LSI(US:LYTS)2025-11-07 21:51Financial Performance - Total net sales for the three months ended September 30, 2025, were $157.2 million, an increase of 14% compared to $138.1 million for the same period in 2024[87]. - Lighting segment net sales reached $69.1 million, up 18% from $58.4 million in the prior year quarter, driven by new product introductions and account conversions[98]. - Display Solutions segment net sales were $88.2 million, an 11% increase from $79.7 million in the same quarter last year, supported by steady demand and the acquisition of Canada's Best Holdings, contributing $8.9 million to sales growth[87][94]. - Operating income for the three months ended September 30, 2025, was $11.0 million, representing a 20% increase from $9.1 million in the same period of 2024[88]. - Adjusted operating income was $14.1 million, an 18% increase compared to $11.9 million in the prior year quarter[88]. - Non-GAAP adjusted net income was $9.7 million for the three months ended September 30, 2025, compared to $8.0 million in the same period of 2024[106]. - For the three months ended September 30, 2025, net income was reported at $7.3 million, an increase from $6.7 million in the same period of 2024, while adjusted net income rose to $9.7 million from $8.0 million[106]. Profitability and Margins - Gross profit for the Lighting segment was $23.2 million, a 25% increase from $18.6 million in the same period of 2024, with gross profit margin improving from 31.9% to 33.6%[99]. - Gross profit for the Display Solutions segment was $17.1 million, a 14% increase from $15.0 million in the same period of 2024, with gross profit margin rising to 19.4%[95]. - Gross profit for the Display Solutions Segment increased to $17.1 million, a 14% rise from $15.0 million in the same period of 2024, with gross profit margin improving to 19.4% from 18.9%[95]. Expenses and Cash Flow - Operating expenses increased by 16% to $8.5 million, primarily due to the acquisition of CBH and investments in commercial initiatives[96]. - Operating expenses for the Lighting Segment increased to $14.6 million, a 14% rise from the same period in 2024, primarily due to higher agent commission expenses linked to increased sales[100]. - Cash generated from operating activities was $0.7 million for the three months ended September 30, 2025, down from $11.8 million in the same period of 2024[113]. - The company reported a free cash flow of $(0.3) million for the three months ended September 30, 2025, compared to $11.1 million in the same period of 2024, primarily due to increased capital expenditures[93]. Debt and Working Capital - Net debt to adjusted EBITDA remained stable at 0.8 for both September 30, 2025, and 2024[93]. - The company’s net debt as of September 30, 2025, was $43.5 million, with a net debt to adjusted EBITDA ratio of 0.8, consistent with the previous year[93]. - The Company had working capital of $112.4 million as of September 30, 2025, up from $96.8 million at June 30, 2025[108]. - Working capital increased to $112.4 million as of September 30, 2025, compared to $96.8 million at June 30, 2025, driven by a $10.4 million increase in net accounts receivable[108]. Dividends and Shareholder Returns - The Company declared a quarterly cash dividend of $0.05 per share, with an indicated annual cash dividend rate of $0.20 per share for fiscal 2026[118]. - The Board of Directors declared a quarterly cash dividend of $0.05 per share, with an indicated annual cash dividend rate of $0.20 per share for fiscal 2026[118]. Financial Position and Instruments - The Company amended its credit facility to a $125 million revolving credit line, with $73 million available as of September 30, 2025[112]. - The Company has no off-balance sheet arrangements or financial instruments with off-balance sheet risk[117]. - The fair value of financial instruments on the balance sheet approximates carrying value due to short-term maturity and variable interest rates[116].