LSI Industries delivered a solid start to fiscal year 2026 (QQ1 2026, quarter ended 2025-09-30) with broad-based, two-digit growth across its two reportable segments: Lighting and Display Solutions. Revenue of $157.249 million rose approximately 14% year over year (management noted 14% organic/YoY growth in Q1 vs the prior year, with total quarterly YoY growth cited at 21.9% on trailing metrics). Adjusted EBITDA reached $15.7 million, implying a margin near 10%, while adjusted EPS increased 19% to $0.31. Management attributes margin resilience to disciplined project quoting, stabilization of input costs, and volume leverage, despite tariffs and component volatility. The quarter featured meaningful progress on strategic initiatives, including the Canada Best acquisition, EMI/JSI integration, and a robust pipeline of opportunities in grocery, refueling C-store, and other verticals.
Operationally, Lighting grew 18% YoY and Display Solutions grew 11% YoY in QQ1, supported by a shift toward higher‑value, purpose-built products and ongoing share gains in selected vertical markets. Free cash flow was slightly negative (-$0.291 million) due to working capital dynamics (notably accounts receivable timing and a billing delay on two large accounts), but management reaffirmed liquidity with more than $80 million of available liquidity and net leverage below 1x after an amended revolving credit facility to $125 million extending to 2030. The strategic emphasis remains on expanding the cross-sell across Lighting and Display Solutions, accelerating vertical-market penetration, and advancing integration benefits from recent acquisitions.
Looking ahead, management reiterated the FY2026 objective to deliver ~12.5% EBITDA growth through a combination of volume-driven top-line expansion and ongoing margin discipline. The company expects continued growth in both segments, a healthy proposal/concept activity pipeline, and additional capacity to support large national programs in the C-store and grocery channels. While management cautioned that Q2 year-over-year comparisons may reflect an unusually strong prior-year period in grocery, the overall trajectory remains positive with a multi-year runway for cross-selling, product specialization, and margin expansion.