Greetings and welcome to LSI Industries' Fiscal Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Jim Galeese, Chief Financial Officer. Thank you. You may begin..

Good morning, everyone, and thank you for joining. We issued a press release before the market opened this morning, detailing our fiscal 2022 fourth quarter and full year results. In conjunction with this release, we also posted a conference call presentation in the Investor Relations portion of our corporate website at www.lsicorp.com.

Information contained in this presentation will be referenced throughout today's conference call included are certain non-GAAP measures for improved transparency of our operating results. A complete reconciliation of GAAP and non-GAAP results is contained in our press release and 10-K.

Please note that management's commentary and responses to questions on today's conference call may include forward-looking statements about our business outlook. Such statements involve risks and opportunities and actual results could differ materially.

I refer you to our Safe Harbor statement, which appears in this morning's press release, as well as our most recent 10-K and 10-Q. Today's call will begin with remarks summarizing our fiscal fourth quarter and full year results. At the conclusion of these prepared remarks, we will open the line for questions.

With that, I'll turn the call over to LSI President and Chief Executive Officer, Jim Clark..

Thank you, Jim, and good morning all. Thank you for joining us today. As you know, we're here discussing our fourth quarter and full year results. The short version of the story is we had a great year. Before we go into the specifics, let me take you back a short three years ago to 2019.

As a management team, we sat down with a commitment to our shareholders in the market that we will be a $500 million company with double-digit EBITDA in 2025. Sales at that time were teetering around $300 million, EBITDA was approximately 3%, and our company's momentum was a bit flat.

We set out to design and execute a plan, which was to make our company a better company before we made it a bigger company. We engaged our workforce, strengthened our relationship with our customers and agents, and put together a focus on specific vertical markets, where we believe we could add value and differentiate ourselves as a key partner.

We were choosy about the markets we selected. We looked for vertical opportunities that matched up well with our core competencies, had the right ingredients for sustainable growth, and would recognize the value and differentiation we were trying to achieve. A good example of that vertical market selection was grocery.

Back in 2019, before the pandemic, we felt there was a real opportunity for remodel and new store development in the grocery space. The traditional grocers were being disrupted by customer experiences of new entrants, like Whole Foods, Fresh Market, and Amazon.

The big guys in groceries wanted to change the look and feel of their stores, compete on a different level, and LSI was a perfect fit. We provided high efficiency, energy-saving, low maintenance outdoor lighting, coupled with graphics and signage on the buildings.

Moving indoors, we offered high quality, high efficiency indoor lighting, with modern engaging graphics, and signage to the interior of the store. We also offered product management -- project management and a full turnkey solution that took a lot of the burden off the store team and allowed them to focus on other activities.

Looking further into the grocery vertical, we look for ways to grow and increase our value and we identify JSI fixtures as a great complement to the solutions we're already providing.

With the acquisition a JSI in May of 2021, we added refrigerated and standalone displays and we're able to create a continuity in the look and the feel of the products is only possible when these solutions come from one company.

This year grocery was our number one vertical market replacing C-store and refueling stations for the first time in the company's history. The best part is we have other vertical markets, we feel represent growth opportunities that can be just as strong as grocery and continue to propel us forward.

Given all of this today, we celebrate our fourth consecutive quarters with sales over $100 million in each quarter and a total sales revenue of $455 million with 7.7% adjusted EBITDA for the year and 8.3% adjusted EBITDA in the fourth quarter, all underpinned by a very robust pipeline as we work into our first quarter of 2023.

Great pricing discipline, margin management, and sales execution would be the theme for 2023. And clearly, our goal of $500 million as well within reach. You can be assured we'll be sitting down in the next quarter or two to plan out our next target. As I said, we have good reason to celebrate.

We have not merely talked about our plans, but we put those plans into action and have shown the results. Going back to 2019, we also made the decision to reassure as much of our supply chain as possible. At that time, around 80% of our materials were coming from overseas.

I'm happy to say today that number is around 30%, while we moved almost 70% of our sourcing to domestic and North American suppliers. Along with that move, we decided to strategically increase our inventory levels.

The lumpiness of the supply chain and transportation delays in the supply chain were interfering with our ability to deliver our products on time. We increased our inventory by almost $20 million in the first half of the year. As you know, this impacted free cash flow a bit in the first half of the year.

But in doing so, we reduced inefficiencies in our manufacturing process and improved our overall profitability, effectiveness and on-time delivery. This performance was noticed. It was noticed by our agents, our customers, and our competitors.

We took share in the market and we created stickiness with these new customers by maintaining our commitments and reliability as a good strong partner. Simply put, we did not have to start and stop our manufacturing processes because of limited parts availability. And I expect on a comparable basis, our inventory levels remain elevated for some time.

It just makes sense to have -- to maintain a higher level of inventory and take a lot of the uncertainty out of our processes.

With that said, it does not mean that we cannot tune that level some and as you may have already noted, we are bringing inventory levels down which has resulted in improved cash flow, which was positive for the third and fourth quarter and I expect that performance will be maintained.

Given this you also note that our debt has improved below $77 million and our debt ratio is around 2.2%. This is a good cash flow business and we will continue to take down debt and consider other opportunities as our company continues to perform.

In closing, I want to recognize and say thank you to the almost 1,400 employees of LSI, along with our agents and partners. None of this would be possible without a great team of people and strong leaders. The dedication of our people, the participation, engagement, and leadership are truly remarkable.

The last few years have not been easy on any business or person. The constant narrative that hard times are just around the corner can be exhausting. But it reminds me of the saying that hard times create strong people and strong people create good times.

We're not in charge of the broader economy, but I can tell you that we have strong people and because of that, I'm confident we can continue to create good times. I'm pleased and excited about the momentum we've developed.

I see robust order and quote activity leading into our new year and I hope you will continue to take a close look at LSI and see the solid execution this team continues to provide. We have a lot of runway in front of us. With that, I'll turn the call back over to Jim Galeese for a closer look at the numbers..

Thank you, Jim. We finished fiscal 2022 with a strong fourth quarter. Net sales were a record $127 million, growth of 31% over prior year, a 16% increase sequentially from Q3 with both reportable segments generating significant growth.

Fiscal fourth quarter earnings also improved significantly as non-GAAP earnings per diluted share were $0.21 compared to $0.12 per share last year. And adjusted EBITDA increased to $10.6 million, or 56% over last year.

Margin expansion was a strong focus throughout fiscal 2022 and the business attained our highest levels in the fourth quarter, with our adjusted operating margin improving 160 basis points versus last year and adjusted EBITDA increasing 130 basis points to 8.3% of sales.

Incremental sales growth and target market verticals selling price aligned with inflationary impacts and discipline cost management productivity all contributed to margin expansion.

For the fiscal year, the business executed at a high level throughout the year, with all four quarters generating significant year-over-year sales and earnings growth despite a challenging operating environment. Sales increased 44% to a record $455 million.

Adjusted net income improved to $18 million, 84% above prior year, and adjusted earnings per diluted share increased to $0.64 versus $0.35 last year. Adjusted EBITDA to increase to $35 million, or 66% above fiscal 2021. In fact, these results represent the highest EPS and adjusted EBITDA attainment in a number of years.

We discussed in previous calls the purposeful decision to invest in inventory, specifically in the first half of the fiscal year, to mitigate supply chain challenges and support sales growth. And improving supply chain allowed us to reduce inventory levels in Q4, contributing to a higher rate of earnings conversion to cash.

As a result, free cash flow increased to $8 million in the fourth quarter. Improved cash flow serve to reduce net long-term debt to $77 million in Q4, lowering the ratio of net debt to trailing 12-month adjusted EBITDA to 2.2 times. A regular cash dividend of $0.05 per share was declared payable September 7th for shareholders of record on August 30th.

Shifting to segment performance, both segments achieved substantial increases in sales and operating income for the quarter, improving both sequentially from Q3 and to prior year. Sales for the lightning segment increased 29% year-over-year in Q4, continuing strong growth in key vertical markets.

Lighting generated a gross margin rate of 31% in the quarter, 210 basis points above prior year, reflecting additional volume leverage and successfully aligning selling price with inflation.

For the fiscal year, lighting sales increased 24%, growth was balanced with double-digit growth realized in multiple market verticals and through both the project and distributor stock channels.

Growth was driven by multiple factors; new products, expanded selling efforts, several effective marketing programs for both our channel partners and end users, and product availability, enabled by our investment in incremental inventory.

Lighting enters fiscal 2023 with continued momentum with favorable quotation and order activity, last three month book-a-bill ratio over 1 and a backlog approximately 30% above prior year. Fourth quarter sales for our Display Solution segment increased 35% versus last year, led by the grocery and quick-serve restaurant verticals.

Growth in grocery was led not only by continued strong demand for JSI display cases across national multiple chains, but our printed graphics also had a solid quarter with several key accounts. This supports the solution selling approach we're utilizing in the grocery vertical.

We continue to successfully execute the major QSR digital menu board program initiated in fiscal 2021 and have -- and begun supporting the additional awards received resulting from our performance. Activity for both will run through fiscal 2023 and beyond.

For the full fiscal year, Display Solution sales increased 75% including the impact of the JSI acquisition, which occurred in the fourth quarter fiscal 2021 All Display Solution vertical markets realized increased sales except refueling, which was down slightly because of the ongoing site construction delays.

Program proposal activity remains at a very high level, however, and we recently received a rebranding program from a major oil company providing a turnkey solution, including both product and installation services for locations in Puerto Rico.

We anticipate this program will generate more than $10 million of new revenue in the first half of fiscal 2023. Fiscal 2022 operating income for Display Solutions increased to $18.1 million or 8.2% of sales. Fundamentals for the market verticals in this segment remain positive and our outlook is favorable as we enter fiscal 2023.

I will now return the call back to the moderator..

Thank you. Ladies and gentlemen, at this time, we will be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the line of Amit Dayal with H.C. Wainwright. Please proceed with your question..

Thank you. Good morning, everyone. Appreciate you taking my questions. Most of my questions are just based on the outlook. For next year, relative to the $500 million revenue target for 2025, it looks like you're almost there.

Would it be too aggressive to assume that you could hit that number in fiscal 2023?.

Well, Amit, first of all, thanks for joining and good to hear you. I'm always trying to -- or we are always trying to just make sure we deliver on what we say. There's -- environmentally, there's still a lot of challenges. I feel very positive about the first quarter and I feel positive about where we can be in the year.

I'm not -- I don't want to commit that we're going to hit the $500 million, but I will say that, based on the momentum we've generated over the last few years, we're certainly on our way to it..

Understood. And then operating leverage has improved significantly, your adjusted operating income grew by, I think, over 150%, while revenues grew by 44%.

If this sort of the level of you know, adjusted EBITDA margins we can expect in a more steady fashion for at least fiscal 2023 for you guys?.

Yes, hi, Amit. This is Jim Galeese here. Yes, we've worked hard if you go back a couple of years, we identified that we needed to work on our margin expansion. And so if you look at what we've accomplished over the last several years in this area, where we're very proud of that. It's no accident.

And it's involved multiple levers, both commercial initiatives and operational initiatives and we're going to continue to work both of those levers, and we do see that we can maintain and continue to enhance both our operating and EBITDA margins moving forward..

Understood. Your book-to-bill ratio entering the fourth quarter was 1.1.

Is it stronger entering the first quarter of 2023?.

I'm sorry, Amit..

It was book-to-bill ratio at 1.1--.

And yes, I mean, it -- coming into Q1, it’s remaining at that level and it's -- we take a daily look at it, obviously, but we're right at that level..

And in terms of the backlog mix, guys, could you maybe give a little bit more granularity on what is in the mix, maybe just from a percentage the different revenue sources?.

Our two reportable segments are Display Solutions and Lighting. And if you go back a couple years, we were 70/30; today, we're 50/50. And it stays there. It's staying there. It's unbalanced. We have a couple of large projects that we tend to work and then most of it is smaller infill product.

But from a mixed standpoint, it's 50/50 right now, Lights and Display Solutions..

Thank you, Jim. Really good to see such a strong execution in this type of environment. So, congratulations on that. I'll take my other questions offline. Thank you..

Thank you, Amit..

Our next question comes from the line of George Gianarikas with Canaccord. Please proceed with your question..

Hey, guys. Thanks for taking my questions. Appreciate it.

Just maybe to start, I'm curious as to what led to the decision to reduce inventory? Are you seeing things in the marketplace that suggests a supply chain loosening such that you felt comfortable bringing down inventories to then continue, then get increasing your position and gain share in the marketplace? Thanks..

Yes, George, thank you for joining. You hit the nail on the head, we're just seeing a couple of the supply issues kind of strengthen and get more reliable. And so we knew that about $20 million is where we wanted to be. I don't think we ever got excessively heavy.

I think that we're going to on a year-over-year basis on a comparable, you're going to see us carrying heavier inventory, likely for years to come in..

From historical levels..

Yes, from historical levels. And the reason for that is to take out some of that variation in supply chain and transportation and that, but we have definitely seen some improvement. And we want to be -- we want to be diligent about taking advantage of that and reducing some of the positions we had had. That's all it is.

It is not -- it has nothing to do with weaker sales or volume or anything like that. Just some of those items have stabilized and we see it as an opportunity..

Is there still an opportunity to maintain even higher inventory levels? How do you balance that versus buybacks versus I'm assuming there's some technology obsolescence that you'd have to deal with? Just I'm just curious as to how that math works out for you guys?.

Yes. So, working backwards from what you just said, we try to -- the way we try to manage our inventory is driven by a couple of things. One is availability, right? We don't want to have the orders and not be able to ship the product.

And I think that over the last couple of years, that's been a significant competitive advantage for us is that it was really about availability and we made sure that we looked at the key components and the ones that we felt were at highest risk. And we made sure we had sufficient inventory to carry us through that.

The second element we look at is technology and obsolescence. We do not want to get upside down on something that is moving towards obsolete. But something we've done over the last three years is really looked at reengineering our products.

And part of that reengineering was cost, performance, but also just uniformity in parts that we use across our product line. So, that's a big lever for us in hedging against obsolescence. But even with those, we're very careful about where we stock up on anything that could be subject to obsolescence.

And then the third is, like I said, the supply chain is getting more reliable for us in particular, we tried to move from offshore to onshore and we did this pre-pandemic, who would have known, but it was part of our plan. We were about 80/20 offshore, if you went back four years ago, we were about 80/20 offshore.

Today, we're about 30% offshore and 70% domestic in North America. And so all three of those levers just give us an opportunity to kind of take down that inventory a little bit..

George, Jim Galeese here. In the last couple years, we've launched a record number of new products, right? And we've done a really nice job on the phase in, phase out process of that, despite the ongoing supply chain challenges.

So, we're confident moving forward as we continue to go through technology changes or just phase-in phase-out of new products that we're going to be able to manage to the inventory situation effectively..

Just -- second question has to do with the strength in your business, I mean you guys are putting up really great results.

And you juxtapose that next to some of the things that we're reading in the paper about economic weakness, and how do you balance what you read about and you kind of alluded to on the call versus the strength you're seeing in the business? I mean, are you hearing any anecdotes from customers about issues or the full steam ahead? Or are you gaining so much market share in your opinion that you've been able to buttress yourselves from any macroeconomic weakness?.

No, we're not -- we're certainly not immune to anything that could have happened to the broader economy. We're all consumers here.

We're all seeing pain points in terms of inflation from gasoline to groceries, and obviously, we're seeing the supply chain issues work out in all kinds of different places, whether it's the availability -- if you want to go buy a new car, or machine, upgrades we want to do here, all of those type things.

When we look at our business, though, there's -- a lot of the decisions we made early on are -- was giving us the momentum to work through this, we're not seeing a slowdown in quote activity.

We're certainly not seeing a slowdown in demand as evidenced by the numbers that we're just publishing here in Q4 and you look at Q3, and you look at Q2 before that. I know the narrative is out there relative to hard times and, kind of, the broader economy, and we're aware of it.

But I will tell you, honestly, we're just not seeing the impact, although we're preloaded to be ready if we do..

Got it.

And I can focus on your margin targets, what have you, given us targets that that accompany that $500 million sales or should we just assumed sort of similar leverage that you've shown over the last year?.

Yes, I think is Jim Galeese mentioned earlier, we've still got levers we can pull and there's two things I'll say. One is, as we get bigger, we get more efficient, you know, our utilization improves. We did a lot of restructuring three years ago. We sold some properties. We consolidated a number of operations.

But when we did that, we left capacity in the locations that we maintain and that we kept. And as we continue to absorb some of that capacity, we become more efficient that hits margin.

The second thing is, I think, right now, there's still a lot of inefficiency that's built in because of the supply chain challenges or workforce issues, those type of things. I believe, as those things continue to stabilize, we already have put the work in, we'll just benefit automatically as those things stabilize reducing inventory.

Obviously, the higher inventory you have, the more you're moving around, the more you're storing, the more work that is and just from an efficiency standpoint, that's not great. But we need to do that right now to assure availability and all those type of things. And it's worked out very well for us.

But as we reduce inventory, as workforce kind of stabilizes, continues to stabilize, the supply chain stabilizes. We have some natural efficiencies that will benefit and you'll see that in margin..

Thank you. And maybe a final question. You announced buybacks, which is great. Any guidance on the timing of that buyback? Is it open ended? Do you expect to be finished with that? And a certain number of-- that'd be great if you could give us a little guidance on that. Thank you..

Yes, the buyback is definitely open ended and we look at it as a management team and as a Board and said, at the levels that our stock was trading at, it just did not make sense. Our capital models are pretty well-defined. We're flexible, we look at them all the time.

But debt -- for us, debt and investment kind of take -- are kind of at the top of that pyramid. And the reason why we would focus on debt only is because it gives us opportunities. And in terms of investment, we make investments that we think can generate a higher return than maybe some other activities we can do.

And then we have in that mix, the buyback and as the stock price goes up, I think the market naturally says, hey, listen, your money might be best served doing -- paying down debt and reloading and being able to be a little bit more opportunistic in the market, or make some investments that we have that gain productivity.

So, right now, it's still on the table, it's still in our top two, top three mix. But we don't have -- I can't say that we have any specific plans to pull the trigger for optics or anything else. We want it to make financial sense. And obviously, as we're looking at the stock price today, as the stock goes up, it makes less and less sense.

But if it -- if the stock did get depressed or settled again, you can be assured we would act on it..

Well, thanks for taking the time and congratulations on a great quarter and executing in a tough environment. Thanks..

Yes, George and I can't say thank you enough for taking the time. I know it was a challenge. So, I appreciate the extra effort..

Of course..

Our next question comes from the line of Rick Fearon - Accretive Capital Partners. Please proceed with your question..

Good morning, Jim and Jim and congrats on another terrific quarter. Thank you..

Thank you, Rick..

So, first question is just round the forecasting of LSI's growth today. And Jim you started off by comparing the state of affairs three years ago, it's apparent today that the company's transformed into a much more diversified business, more orders, larger number of customers constituting that revenue base.

And so just wondered about your commentary around the forecasting today versus three years ago, the predictability of that, the stability of sales, as you see it, whether some of the lumpiness of sales is ironed out with the transformation of the company?.

I mean, I think that -- it's a great question, Rick, and I think from a company's perspective -- from a company's standpoint, yes, we become much more stable, have better visibility, our forecasting is better, our commitments from our customers, our salespeople, our agents is much better and that all works.

Environmentally, a lot of that progress is offset just by the current environment. And I don't think anybody's immune to it.

There's so much instability in the general, kind of, economic market that we're not only trying to forecast what we'll do and what our agents will do, but what their customers would do, and then what their suppliers will do to them. And we've seen it run the gamut in terms of a new surprise all the time.

And at one point, it's copper wire, and another point, it's sheetrock, and another point it's acoustical ceiling tiles or asphalt or parking rods. So, there's a lot of cars to be cautious relative to making any bold statements on forecasting and what we see the future to be.

But I can tell you this -- and I've said it before, and I think that we follow through every time we've said it, our quote activity remains very strong, historic levels, and our order activity remains strong. And as mentioned in the beginning, our book-to-bill remains elevated.

So, all of those indicators say we're going to be strong, but I don't -- for me to be on the spot and try to forecast out more than six to eight weeks, I just don't want to be that guy that gets caught. But I will say that generally, I'm very optimistic..

Understood. And it would seem that the greater focus on the grocery vertical, probably provides a little less cyclicality in the sales at least vis-à-vis the petroleum.

And I guess that leads to another question, which is regarding additional verticals that you've targeted? Are you able to talk about some of the you alluded to some opportunities to grow outside these verticals that you've identified? Are there things that you can speak to today or should we hold off to hear about that?.

I mean I'd rather hold off on any specifics on expanded verticals, because it serves a couple purposes. And one of them, which is just, frankly, our guys, our agents, our guys, we want to stay narrowly focused on the verticals we've already identified that do create great growth opportunities for us.

Grocery is something that we had identified far before the pandemic and I talked about it a little bit my comments in the beginning, which were that we saw disruption going on and so we saw an opportunity there, the pandemic kind of accelerated in groceries, right, where we kind of forecasted it would be.

Petro, the refueling stations, they aren't necessarily any weaker. They are just under pressure, frankly, it's permitting and things like that. It's the underlying infrastructure, state, federal, local municipality, that are just slower to recover. And they're holding up projects. It's not activity, it's not interest. It's not quote.

It's just getting them to be converted, where frankly, folks can go out and put a shovel in the ground and start some of these projects. Even with that, I think that if the tempo had remained high in petro, we still would have won with grocery. I mean, grocery was just such a powerful combination for us.

And it's all around that broader share of wallet, we're in a specific vertical and we're just offering more in terms of a solution and it's one component is the part side. But don't forget, we do project management for a lot of these, and these have been very important element for us to win.

When I think about our digital menu board, that's now in excess of $125 million contract and a big component of that was our ability to manage that nationwide and to make sure the deployments went good. That's the same formula we're using, it's an element in that formula with petroleum and C store refueling. It's another element with grocery.

So, that's a big win for us. Automotive, automotive we've been very strong in but it's under pressure right now that the market in general is under pressure, but of the projects that are coming up, we think we're taking share in that. Warehouse is something that has just, frankly, almost four times our thesis relative to where we thought we would be.

And we've been able to serve it. So, that's what's most important. The demand came and we weren't caught, again, because of a lot of uniformity between our parts, the way we make our different products, we were able to shift and meet that demand.

So, of the verticals we're in, we're doing good and I'll just say this, Rick, we're experimenting with some others. But we like to do it in a smaller group, so that we don't detract attention from anybody in case it's not going to meet our requirements in terms of velocity of growth and sustainability. We don't want things that are a flash in the pan.

If we're going to invest, we want things that have legs under it that can go five seven, 10, 15 years..

Understood, that makes sense. Thanks for that color, Jim.

And then regarding geographic growth and some of the slowdowns you're experiencing a couple quarters ago in Mexico, those have been alleviated as well?.

Yes, I mean, I'll talk specifically on Mexico, Mexico has opened back up again, but it's still about half of what we expected. Again, no representation of loss projects or interest.

In fact in this situation, it is again, broader kind of government approvals and transactions and getting paperwork across the desk, nothing to do with us, but everything from permitting to transfer of assets and real estate transactions and things like that.

With that said, Canada, Canada opened up -- broadly opened up six months ago, that has -- we've definitely picked up activity there.

And you notice in Jim Galeese's comments and in our press release, we had a very good size when in Puerto Rico with a petroleum customer, which is not only a good project, a great project, but it's a new customer for us too..

Yes, congrats on that. And just, I mean, it's exciting to hear additional international markets opening up. So, that's -- that is really encouraging. The two other questions just regarding margins and the margin improvement continues to be really impressive. Definitely doing a lot of things right.

And I'm curious with respect to kind of keeping that momentum going.

If you've been able to identify other niche-oriented sort of add on sales that might be bundled together higher margin business, when you're in these projects on the ground that can kind of continue to improve your gross margins?.

Yes, I mean, great question. And frankly it goes back to that broader share of wallet, right, which is, if we're going to walk in and get the confidence of a customer, we want to solve as many of their problems as we can.

And when we're on site, when we're doing the project management, when we are managing the logistics in the background, it gives us tremendous flexibility to work around delays that might happen somewhere else where we can pivot and accelerate something while we're delayed by something else.

We have a list of -- we're constantly contributing to it and scratching things off and trying to figure out a way in, but we do have a list of our vertical markets and things that we think we could add.

And sometimes we're successful in the conversations with companies that might have these products or ways that we might be able to engineer them and sometimes things are on the sideline. JSI is a great example. JSI was, kind of, purposely sourced if you will.

And we were very fortunate to be able to get together with such a good strong company and add it to our portfolio. We have others that are out there like that.

And this goes back to some of the questions we were just talking about in terms of prioritization, stock buyback, debt reduction, investments, and those are things we think we continue to invest in. And as long as the stock price remains elevated, then we can focus on those things and we do have a list that we're in pursuing.

And then after that, it's just there's a lot of cards that have to fall in place..

Thanks for some of that commentary. And Jim, that last question is more of a comment, since you've addressed the stock repurchases.

And I would just encourage your -- the management team and as you sit with the Board and think about valuations and all, the multiple of sales that the company trades at less than one times sales, where EBITDA even soon should be 10% of sales, really is -- I got to believe from your perspective, frustrating, but from our perspective, it's just -- it's an opportunity that this company trades -- continues to trade at this kind of discount.

And certainly, as compared to some of the competitors, albeit, they are larger. But as LSI grows, it should certainly grow into multiples like that. And it just seems like there's an extraordinary opportunity, even at today's prices, to retire some of those shares.

The benefit, of course, being you're buying back more of what we all have already come to loathe, which is this business JSI part of it, you're buying more JSI, you are retiring a dividend payment. So, there's some benefit there that those shares don't need to be paid their dividends going forward. And then.

of course, reducing the share count improves your EPS. And I just encourage you to continue to think about what is clearly a dynamic valuation of the company as the company grows and becomes more profitable, the valuation goes up as well. And the stock price, in my mind anyway, reflects an extraordinary opportunity.

So, not to belabor it further, but just encourage you to continue thinking about deploying some of the capital into stock repurchases..

I appreciate that comment, Rick. And I want you to know this does not fall on deaf ears, not by the management team, not by me, and not by the Board. We want to be very optimistic. And if that if the stock repurchase rises to the best opportunity, you can be assured, I'll execute against it -- we will execute against it..

Yes, and I take you absolutely at face value on that. So, thanks, Jim. And thanks for the hard work and congrats on a fantastic quarter again..

Thank you..

This concludes our question-and-answer session. I'd like to hand the call back to management for closing remarks..

I just want to say that this is the end of our fiscal year, we're -- happy new year. We're actually into a new year here. Our first quarter is starting off very, very solid and I'm very encouraged by it. But I want to take a minute to just thank the effort of the whole team, the management team, the chair, outstanding effort.

I can't tell you how dynamic and how much work they all put in, and how they're constantly trying to look at things and solve problems from different angles. And I also want to say thanks to all the team members that are here. We're almost 1,400 employees strong now. And we every business is only as strong as the people that are in it.

And for those of the employees that are listening or family members, or people that know folks here, I just want to say thanks. None of this would be possible if we didn't have a stronger team as we do and as good of people as we do.

So, for all the people that are on the call or reading the transcript, thank you for taking the interest and we'll look forward to the next call..

Ladies and gentlemen, this does conclude today’s teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day..