LSI Industries (LYTS) Q4 2024 earnings summary

Executive summary

• Fiscal Q4 sales increased 4% year-over-year to $129 million, driven by the EMI Industries acquisition and strong performance in core verticals.

• Full-year net sales were $470 million, down 6% from the prior year; adjusted EBITDA rose 11% to $51.4 million, with a 60 basis point margin improvement.

• Over 25 new products were introduced, a new refrigeration facility was opened, and operational capabilities were expanded.

• EMI integration is progressing well, with immediate accretion to adjusted EPS and expanded product offerings.

• A quarterly cash dividend of $0.05 per share was declared, payable September 3, 2024.

Financial highlights

• Q4 sales reached $129 million, up 4% year-over-year, with adjusted EBITDA of $14 million (10.9% of sales).

• Fiscal year sales totaled $470 million; adjusted EPS was $0.95, down from $0.99 last year.

• Adjusted EBITDA for the year was $51.4 million, with a margin rate of 11%, up 60 basis points.

• Free cash flow for the year was $38 million; net debt reduced to $50 million, with a net debt/EBITDA ratio of 1x.

• Q4 net income was $5.7 million, including $1 million in acquisition costs; full-year net income was $25 million.

Outlook and guidance

• Entering fiscal 2025 with macroeconomic uncertainty, but key verticals remain fundamentally sound and management expects profitable growth.

• Display solutions backlog for refueling C-store vertical is strong, with multi-year projects extending into 2026.

• Project services business expected to grow over 30% in fiscal 2025.

• Continued product innovation and new launches planned, maintaining a product vitality rate over 30%.

• Grocery vertical expected to recover as industry merger uncertainty resolves and R290 refrigeration adoption increases.