Napco Security reports Q1 EPS 28c, consensus 21c

Reports Q1 revenue $41.7M, consensus $41.27M. CEO Richard Soloway commented, “FY24 began with record Q1 sales of $41.7M…Our net income of $10.5M is the largest Q1 net income in the company’s history…We were also pleased with the significant increase in the recurring revenues annual run rate, which increased to $72.5M based on October 2023 recurring revenues, compared to an annual run rate of $67M based on July 2023 recurring revenues…Our balance sheet continues to get stronger, with cash and cash equivalents, other investments and marketable securities increasing 12% to $74.6M and we have no debt. Net cash provided by operating activities for Q1 was also strong, amounting to $11.2M…NAPCO’s record-breaking results for Q1 of fiscal year 2024, was primarily the result of the continued growth and profitability from recurring revenues as well as the strong sales from our Alarm Lock and Marks locking product lines…As we begin FY24, we are encouraged with the improved gross margin for hardware sales of 28%, and, based on historical seasonal trends, we believe this could improve further as the fiscal year progresses. Our net income margin and Adjusted EBITDA margin of 25% and 31%, respectively, indicates the financial strength of our business. We are pleased to continue our dividend program and we will be paying another dividend of 8c per share on December 22…”