The following is a summary of the LSI Industries, Inc. (LYTS) Q1 2025 Earnings Call Transcript:

Financial Performance:

• LSI Industries reported a strong Q1 fiscal 2025 with sales of $138 million, up 12% year-over-year, including the first full quarter performance of EMI.

• Adjusted EBITDA was over $13 million, with free cash flow exceeding $11 million, showcasing robust financial health.

• The net debt stood at a manageable 0.8 times the EBITDA, reflecting a strong balance sheet.

Business Progress:

• Significant growth in the Display Solutions segment, with sales increasing 43% from the integration of EMI and robust project activity in the refueling C-store space and grocery vertical.

• Introduction of the V-LOCITY outdoor lighting product, marking strategic expansion in outdoor lighting capabilities.

• Successful integration and collaboration with EMI, leading to operational and commercial synergies.

• High engagement and visibility in industry trade shows like NACS and PEI, enhancing brand strength and market reach.

Opportunities:

• Increased project and quote activity across verticals with a strong book-to-bill ratio of 1.3 times, suggesting continued growth particularly in refueling and grocery verticals.

• Transition to environmentally friendly R290 refrigerants in grocery displays, aligning with new DOE refrigerant standards effective from January 1, 2025, represents an expanded market opportunity.

Risks:

• Persistent project timing volatility and delays in large projects, particularly in the lighting segment, pose risks to revenue forecasts.

• Uncertainty in the grocery segment due to external factors like court hearings, although resolutions are expected by year-end.

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