LSI Industries Inc.

Greetings and welcome to LSI Industries Fiscal 2024 Fourth Quarter Results Conference Call. At this time, all participants are on a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Jim Gilles, Chief Financial Officer of LSI. Thank you. You may begin.

Welcome, everyone, and thank you for joining today's call. We issued a press release before the market opened this morning detailing our fiscal 24 fourth quarter and full year results. In addition to this release, we also posted a conference call presentation in the investor relations section of our corporate website. Information contained in this presentation will be referenced throughout today's conference call. Included are certain non-GAAP measures for improved transparency of our operating results. A complete reconciliation of GAAP and non-GAAP results is contained in our press release and 10-K. Please note that management's commentary and responses to questions on today's conference call may include forward-looking statements about our business outlook. Such statements involve risks and opportunities, and actual results could differ materially. I refer you to our safe harbor statement, which appears in this morning's press release, for more details. Today's call will begin with remarks summarizing our fiscal fourth quarter and full year results. At the conclusion of these prepared remarks, we will open the line for questions. With that, I'll turn the call over to LSI President and Chief Executive Officer Jim Clark.

Thank you, Jim, and good morning, all. Thank you for joining us this morning, and Happy New Year to LSI. As you know, our fiscal year runs from July 1st through June 30th, so we are now into our new fiscal year 2025 at LSI, and we'll be discussing our fourth quarter and full year 2024 results on today's call. I'm pleased with the results of Q4 And overall, I'm pleased with the results of our full year 2024. We end the fourth quarter up 4% in sales compared to our prior year. We added a new business segment with the purchase of EMI Industries in April. And we continue to expand LSI's value to our customers by expanding our product and solutions offering in our core vertical markets. For the full year 2024, we will continue to improve margins. And our year-end adjusted EBITDA was up 11%. up 60 basis points versus last year, while free cash flow for the year exceeded $38 million. LSI's growth in most of our vertical markets continued to outperform in 2024, while we did experience some steady market headwinds in our grocery store vertical throughout the year. Our execution as a company and as a management team remains high, and I'm proud of the company's ability to adapt to various market challenges and to keep in focus our responsibility to deliver results to both our customers and our shareholders. We often talk internally about our say-do ratio. It simply means we are doing what we say we are going to do. This commitment to be a high-performance say-do ratio extends to our customers, our shareholders, but it also extends to our coworkers, our suppliers, our agents, and so many others. This culture around a high safety ratio is chiefly responsible for our continued progress, and it underscores our ability to adapt and to continue to seek out growth opportunities and execution excellence. In 2024, we accomplished a lot. We introduced a slew of new products in excess of 25. We opened a new refrigeration manufacturing facility in Bangor, Maine, offering an entirely new type of refrigeration solution that uses environmentally friendly refrigerants, R290, a naturally occurring gas that causes no harmful effects to our environment. We expanded our capabilities in our electronics manufacturing segment and our capabilities in our onsite project management through our ADAPT services group. We created a center of excellence around our print graphics business that will ensure our ability to provide robust print graphics solutions while at the same time being able to be more efficient and more profitable in this segment. Internally, we added to our management team, including additional focus on our operations and procurement functions while continuing to strengthen our sales, marketing, and engineering capabilities. We promoted from within and created opportunities for people to advance in positions of increasing responsibility while helping to cement and expand the culture we have created at the company. We spent a lot of time this year with our customers and our partners. We hosted a record number of training sessions, new product introduction, business strategy discussions, and customer acquisition planning. The markets we play in are big, and they hold a lot of opportunities. Great partnerships make access to those markets easier and more efficient, and I believe the time and effort we put into the development of close working relationships with our partners pays off exponentially for LSI, our agents, and most importantly, our customers. From a business segment perspective, we continue to outpace our competitors in the lighting segment. Despite a small drop in lighting sales in 2024, we feel we're outperforming the general market, and we continue to believe there's sufficient market share opportunities to support our fast-forward plan. Our margins and our pricing discipline remain strong in the combination of our agent network, Vertical market focus continues to create growth opportunities for us in the broader lighting segment. LSI continues to innovate in the lighting segment. And in 2025, we'll introduce an entirely new lighting product line called Velocity. This will expand our ability to serve our customers while offering those customers the very best in performance and price. In our display solutions group, we entered 2025 with a strong backlog and momentum that we have gained throughout 2024. Fourth quarter sales were up 22% versus prior year, including the partial quarter impact of EMI. Sales in our print and digital graphic business were up 9% in the quarter, and our display case orders were up over the prior year. We anticipate a recovery in our grocery vertical as customers in this segment move forward with in-store refresh programs. And will you offer some new innovative standalone case solutions that expand into the salad dressing and condiment sections of the grocery store and C-market space? 2025 looks to be another year of growth for LSI in the vertical segments we are focused on. Our partnerships with our agents, channel partners, and end users continues to create opportunities for both LSI and our customers. The LSI team continues to execute well. and we look forward to sustained profitable growth. With that, I'll turn the call back over to Jim Gilles for a closer look at our financials. Jim?