LSI Industries Reports Fourth Quarter, Full-Year Fiscal 2021 Results and Declares Quarterly Cash Dividend

CEW LSI HR hire 400

August 24, 2021

LSI Industries Inc. has announced results for the fourth quarter and full-year fiscal 2021.

FOURTH QUARTER 2021 SUMMARY

  • Net Sales increased 53% versus Prior Year, organic sales increased 39%
  • Completed acquisition of JSI Store Fixtures on May 21, 2021
  • Net Income of $0.2 million; Adjusted Net Income of $3.3 million
  • Diluted EPS of $0.01, including $0.08 of acquisition related expense
  • Adjusted EPS $0.12 versus $0.07 prior year

FISCAL YEAR 2021 SUMMARY

  • Net Sales increased 3% from prior year to $316 million
  • Net Income of $5.9 million; Adjusted Net Income of $9.8 million
  • Diluted EPS of $0.21; Adjusted EPS of $0.36 versus $0.15 prior year
  • EBITDA of $16.1 million; Adjusted EBITDA of $21.1 million
  • Free Cash Flow $25.8 million

LSI generated significant year-over-year growth in net sales and profitability during the fiscal fourth quarter, capitalizing on both improved demand across both its lighting and display markets while continuing to expand its presence within higher growth, higher-margin verticals. Fourth quarter and fiscal 2021 results include approximately five weeks of financial contributions from the JSI Store Fixtures (“JSI”) acquisition completed on May 21, 2021.

The Company reported net income of $0.2 million, or $0.01 per diluted share in the fourth quarter 2021, versus net income of $1.5 million, or $0.06 per diluted share, in the prior year period. Fourth quarter 2021 results include $2.9 million or $0.08 per share of JSI acquisition related expenses.

LSI reported adjusted net income of $3.3 million, or $0.12 per diluted share, compared to $1.8 million or $0.07 per diluted share in the prior period. A reconciliation of GAAP and non-GAAP financial results is included in this press release.

For the twelve months ended June 30, 2021, LSI reported net income of $5.9 million, or $0.21 per diluted share versus net income of $9.6 million or $0.36 per share in the prior year. Prior year results include an $8.5 million pre-tax gain on sale of facilities. On an adjusted basis, the Company reported net income of $9.8 million, or $0.36 per diluted share in fiscal 2021, versus $4.1 million, or $0.15 per share in fiscal 2020. LSI generated Adjusted EBITDA of $21.1 million in fiscal 2021, versus $15.6 million in the prior year.

As of June 30, 2021, the Company had $68 million in long-term debt, including borrowings related to the purchase of JSI, resulting in a ratio of net debt to pro forma trailing twelve month Adjusted EBITDA of 2.5x. At the end of the fourth quarter, LSI had $32 million available under its $100 million credit facility due fiscal 2026.

The Company declared a regular cash dividend of $0.05 per share payable on September 7, 2021, to shareholders of record on August 30, 2021.

MANAGEMENT COMMENTARY

James A. Clark, President and Chief Executive Officer commented, “We have continued to expand our presence within growing, high-value lighting and display markets, while positioning the business to capitalize on early indications of a broader sector recovery. Our collective focus on launching new products, customer engagement, technological innovation and operational discipline contributed to strong year-over year growth in adjusted EBITDA and profitability during both the fourth quarter and full-year fiscal 2021, creating significant momentum as we look ahead to fiscal 2022.

“The LSI team delivered 39% year-over-year organic sales growth in the fourth quarter, and 22% sequential growth from the third quarter, a tribute to the diligent execution efforts of our more than 1,100 employees. We successfully navigated various supply chain disruptions during the quarter, while continuing to leverage our North American design and manufacturing capabilities to service our diverse customer base.

“In May, we completed the acquisition of JSI, a transaction that serves to materially increase our total addressable market opportunity within the growing grocery and convenience store verticals, while driving meaningful revenue synergies across our combined product portfolio. This business combination creates a leading integrated provider of lighting and display solutions to the North American grocery, convenience, and specialty store channels, one uniquely positioned to capitalize on a multi-year period of growth and investment in these markets,” continued Clark.

“Both the LSI and JSI teams have demonstrated professionalism and leadership throughout the business combination, resulting in a seamless integration process. We are exceptionally pleased with the high-caliber of our new colleagues, their customer-centric culture, and their commitment to product innovation, all of which aligns with how we do business. In the short period since closing on the transaction, our integration team has identified incremental revenue synergies, together with immediate cost savings not previously identified.  

“We have renamed the ‘Graphics’ segment to ‘Display Solutions’ to reflect the comprehensive offering the business combination provides. Beginning with these fourth quarter results, we will publish under the ‘Lighting’ and ‘Display Solutions’ segments,” noted Clark.

“Fiscal fourth quarter sales for our Display Solutions segment increased 93% versus prior year, reflecting organic growth of 54% with five weeks of JSI sales contributing the balance. Organic growth was led by our digital signage offering, which continues to benefit from our large QSR program that remains in-process. The program was approximately 40% complete at the end of June. Separately, we have continued to increase our book of business with a fast-growing grocery chain in the Southwest, where we are providing a broad range of display products. On balance, development activity on potential new programs across multiple verticals and customers remains robust. Display Solutions generated strong results in the period, with operating income of $3.7 million, or 70% above the prior-year period.

“The Lighting segment generated sales growth of 30% in the fiscal fourth quarter, with significant increases in both project business and sales through distributor stock. Distributor stock sales increased more than 50% on a year-on-year basis, driven by increased current demand, and confidence by distributors to increase stock levels which were significantly reduced during the pandemic. Project quotation activity also remains very strong, particularly with respect to our recently expanded High Bay product range, as well as the recently introduced Opulence™ architectural area lighting family of products, which will complement our current Mirada™ commercial line. Operating income for the Lighting segment increased significantly versus the prior year period, driven by increased sales volume and gross margin rate expansion.

“We are well positioned entering fiscal 2022,” noted Clark. “The cross-selling opportunities between LSI and JSI are significant, creating a pathway for multi-year growth. These acquisition-related synergies, together with organic investments in sales, marketing, and new products, positions us to create substantial value for our customers, employees and investors,” concluded Clark.

Source

Related Articles


Changing Scene

  • Grand Opening: Legrand BCS Office in Markham

    Legrand is thrilled to announce the grand opening of their new BCS facility in the heart of downtown Markham, ON, located at 85 Enterprise Blvd, Suite 400, which is set to take place on Thursday, September 19th, 2024. “Our facility in Vaughan will remain open to continue to stock inventory for Canada for all Legrand… Read More…

  • Leviton Canada Achieves Another Year of Carbon Neutrality

    Leviton Canada proudly reaffirms its commitment to sustainability by achieving carbon neutrality once again in 2023. The company has significantly reduced their environmental footprint by 32% compared to 2022, with a substantial impact on transportation. Despite having energy-efficient lighting and relying on hydropower—a clean and renewable energy source—for their facility, transportation (both upstream and downstream)… Read More…


Design

  • Project Story: Sainte-Thérèse High School Outdoor Lighting Upgrade

    Project Story: Sainte-Thérèse High School Outdoor Lighting Upgrade

    August 6, 2024 Built in 1980, the building that houses Sainte-Thérèse high school, in Quebec Canada, was looking a little worse for the wear. Renovation work began with two major projects: introducing a multidisciplinary sports centre, as well as redesigning the parking lots.  The employee and visitor parking lots were completely reconfigured during phase 1… Read More…

  • Resilience Illuminated: Reviving Westminster Pier Park After Devastating Fire

    Resilience Illuminated: Reviving Westminster Pier Park After Devastating Fire

    In September 2020, the picturesque city of New Westminster near Vancouver in British Columbia suffered a devastating setback when an intentionally set fire destroyed much of the city’s waterfront park, including its urban beach, sand volleyball courts, and iconic art installation known as Wow Westminster. The fire, which burned for ten days before firefighters could… Read More…


New Products

  • GB Agencies: HELIX2-LED Area Light

    GB Agencies: HELIX2-LED Area Light

    The HELIX2-LED is a highly versatile fixture designed with a full range of beam distribution options (Type II, III, IV, V), rotatable optics, glare control shields, and control options to create the perfect, most optimized lighting layout for your area. This standard fixture has all-in-one features including 120-347V, Colour Selection, and Lumen Adjustability. The HELIX2-LED Series is… Read More…

  • Eureka Introduces Velia Tubular Luminaire

    Eureka Introduces Velia Tubular Luminaire

    Eureka has recently announced the release of its Velia luminaire. The versatile family is offered in a variety of colors, textures, lengths, and configurations to meet a space’s specific aesthetics. Unique tubular arrangements can be created with Velia; 36 preconfigured clusters are available. Designers can select from three canopy types and then choose one, three,… Read More…