Slide 1: Second Quarter Fiscal 2021 Results
SECOND QUARTER FISCAL 2021 RESULTS CONFERENCE CALL PRESENTATION January 21, 2021
Slide 2: Disclaimer
DISCLAIMER This presentation contains “forward-looking statements”—that is, statements related to future events within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In t
Slide 3: Key Messages
KEY MESSAGES Advancing Business Transformation Improved Consolidated Financial Results Margin Expansion Across Segments Continued strategic focus on higher margin vertical 9% quarter-over-quarter sales improvement; Year-over- Focus on higher-value business resulted in 140 bps and market applications
Slide 4: Consolidated Financial Results
CONSOLIDATED FINANCIAL RESULTS Total Net Sales ($M) Operating Income ($M) 130 bps y/y improvement to 4.1% of sales 9% q/q sales growth • Sequential sales growth despite pandemic-related market challenges $3.1 $82.4 $76.4 $2.7 $70.0 $2.3 $1.8 2• Graphics sales increased, while F2Q20 F1Q21 F2Q21 F2Q20
Slide 5: Lighting Segment Update
LIGHTING SEGMENT UPDATE Lighting Segment Sales ($M) Lighting Segment Gross Margin ($M) $53.4 140 bps y/y improvement to 30.4% of sales • Sales flat vs. F1Q21; Quote activity increased throughout $45.1 F2Q21, with the quote-to-order conversion period lengthening $15.5 $13.7 2• Price/mix and productiv
Slide 6: Graphics Segment Update
GRAPHICS SEGMENT UPDATE • 8% y/y growth in Graphics segment sales, supported by Graphics Segment Sales ($M) Graphics Segment Gross Margin ($M) grocery and QSR – both channels 8% y/y growth in sales 280 bps y/y improvement to 19.2% of sales outperforming during pandemic $31.3 $28.9 $6.0 $4.7 • Produc
Slide 7: Improved Working Capital Management
IMPROVED WORKING CAPITAL MANAGEMENT Total Working Capital ($M) Total Inventory ($M) Close monitoring of all non-cash Non-cash working capital declined 11% y/y working capital – generated 11% y/y Inventory declined 20% y/y in both dollars reduction and DIO $1.2 $13.6 $43.3 2Successfully managing new
Slide 8: Stable Free Cash Flow Generation
STABLE FREE CASH FLOW GENERATION Free Cash Flow – F2Q20 vs. F2Q21 ($M) Free Cash Flow – TTM F2Q20 vs. TTM F2Q21 ($M)(1) • Generated nearly $20 million in free cash flow, less asset sales, on $34.9 $13.8 $13.8 a TTM basis $27.5 $22.6 $19.7 2• As noted, prior-year free cash flow contains cash proceeds
Slide 9: Disciplined Balance Sheet Management
DISCIPLINED BALANCE SHEET MANAGEMENT Net Debt Outstanding ($M) • Cash balance of $13.6 million at the end of F2Q21 $52 million improvement to net cash positive in under two years • No long-term debt outstanding; in compliance with all bank covenants • Improved liquidity provides $13.6 $9.5 capital a
Slide 10: Investment Summary
INVESTMENT SUMMARY American-Made Company Positioned for Profitable Growth EXPAND Our Vertical • Integrated Lighting / Graphics Solutions Company with Adjacent Growth Opportunities in Focus Services Businesses • Strong Foundation With Entrenched Position in Target Vertical Market Applications; CHANGE
Slide 11: Appendix
APPENDIX
Slide 12: Statement on Non-GAAP Financial Measures
STATEMENT ON NON-GAAP FINANCIAL MEASURES This presentation includes adjustments to GAAP operating income, net income and earnings per share for the three months ended December 31, 2020 and 2019. Operating income, net income and earnings per share, which exclude the impact of restructuring and plant
Slide 13: Non-GAAP Reconciliation
Non-GAAP RECONCILIATION Q2 2020 Q1 2021 Q2 2021 Diluted EPS Diluted EPS Diluted EPS Net Income $ 1,743 $ 0.07 $ 1,990 $ 0.07 $ 2,208 $ 0.08 Restructuring and plant closure costs 223 0.01 2 - - - Severance costs 44 - - - 17 - Stock compensation expense 161 0.01 380 0.01 318 0.01 Tax impact due to the
Slide 14: Non-GAAP Reconciliation
Non-GAAP RECONCILIATION LSI Industries Q2 2020 Q1 2021 Q2 2021 Operating Income 1,760 2,202 2,686 Restructuring and plant closure costs (gains) 276 3 - Severance costs 54 - 21 Stock compensation expense 199 505 397 Adjusted Operating Income 2,289 2,710 3,104 Depreciation and amortization 2,152 2,033
Slide 15: Non-GAAP Reconciliation
Non-GAAP RECONCILIATION Lighting Segment Q2 2020 Q1 2021 Q2 2021 Graphics Segment Q2 2020 Q1 2021 Q2 2021 Net Sales [a] 53,436 45,405 45,126 Net Sales [c] 28,941 24,601 31,261 Operating Income 3,150 3,588 2,134 Operating Income 1,362 1,823 3,143 Restructuring and plant closure costs (gains) (2) - -
Slide 16: Non-GAAP Reconciliation
Non-GAAP RECONCILIATION Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Debt 39,541 23,181 10,437 7,919 - - - Less: Cash 966 1,579 1,248 820 3,517 9,463 13,584 Net Debt Outstanding 38,575 21,602 9,189 7,099 (3,517) (9,463) (13,584) Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Net cash flows (used
Slide 17: Thank you, LSI Investor Relations
For access to our full investor presentation, please visit our investor relations website at https://investors.lsicorp.com or contact our investor relations team at 720.778.2415 Thank you, LSI Investor Relations