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Sep 30, 2021
Napco Q1 2022 Earnings Report
NAPCO reported first quarter fiscal 2022 results with record sales and net income.
Key Takeaways
NAPCO Security Technologies reported a strong first quarter in fiscal year 2022, marked by a 34% increase in sales to a record $31.1 million and a 234% increase in net income to $7.8 million. Recurring service revenues grew by 41% to $10.2 million, with a gross margin of 86%. The company's cash and cash equivalents and marketable securities increased to $43.2 million.
Net sales increased by 34% to a record $31.1 million.
Recurring service revenue increased by 41% to $10.2 million with an 86% gross margin.
Net income increased by 234% to a record $7.8 million.
Earnings per share increased by 223% to $0.42.
Napco
Napco
Forward Guidance
NAPCO anticipates continued strong recurring revenue and profitability, focusing on providing seamless security solutions and expanding recurring revenue with existing and new products.
Positive Outlook
- Company's strategy is to provide seamless security solutions for customers.
- Company aims to continue to grow recurring revenue with both existing and new products.
- Company is expanding recurring revenue product offerings into all product lines.
- Company is focused on generating strong revenue growth.
- Company is focused on increased profitability for the balance of fiscal 2022 and beyond
Challenges Ahead
- Supply chain constraints and shortages of electronic and other parts slowing the pace of revenue realization.
- Higher than usual backlog levels that may continue into 2022, particularly for electronic products.
- Gross margin on hardware decreased to 22%, primarily as a result of increased freight and component parts costs relating to the current, world-wide supply chain problems.
- Shift in product mix to more of the Company’s Starlink radios (which generate the recurring service revenues).
- COVID-19 pandemic impact