lyts20221231

lyts20221231_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2022, OR

☐		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________________ TO ________________.

Commission File No. 0-13375

LSI Industries Inc.

(Exact name of registrant as specified in its charter)

Ohio

31-0888951

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer Identification No.)

10000 Alliance Road, Cincinnati, Ohio		45242
(Address of principal executive offices)		(Zip Code)
(513) 793-3200
Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	LYTS	NASDAQ Global Select Market

Indicate by checkmark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by checkmark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

	Large accelerated filer ☐	Accelerated filer ☒	Emerging growth company ☐
	Non-accelerated filer ☐	Smaller reporting company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of January 27, 2023, there were 28,166,965 shares of the registrant's common stock, no par value per share, outstanding.

LSI INDUSTRIES INC.

FORM 10-Q

FOR THE QUARTER ENDED December 31, 2022

INDEX

PART I. FINANCIAL INFORMATION	3

ITEM 1. FINANCIAL STATEMENTS	3

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	3

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	4

CONDENSED CONSOLIDATED BALANCE SHEETS	5

CONDENSED CONSOLIDATED BALANCE SHEETS	6

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY	7

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	8

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	9

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	20

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	28

ITEM 4. CONTROLS AND PROCEDURES	28

PART II. OTHER INFORMATION	29

ITEM 5. OTHER INFORMATION	29

ITEM 6. EXHIBITS	29

SIGNATURES	30

Page 2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended					Six Months Ended
	December 31					December 31
(In thousands, except per share data)	2022			2021		2022		2021

Net Sales	$	128,804		$	111,143	$	255,873	$	217,540

Cost of products and services sold		94,646			85,695		186,964		167,582

Severence Costs		18			-		31		-

Gross profit		34,140			25,448		68,878		49,958

Selling and administrative expenses		25,102			21,026		49,819		41,092

Operating income		9,038			4,422		19,059		8,866

Interest expense		1,258			529		2,046		763

Other expense (income)		(55	)		9		158		88

Income before income taxes		7,835			3,884		16,855		8,015

Income tax expense		1,418			779		4,177		1,777

Net income	$	6,417		$	3,105	$	12,678	$	6,238


Earnings per common share (see Note 4)
Basic	$	0.23		$	0.11	$	0.45	$	0.23
Diluted	$	0.22		$	0.11	$	0.44	$	0.22


Weighted average common shares outstanding
Basic		28,078			27,292		27,874		27,144
Diluted		29,204			28,067		28,766		27,895

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 3

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended				Six Months Ended
	December 31				December 31
(In thousands)	2022		2021		2022		2021

Net Income	$	6,417	$	3,105	$	12,678	$	6,238

Foreign currency translation adjustment		68		9		75		(35	)

Comprehensive Income	$	6,485	$	3,114	$	12,753	$	6,203

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 4

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	December 31,			June 30,
(In thousands, except shares)	2022			2022

ASSETS

Current assets

Cash and cash equivalents	$	2,765		$	2,462

Accounts receivable, less allowance for credit losses of $392 and $499, respectively		67,352			77,750

Inventories		73,205			74,421

Refundable income taxes		1,325			1,041

Other current assets		4,378			3,243

Total current assets		149,025			158,917

Property, Plant and Equipment, at cost
Land		4,010			4,010
Buildings		24,485			24,495
Machinery and equipment		67,322			66,762
Buildings under finance leases		2,033			2,033
Construction in progress		893			618
		98,743			97,918
Less accumulated depreciation		(72,957	)		(70,760	)
Net property, plant and equipment		25,786			27,158

Goodwill		45,030			45,030

Other intangible assets, net		65,584			67,964

Operating lease right-of-use assets		7,548			8,664

Other long-term assets, net		3,310			3,347

Total assets	$	296,283		$	311,080

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 5

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	December 31		June 30,
(In thousands, except shares)	2022		2022

LIABILITIES & SHAREHOLDERS' EQUITY

Current liabilities
Current maturities of long-term debt	$	3,571	$	3,571
Accounts payable		27,293		34,783
Accrued expenses		33,270		36,264

Total current liabilities		64,134		74,618

Long-term debt		59,250		76,025

Finance lease liabilities		1,105		1,246

SEC Form 10-Q filed by LSI Industries Inc.