LSI Industries Reports 22% Revenue Growth to $132.5 Million, Operating Income Declines

LSI Industries Inc. reported a significant increase in financial performance for the three months ended March 31, 2025, with net sales reaching $132.5 million, a 22% rise from $108.2 million in the same period last year. The Display Solutions Segment was a key driver of this growth, contributing $73.5 million in sales, a 70% increase year-over-year, while the Lighting Segment saw a decline of 9% to $59.0 million. For the nine months ending March 31, 2025, total net sales were $418.3 million, up 23% from $340.6 million in the prior year, largely due to a $99.4 million increase in the Display Solutions Segment, which benefited from acquisitions and organic growth.

Despite the increase in sales, LSI Industries experienced a decrease in profitability. Operating income for the three months ended March 31, 2025, was $6.2 million, down 19% from $7.7 million in the same quarter of 2024. The decline was attributed to a change in product mix and increased operating expenses, which rose 43% to $7.9 million, driven by the acquisitions of EMI and Canada’s Best Holdings (CBH). For the nine-month period, operating income decreased by 10% to $23.8 million compared to $26.5 million in the previous year.

Strategically, LSI Industries has expanded its market presence through acquisitions, including EMI Industries, which was finalized in April 2024 for $50 million, and CBH, acquired in March 2025 for $25.9 million. These acquisitions are expected to enhance the company's vertical market presence, particularly in grocery and convenience store sectors. The company also reported an increase in its employee headcount, reflecting its growth strategy and operational expansion.

Operationally, LSI Industries reported a rise in accounts receivable to $98.0 million from $78.6 million, indicating increased sales activity. The company’s inventory also grew to $74.5 million, up from $70.9 million, primarily due to the acquisition of CBH and increased backlog in the Display Solutions Segment. The company maintained a current ratio of 2.1 to 1, indicating strong liquidity, and had $32.2 million available under its $75 million revolving line of credit as of March 31, 2025.

Looking ahead, LSI Industries anticipates continued growth driven by its recent acquisitions and ongoing investments in commercial initiatives. However, the company acknowledges potential challenges related to product mix and operating efficiencies that may impact profitability. The management remains focused on leveraging its expanded capabilities to capture market opportunities while managing costs effectively.