LSI Industries reports Q2 EPS 21c, consensus 17c

Reports Q2 revenue $109M, consensus $114.67M.James A. Clark, President and Chief Executive Officer commented, “LSI delivered solid second quarter results, a performance that reflects the durability of our vertical market strategy, together with a proven ability to drive sustained margin expansion and profitability through the cycle. We continued to execute at a high-level while effectively navigating the transitory disruption in grocery market project activity, due to the pending merger of two large industry participants. LSI remains well-positioned to capitalize on an expected acceleration in project activity as market conditions normalize. “During the last twelve months, we’ve generated nearly $44 million in free cash flow, including more than $7 million in the second quarter, positioning us to support further reduction in net debt, strategic investments in organic growth, and a robust return of capital program,” continued Clark. “Since acquiring JSI in calendar year 2021, we’ve reduced our net leverage ratio from 3.2x to 0.4x, consistent with a focus on capital discipline and balance sheet flexibility. “As outlined within our Fast Forward growth strategy, our teams remain highly focused on increasing the volume of LSI content and related solutions per customer through targeted cross-selling initiatives. In the second quarter, our cross-selling initiative positioned LSI to secure refrigerated display case project wins with two national refueling/c-store chains that currently use our lighting solutions. Each program represents multi-million-dollar sales on an annual basis. In both the QSR and Grocery verticals we have secured customer projects to provide indoor and outdoor lighting, in addition to existing display case and print graphics activity. Moving forward, we have a significant volume of additional cross-selling proposals currently under review, as customers continue to recognize the value of our comprehensive offering of products and services.