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Dec 31, 2019
LSI Q2 2020 Earnings Report
LSI Industries achieved improved earnings on lower sales, driven by a transition towards higher-value sales mix.
Key Takeaways
LSI Industries reported improved earnings in Q2 2020 despite lower sales. Net income increased to $1.7 million, and EPS reached $0.07. The company also generated strong free cash flow of $13.8 million and reduced net debt to $9.2 million.
Sales of $82.4 million reflects success in demand-shaping initiatives.
EPS of $0.07 vs. $(0.61) prior year; Adjusted EPS of $0.06 vs $0.03 prior year.
Net Income of $1.7 million compared to net loss of $(15.8) million last year.
Free Cash Flow of $13.8 million.
Revenue by Segment
Forward Guidance
LSI Industries is focused on gaining share in select vertical markets and generating profitable growth through accelerating innovation and focused sales efforts.
Positive Outlook
- The company is focused on higher margin applications and solutions.
- The business continues to generate strong free cash flow from operations.
- The graphics segment has now reported nine consecutive quarters of year-over-year growth.
- The company was awarded a four-year contract extension with ChevronTexaco.
- Recent product launches include: the next generation Alliance high bay; new distribution area light; new controls platform and configuration app for mobile devices; Low Profile recessed troffer with Lutron Wireless Integral fixture control; field selectable Troffers; and Pole retro-fit kits.
Challenges Ahead
- The company is pivoting away from low margin commodity business.
- This approach contributed to a near-term decline in total sales.
- Execution of our change in commercial policy is evident in the Lighting Segment where we elected to exit a supply relationship with a low-margin retail account during the fiscal second quarter.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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