a significant increase in net sales to $89.52 million for the three months ended December 31, 2024, compared to $44.21 million in 2023, representing an increase of about 102.5%[54] - EMI generated net sales of $18.1 million and operating income of $0.7 million for the period from April 18, 2024, to June 30, 2024[44] Expenses and Costs - The company reported depreciation and amortization expenses of $5,958,000 for the six months ended December 31, 2024, up from $4,728,000 in 2023, indicating an increase of about 26.0%[26] - Stock compensation expense for the six months ended December 31, 2024, was $2,188,000, compared to $2,034,000 in 2023, reflecting an increase of approximately 7.6%[26] - The Company expects to record annual amortization expenses of $5,739,000 in 2025, decreasing to $4,497,000 after 2029[62] - The Company recorded interest payments of $1,460,000 for the six months ended December 31, 2024, compared to $1,006,000 in 2023[69] Tax and Compliance - The effective tax rate for the three months ended December 31, 2024, was 23.2%, up from 20.1% in 2023[78] - The Company is in compliance with all loan covenants as of December 31, 2024[64] Inventory and Accrued Expenses - Total inventories as of December 31, 2024, were $69.43 million, slightly down from $70.91 million as of June 30, 2024[57] - Total accrued expenses as of December 31, 2024, were $42.66 million, a decrease from $43.44 million as of June 30, 2024[58]

Fiscal Second Quarter 2025 Results Conference Call January 23, 2025 DISCLAIMER This presentation contains "forward-looking statements"—that is, statements related to future events within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. Forward-looking statements often address our expected future business, financial performance, financial condition and results of operations, often c ...

Financial Data and Key Metrics Changes - Net sales for Q2 were above $147 million, with adjusted EBITDA exceeding $13 million and free cash flow of almost $9 million, resulting in a trailing twelve months (TTM) net debt ratio of 0.6 times leverage [9][25]. - Total sales increased by 36% year-over-year, with comparable organic sales rising by 14% [24][25]. - Adjusted earnings per share for Q2 were $0.26 compared to $0.24 in the previous year, and adjusted EBITDA was $13.3 million, which is 20% higher than the prior year quarter [25][26]. Business Line Data and Key Metrics Changes - The Display Solutions segment saw total sales double, with organic growth of 50%, driven by demand resurgence in grocery and continued implementations in the refueling vertical [24][30]. - Sales in the grocery vertical increased over 60%, influenced by the release of previously held programs and the phase-out of R448 technology [30]. - The Lighting segment experienced sales below the prior year due to fluctuations in demand across project sizes, although small project activity remained strong [31][32]. Market Data and Key Metrics Changes - The company reported strong project activity in the refueling/c-store vertical, contributing to approximately 1,000 refueling/c-store sites serviced in Q2, marking the highest quarter in many years [28]. - The resurgence in the grocery vertical was significant, with many projects that had been on hold now moving forward due to increased clarity in the market [12][30]. - The company noted that its Latin America business has started to pick up momentum post-COVID, indicating a recovery in that market [109]. Company Strategy and Development Direction - The company is committed to its Fast Forward plan, focusing on profitable growth and operational efficiency while integrating the acquired EMI business [22][113]. - There is a strong emphasis on new product development, with plans to launch around 40 new products this year, including the next-generation outdoor lighting product, V-LOCITY [20][66]. - The company aims to maintain a vertical market orientation, enhancing its capabilities to offer more goods and services to targeted markets [21]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued order activity, particularly in the Display Solutions and grocery segments, although they acknowledged some uncertainty regarding the sustainability of the surge in demand [40][41]. - There are expectations for improved operational efficiency and margins as the company continues to ramp up production and integrate EMI [47][48]. - Management highlighted the importance of maintaining strong relationships with customers and adapting to changes in the market, including potential impacts from tariffs [52][56]. Other Important Information - The company has reduced its net debt to $33 million, significantly lowering its leverage ratio from 1.3 to 0.6 times since the acquisition of EMI [26]. - The company is actively engaged in larger projects, including data centers and chip manufacturing facilities, although these projects are progressing more slowly than anticipated [17][32]. - Management noted that they have contingency plans in place to address potential supply chain disruptions and have proactively moved some sourcing to mitigate risks [59][60]. Q&A Session Summary Question: Expectations for strength in the second half and seasonality - Management indicated that they expect elevated order rates to continue, particularly in the Display Solutions and grocery segments, although not at the same rate as Q2 [40][41]. Question: Trajectory of gross margins and EBITDA margins - Management acknowledged inefficiencies in Q2 due to rapid ramp-up but anticipates improvements in margins moving forward as operational efficiencies are regained [47][48]. Question: Impact of proposed tariffs - Management believes their domestic focus will mitigate the impact of tariffs, as they have shifted from 20% domestic sourcing to 70% [52][56]. Question: Surge in order activity across verticals - The majority of the surge was related to the grocery market, but there was also significant activity in the petroleum c-store space and QSR projects [94][96]. Question: Delivery delays and managing customer expectations - Management confirmed that they have not experienced delays in product delivery and have maintained efficiency in capacity utilization [100][101]. Question: Changes in permitting and supply chain issues - Permitting has normalized, and the company has effectively managed its supply chain to minimize disruptions [105][106].

Company Performance - LSI reported quarterly earnings of $0.18 per share, missing the Zacks Consensus Estimate of $0.20 per share, and down from $0.20 per share a year ago, representing an earnings surprise of -10% [1] - The company posted revenues of $147.73 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 14.99%, compared to year-ago revenues of $109.01 million [2] - Over the last four quarters, LSI has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2] Stock Outlook - LSI shares have added about 1.9% since the beginning of the year, underperforming the S&P 500's gain of 3.5% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for stock performance [4] - The current consensus EPS estimate for the coming quarter is $0.21 on revenues of $132.16 million, and for the current fiscal year, it is $0.86 on revenues of $537.54 million [7] Industry Context - The Building Products - Lighting industry, to which LSI belongs, is currently in the top 12% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact LSI's stock performance [5][6]

Financial Performance - LSI reported net sales of $147.7 million in Q2 2025, a 36% increase year-over-year, with organic net sales growing by 14%[4] - Net income for the second quarter was $5.6 million, or $0.18 per diluted share, while adjusted net income was $8.0 million, or $0.26 per diluted share[5] - Adjusted EBITDA reached $13.3 million, representing 9.0% of net sales, an increase of over 20% compared to the previous year[5] - Free cash flow generated in the second quarter was $8.8 million, with a trailing twelve-month free cash flow of nearly $41.4 million[6] - The company reported a net income of $5,647,000 for the three months ended December 31, 2024, a decrease of 4% from $5,906,000 in the same period of 2023[34] - Earnings per share (diluted) as reported for the three months ended December 31, 2024, was $0.18, down 7% from $0.20 in the same period of 2023[34] - FY 2024 Q1 reported net income was $8,028 million with an EPS of $0.27, while Q2 reported net income was $5,906 million with an EPS of $0.20[37] - FY 2024 Q3 reported net income was $5,375 million with an EPS of $0.18, and Q4 reported net income was $5,668 million with an EPS of $0.19[37] - FY 2025 Q1 reported net income was $6,682 million with an EPS of $0.22, while Q2 reported net income was $5,647 million with an EPS of $0.18[37] Cash Flow and Debt Management - Free cash flow for the three months ended December 31, 2024, was $8,825,000, a 21% increase from $7,320,000 in the same period of 2023[35] - The ratio of net debt to trailing twelve-month adjusted EBITDA improved to 0.6x, down from 1.3x at the time of the EMI acquisition[6] - The net debt to adjusted EBITDA ratio improved to 0.6 as of December 31, 2024, down from 1.0 in June 2024[35] Segment Performance - Display Solutions segment achieved organic sales growth of 50% in Q2, with sales to refueling/c-store customers increasing by over 60% year-over-year[11] - The grocery vertical saw sales growth exceeding 50% due to increased demand for refrigerated and non-refrigerated display cases[12] - The company experienced a 50% increase in comparable Display Solutions sales, rising from $44,209,000 to $66,133,000[35] - Lighting segment sales decreased by 10% year-over-year, attributed to a challenging comparison with the previous year’s large projects[16] Product Development and Innovation - LSI plans to launch over 40 new products in fiscal 2025, continuing its focus on innovation and meeting customer requirements[18] Dividends - The company declared a quarterly cash dividend of $0.05 per share, payable on February 11, 2025[8] - The Board of Directors declared a quarterly cash dividend of $0.05 per share, with an annual cash dividend rate of $0.20 per share[31] Adjusted Income and Expenses - Adjusted net income for FY 2024 Q1 was $9,610 million, representing an adjusted net income percentage of 7.8%, and Q2 adjusted net income was $7,249 million with a percentage of 6.7%[37] - Adjusted net income for FY 2024 Q3 was $7,131 million, with an adjusted net income percentage of 6.6%, and Q4 adjusted net income was $8,304 million with a percentage of 6.4%[37] - Adjusted net income for FY 2025 Q1 was $7,981 million, representing an adjusted net income percentage of 5.8%, and Q2 adjusted net income was $7,996 million with a percentage of 5.4%[37] Amortization and Compensation - Amortization expense of acquired intangible assets for FY 2024 Q1 was $870 million, and for Q2 it was $885 million[37] - Long-term performance-based compensation for FY 2024 Q1 was $974 million, and for Q2 it was $625 million[37] - Severance costs for FY 2024 Q1 were $256 million, while Q2 saw a reduction to $34 million[37] - The tax rate difference between reported and adjusted net income for FY 2024 Q1 was $(531) million, and for Q2 it was $(201) million[37]

Core Viewpoint - The article emphasizes the importance of confirming the sustainability of stock trends for successful short-term investing, highlighting the use of a specific screening strategy to identify stocks with strong fundamentals and positive price momentum [1][2]. Group 1: Stock Screening Strategy - The "Recent Price Strength" screen is designed to identify stocks with sufficient fundamental strength to maintain their recent uptrend, focusing on those trading in the upper portion of their 52-week high-low range, indicating bullishness [3]. - LYTS (LSI) is highlighted as a strong candidate for trend investing, having increased by 30.5% over the past 12 weeks, reflecting investor confidence in its potential upside [4]. - A recent price increase of 21.2% over the past four weeks for LYTS suggests that the upward trend is still intact, with the stock currently trading at 85.9% of its 52-week high-low range, indicating a potential breakout [5]. Group 2: Fundamental Strength - LYTS holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, which are critical for near-term price movements [6]. - The stock also has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7]. - The article suggests that the price trend for LYTS is unlikely to reverse soon, and encourages consideration of other stocks that meet the screening criteria for potential investment [8].

Fiscal First Quarter 2025 Results Conference Call November 7, 2024 DISCLAIMER This presentation contains "forward-looking statements"—that is, statements related to future events within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In this context, forward-looking statements often address our expected future business, financial performance, financial condition and results of ope ...

LSI (LYTS) came out with quarterly earnings of $0.22 per share, beating the Zacks Consensus Estimate of $0.20 per share. This compares to earnings of $0.27 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 10%. A quarter ago, it was expected that this lighting and LED display company would post earnings of $0.18 per share when it actually produced earnings of $0.19, delivering a surprise of 5.56%.Over the last four quarters, the ...

Most of us have heard the dictum "the trend is your friend." And this is undeniably the key to success when it comes to short-term investing or trading. But it isn't easy to ensure the sustainability of a trend and profit from it. Often, the direction of a stock's price movement reverses quickly after taking a position in it, making investors incur a short-term capital loss. So, it's important to ensure that there are enough factors -- such as sound fundamentals, positive earnings estimate revisions, etc. - ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks. Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks. Luckily, Zacks has develope ...