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NAPCO Security Technologies to Announce Fiscal Third Quarter 2024 Results Monday, May 6, 2024
Prnewswire· 2024-05-01 11:30
AMITYVILLE, N.Y., May 1, 2024 /PRNewswire/ -- NAPCO Security Technologies, Inc. (NASDAQ: NSSC), one of the leading designers and manufacturers of high-tech electronic security devices, wireless recurring communication services for intrusion, fire alarm, access control and locking systems as well as a leading provider of school safety solutions will release financial results for its Fiscal Third Quarter 2024 which ended March 31, 2024 on Monday May 6, 2024 before the market opens followed by a conference cal ...
Will Napco (NSSC) Beat Estimates Again in Its Next Earnings Report?
Zacks Investment Research· 2024-04-30 17:11
If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider Napco (NSSC) . This company, which is in the Zacks Security and Safety Services industry, shows potential for another earnings beat.This security products and software company has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for ...
NAPCO Security Technologies(NSSC) - 2024 Q2 - Quarterly Report
2024-02-05 19:43
[PART I: FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%3A%20FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents NAPCO Security Technologies' unaudited condensed consolidated financial statements for the quarter ended December 31, 2023, including balance sheets, income statements, and cash flows [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$185.9 million** by December 31, 2023, driven by cash and inventory growth, with stockholders' equity rising to **$158.0 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Dec 31, 2023 | June 30, 2023 | | :--- | :--- | :--- | | **Total Current Assets** | $149,728 | $131,359 | | **Total Assets** | **$185,878** | **$166,654** | | **Total Current Liabilities** | $21,211 | $19,686 | | **Total Liabilities** | $27,894 | $26,485 | | **Total Stockholders' Equity** | **$157,984** | **$140,169** | [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Net sales for the three months ended December 31, 2023, rose to **$47.5 million**, with net income surging to **$12.6 million** due to strong service revenue growth Three Months Ended December 31, (in thousands, except per share data) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | **Net Sales** | **$47,547** | **$42,314** | | Equipment Revenues | $29,007 | $27,434 | | Service Revenues | $18,540 | $14,880 | | **Gross Profit** | **$25,012** | **$14,354** | | **Operating Income** | **$13,805** | **$4,328** | | **Net Income** | **$12,610** | **$3,929** | | **Diluted EPS** | **$0.34** | **$0.11** | Six Months Ended December 31, (in thousands, except per share data) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | **Net Sales** | **$89,223** | **$81,807** | | Equipment Revenues | $53,398 | $53,121 | | Service Revenues | $35,825 | $28,686 | | **Gross Profit** | **$47,425** | **$28,920** | | **Operating Income** | **$25,360** | **$7,976** | | **Net Income** | **$23,088** | **$7,013** | | **Diluted EPS** | **$0.62** | **$0.19** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow for the six months ended December 31, 2023, significantly improved to **$18.7 million**, increasing cash and equivalents to **$47.3 million** Six Months Ended December 31, Cash Flow Summary (in thousands) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net Cash Provided by (Used in) Operating Activities | $18,693 | $1,088 | | Net Cash Used in Investing Activities | ($1,454) | ($10,856) | | Net Cash (Used in) Provided by Financing Activities | ($5,883) | $45 | | **Net increase (decrease) in Cash and Cash Equivalents** | **$11,356** | **($9,723)** | | **Cash and Cash Equivalents - Ending** | **$47,311** | **$32,007** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes cover accounting policies, revenue disaggregation, stock options, and legal proceedings, highlighting strong growth in Services and Door locking devices - The company's business is primarily the manufacturing and design of electronic security devices, with significant growth driven by recurring service revenues from wireless communication services and school security products[14](index=14&type=chunk) Disaggregation of Revenues by Major Product Lines (in thousands) | Major Product Lines | Three months ended Dec 31, 2023 | Three months ended Dec 31, 2022 | Six months ended Dec 31, 2023 | Six months ended Dec 31, 2022 | | :--- | :--- | :--- | :--- | :--- | | Intrusion and access alarm products | $11,258 | $11,342 | $20,554 | $24,874 | | Door locking devices | $17,749 | $16,092 | $32,844 | $28,247 | | Services | $18,540 | $14,880 | $35,825 | $28,686 | | **Total Revenues** | **$47,547** | **$42,314** | **$89,223** | **$81,807** | - As of December 31, 2023, the company had no outstanding debt under its **$11.0 million** revolving line of credit, which expires in June 2024[72](index=72&type=chunk) - A class action lawsuit was filed against the company and certain officers on August 29, 2023, alleging securities fraud. The company intends to vigorously defend against the action[111](index=111&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strong financial performance for the quarter, with **12.4% net sales growth**, expanded gross profit margin, and **$79 million** in liquidity [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Net sales grew **12.4%** to **$47.5 million** for the quarter, driven by service and door-locking products, with operating income surging **219.0%** Key Performance Metrics Comparison | Metric | Three months ended Dec 31, 2023 | Three months ended Dec 31, 2022 | % Change | | :--- | :--- | :--- | :--- | | Total net sales | $47,547,000 | $42,314,000 | 12.4% | | Service revenues | $18,540,000 | $14,880,000 | 24.6% | | Total gross profit | $25,012,000 | $14,354,000 | 74.3% | | Gross profit as a % of net sales | 52.6% | 33.9% | 55.2% | | Operating income | $13,805,000 | $4,328,000 | 219.0% | | Net income | $12,610,000 | $3,929,000 | 220.9% | - The significant increase in gross profit on equipment sales was attributed to lower costs of certain components compared to the prior year when the company was affected by global supply chain shortages[130](index=130&type=chunk) - Selling, general and administrative (SG&A) expenses increased primarily due to higher legal, advertising, and internal control enhancement costs, but decreased as a percentage of net sales from **18.4%** to **18.2%** for the quarter[133](index=133&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$79 million** in cash and equivalents, generating **$18.7 million** in operating cash flow, with no outstanding long-term debt - The company generated **$18.7 million** in cash from operations during the six months ended December 31, 2023, and believes its working capital and credit agreement are sufficient to fund operations for the next year[137](index=137&type=chunk) - Inventories increased by **$4.3 million** to **$52.6 million** at December 31, 2023, primarily to build up radio products and secure hard-to-source components to mitigate supply chain risks[139](index=139&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Market risks include interest rate changes and foreign currency fluctuations, with a **10%** USD/RD$ exchange rate change impacting annual operating income by **$940,000** - The company's primary market risks are interest rate changes on its debt and foreign currency exposure[143](index=143&type=chunk) - A **10%** strengthening or weakening of the U.S. dollar against the Dominican Peso (RD$) would result in an approximate annual change of **$940,000** in income from operations[144](index=144&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were deemed ineffective as of December 31, 2023, due to three material weaknesses in internal control over financial reporting - Management concluded that disclosure controls and procedures were not effective as of December 31, 2023, due to material weaknesses in internal control over financial reporting[145](index=145&type=chunk) - Three material weaknesses were previously identified relating to: 1. Ineffective IT general controls over user access and change management 2. Deficiencies in the calculation of reserves for excess and slow-moving inventory 3. Inaccurate inventory costing and COGS calculations during the first three quarters of fiscal 2023[147](index=147&type=chunk)[148](index=148&type=chunk)[149](index=149&type=chunk) - Remediation efforts are ongoing, including installing monitoring software for IT, enhancing inventory forecast reviews, and refining the component cost calculation methods. The material weaknesses are not yet considered fully remediated[151](index=151&type=chunk)[155](index=155&type=chunk) [PART II: OTHER INFORMATION](index=33&type=section&id=PART%20II%3A%20OTHER%20INFORMATION) [Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) A class action lawsuit alleging securities fraud was filed on August 29, 2023, which the company intends to vigorously defend without recording a liability - A class action lawsuit was filed against the Company, its CEO, and CFO on August 29, 2023, alleging securities fraud related to public statements made between November 2022 and August 2023[111](index=111&type=chunk) - The Company has not recorded a liability for this litigation and intends to defend against the action vigorously[111](index=111&type=chunk)[112](index=112&type=chunk) [Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors were identified for the period, remaining consistent with those disclosed in the Form 10-K for fiscal year ended June 30, 2023 - There has been no material change in the risk factors previously disclosed in the Company's Form 10-K for the fiscal year ended June 30, 2023[155](index=155&type=chunk) [Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists exhibits for the Form 10-Q, including CEO/CFO certifications and Inline XBRL documents - The exhibits filed with this report include: - Certifications from the CEO (Richard L. Soloway) and CFO (Kevin S. Buchel) - Section 1350 Certifications - Inline XBRL Instance Document and related taxonomy files[158](index=158&type=chunk)
NAPCO Security Technologies(NSSC) - 2024 Q1 - Quarterly Report
2023-11-09 16:52
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED: September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO . Commission File number: 0-10004 NAPCO SECURITY TECHNOLOGIES, INC. (Exact name of Registrant as specified in its charter) Delaware 11-2277818 (State or ...
NAPCO Security Technologies(NSSC) - 2023 Q4 - Annual Report
2023-09-08 16:32
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended June 30, 2023 Securities registered pursuant to Section 12(b) of the Act: | | Trading | | | --- | --- | --- | | Title of each class | Symbol(s) | Name of each exchange on which registered | | Common Stock, par value $0.01 per share | NSSC | The Nasdaq Stock Market LLP | Securities regist ...
NAPCO Security Technologies(NSSC) - 2023 Q3 - Quarterly Report
2023-05-08 18:32
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED: March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO . Commission File number: 0-10004 NAPCO SECURITY TECHNOLOGIES, INC. (Exact name of Registrant as specified in its charter) Delaware 11-2277 ...
NAPCO Security Technologies(NSSC) - 2023 Q2 - Quarterly Report
2023-02-06 21:15
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED: December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO . Commission File number: 0-10004 NAPCO SECURITY TECHNOLOGIES, INC. (Exact name of Registrant as specified in its charter) Delaware 11-2 ...
NAPCO Security Technologies(NSSC) - 2023 Q2 - Earnings Call Transcript
2023-02-06 21:05
Financial Data and Key Metrics Changes - The company reported record sales of $42.3 million for fiscal Q2 2023, a 27% increase compared to $33.4 million in the same period last year [12][26] - Recurring monthly revenue grew by 35% to $14.9 million, up from $11 million year-over-year [27] - Net income for Q2 reached $8.4 million or $0.23 per diluted share, a 714% increase from $1 million or $0.03 per diluted share in the prior year [34] - Adjusted EBITDA for the quarter was $10.3 million or $0.28 per diluted share, a 232% increase compared to $3.1 million or $0.08 per diluted share last year [35] Business Line Data and Key Metrics Changes - Equipment sales increased by 23% to $27.4 million in Q2, compared to $22.4 million in the same period last year [45] - Gross profit for equipment sales increased 245% to $6.2 million with a gross margin of 23%, compared to $1.8 million and 8% margin last year [29] - Gross profit for recurring revenues increased 37% to $13.2 million with a gross margin of 89%, compared to $9.6 million and 87% margin last year [30] Market Data and Key Metrics Changes - The company noted that 80% of its business is commercial, making it highly recession-resistant [40] - The backlog remains at a higher-than-normal level but is decreasing, indicating strong demand for products [62] Company Strategy and Development Direction - The company is focusing on capitalizing on key industry trends such as wireless, fire and intrusion alarms, and school security solutions [24] - Management aims to achieve $150 million in recurring revenue and $150 million in equipment revenue by the end of fiscal 2026 [60] - The introduction of Air Access is expected to generate recurring revenue across all divisions, marking a significant opportunity for growth [79][167] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to replace old 3G radios with new 5G radios, anticipating increased sales and recurring revenue [41][61] - The supply chain constraints are easing, and the company expects improved equipment margins in the coming months [43] - The ongoing concerns about a potential recession are acknowledged, but the company remains optimistic about its recession-resistant business model [40] Other Important Information - The company has a strong balance sheet with $47.1 million in cash and no debt [13][38] - Research and development expenses increased by 12% to $2.2 million, reflecting ongoing investment in product development [16] Q&A Session Summary Question: Impact of Verizon 3G sunset on demand - Management noted that dealers who failed to act on the sunset are now scrambling to replace radios, which is expected to lead to increased sales and recurring revenue [82][88] Question: Redesign activities and gross margins - The company is working on redesigning its radio sourcing to improve gross margins, with expectations of noticeable improvements in Q3 and Q4 [70][85] Question: Backlog levels and visibility - Management confirmed that while backlog levels are decreasing, they remain historically high, and strong demand continues to drive new orders [108] Question: School security projects and equipment sales - The company highlighted that school security projects are contributing positively to equipment sales, with significant wins in large school districts [111][151]
NAPCO Security Technologies(NSSC) - 2023 Q1 - Quarterly Report
2022-11-07 21:34
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ⌧ Number of shares outstanding of each of the issuer's classes of common stock, as of: November 4, 2022 COMMON STOCK, $.01 PAR VALUE PER SHARE 36, ...
NAPCO Security Technologies(NSSC) - 2023 Q1 - Earnings Call Presentation
2022-11-07 20:43
November 2022 (NSSC:NASDAQ) Disclaimer Special Note on Forward-Looking Statements This presentation contains forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management's judgment, beliefs, current trends, and anticipated product performance. These forward-looking statements include, without limitation, statements relating to growth drivers of Napco Security Technologies, Inc.'s (the "Company") business such as school secu ...