Napco Security reports Q2 EPS 28c vs. 34c last year

Reports Q2 revenue $43.0M, consensus $49.88M. CEO Richard Soloway commented, “As we complete the first half of Fiscal 2025, our performance has yielded mixed results. Our RSR increased 14.4% to $21.2M and generated a gross margin of 91%, which was an improvement on last year’s RSR margin of 90%. RSR represents 49% of total revenue in Q2 and our RSR had a prospective run rate of approximately $86M based on our January 2025 recurring service revenue. For the quarter, our overall gross margin improved by over 400 basis points to 57.0% compared to 52.6% last year…In FY25 we are completing a project related to a significant NYC building renovation which began in FY24. While we were disappointed in our overall equipment sales, we attribute the decline to timing and based on historical purchase activity of our largest distributors we anticipate improvement in equipment sales through the balance of FY25…As we enter into the latter half of FY25, we remain confident that our strong net income, Adjusted EBITDA and cash flow, will improve further. As such we are pleased to continue our dividend program and will be paying the next quarterly dividend of 12.5c per share on April 3, 2025. As always, we will strive to accomplish our goal of continued financial strength, product innovation, technical superiority and strong profitability, for the balance of FY25 and beyond.”