Optex Systems (OPXS) Q1 2025 earnings summary

Executive summary

• Revenue for the quarter ended December 29, 2024, increased 17.7% year-over-year to $8.2 million, driven by strong performance at the Applied Optics Center segment and higher demand for periscopes, laser filters, and day windows.

• Net income more than doubled to $844,000 from $431,000 in the prior year period, with EPS rising to $0.12 from $0.06.

• Adjusted EBITDA rose to $1.1 million from $758,000, reflecting improved operating leverage.

• Operating income rose 65.6% year-over-year, outpacing increased general and administrative expenses.

• Backlog remains robust at $42.0 million, though down 6.7% from the prior year, with Optex Richardson backlog up 5.8% and Applied Optics Center backlog down 29.9%.

Financial highlights

• Gross profit increased 26.4% to $2.1 million, with gross margin improving to 26.0% from 24.2% year-over-year.

• Operating income rose to $916,000 from $553,000, a 65.6% increase.

• Cash flow from operations was $2.8 million, up from $2.3 million in the prior year period.

• Cash and cash equivalents at quarter-end were $2.5 million, with no outstanding balance on the $3 million credit facility.

• Basic and diluted EPS were $0.12, up from $0.06 year-over-year.

Outlook and guidance

• Management expects continued revenue growth, with fiscal 2025 revenue projected to exceed $38 million, supported by a strong backlog and increased production capacity.

• Anticipation of new orders in the near term, some for delivery in the current fiscal year.

• Short-term cash will be used to fund inventory and potential asset purchases; longer-term, excess cash may support new product development or stock repurchases.

• The company anticipates positive net income and operating cash flow over the next twelve months.