First Half Fiscal 2011 Results
Net sales in the first half of fiscal 2011 were $154,656,000, an increase of 12.8% over last year's first half net sales of $137,050,000. Lighting Segment net sales increased 14.0% to $94,965,000 (sales to national accounts and niche markets increased 17.5% and sales to the Commercial / Industrial lighting market increased 10.2%), Graphics Segment net sales increased 13.2% to $46,870,000, Electronic Components Segment net sales increased 28.7% to $9,841,000 and net sales of the All Other Category decreased 36.0% to $2,980,000. The fiscal 2011 first half net income of $7,216,000, or $0.30 per share, compares to a fiscal 2010 first half net income of $3,229,000, or $0.13 per share. First half fiscal 2010 net income included the following pre-tax expenses: acquisition-related costs of $513,000 and an acquisition-related fair value inventory adjustment of $613,000 related to purchase accounting requirements of LSI ADL Technology's finished goods and work-in-process inventory. Earnings per share represents diluted earnings per share.
Robert J. Ready, Chief Executive Officer, commented, "Operating results for the second quarter and first half of fiscal 2011 were somewhat above our internal budget and benefited from generally improving market conditions. The many actions we have taken to improve efficiencies and 'right size' the business over the last two to three years are now resulting in favorable operating leverage and benefiting earnings. For the six months ended December 31, 2010 our per share earnings increased 131% on a net sales increase of 13%. As a highly efficient low cost producer of American made advanced lighting products, LSI is well positioned to capitalize on higher sales."The outlook for higher sales as we move forward in fiscal 2011 and look beyond is becoming more favorable. We now expect our work re-imaging 7-Eleven convenience stores to be extended, at a slower pace, to include additional stores in Canada and domestically. As 7-Eleven continues to expand its fresh food offering, LSI expects to be involved in their store remodeling effort with a broader range of products from our graphics group. Our national program with BP Products North America for new LED-based canopy lighting is progressing very well and LSI is well underway with the survey phase of this multi-year program. LSI's recently introduced Generation 3 LED lighting fixture will be used in the BP retrofit program. This product has gained strong acceptance in the marketplace. Aside from major programs, we see a more solid market for our lighting products in general. During the most recent second quarter our sales to the Commercial / Industrial lighting market increased over 10%.