Napco Releases 4Q Earnings Results, Beats EPS Estimates by 5 Cents
Net sales for the fourth quarter were a record $23 million, up 7% from the same quarter last year.
AMITYVILLE, N.Y. – Napco Security Technologies (NASDAQ: NSSC) reported fourth-quarter net income of $3.34 million or 18 cents per share, up from $2.34 million or 12 cents per share in the same period last year. Adjusted EBITDA per share for the quarter was 20 cents per share, compared to 17 cents per share in the year-ago period.
Net sales for the quarter increased 7% to $22.96 million from $21.52 million in the same period last year.
“We achieved one of our best performing years ever in 2015, delivering strong results by soundly executing our business model,” says Richard Soloway, chairman and president, Napco. “Our recently introduced products and product enhancements are paying dividends as they gain traction in the security marketplace and the investments we made in our recurring revenue services are also growing.”
The success of these initiatives drove broad based improvements across all key metrics, including sales, gross margins and net income. Soloway says the company is particularly proud of its gross margin for the fiscal fourth quarter, which increased 220 basis points from the prior year period to 40.7%.
“Looking more closely at our recurring revenue services, we continued to generate exceptional growth in this part of our business, with sales increasing 40% for the fiscal fourth quarter and 53% for the fiscal year,” Soloway says. “This was driven by strong demand for our Starlink 3G/4G and Verizon CDMA alarm communicators, which are being used to replace defunct 2G radios as well as the communications link on new alarm installations.”
The company is currently in the process of launching a comprehensive line of commercial fire alarm communicators that use wireless radio communications. The company says it expects this category to undergo significant growth as fire alarms that use traditional phone lines are replaced with wireless communications that report to the central station.
Looking ahead, Napco says it expects to achieve its long-term goals, including further margin expansion, a $100 million annual revenue run rate and greater profitability. Simultaneously, the company is continuing to explore ways to use its excess cash to create the most value for shareholders.
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