Napco Security reports Q1 EPS 30c, consensus 35c

Reports Q1 revenue $44.0M, consensus $47.73M. Richard Soloway, Chairman and CEO, commented, “FY25 began with record revenue and net income for any first quarter in the Company’s history and represents the sixteenth consecutive quarter of record sales for a quarterly reporting period. Our record quarterly net income of $11.2M represents 25% of sales, and our Adjusted EBITDA was $12.3M for Q1 and equates to a 28% EBITDA margin. Our cellular communication device sales increased 93% compared to Q1 last year and represent 70% of our Intrusion and Access Alarm product sales. In addition, radio sales for Q1 increased 23% sequentially and represent the highest level of radio sales since Q3 of FY23, which was the last quarter positively affected by the Verizon 3G sunset. While robust radio sales do have a negative impact on our overall equipment gross margins, which was 24% for Q1 compared to 28% in last year’s first quarter, strong radio sales ultimately leads to increases in our recurring revenue business. Overall, our equipment revenue decreased 6% for the quarter, which partially was a result of a decrease in our door locking sales, which decreased 8% compared to last year. Locking products represents approximately 60% of our equipment revenues and the decline was primarily attributable to several locking distributors’ efforts to lower their inventory levels.”