Core Insights - The company reported solid second-quarter results for fiscal 2026, with revenue flat year over year at $147 million, while profitability and free cash flow improved [5][16]. - The Display Solutions segment saw a slight revenue decline year over year but improved order trends and backlog, particularly in the refueling, convenience store, and casual dining sectors [1][3][21]. - The Lighting segment achieved a 15% year-over-year sales growth, marking the third consecutive quarter of double-digit growth, driven by new product introductions and strong project shipments [2][17]. Display Solutions - The Display Solutions segment experienced a year-over-year revenue decline due to strong prior-year comparisons, but orders improved sequentially and were up year over year, indicating a healthier backlog [1][3]. - The company is expanding its presence beyond quick-serve restaurants into casual dining and premium food services, with project values per site ranging from $250,000 to $1 million [6][19]. - The grocery vertical has returned to normalized demand levels after a previous surge, with Q2 orders increasing double digits year over year, resulting in a strong book-to-bill ratio of 1.2 [20][19]. Lighting - The Lighting segment reported a 15% year-over-year sales growth, following an 18% growth in the first quarter, with adjusted operating income increasing by 29% [2][17]. - The growth in Lighting is attributed to the addition of aluminum poles to the product line, increased large project shipments, and a successful national account strategy [2][17]. - Orders in the Lighting segment were up approximately 10% year over year, contributing to a book-to-bill ratio above one, indicating continued confidence in future performance [2][17]. Financial Performance - Adjusted EBITDA increased year over year to $13.4 million, with free cash flow strong at $23 million, allowing the company to reduce total debt by $22.7 million during the quarter [12][13][16]. - The company ended the quarter with a net leverage ratio of 0.4, providing significant capital allocation flexibility for future investments and acquisitions [13][16]. - The company expects to maintain above-market growth, supported by improving order trends and backlog across key vertical markets [14][55]. Strategic Initiatives - The company is focused on integrating its teams and breaking down silos to enhance cross-selling opportunities and improve operational efficiency [9][10]. - There is a commitment to talent management and empowering employees to foster a unified organizational culture [8][11]. - The company is optimistic about the potential in the casual dining and premium food services sectors, with larger project sizes and cross-selling opportunities expected to drive growth [38][62]. Market Outlook - The company anticipates continued elevated activity levels into fiscal and calendar year 2027, driven by strong customer engagement and planning discussions [7][22]. - The competitive environment in the convenience store and grocery markets is seen as favorable, with new entrants and existing players investing in customer experience and branding [56][59]. - The company is exploring M&A opportunities, with a focus on cultural fit and operational synergies, while remaining selective in its acquisition strategy [59][60].