10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC  20549

_________________________

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2022, OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________________ TO ________________.

Commission File No. 0-13375

LSI Industries Inc.

(Exact name of registrant as specified in its charter)

Ohio	31-0888951
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

10000 Alliance Road, Cincinnati, Ohio	45242
(Address of principal executive offices)	(Zip Code)
(513) 793-3200
Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	LYTS	NASDAQGlobal Select Market

Indicate by checkmark whether the registrant:  (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐

Indicate by checkmark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒   No ☐

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☒	Emerging growth company ☐
Non-accelerated filer ☐	Smaller reporting company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐  No ☒

As of October 28, 2022, there were 27,777,410 shares of the registrant's common stock, no par value per share, outstanding.  

LSI INDUSTRIES INC.

FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 2022

INDEX

PART I.  FINANCIAL INFORMATION			3
ITEM 1.		FINANCIAL STATEMENTS	3
	CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS		3
	CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME		4
	CONDENSED CONSOLIDATED BALANCE SHEETS		5
	CONDENSED CONSOLIDATED BALANCE SHEETS		6
	CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY		7
	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS		8
	NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS		9
ITEM 2.		MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	20
ITEM 3.		QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	26
ITEM 4.		CONTROLS AND PROCEDURES	26
PART II.  OTHER INFORMATION			27
ITEM 5.		OTHER INFORMATION	27
ITEM 6.		EXHIBITS	27
	SIGNATURES		28

Page 2

PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended
	September 30
(In thousands, except per share data)	2022		2021
Net Sales	$	127,069	$	106,397
Cost of products and services sold		92,319		81,887
Severance costs		12		-
Gross profit		34,738		24,510
Selling and administrative expenses		24,717		20,066
Operating income		10,021		4,444
Interest expense		788		234
Other expense		213		79
Income before income taxes		9,020		4,131
Income tax expense		2,758		998
Net income	$	6,262	$	3,133
Earnings per common share (see Note 4)
Basic	$	0.23	$	0.12
Diluted	$	0.22	$	0.11
Weighted average common shares outstanding
Basic		27,641		26,996
Diluted		28,664		27,743

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 3

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended
	September 30
(In thousands)	2022		2021
Net Income	$	6,262	$	3,133
Foreign currency translation adjustment		7		(44	)
Comprehensive Income	$	6,269	$	3,089

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 4

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30,			June 30,
(In thousands, except shares)	2022			2022
ASSETS
Current assets
Cash and cash equivalents	$	9,028		$	2,462
Accounts receivable, less allowance for credit losses of $508 and $499, respectively		75,449			77,750
Inventories		80,457			74,421
Refundable income taxes		1,118			1,041
Other current assets		4,355			3,243
Total current assets		170,407			158,917
Property, Plant and Equipment, at cost
Land		4,010			4,010
Buildings		24,469			24,495
Machinery and equipment		67,115			66,762
Buildings under finance leases		2,033			2,033
Construction in progress		563			618
		98,190			97,918
Less accumulated depreciation		(71,913	)		(70,760	)
Net property, plant and equipment		26,277			27,158
Goodwill		45,030			45,030
Other intangible assets, net		66,774			67,964
Operating lease right-of-use assets		7,826			8,664
Other long-term assets, net		3,187			3,347
Total assets	$	319,501		$	311,080

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 5

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30,			June 30,
(In thousands, except shares)	2022			2022
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt	$	3,571		$	3,571
Accounts payable		41,133			34,783
Accrued expenses		35,231			36,264
Total current liabilities		79,935			74,618
Long-term debt		73,975			76,025
Finance lease liabilities		1,174			1,246
Operating lease liabilities		7,381			8,240
Other long-term liabilities		3,307			3,182
Commitments and contingencies (Note 12)		-			-
Shareholders' Equity
Preferred shares, without par value; Authorized 1,000,000 shares, none issued		-			-
Common shares, without par value; Authorized 40,000,000 shares; Outstanding 27,777,410 and 27,484,514 shares, respectively		140,599			139,500
Treasury shares, without par value		(6,439	)		(5,927	)
Deferred compensation plan		6,439			5,927
Retained earnings		13,078			8,224
Accumulated other comprehensive income		52			45
Total shareholders' equity		153,729			147,769
Total liabilities & shareholders' equity	$	319,501		$	311,080

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 6

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

	Common Shares					Treasury Shares						Key Executive		Accumulated Other			Retained			Total
(In thousands, except per share data)	Number Of Shares					Number Of Shares						Compensation Amount		Comprehensive Income (Loss)			Earnings (Loss)			Shareholders' Equity
			Amount						Amount
Balance at June 30, 2021		26,863	$	132,526			(346	)	$	(2,450	)	$	2,450	$	49		$	(1,405	)	$	131,170
Net Income		-		-			-			-			-		-			3,133			3,133
Other comprehensive loss		-		-			-			-			-		(44	)		-			(44	)
Stock compensation awards		10		75			-			-			-		-			-			75
Restricted stock units issued, net of shares withheld for tax withholdings		79		(247	)		-			-			-		-			-			(247	)
Shares issued for deferred compensation		263		2,042			-			-			-		-			-			2,042
Activity of treasury shares, net		-		-			(261	)		(2,021	)		-		-			-			(2,021	)
Deferred stock compensation		-		-			-			-			2,021		-			-			2,021
Stock compensation expense		-		556			-			-			-		-			-			556
Stock options exercised, net		3		16			-			-			-		-			-			16
Dividends — $0.20 per share		-		-			-			-			-		-			(1,328	)		(1,328	)
Balance at September 30, 2021		27,218	$	134,968			(607	)	$	(4,471	)	$	4,471	$	5		$	400		$	135,373

	Common Shares					Treasury Shares						Key Executive		Accumulated Other		Retained			Total
	Number Of Shares					Number Of Shares						Compensation Amount		Comprehensive Income (Loss)		Earnings (Loss)			Shareholders' Equity
			Amount						Amount
Balance at June 30, 2022		27,484	$	139,500			(822	)	$	(5,927	)	$	5,927	$	45	$	8,224		$	147,769
Net Income		-		-			-			-			-		-		6,262			6,262
Other comprehensive loss		-		-			-			-			-		7		-			7
Stock compensation awards		12		75			-			-			-		-		-			75
Restricted stock units issued, net of shares withheld for tax withholdings		201		(66	)		-			-			-		-		-			(66	)
Shares issued for deferred compensation		80		539			-			-			-		-		-			539
Activity of treasury shares, net		-		-			(77	)		(512	)		-		-		-			(512	)
Deferred stock compensation		-		-			-			-			512		-		-			512
Stock compensation expense		-		551			-			-			-		-		-			551
Stock options exercised, net		-		-			-			-			-		-		-			-
Dividends — $0.20 per share		-		-			-			-			-		-		(1,408	)		(1,408	)
Balance at September 30, 2022		27,777	$	140,599			(899	)	$	(6,439	)	$	6,439	$	52	$	13,078		$	153,729

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 7

LSI INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended
	September 30
(In thousands)	2022			2021
Cash Flows from Operating Activities
Net income	$	6,262		$	3,133
Non-cash items included in net income
Depreciation and amortization		2,421			2,563
Deferred income taxes		350			(13	)
Deferred compensation plan		539			2,042
Stock compensation expense		551			556
Issuance of common shares as compensation		75			75
Loss on disposition of fixed assets		2			14
Allowance for doubtful accounts		8			10
Inventory obsolescence reserve		250			572
Changes in certain assets and liabilities
Accounts receivable		2,293			(6,260	)
Inventories		(6,286	)		(9,578	)
Refundable income taxes		(77	)		138
Accounts payable		6,350			8,359
Accrued expenses and other		(1,943	)		(6,663	)
Customer prepayments		(212	)		(2,837	)
Net cash flows provided by (used in) operating activities		10,583			(7,889	)
Cash Flows from Investing Activities
Purchases of property, plant and equipment		(434	)		(297	)
Net cash flows (used in) investing activities		(434	)		(297	)
Cash Flows from Financing Activities
Payments of long-term debt		(47,123	)		(42,533	)
Borrowings of long-term debt		45,073			52,659
Cash dividends paid		(1,408	)		(1,326	)
Shares withheld for employees' taxes		(66	)		(247	)
Payments on financing lease obligations		(66	)		(64	)
Proceeds from stock option exercises		-			16
Net cash flows (used in) provided by financing activities		(3,590	)		8,505
Change related to foreign currency		7			(31	)
Increase in cash and cash equivalents		6,566			288
Cash and cash equivalents at beginning of period		2,462			2,282
Cash and cash equivalents at end of period	$	9,028		$	2,570

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

Page 8

LSI INDUSTRIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 - INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The interim condensed consolidated financial statements are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information, and rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the interim financial statements include all normal adjustments and disclosures necessary to present fairly the Company’s financial position as of September 30, 2022, the results of its operations for the three-month periods ended September 30, 2022, and 2021, and its cash flows for the three-month periods ended September 30, 2022, and 2021. These statements should be read in conjunction with the financial statements and footnotes included in the fiscal 2022 Annual Report on Form 10-K. Financial information as of June 30, 2022, has been derived from the Company’s audited consolidated financial statements.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation:

A summary of the Company’s significant accounting policies is included in Note 1 to the audited consolidated financial statements of the Company’s fiscal 2022 Annual Report on Form 10-K.

Revenue Recognition:

The Company recognizes revenue when it satisfies the performance obligation in its customer contracts or purchase orders. Most of the Company’s products have a single performance obligation which is satisfied at a point in time when control is transferred to the customer. Control is generally transferred at time of shipment when title and risk of ownership passes to the customer. For customer contracts with multiple performance obligations, the Company allocates the transaction price and any discounts to each performance obligation based on relative standalone selling prices. Payment terms are typically within 30 to 90 days from the shipping date, depending on the terms with the customer. The Company offers standard warranties that do not represent separate performance obligations.

Installation is a separate performance obligation, except for the Company’s digital signage products. For digital signage products, installation is not a separate performance obligation as the product and installation is the combined item promised in digital signage contracts. The Company is not always responsible for installation of products it sells and has no post-installation responsibilities other than standard warranties.

A number of the Company's display solutions and select lighting products are customized for specific customers. As a result, these customized products do not have an alternative use. For these products, the Company has a legal right to payment for performance to date and generally does not accept returns on these items. The measurement of performance is based upon cost plus a reasonable profit margin for work completed. Because there is no alternative use and there is a legal right to payment, the Company transfers control of the item as the item is being produced and therefore, recognizes revenue over time. The customized product types are as follows:

● Customer specific branded print graphics

● Electrical components based on customer specifications

● Digital signage and related media content

The Company also offers installation services for its display solutions elements and select lighting products. Installation revenue is recognized over time as the customer simultaneously receives and consumes the benefits provided through the installation process.

For these customized products and installation services, revenue is recognized using a cost-based input method: recognizing revenue and gross profit as work is performed based on the relationship between the actual cost incurred and the total estimated cost for the performance obligation.

Page 9

On occasion, the Company enters into bill-and-hold arrangements on a limited basis. Each bill-and-hold arrangement is reviewed and revenue is recognized only when certain criteria have been met: (1) the customer has requested delayed delivery and storage of the products by the Company because the customer wants to secure a supply of the products but lacks storage space; (ii) the risk of ownership has passed to the customer; (iii) the products are segregated from the Company’s other inventory items held for sale; (iv) the products are ready for shipment to the customer; and (v) the Company does not have the ability to use the products or direct them to another customer.

Disaggregation of Revenue

The Company disaggregates the revenue from contracts with customers by the timing of revenue recognition because the Company believes it best depicts the nature, amount, and timing of its revenue and cash flows. The table below presents a reconciliation of the disaggregation by reportable segments:

	Three Months Ended
(In thousands)	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Timing of revenue recognition
Products and services transferred at a point in time	$	58,077	$	47,489	$	44,582	$	37,431
Products and services transferred over time		9,456		12,047		6,678		17,706
	$	67,533	$	59,536	$	51,260	$	55,137

	Three Months Ended
	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Type of Product and Services
LED lighting, digital signage solutions, electronic circuit boards	$	55,535	$	7,175	$	41,879	$	12,428
Poles, other display solution elements		11,129		41,471		8,966		33,302
Project management, installation services, shipping and handling		869		10,890		415		9,407
	$	67,533	$	59,536	$	51,260	$	55,137

Practical Expedients and Exemptions

● The Company’s contracts with customers have an expected duration of one year or less, as such, the Company applies the practical expedient to expense sales commissions as incurred and has omitted disclosures on the amount of remaining performance obligations.

● Shipping costs that are not material in context of the delivery of products are expensed as incurred.

● The Company’s accounts receivable balance represents the Company’s unconditional right to receive payment from its customers with contracts. Payments are generally due within 30 to 90 days of completion of the performance obligation and invoicing; therefore, payments do not contain significant financing components.

● The Company collects sales tax and other taxes concurrent with revenue-producing activities which are excluded from revenue. Shipping and handling costs are treated as fulfillment activities and included in cost of products and services sold on the Consolidated Statements of Operations.

New Accounting Pronouncements:

In October 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” creating an exception to the recognition and measurement principles in ASC 805. The amendment requires that entities apply ASC 606, “Revenue from Contracts with Customers,” rather than using fair value, to recognize and measure contracts assets and contract liabilities from contracts with customers acquired in a business combination. The ASU is effective for fiscal years beginning after December 15, 2022, and interim periods therein. Early adoption is permitted, including adoption in an interim period, regardless of whether a business combination occurs in that period. The guidance should be applied prospectively; however, an entity that elects to early adopt in an interim period should apply the amendments to all business combinations that occurred during the fiscal year that includes that interim period. The Company is evaluating the impact this guidance may have on its consolidated financial statements and related disclosures.

Page 10

In December 2019, the Financial Accounting Standards Board ("FASB") issued ASU 2019-12, "Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740)." This guidance removes certain exceptions to the general principles in ASC 740 such as recognizing deferred taxes for equity investments, the incremental approach to performing intra-period tax allocation and calculating income taxes in interim periods. The standard also simplifies accounting for income taxes under U.S. GAAP by clarifying and amending existing guidance, including the recognition of deferred taxes for goodwill, the allocation of taxes to members of a consolidated group and requiring that an entity reflect the effect of enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The Company adopted ASC 2019-12 effective July 1, 2021, which did not have a material impact on its consolidated financial statements or disclosures.

NOTE 3 - SEGMENT REPORTING INFORMATION

The accounting guidance on Segment Reporting establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in financial statements. Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision maker (the Company’s Chief Executive Officer or “CODM”) in making decisions on how to allocate resources and assess performance. The Company’s two operating segments are Lighting and Display Solutions (formerly known as the Graphics Segment), with one executive team under the organizational structure reporting directly to the CODM with responsibilities for managing each segment. Corporate and Eliminations, which captures the Company’s corporate administrative activities, is also reported in the segment information.

The Lighting Segment includes non-residential outdoor and indoor lighting fixtures utilizing LED light sources that have been fabricated and assembled for the Company’s markets, primarily the refueling and convenience store markets, parking lot and garage markets, quick-service restaurant market, retail and grocery store markets, the automotive market, the warehouse market, and the sports court and field market. The Company also offers a variety of lighting controls to complement its lighting fixtures which include sensors, photocontrols, dimmers, motion detection and Bluetooth systems. The Company also services lighting product customers through the commercial and industrial project, stock and flow, and renovation channels. The Lighting Segment also includes the design, engineering and manufacturing of electronic circuit boards, assemblies and sub-assemblies which are sold directly to customers.

The Display Solutions Segment manufactures, sells and installs exterior and interior visual image and display elements, including printed graphics, structural graphics, digital signage, menu board systems, display fixtures, refrigerated displays, and custom display elements. These products are used in visual image programs in several markets including the refueling and convenience store markets, parking lot and garage markets, quick-service restaurant market, retail and grocery store markets, the automotive market, the warehouse market, and the sports court and field market. The Display Solutions Segment also provides a variety of project management services to complement our display elements, such as installation management, site surveys, permitting, and content management which are offered to our customers to support our digital signage.

The Company’s corporate administration activities are reported in the Corporate and Eliminations line item. These activities primarily include intercompany profit in inventory eliminations, expense related to certain corporate officers and support staff, the Company’s internal audit staff, expense related to the Company’s Board of Directors, equity compensation expense for various equity awards granted to corporate administration employees, certain consulting expenses, investor relations activities, and a portion of the Company’s legal, auditing, and professional fee expenses. Corporate identifiable assets primarily consist of cash, invested cash (if any), refundable income taxes (if any), and deferred income taxes.

There were no customers or customer programs representing a concentration of 10% or more of the Company’s consolidated net sales in the three months ended September 30, 2022. One customer program in the Display Solutions Segment represents $12.3 million or 12% of the Company’s net sales in the three months ended September 30, 2021. One customer in the Display Solutions represents $8.5 million or 11% of accounts receivable at September 30, 2022. There was no concentration of accounts receivable at September 30, 2021.

Page 11

Summarized financial information for the Company’s operating segments is provided for the indicated periods and as of September 30, 2022, and September 30, 2021:

	Three Months Ended
(In thousands)	September 30
	2022			2021
Net Sales:
Lighting Segment	$	67,533		$	51,260
Display Solutions Segment		59,536			55,137
	$	127,069		$	106,397
Operating Income (Loss):
Lighting Segment	$	9,158		$	4,339
Display Solutions Segment		6,496			3,749
Corporate and Eliminations		(5,633	)		(3,644	)
	$	10,021		$	4,444
Capital Expenditures:
Lighting Segment	$	249		$	180
Display Solutions Segment		162			221
Corporate and Eliminations		23			(104	)
	$	434		$	297
Depreciation and Amortization:
Lighting Segment	$	1,387		$	1,461
Display Solutions Segment		974			1,031
Corporate and Eliminations		60			71
	$	2,421		$	2,563

	September 30, 2022		June 30, 2022
Total Assets:
Lighting Segment	$	151,856	$	152,431
Display Solutions Segment		160,099		152,302
Corporate and Eliminations		7,546		6,347
	$	319,501	$	311,080

The segment net sales reported above represent sales to external customers. Segment operating income, which is used in management’s evaluation of segment performance, represents net sales less all operating expenses. Identifiable assets are those assets used by each segment in its operations.

The Company records a 10% mark-up on intersegment revenues. Any intersegment profit in inventory is eliminated in consolidation. Intersegment revenues were eliminated in consolidation as follows:

Inter-segment sales

	Three Months Ended
(In thousands)	September 30
	2022		2021
Lighting Segment inter-segment net sales	$	6,143	$	10,457
Display Solutions Segment inter-segment net sales	$	66	$	163

The Company’s operations are located solely within North America. As a result, the geographic distribution of the Company’s net sales and long-lived assets originate within North America.

Page 12

NOTE 4 - EARNINGS PER COMMON SHARE

The following table presents the amounts used to compute basic and diluted earnings per common share, as well as the effect of dilutive potential common shares on weighted average shares outstanding (in thousands, except per share data):

	Three Months Ended
	September 30
	2022		2021
BASIC EARNINGS PER SHARE
Net income	$	6,262	$	3,133
Weighted average shares outstanding during the period, net of treasury shares		26,730		26,553
Weighted average vested restricted stock units outstanding		46		17
Weighted average shares outstanding in the Deferred Compensation Plan during the period		865		426
Weighted average shares outstanding		27,641		26,996
Basic earnings per common share	$	0.23	$	0.12
DILUTED EARNINGS PER SHARE
Net income	$	6,262	$	3,133
Weighted average shares outstanding:
Basic		27,641		26,996
Effect of dilutive securities (a):
Impact of common shares to be issued under stock option plans, and contingently issuable shares, if any		1,023		747
Weighted average shares outstanding		28,664		27,743
Diluted earnings per common share	$	0.22	$	0.11
Anti-dilutive securities (b)		213		989

(a) Calculated using the “Treasury Stock” method as if dilutive securities were exercised and the funds were used to purchase common shares at the average market price during the period.

(b) Anti-dilutive securities were excluded from the computation of diluted net income per share for the three months ended September 30, 2022, and September 30, 2021, because the exercise price was greater than the average fair market price of the common shares or because the assumed proceeds from the award’s exercise or vesting was greater than the average fair market price of the common shares.

Page 13

NOTE 5 – INVENTORIES, NET

The following information is provided as of the dates indicated:

	September 30,		June 30,
(In thousands)	2022		2022
Inventories:
Raw materials	$	53,962	$	51,637
Work-in-progress		6,156		3,029
Finished goods		20,339		19,755
Total Inventories	$	80,457	$	74,421

NOTE 6 - ACCRUED EXPENSES

The following information is provided as of the dates indicated:

	September 30,		June 30,
(In thousands)	2022		2022
Accrued Expenses:
Customer prepayments	$	6,204	$	6,416
Compensation and benefits		8,752		9,611
Accrued warranty		4,319		4,491
Operating lease liabilities		1,187		1,274
Accrued sales commissions		2,506		4,783
Accrued Freight		4,139		3,680
Accrued FICA		1,161		1,122
Finance lease liabilities		280		275
Accrued income tax		1,835		109
Other accrued expenses		4,848		4,503
Total Accrued Expenses	$	35,231	$	36,264

NOTE 7 - GOODWILL AND OTHER INTANGIBLE ASSETS

The carrying values of goodwill and other intangible assets with indefinite lives are reviewed at least annually for possible impairment. The Company may first assess qualitative factors in order to determine if goodwill and indefinite-lived intangible assets are impaired. If through the qualitative assessment it is determined that it is more likely than not that goodwill and indefinite-lived assets are not impaired, no further testing is required. If it is determined more likely than not that goodwill and indefinite-lived assets are impaired, or if the Company elects not to first assess qualitative factors, the Company’s impairment testing continues with the estimation of the fair value of the reporting unit using a combination of a market approach and an income (discounted cash flow) approach, at the reporting unit level. The estimation of the fair value of reporting unit requires significant management judgment with respect to revenue and expense growth rates, changes in working capital and the selection and use of an appropriate discount rate. The estimates of the fair value of reporting units are based on the best information available as of the date of the assessment. The use of different assumptions would increase or decrease estimated discounted future operating cash flows and could increase or decrease an impairment charge. Company management uses its judgment in assessing whether assets may have become impaired between annual impairment tests. Indicators such as adverse business conditions, economic factors and technological change or competitive activities may signal that an asset has become impaired.

The Company identified its reporting units in conjunction with its annual goodwill impairment testing. The Company has a total of three reporting units that contain goodwill. One reporting unit is within the Lighting Segment and two reporting units are within the Display Solutions Segment. The tradename intangible assets have an indefinite life and are also tested separately on an annual basis. The Company relies upon a number of factors, judgments and estimates when conducting its impairment testing including, but not limited to, the Company’s stock price, operating results, forecasts, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and judgments in applying them to the analysis of goodwill impairment.

Page 14

The following table presents information about the Company's goodwill on the dates or for the periods indicated:

Goodwill
(In thousands)				Display
	Lighting			Solutions
	Segment			Segment			Total
Balance as of September 30, 2022
Goodwill	$	70,971		$	63,347		$	134,318
Accumulated impairment losses		(61,763	)		(27,525	)		(89,288	)
Goodwill, net as of September 30, 2022	$	9,208		$	35,822		$	45,030
Balance as of June 30, 2022
Goodwill	$	70,971		$	63,347		$	134,318
Accumulated impairment losses		(61,763	)		(27,525	)		(89,288	)
Goodwill, net as of June 30, 2022	$	9,208		$	35,822		$	45,030

The gross carrying amount and accumulated amortization by each major intangible asset class is as follows:

Other Intangible Assets
	September 30, 2022
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	62,083	$	15,254	$	46,829
Patents		268		268		-
LED technology firmware, software		20,966		14,895		6,071
Trade name		2,658		1,075		1,583
Non-compete		260		71		189
Total Amortized Intangible Assets		86,235		31,563		54,672
Indefinite-lived Intangible Assets
Trademarks and trade names		12,102		-		12,102
Total indefinite-lived Intangible Assets		12,102		-		12,102
Total Other Intangible Assets	$	98,337	$	31,563	$	66,774

Other Intangible Assets
	June 30, 2022
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	62,083	$	14,400	$	47,683
Patents		268		268		-
LED technology firmware, software		20,966		14,598		6,368
Trade name		2,658		1,049		1,609
Non-compete		260		58		202
Total Amortized Intangible Assets		86,235		30,373		55,862
Indefinite-lived Intangible Assets
Trademarks and trade names		12,102		-		12,102
Total indefinite-lived Intangible Assets		12,102		-		12,102
Total Other Intangible Assets	$	98,337	$	30,373	$	67,964

Page 15

	Three Months Ended
	September 30
(In thousands)	2022		2021
Amortization Expense of Other Intangible Assets	$	1,190	$	1,215

The Company expects to record annual amortization expense as follows:

(In thousands)
2023	$	3,618
2024		4,760
2025		4,760
2026		4,760
2027		4,754
After 2027		32,020

NOTE 8 - DEBT

The Company’s long-term debt as of September 30, 2022, and June 30, 2022, consisted of the following:

	September 30,		June 30,
(In thousands)	2022		2022
Secured line of credit	$	56,144	$	57,275
Term loan, net of debt issuance costs of $26 and $30, respectively		21,402		22,321
Total debt		77,546		79,596
Less: amounts due within one year		3,571		3,571
Total amounts due after one year, net	$	73,975	$	76,025

In September 2021, the Company amended its existing $100 million secured line of credit, to a $25 million term loan and $75 million remaining as a secured revolving line of credit. Both facilities expire in the third quarter of fiscal 2026. The principal of the term loan is repaid annually in the amount of $3.6 million over a five-year period with a balloon payment of the remaining balance due on the last month. Interest on both the revolving line of credit and the term loan is charged based upon an increment over the LIBOR rate or a base rate, at the Company’s option. The base rate is calculated as the highest of (a) the Prime rate, (b) the sum of the Overnight Funding Rate plus 50 basis points and (c) the sum of the Daily LIBOR Rate plus 100 basis points as long as a Daily LIBOR rate is offered, ascertainable and not unlawful. The increment over the LIBOR borrowing rate fluctuates between 100 and 225 basis points, and the increment over the Base Rate fluctuates between 0 and 125 basis points, both of which depend upon the ratio of indebtedness to earnings before interest, taxes, depreciation, and amortization (“EBITDA”), as defined in the line of credit agreement. As of September 30, 2022, the Company’s borrowing rate against its revolving line of credit was 4.8%. The increment over LIBOR borrowing rate will be 175 basis points for the second quarter of fiscal 2023. The fee on the unused balance of the $75 million committed line of credit fluctuates between 15 and 25 basis points. Under the terms of this line of credit, the Company has agreed to a negative pledge of real estate assets and is required to comply with financial covenants that limit the ratio of indebtedness to EBITDA and require a minimum fixed charge ratio. As of September 30, 2022, there was $18.9 million available for borrowing under the $75 million line of credit.

The Company is in compliance with all of its loan covenants as of September 30, 2022.

NOTE 9 - CASH DIVIDENDS

The Company paid cash dividends of $1.4 million and $1.3 million in both the three months ended September 30, 2022, and September 30, 2021, respectively. Dividends on restricted stock units in the amount of $0.2 million and $0.1 million were accrued as of both September 30, 2022, and 2021, respectively. These dividends will be paid upon the vesting of the restricted stock and performance stock units when shares are issued to the award recipients. In November 2022, the Board of Directors declared a regular quarterly cash dividend of $0.05 per share payable November 22, 2022, to shareholders of record as of November 14, 2022. The indicated annual cash dividend rate is $0.20 per share.

Page 16

NOTE 10 – EQUITY COMPENSATION

In November 2022, the Company’s shareholders approved an amendment to the 2019 Omnibus Award Plan (“2019 Omnibus Plan”) which increased the number of shares authorized for issuance under the plan by 2,350,000 and to remove the Plan’s fungible share counting feature. The purpose of the 2019 Omnibus Plan is to provide a means through which the Company may attract and retain key personnel and to provide a means by which directors, officers, and employees can acquire and maintain an equity interest in the Company. The number of shares that remain reserved for issuance under the 2019 Omnibus Plan prior to the amendment of the Plan equates to 1,253,908 as of September 30, 2022. The 2019 Omnibus Plan allows for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance stock units (“PSUs”) and other stock-based awards.

In the three months ended September 30, 2022, the Company granted 164,348 PSU’s and 196,522 RSU’s, both with a weighted average market value of $6.90. Stock compensation expense was $0.6 million for both the three months ended September 30, 2022, and 2021.

NOTE 11 - SUPPLEMENTAL CASH FLOW INFORMATION

	Three Months Ended
(In thousands)	September 30
	2022		2021
Cash Payments:
Interest	$	679	$	203
Income taxes	$	664	$	1,183
Non-cash investing and financing activities
Issuance of common shares as compensation	$	75	$	75
Issuance of common shares to fund deferred compensation plan	$	539	$	2,042

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company is party to various negotiations, customer bankruptcies, and legal proceedings arising in the normal course of business. The Company provides reserves for these matters when a loss is probable and reasonably estimable. The Company does not disclose a range of potential loss because the likelihood of such a loss is remote. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position, results of operations, cash flows or liquidity.

The Company may occasionally issue a standby letter of credit in favor of third parties. As of September 30, 2022, there were no such standby letters of credit issued.

NOTE 13 - LEASES

The Company leases certain manufacturing facilities along with a small office space, several forklifts, several small tooling items, and various items of office equipment. The Company also acquired buildings, machinery, and forklift leases with the acquisition of JSI, as well as one sublease. All but two of the Company’s leases are operating leases. Leases have a remaining term of one to seven years some of which have an option to renew. The Company does not assume renewals in determining the lease term unless the renewals are deemed reasonably certain. The lease agreements do not contain any material residual guarantees or material variable lease payments.

The Company has periodically entered into short-term operating leases with an initial term of twelve months or less. The Company elected not to record these leases on the balance sheet. For the three months ended September 30, 2022, and 2021, the rent expense for these leases is immaterial.

The Company has certain leases that contain lease and non-lease components and has elected to utilize the practical expedient to account for these components together as a single lease component.

Lease expense is recognized on a straight-line basis over the lease term. The Company used its incremental borrowing rate when determining the present value of lease payments.

Page 17

	Three Months Ended
	September 30
(In thousands)	2022			2021
Operating lease cost	$	863		$	879
Financing lease cost:
Amortization of right of use assets		74			74
Interest on lease liabilities		18			21
Variable lease cost		22			22
Sublease income		(116	)		(94	)
Total lease cost	$	861		$	902

Supplemental Cash Flow Information:
	Three Months Ended
	September 30
(In thousands)	2022		2021
Cash flows from operating leases
Fixed payments - operating cash flows	$	885	$	887
Liability reduction - operating cash flows	$	779	$	744
Cash flows from finance leases
Interest - operating cash flows	$	18	$	21
Repayments of principal portion - financing cash flows	$	66	$	64

Operating Leases:	September 30,			June 30,
	2022			2022
Total operating right-of-use assets	$	7,826		$	8,664
Accrued expenses (Current liabilities)	$	1,187		$	1,274
Long-term operating lease liability		7,381			8,240
Total operating lease liabilities	$	8,568		$	9,514
Weighted Average remaining Lease Term (in years)		2.83			3.05
Weighted Average Discount Rate		4.82	%		4.81	%

Finance Leases:	September 30,			June 30,
	2022			2022
Buildings under finance leases	$	2,033		$	2,033
Equipment under finance leases		30			30
Accumulated depreciation		(719	)		(634	)
Total finance lease assets, net	$	1,344		$	1,429
Accrued expenses (Current liabilities)	$	280		$	275
Long-term finance lease liability		1,174			1,246
Total finance lease liabilities	$	1,454		$	1,521
Weighted Average remaining Lease Term (in years)		4.54			4.80
Weighted Average Discount Rate		4.86	%		4.86	%

Page 18

Maturities of Lease Liability:	Operating Lease Liabilities			Finance Lease Liabilities			Operating Subleases		Net Lease Commitments
2023	$	2,792		$	275		$	377	$	3,444
2024		3,285			337			377		3,999
2025		2,136			362			31		2,529
2026		835			362			-		1,197
2027		215			303			-		518
Thereafter		4			-			-		4
Total lease payments	$	9,267		$	1,639		$	785	$	11,691
Less: Interest		(699	)		(185	)				(884	)
Present Value of Lease Liabilities	$	8,568		$	1,454				$	10,807

NOTE 16 – INCOME TAXES

The Company's effective income tax rate is based on expected income, statutory rates and tax planning opportunities available in the various jurisdictions in which it operates. For interim financial reporting, the Company estimates the annual income tax rate based on projected taxable income for the full year and records a quarterly income tax provision or benefit in accordance with the anticipated annual rate. The Company refines the estimates of the year's taxable income as new information becomes available, including actual year-to-date financial results. This continual estimation process often results in a change to the expected effective income tax rate for the year. When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected income tax rate. Significant judgment is required in determining the effective tax rate and in evaluating tax positions.

	Three Months Ended
	September 30
	2022			2021
Reconciliation of effective tax rate:
Provision for income taxes at the anticipated annual tax rate		26.20	%		24.2	%
Uncertain tax positions		1.0			0.8
Deferred Income Tax Adjustment		1.6			-
Share-based compensation		1.8			(0.8	)
Effective tax rate		30.6	%		24.2	%

Page 19

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Note About Forward-Looking Statements

This report includes estimates, projections, statements relating to our business plans, objectives, and expected operating results that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may appear throughout this report, including this section. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “focus,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that may cause actual results to differ materially. We describe risks and uncertainties that could cause actual results and events to differ materially in in our Annual Report on Form 10-K in the following sections: “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Quantitative and Qualitative Disclosures about Market Risk,” and “Risk Factors.” All of those risks and uncertainties are incorporated herein by reference. We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events, or otherwise.

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand the results of operations and financial condition of LSI Industries Inc. MD&A is provided as a supplement to, and should be read in conjunction with, our Annual Report on Form 10-K for the year ended June 30, 2022, and our financial statements and the accompanying Notes to Financial Statements (Part I, Item 1 of this Form 10-Q).

Our condensed consolidated financial statements, accompanying notes and the “Safe Harbor” Statement, each as appearing earlier in this report, should be referred to in conjunction with this Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Summary of Consolidated Results

Net Sales by Business Segment
	Three Months Ended
	September 30
(In thousands)	2022		2021
Lighting Segment	$	67,533	$	51,260
Display Solutions Segment		59,536		55,137
	$	127,069	$	106,397

Operating Income (Loss) by Business Segment
	Three Months Ended
	September 30
(In thousands)	2022			2021
Lighting Segment	$	9,158		$	4,339
Display Solutions Segment		6,496			3,749
Corporate and Eliminations		(5,633	)		(3,644	)
	$	10,021		$	4,444

Net sales of $127.1 million for the three months ended September 30, 2022, increased $20.7 million or 19% as compared to net sales of $106.4 million for the three months ended September 30, 2021. Net sales were driven by increased net sales of the Lighting Segment (an increase of $16.2 million or 32%) and increased net sales of the Display Solutions Segment (an increase of $4.4 million or 8%). Growth in both reportable segments reflects the ongoing strength in demand levels from our key vertical markets, focusing on higher-value applications where our differentiated products and solutions meet the unique requirements of our customers.

Page 20

Operating income of $10.0 million for the three months ended September 30, 2022, represents a $5.6 million increase from operating income of $4.4 million in the three months ended September 30, 2021. Adjusted operating income, a Non-GAAP measure, was $10.9 million in the three months ended September 30, 2022, compared to $5.0 million in the three months ended September 30, 2021. Refer to “Non-GAAP Financial Measures” below for a reconciliation of Non-GAAP financial measures to U.S. GAAP measures. The increase in operating income was the result of increased volume leveraged by a higher-value sales mix, price realization offsetting inflation, and effective cost management.The Company continues to focus on actions which increase its value and importance to customers in verticals where the Company sees profitable growth.

Non-GAAP Financial Measures

We believe it is appropriate to evaluate our performance after making adjustments to the as-reported U.S. GAAP operating income, net income, and earnings per share. Adjusted operating income, net income, and earnings per share, which exclude the impact of stock compensation expense, severance costs, and consulting expense related to commercial growth initiatives, are Non-GAAP financial measures. Also included below are Non-GAAP financial measures including Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA and Adjusted EBITDA), Free Cash Flow, and Net Debt to Adjusted EBITDA. We believe that these adjusted supplemental measures are useful in assessing the operating performance of our business. These supplemental measures are used by our management, including our chief operating decision maker, to evaluate business results. Although the impacts of some of these items have been recognized in prior periods and could recur in future periods, we exclude these items because they provide greater comparability and enhanced visibility into our results of operations. These non-GAAP measures may be different from non-GAAP measures used by other companies.  In addition, the non-GAAP measures are not based on any comprehensive set of accounting rules or principles.  Non-GAAP measures have limitations, in that they do not reflect all amounts associated with our results as determined in accordance with U.S. GAAP. Therefore, these measures should be used only to evaluate our results in conjunction with corresponding GAAP measures. Below is a reconciliation of these Non-GAAP measures to operating income, net income, and earnings per share for the periods indicated along with the calculation of EBITDA and Adjusted EBITDA, Free Cash Flow, and Net Debt to Adjusted EBITDA.

.

Reconciliation of net income to adjusted net income
	Three Months Ended
	September 30
(In thousands, except per share data)	2022						2021
					Diluted EPS						Diluted EPS
Net Income as reported	$	6,262			$	0.22	$	3,133			$	0.11
Stock compensation expense		420	(1	)		0.01		407	(5	)		0.02
Consulting expense: Commercial Growth Initiatives		226	(2	)		0.01		-				-
Severance costs		9	(3	)		-		-				-
Tax rate difference between reported and adjusted net income		160	(4	)		0.01		-				-
Net Income adjusted	$	7,077			$	0.25	$	3,540			$	0.13

The following represents the income tax effects of the adjustments in the tables above, which were calculated using the estimated combined U.S., Canada and Mexico effective income tax rates for the periods indicated (in thousands):

⁽¹⁾ $131

⁽²⁾ $77

⁽³⁾ $3

⁽⁴⁾ $160

⁽⁵⁾ $149

Page 21

Reconciliation of operating income to adjusted operating income:
	Three Months Ended
	September 30
(In thousands)	2022		2021
Operating Income as reported	$	10,021	$	4,444
Stock compensation expense		551		556
Consulting expense: Commercial Growth Initiatives		303		-
Severance costs		12		-
Adjusted Operating Income	$	10,887	$	5,000

Reconciliation of operating income to EBITDA and Adjusted EBITDA
	Three Months Ended
	September 30
(In thousands)	2022		2021
Operating Income as reported	$	10,021	$	4,444
Depreciation and Amortization		2,421		2,563
EBITDA	$	12,442	$	7,007
Stock compensation expense		551		556
Consulting expense: Commercial Growth Initiatives		303		-
Severance costs		12		-
Adjusted EBITDA	$	13,308	$	7,563

Reconciliation of cash flow from operations to free cash flow
	Three Months Ended
	September 30
(In thousands)	2022			2021
Cash Flow from Operations	$	10,583		$	(7,889	)
Capital expenditures		(434	)		(297	)
Free Cash Flow	$	10,149		$	(8,186	)

Net Debt to Adjusted EBITDA
	September 30,
(In thousands)	2022		2021
Current portion and long-term debt as reported	$	3,571	$	3,571
Long-Term Debt		73,975		76,025
Total Debt		77,546		79,596
Less: Cash and cash equivalents		9,028		2,570
Net Debt	$	68,518	$	77,026
Adjusted EBITDA - Trailing 12 Months	$	40,836	$	30,907
Net Debt to Adjusted EBITDA		1.7		2.5

Page 22

Results of Operations

THREE MONTHS ENDED SEPTEMBER 30, 2022, COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2021

Lighting Segment
	Three Months Ended
	September 30
(In thousands)	2022		2021
Net Sales	$	67,533	$	51,260
Gross Profit		22,279		15,457
Operating Income		9,158		4,339

Lighting Segment net sales of $67.5 million in the three months ended September 30, 2022, increased 32% from net sales of $51.3 million in the same period in fiscal 2022. Growth was broad-based, with sales increasing double digits in both project business and shipments to distributor stock. The Company’s efforts over the last two years to strengthen its lighting offering for select vertical market applications continues to position LSI to win additional business which has resulted in a growth in net sales.

Gross profit of $22.3 million in the three months ended September 30, 2022, increased $6.8 million or 44% from the same period of fiscal 2022. Gross profit as a percentage of net sales was 33.0% in the three months ended September 30, 2022, compared to 30.2% in the same period of fiscal 2022. The improvement in gross profit as a percentage of sales was driven by the increase in net sales and from targeted pricing actions to offset the impact of inflation, and effective cost control.

Operating expenses of $13.1 million in the three months ended September 30, 2022, increased $2.0 million from the same period of fiscal 2022, primarily driven by higher commission expense as a result of higher net sales.

Lighting Segment operating income of $9.2 million for the three months ended September 30, 2022, increased $4.8 million from operating income of $4.3 million in the same period of fiscal 2022 primarily driven by sales volume and by an improvement in gross profit as a percentage of sales.

Display Solutions Segment
	Three Months Ended
	September 30
(In thousands)	2022		2021
Net Sales	$	59,536	$	55,137
Gross Profit	$	12,453	$	9,036
Operating Income	$	6,496	$	3,749

Display Solutions Segment net sales of $59.5 million in the three months ended September 30, 2022, increased $4.4 million or 8% from net sales of $55.1 million in the same period in fiscal 2022. The sales increase is primarily the result of growth in both the grocery and refueling/convenience-store verticals.

Gross profit of $12.5 million in the three months ended September 30, 2022, increased $3.4 million or 38% from the same period of fiscal 2022. Gross profit as a percentage of net sales in the three months ended September 30, 2022, was 20.9% compared to 16.4% in the same period of fiscal 2022. The improvement in gross profit as a percentage of sales was driven by the increase in net sales and from targeted pricing actions to offset the impact of inflation, as well as favorable project mix.

Operating expenses of $6.0 million in the three months ended September 30, 2022, increased $0.7 million from $5.3 million in the same period of fiscal 2022, primarily driven by investments in commercial resources.

Display Solutions Segment operating income of $6.5 million in the three months ended September 30, 2022, increased $2.7 million from operating income of $3.7 million in the same period of fiscal 2022. The increase of $2.8 million was primarily driven by an increase in sales and an improvement of gross profit as a percentage of sales.

Page 23

Corporate and Eliminations
	Three Months Ended
	September 30
(In thousands)	2022			2021
Gross Profit	$	6		$	17
Operating (Loss)	$	(5,633	)	$	(3,644	)

The gross profit relates to the change in the intercompany profit in inventory elimination.

Operating expenses of $5.6 million in the three months ended September 30, 2022, increased $2.0 million or 55% from the same period of fiscal 2022. The increase was primarily the result of an increase in short-term and long-term performance-based incentive plan expense driven by improved business performance.

Consolidated Results

The Company reported $0.8 million and $0.2 million of net interest expense in the three months ended September 30, 2022, and September 30, 2021, respectively. The increase in interest expense is the results of increased borrowing costs. The Company also recorded other expense of $0.2 million and $0.1 million in the three months ended September 30, 2022, and September 30, 2021, respectively, both of which is related to net foreign exchange currency transaction losses through our Mexican and Canadian subsidiaries.

The $2.8 million of income tax expense in the three months ended September 30, 2022, represents a consolidated effective tax rate of 30.6%. Impacting the effective tax rate is an increase in a valuation reserve related to the Company’s deferred tax assets and from a higher anticipated annual tax rate. The $1.0 million of income tax expense in the three months ended September 30, 2021, represents a consolidated effective tax rate of 24.2%.

The Company reported net income of $6.3 million in the three months ended September 30, 2022, compared to net income of $3.1 million in the three months ended September 30, 2021. Non-GAAP adjusted net income was $7.1 million for the three months ended September 30, 2022, compared to adjusted net income of $3.5 million for the three months ended September 30, 2021 (Refer to the Non-GAAP tables above). The increase in Non-GAAP adjusted net income is primarily the net result of an increase in sales and an increase in the gross profit as a percentage of sales. Diluted earnings per share of $0.22 was reported in the three months ended September 30, 2022, as compared to $0.11 diluted earnings per share in the same period of fiscal 2022. The weighted average common shares outstanding for purposes of computing diluted earnings per share in the three months ended September 30, 2022, were 28,664,000 shares compared to 27,743,000 shares in the same period last year.

Page 24

Liquidity and Capital Resources

The Company considers its level of cash on hand, borrowing capacity, current ratio and working capital levels to be its most important measures of short-term liquidity. For long-term liquidity indicators, the Company believes its ratio of long-term debt to equity and our historical levels of net cash flows from operating activities to be the most important measures.

At September 30, 2022, the Company had working capital of $90.5 million compared to $84.3 million at June 30, 2022. The ratio of current assets to current liabilities was 2.13 to 1 for both September 30, 2022, and June 30, 2022. The increase in working capital from June 30, 2022, to September 30, 2022, is primarily driven by a $6.0 million increase in net inventory, a $1.0 million decrease in accrued expenses and a $6.6 million increase in cash and cash equivalents, partially offset by a $6.4 million increase in accounts payable and a $2.3 million decrease in net accounts receivable.

Net accounts receivable was $75.5 million and $77.8 million at September 30, 2022, and June 30, 2022, respectively. DSO increased to 55 days at September 30, 2022, from 54 days at June 30, 2022.

Net inventories of $80.5 million at September 30, 2022, increased $6.1 million from $74.4 million at June 30, 2022. The increase of $6.1 million is the result of an increase in gross inventory of $6.1 million and a negligible change in obsolescence reserves. Lighting Segment net inventory increased $3.4 million as the Company continues to mitigate the risk of any lingering supply chain challenges. Net inventory in the Display Solutions Segment increased $2.7 million to support several on-going programs.

Cash generated from operations and borrowing capacity under the Company’s line of credit is its primary source of liquidity. In September 2021, the Company amended its existing $100 million secured line of credit, to a $25 million term loan and $75 million remaining as a secured revolving line of credit. Both facilities expire in the third quarter of fiscal 2026. As of September 30, 2022, $18.9 million of the credit line was available. The Company is in compliance with all of its loan covenants. The $100 million credit facility plus cash flows from operating activities are adequate for operational and capital expenditure needs for the remainder of fiscal 2023. The Company also has on file with the SEC a shelf registration statement which allows it to sell any combination of common stock, preferred stock warrants, senior or subordinated debt securities or other securities in one or more offerings if it chooses to do so in the future. The Company expects to maintain the effectiveness of this shelf registration statement for the foreseeable future.

The Company had a source of $10.6 million of cash from operating activities in the three months ended September 30, 2022, compared to a use of cash of $7.9 million in the three months ended September 30, 2021. The increase in net cash flows from operating activities is primarily the result of effective management of the Company’s working capital and from improved earnings.

The Company used $0.4 million and $0.3 million of cash related to investing activities in the three months ended September 30, 2022, and September 30, 2021, respectively.

The Company had a use of cash of $3.6 million related to financing activities in the three months ended September 30, 2022, compared to a source of cash of $8.5 million in the three months ended September 30, 2021. The $12.1 million change in cash flow was primarily the result of cash generated from improved working capital management and from improved earnings, which was used to pay down the Company’s line of credit in the first quarter of fiscal 2023.

The Company has on its balance sheet financial instruments consisting primarily of cash and cash equivalents, short-term investments, revolving lines of credit, and long-term debt. The fair value of these financial instruments approximates carrying value because of their short-term maturity and/or variable, market-driven interest rates.

Off-Balance Sheet Arrangements

The Company has no financial instruments with off-balance sheet risk and have no off-balance sheet arrangements.

Cash Dividends

In November 2022, the Board of Directors declared a regular quarterly cash dividend of $0.05 per share payable November 22, 2022, to shareholders of record as of November 14, 2022. The indicated annual cash dividend rate for fiscal 2023 is $0.20 per share. The Board of Directors has adopted a policy regarding dividends which indicates that dividends will be determined by the Board of Directors in its discretion based upon its evaluation of earnings, cash flow requirements, financial condition, debt levels, stock repurchases, future business developments and opportunities, and other factors deemed relevant.

Page 25

Critical Accounting Policies and Estimates

A summary of our significant accounting policies is included in Note 1 to the audited consolidated financial statements of the Company’s fiscal 2022 Annual Report on Form 10-K.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in our exposure to market risk since June 30, 2022. Additional information can be found in Item 7A, Quantitative and Qualitative Disclosures About Market Risk, which appears on page 18 of the Annual Report on Form 10-K for the fiscal year ended June 30, 2022.

ITEM 4.  CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as such term is defined Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), that are designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed, summarized, and reported within required time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

We conducted, under the supervision of our management, including the Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Based upon our evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2022, our disclosure controls and procedures were effective. Management believes that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q are fairly presented in all material respects in accordance with GAAP for interim financial statements, and the Company’s Chief Executive Officer and Chief Financial Officer have certified that, based on their knowledge, the condensed consolidated financial statements included in this report fairly present in all material respects the Company’s financial condition, results of operations and cash flows for each of the periods presented in this report.

Changes in Internal Control

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter ended September 30, 2022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Page 26

PART II.  OTHER INFORMATION

ITEM 5. OTHER INFORMATION

None.

ITEM 6.  EXHIBITS

Exhibits:

10.1 Fiscal Year 2023 Long-Term Incentive Plan (LTIP)*++

10.2 Fiscal Year 2023 Short-Term Incentive Plan (STIP)*++

10.3 Nonqualified Deferred Compensation Plan Amended and Restated as of August 17, 2022*

31.1 Certification of Principal Executive Officer required by Rule 13a-14(a)

31.2 Certification of Principal Financial Officer required by Rule 13a-14(a)

32.1 Section 1350 Certification of Principal Executive Officer

32.2 Section 1350 Certification of Principal Financial Officer

101.INS Inline XBRL Instance Document

101.SCH Inline XBRL Taxonomy Extension Schema Document

101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document

104 Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101)

* Management compensatory agreement.

++ Certain portions of this exhibit have been omitted pursuant to Item 601(b)(10) of Regulation S-K. The omitted information is not material and would likely cause competitive harm to the Registrant if publicly disclosed. The Registrant hereby agrees to furnish a copy of any omitted portion to the SEC upon request.

Page 27

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	LSI Industries Inc.
	By:	/s/ James A. Clark
		James A. Clark
		Chief Executive Officer and President
		(Principal Executive Officer)
	By:	/s/ James E. Galeese
		James E. Galeese
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)
November 4, 2022

Page 28

EX-10.1

Exhibit 10.1

CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***]

LSI INDUSTRIES INC.

EXECUTIVE OFFICER FY23

LONG-TERM INCENTIVE PLAN

Effective: August 17, 2022

LSI INDUSTRIES INC.

FY23

LONG-TERM INCENTIVE PLAN

Effective: August 17, 2022

The LSI Industries Inc. (Company) 2019 Omnibus Plan authorizes the Compensation Committee of the Board of Directors (Compensation Committee) to issue share-based incentive awards to Company Executives. The Fiscal Year 2023 Long Term Incentive Plan (LTIP) provides for grants to the Named Executive Officers (NEOs), and other employees of the Company designated by the Compensation Committee and the Chief Executive Officer (CEO). The employees receiving grants are collectively referred to as the “Employees”.

The LTIP has been approved by the Compensation Committee as a retention tool to encourage Employees to maintain long-term employment with the Company. The LTIP provides for the issuance of three types of share-based awards: stock options, performance stock units and restricted stock units. All LTIP awards are granted effective the close of business on August 17, 2022 and at such other times and in such other manner as may be approved or authorized by the Compensation Committee.

1. Stock Options. The Company may grant time-based stock option (Stock Options) awards to Employees. Stock Option awards have a ten-year exercise term; a three-year ratable vesting period; and a stated and fixed exercise price set by the Compensation Committee as the closing price of a share of Company common stock on the date of the grant. The form of Stock Option Agreement is set forth as Exhibit “1” hereto.

2. Performance Stock Units. The Company may grant performance stock units (PSUs) to the Employees. The vesting of such PSUs is subject to the achievement of designated metrics for Return on Net Assets (RONA) and cumulative Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) at the completion of the three-year performance period concluding on June 30, 2025 (FY25). The LTIP sets for a threshold (or minimum), target and maximum goals to be achieved in FY25 for each metric. If the threshold amount is not achieved for any performance metric, there shall be no payout under such metric. The grant made to the employee is the target number of PSUs. The actual number of PSUs at vesting may stretch to a greater amount than the target amount if greater than target performance is achieved; and may be less than the target number of PSUs if less than target performance is achieved. RONA achievement accounts for 50% of the vesting of the PSUs and Cumulative Adjusted EBITDA accounts for 50% of the vesting of the PSUs. The PSUs shall cliff vest at the completion of FY25 if the FY25 threshold, target or maximum is met pursuant to the matrix set forth in Section A below. The form of PSU Award Agreement is set forth as Exhibit “2” hereto. PSUs are settled in the Common Shares of the Company.

Exhibit 10.1

3. Performance Cash Units. The Company may grant performance stock units (PCUs) to the Employees. The vesting of such PCUs is subject to the achievement of designated metrics for Return on Net Assets (RONA) and cumulative Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) at the completion of the three-year performance period concluding on June 30, 2025 (FY25). The LTIP sets for a threshold (or minimum), target and maximum goals to be achieved in FY25 for each metric. If the threshold amount is not achieved for any performance metric, there shall be no payout under such metric. The grant made to the employee is the target number of PCUs. The actual number of PCUs at vesting may stretch to a greater amount than the target amount if greater than target performance is achieved; and may be less than the target number of PCUs if less than target performance is achieved. RONA achievement accounts for 50% of the vesting of the PCUs and Cumulative Adjusted EBITDA accounts for 50% of the vesting of the PCUs. The PCUs shall cliff vest at the completion of FY25 if the FY25 threshold, target or maximum is met pursuant to the matrix set forth in Section A below. PCUs are settled in cash. The form of PCU Award Agreement is set forth as Exhibit “3” hereto.

A. PSU and PCU Performance and Payout Matrix. Attached as Exhibit “4” is the LTIP Payout Matrix. Below is a summary of the Matrix:

	Payout %	2025 RONA	2025 EBITDA Cumulative $ (000s)
Threshold	[***]	[***]	[***]
Target	[***]	[***]	[***]
Maximum	[***]	[***]	[***]

The actual LTIP award payout will be interpolated between the percentages set forth in the chart based on actual results. Examples of the Vesting of the PSUs and PCUs are set forth on Exhibit “5” hereto.

4. Restricted Stock Units. The Company may grant restricted stock units (RSUs) to the Employees. RSUs are time-based and vest one-third on each of the anniversary dates of the grant date. The form of RSU Award Agreement is set forth as Exhibit “6” hereto.

5. General Terms and Conditions. The following provisions apply to the LTIP:

A. The value of the total LTIP award to each participant shall be apportioned among PSUs, PCUs and RSUs and/or Stock Options, as determined by the Committee. The apportionment of the awards to the Named Executive Officers and the remaining Senior Officers shall be approved by the Compensation Committee.

B. The actual grants to Employees on the date of the adoption of this FY23 LTIP are set forth in the Compensation Committee resolution whereby this FY23 LTIP is adopted.

C. CEO Pool. The Compensation Committee hereby approves an additional pool of any combination of 3,000 Stock Options, RSUs, PCUs and PSUs for grant by the CEO in FY23 to employees not previously receiving a LTIP award from the Compensation Committee. The pool awards have been set aside for grant to new employees and employees whom in the discretion of the CEO are deemed to merit an award. The employees receiving a grant from the pool, and the amount of the pool awards shall be within the discretion of the CEO.

2

Exhibit 10.1

D. Definitions.

1. “Cumulative Adjusted EBITDA” is defined as the Company’s cumulative consolidated earnings before interest, taxes, depreciation and amortization expenses as adjusted for certain unusual or non-recurring items for the period commencing July 1, 2022 and ending June 30, 2025. The Company’s Adjusted EBITDA will be as reported in the Company’s Annual Report on Form 10-K for FY25 and as approved by the Compensation Committee.

2.  “RONA” is defined as the Company’s consolidated Adjusted Net Income as percent of Net Assets, which derived by dividing Adjusted Net Income by Net Assets. For purposes of this definition,

3.  “Adjusted Net Income” is defined as non-GAAP Net Income which is developed and reported to the Company’s Board of Directors on a quarterly basis. For purposes of this definition, “Net Assets” is defined as working capital and net property, plant, and equipment (excluding goodwill and intangibles).

E. Except to the extent an agreement approved by the Company’s Compensation Committee provides for vesting in other circumstances, such as Company terminating Participant’s employment without Cause or Participant terminating employment for Good Reason, LTIP participants must be continuously employed by the Company on (i) the specified award vesting for Stock Options and RSUs and (ii) the date designated for payout of the PSUs and/or PCUs, in order to vest in such award or portion of such award. The Company will make the distribution of the PSU and PCU awards to participants as soon as administratively practicable following the date of the award determination by the Compensation Committee.

F. At the discretion of the CEO in consultation with the EVP of Human Resources, any type of lengthy leave of absence may result in an adjustment of the award. Leaves of absence include time away from work for reasons of short-term disability, FMLA leave, military leave, or other leave of absence.

G. If a grantee Retires or becomes disabled (as defined by Social Security) or deceased during the plan period, the Compensation Committee may consider a pro-rated award based to the grantee or the grantee’s beneficiary, as the case may be, upon the actual amount of base salary received during the plan period, subject to the terms and conditions of the 2019 Omnibus Plan.

H. LTIP awards may be subject to assignment laws and other laws that require payment of the incentive award to an individual other than the grantee (such as IRS tax levies, child support arrearages, etc.). The Company will comply with all such applicable assignment laws.

3

Exhibit 10.1

I. The LTIP does not create or imply the existence of a contract of employment. The Company reserves the right to amend, reduce, modify, interpret or discontinue all or part of the LTIP with or without reason as the Compensation Committee deems advisable in its sole and absolute discretion, subject to the terms and conditions of the 2019 Omnibus Plan and the terms and conditions of the grant documents.

J. In the event the Company is required to prepare an accounting restatement due to the material noncompliance of the Company with any financial reporting requirement under the federal securities laws, the Compensation Committee shall require reimbursement to the Company of the PSUs granted hereunder where: (i) the payment was predicated upon achieving certain financial results that were subsequently the subject of a substantial restatement of the Company’s financial statements filed with the SEC; (ii) the Compensation Committee determines the grantee engaged in intentional misconduct that caused or substantially caused the need for the accounting restatement; and (iii) a lower payment would have been made to such officer based upon the restated financial results. In each such instance, the Company will, to the extent practicable, seek to recover from the officer the amount by which any performance-based awards paid to such officer for the relevant period exceeded the lower payment that would have been made based on the restated financial results.

K. In the event and to the extent Company common shares are issued pursuant to awards granted under the LTIP, each grantee who was a NEO on the grant date, and receives such Company common shares, will be subject to the stock ownership guidelines with respect to the net after tax shares received upon exercise of the stock options or vesting of RSUs, PCUs and PSUs.

L. The Compensation Committee shall have the discretion to determine that certain Employees of the Company other than NEOs shall be entitled to award payouts in cash in lieu of shares. Employees Designated to receive cash will be awarded PCUs. The cash value for payouts with respect to PCUs shall be calculated based upon the closing price of LSI Common Stock (“LYTS”) as quoted by Nasdaq Global Select Market (or other exchange on which LYTS is traded) on the date the Compensation Committee determines that the applicable performance metrics have been achieved (the Per Unit Valuation). Specifically, with respect to PCUs, the actual dollar amount of the cash payout shall be calculated as follows: (i) number of PSUs granted, multiplied by (ii) applicable payout percentage(s), multiplied by (iii) Per Unit Valuation Cash payments shall be made as soon as administratively practicable following the Compensation Committee’s determination of the achievement of applicable performance metrics, but in no event later than 2 ½ months following the end of the fiscal year during which the performance period is completed.

4

Exhibit 10.1

M. The Company reserves the right to require each grantee to execute and deliver to the Company a non-compete/non-solicitation agreement, in the form satisfactory to Company, as a condition of the grant of any award or the payment of any amounts as may be due under the LTIP.

N. Capitalized terms not otherwise defined by this LTIP shall have the meanings ascribed to them in the 2019 Omnibus Plan.

O. In the event of a conflict between this LTIP and any Supplemental Benefits and/or Change in Control Agreement (“Employment Related Agreements”) between the Company and an Employee, the Employment Related Agreements shall control.

5

EX-10.2

Exhibit 10.2

CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***]

LSI INDSTRIES INC.

FISCAL YEAR 2023

SHORT TERM INCENTIVE PLAN

Effective : August 17, 2022

pg. 1

LSI INDUSTRIES INC.

FISCAL YEAR 2022

SHORT TERM INCENTIVE PLAN

Effective August 17, 2022

The Fiscal Year 2023 Short Term Incentive Plan (STIP) is designed to motivate executives to achieve the LSI Industries Inc. (Company) fiscal year 2023 (FY23) operating plan and its Adjusted EBITDA and Net Sales objectives. The STIP has been approved by the Company’s Compensation of the Board of Directors Committee (Compensation Committee). The FY23 STIP provides for the payment of cash incentive awards to executive’s if the stated Adjusted EBITDA and Net Sales metrics set forth herein are achieved.

1. Bonus Potential. The bonus potential is a percentage payout based on the Company’s attainment of the FY23 financial metrics for Adjusted EBITDA and Net Sales. The STIP sets for a Threshold (or minimum), Target and Maximum goals to be achieved in FY23 for each metric. If the threshold amount is not achieved for any performance metric, there shall be no payout under such metric. The payout matrix is attached as EXHIBIT “1” hereto. Below is a summary:

1.1 Adjusted EBITDA Component

Threshold: [***]

Target:       [***]

Maximum: [***]

1.2 Net Sales Component 

Threshold: [***]

Target:       [***]

Maximum: [***]

2. Performance Mix. The STI payout shall be based eighty percent (80%) on achievement of the Adjusted EBITDA metric and twenty percent (20%) on achievement of the Net Sales metric.

3. Payout Potential by Executive.  The Compensation Committee has assigned each executive a STIP Target percentage of Base Salary. The Target Assignment is set forth on Exhibit “2” hereto. The bonus amount is based on a percentage of the executive’s base salary or annual hourly wages. An executive may not be moved to a different position category unless a formal request has been submitted and approved by the CEO.

The threshold is paid at 50% of Target and the Maximum is paid at 150% of Target.

The actual STIP award payout will be interpolated between the percentages set forth in Exhibit “1” based on actual results.

pg. 2

4. Retention of Discretion. The Compensation Committee maintains the discretion to award additional bonuses.

5. Examples. Examples of the manner in which the payout shall be calculated under the FY23 STIP are set forth on the attached Exhibit “3”.

6. General Terms and Conditions. The following terms and conditions govern the STIP:

A. The STIP covers all executives of the Company and its subsidiaries except for certain sales executives who participate in individual commission-based or quota-based bonus plans unique to such executives’ sales territory or vertical. An executive who participates in a commission-based or a quota-based bonus plan is not eligible to participate in the STIP, except as permitted in the discretion of the CEO.

B. STIP incentive award payments to Named Executive Officers and other Corporate Officers shall be approved by the Company’s Compensation Committee. The CEO may make discretionary modifications of the calculated STIP incentive award of non-Named Executive Officers and Corporate Officers to decrease or increase an executive’s bonus for special objectives or subjective circumstances. An executive must be employed on the date of the payment of the STIP in order to be eligible to receive a STIP payment.

C. Definitions:

“Adjusted EBITDA” is defined as the Company’s consolidated earnings before interest, taxes, depreciation and amortization expenses as adjusted for certain unusual or non-recurring items. The Company’s Adjusted EBITDA will be as reported in the Company’s Annual Report on Form 10-K for FY23 and as approved by the Compensation Committee.

“Net Sales” is the number reported as such in the Company’s financial statements on Form 10-K for FY23 and as approved by the Compensation Committee.

“Retire” means to retire from the Company at or after the age of 62 and at least 5 years of service.

D. The Company’s fiscal year commences July 1^st and concludes on June 30^th. Executives hired after July 1^st and before April 1^st will have their STIP prorated to the number of days employed in the fiscal year. Executives hired after March 31^st will not be eligible to participate in the STIP.

E. At the discretion of the CEO in consultation with the EVP of Human Resources, any type of lengthy leave of absence could result in a pro-rata reduction of the calculated award. Leaves of absence may include time away from work for reasons of short-term disability, FMLA leave, military leave, or other leave of absence.

F. If an executive Retires or becomes disabled (as defined by Social Security) or deceased during the fiscal year, the Company may consider a pro-rated incentive award payment based upon the actual amount of base salary received during the fiscal year prior to the date of retirement, disability or death.

G. STIP Incentive award payments can be subject to assignment laws and other laws that require payment of the incentive award to other than the executive (IRS tax levies, child support arrearages, etc.). The Company will comply with all such applicable assignment laws.

pg. 3

H. The STIP does not create or imply the existence of a contract of employment. The Company reserves the right to amend, reduce, modify, interpret or discontinue all or any part of the STIP with or without reason as the Compensation Committee deems advisable in its sole and absolute discretion.

I. An executive’s actual base salary paid on the last day of FY23 shall be used to calculate the incentive amount that may be awarded under the STIP.

EXHIBITS / EXAMPLES

[***]

pg. 4

EX-10.3

Exhibit 10.3

LSI INDUSTRIES INC.
NONQUALIFIED DEFERRED COMPENSATION PLAN

(Amended and Restated as of August 17, 2022)

PREAMBLE

LSI Industries Inc. and each Employer hereby amend and restate the Plan effective as of December 30, 2019 as set forth herein. The Plan was originally effective as of September 15, 1996. The Plan was amended and restated as of July 1, 1998, July 1, 2002, April 27, 2004, September 9, 2005, November 1, 2006, December 31, 2008, November 19, 2009, November 18, 2010, November 20, 2014 and December 30, 2019. This Plan is an unfunded deferred compensation arrangement for a select group of management or highly compensated employees who render services to an Employer. Amounts credited to a Participant’s Deferred Compensation Account are deemed to be invested in Common Stock of LSI Industries Inc (the “Shares”) and distributions to Plan Participants are made in Shares.

ARTICLE I.     DEFINITIONS

1.1 “Beneficiary” shall mean the person or persons entitled to receive the distributions, if any, payable under the Plan upon or after a Participant’s death, to such person or persons as such Participant’s Beneficiary. Each Participant may designate a Beneficiary by filing the proper form with the Committee. A Participant may designate one or more contingent Beneficiaries to receive any distributions after the death of a prior Beneficiary. A designation shall be effective upon said filing, provided that it is so filed during such Participant’s lifetime and may be changed from time to time by the Participant.

1.2 “Base Salary” shall mean Compensation that is not incentive based and Paid to the Employee on a regular periodic basis.

1.3 “Bonus” shall mean Compensation that is not Base Salary and which is bonus paid to the Participant.

1.4 “Change in Control” shall mean the occurrence of a “change in the ownership,” a “change in the effective control” or a “change in the ownership of a substantial portion of the assets” of LSI Industries Inc., as defined under Section 409A of the Code.

1.5  “Code” shall mean the Internal Revenue Code of 1986 as amended.

1.6 “Committee” shall mean the Compensation Committee of the Board of Directors of LSI Industries Inc., or its designee, which is responsible for the administration of this Plan in accordance with the provisions of the Plan as set forth in this document.

1.7 “Compensation” shall mean the total amount of earnings (including bonuses) paid by an Employer to an Executive or which would otherwise be paid but for a deferral election hereunder or a salary reduction election under any Code Section 401(k) plan or Code Section 125 plan.

1.8 “Deferred Compensation Account” shall mean the account to be established by an Employer as a book reserve to reflect the amounts deferred by a Participant, the amounts credited by the Employer, and the earnings adjustment under Article VII. A Participant’s Deferred Compensation Account shall be reduced by distributions under Article VIII and Article IX.

1.9 “Employer” shall mean LSI Industries Inc. and any affiliate of LSI Industries Inc. (whether or not incorporated) which has adopted the Plan with the consent of LSI Industries Inc., or any successor or assignee of any of them.

1.10 “Executive” shall mean any employee designated by the Committee (in conjunction with senior management of LSI Industries Inc.) as a member of the select group of management or highly compensated employees eligible for participation in this Plan.

1.11 “Participant” shall mean any Executive who has a right to a benefit under the Plan and a person who was such at the time of the Executive’s death or Separation from Service and who retains, or whose Beneficiary retains, a benefit under the Plan which has not been distributed.

1.12 “Plan” shall mean the LSI Industries Inc. Nonqualified Deferred Compensation Plan as described in this instrument, amended and restated, and, as may be amended thereafter.

1.13 “Plan Year” shall mean the 12-consecutive month period beginning on July 1.

1.12 “Separation from Service” shall mean a “separation from service” within the meaning of Code Section 409A and the rules and regulations promulgated thereunder.

1.13 “Shares” is defined in the Preamble.

1.14 “Subsequent Election” is defined in Section 8.2(b).

ARTICLE II.     PARTICIPANT’S ELECTION TO DEFER

2.1 Each Executive may elect to have up to 20% of the Executive’s Base Salary or Bonus (in whole percentages) for a Plan Year deferred and credited with earnings in accordance with the terms and conditions of the Plan. Deferrals are credited to a Participant’s Deferred Compensation Account and deemed to be invested in Shares.

- 2 -

2.2 An Executive desiring to exercise an election under Paragraph 2.1 shall notify the Committee of his/her deferral election. Such notice must be in writing on a form provided by the Committee, or in a manner otherwise satisfactory to the Committee, and provided to the Committee by such date as the Committee shall specify, but in all events no later than the end of the calendar year preceding the first day of the Plan Year to which such election is to apply. Notwithstanding the foregoing, the following special rules shall apply:

(a) Base Salary. The deferral election with respect to Base Salary earned for periods commencing after December 31, 2022 (and that is not otherwise subject to an irrevocable deferral election) must be filed with the Committee by, and shall become irrevocable as of, December 31 (or such earlier date as specified by the Committee on the deferral election) of the calendar year next preceding the calendar year for which such base salary would otherwise be earned. For purposes of illustration only, an election for deferral of base salary to be earned in calendar year 2023 for the fiscal 2023 Plan Year must be made by December 31, 2022.

(b) Annual Bonus.

(1) Subject to Section 2.2 (b)(2) of the Plan, the deferral election with respect to Annual Bonuses commencing with the 2021 Plan Year that are “fiscal year compensation” as defined under Code Section 409A must be filed with the Committee by, and shall become irrevocable as of, the close of the Plan Year (or such earlier date as specified by the Committee on the deferral election) next preceding the first day of the Plan Year for which such annual bonus would otherwise be earned. For purposes of illustration only, an election for deferral of a bonus which is “fiscal year compensation” to be earned in Plan Year 2021 and if earned, payable in August 2021, shall be made by June 30, 2020; and

(2) An Executive’s election relating to Compensation from a performance-based bonus payment based on services over a period of at least 12 months must be made no later than 6 months before the end of the service period, provided the Executive performs services continuously from the later of the beginning of the performance period or the date the performance criteria are established through the date an election is made under this Paragraph 2.2, and provided further that in no event may an election to defer Compensation from a performance-based bonus payment be made after such Compensation has become readily ascertainable. For purposes of illustration only, an election for deferral of a bonus to be earned in Plan Year 2023 and if earned, payable in August 2023, shall be made by December 31, 2022.

(c) New Participants. An Executive’s election for deferrals must be provided no later than 30 days following the date the Executive first becomes eligible, and such election will only be effective with regard to Compensation earned following the election; otherwise the Executive must wait until the next enrollment period.

2.3 A deferral election shall be effective with respect to the entire Plan Year or calendar year to which it relates and may not be modified or terminated for that Plan Year or calendar year; provided, however, in the event of an unforeseeable emergency (as defined in Paragraph 8.4), a Participant’s deferral election shall be terminated for the remainder of the respective Plan Year or calendar year, as applicable.

- 3 -

2.4 The Compensation otherwise payable to the Executive during the Plan Year or calendar year shall be reduced pursuant to the Executive’s election under this Article II. Such amounts shall be credited to the Executive’s Deferred Compensation Account.

ARTICLE III.     EMPLOYER MAKE-UP ALLOCATIONS

3.1 If because of an election under Article II, a Participant receives a smaller allocation of Employer contributions and/or forfeitures under the LSI Industries Inc. Retirement Plan for a Plan Year of that plan than the Participant would have received had no such election been made, then there shall be credited to the Participant’s Deferred Compensation Account an amount equal to the amount which bears the same relationship to the amounts deferred under Article II and credited to the Participant’s Deferred Compensation Account during the Plan Year as the Participant’s allocations (of Employer contributions and/or forfeitures) under the LSI Industries Inc. Retirement Plan bear to the Participant’s compensation taken into account under that plan. Such amount shall be credited to the Participant’s Deferred Compensation Account at such time as the Committee shall determine.

3.2 (a)If, by reason of the application of the compensation limitation imposed by Code Section 401(a)(17) (or any corresponding successor provision), including any provision in the LSI Industries Inc. Retirement Plan providing such limitation, a Participant receives a smaller allocation of Employer contributions and/or forfeitures under the LSI Industries Inc. Retirement Plan for any plan year of that plan than he would have received had no such limitation been in effect, then there shall be credited to his Deferred Compensation Account the amount determined under (b) below. Such amount shall be credited to the Participant’s Deferred Compensation Account at such time as the Committee shall determine.

(b) The amount hereunder shall be equal to the amount which is the same percentage of the Participant’s compensation (as defined in the LSI Industries Inc. Retirement Plan) in excess of the compensation limitation referred to in (a) above as the percentage allocated under the LSI Industries Inc. Retirement Plan on compensation in excess of the Social Security taxable wage base (but not in excess of the limitation referred to in (a) above).

- 4 -

ARTICLE IV.     LSI INCENTIVE ALLOCATIONS

4.1 Each Participant shall be eligible for an Employer incentive allocation for a Plan Year, to be determined in accordance with Paragraph 4.2, if the Participant satisfies both of the following requirements:

(a) The Participant must have elected to make Compensation deferrals under the Plan for the Plan Year of the LSI incentive allocation; and

(b) The Participant must be employed by an Employer at the time the Committee makes the allocation.

4.2 Participants eligible for an Employer incentive allocation under Paragraph 4.1 above shall receive such an allocation determined by the Committee as follows:

(a) The Employer shall match 100% the amount deferred by the Participant; provided that the Employer shall not in a Plan Year make matches that in the aggregate exceed 20% of the Participant’s Base Salary or Bonus; and

(b) The Committee shall make the match at the same time the Participant deferral is made or at such time as is reasonably administratively practical for the Employer. The match shall be deemed to be made in Shares.

ARTICLE V.     ADDITIONAL LSI ALLOCATIONS

The Employer may make additional discretionary allocations to certain Participants. Such additional discretionary allocations must be approved by the Committee and shall be credited to the Participants’ Deferred Compensation Accounts at such time as the Committee shall determine.

ARTICLE VI.     PARTICIPANT’S INTEREST

Neither a Participant nor a Participant’s designated Beneficiary shall acquire any property interest in the Participant’s Deferred Compensation Account or any other assets of the Employer, their rights being limited to receiving from the Employer a deferred payment as set forth in this Plan, and these rights are conditioned upon continued compliance with the terms and conditions of this Plan. To the extent that any Participant or Beneficiary acquires a right to receive benefits under this Plan, such right shall be no greater than the right of any unsecured general creditor of the Employer.

ARTICLE VII.     CREDITING OF EARNINGS

7.1 General. There shall be credited to the Deferred Compensation Account of each Participant an additional amount of earnings (or losses) determined under this Article VII.

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7.2 Investment of Compensation Deferrals in Shares. All Compensation deferrals shall be credited with earnings (or losses) as though invested in Shares without reference to dividends paid on Shares.

7.3 Employer Allocations. Employer allocations under Article III and Article IV shall be credited with earnings (or losses) as if it were invested in Shares without reference to the payment of dividends. The Participant shall have no right to elect that alternative investments be used.

7.4 Valuation of Deferred Amounts and Employer Matching Contribution. Executive deferrals shall be valued at the closing price of Shares on the NASDAQ on the date the deferral is made, and the Employer matching contribution shall be likewise valued. The Committee shall determine the valuation of any Employer discretionary contribution.

7.5 Valuation of Account. For each Plan Year quarter or other period, the Participant’s Deferred Compensation Account shall be increased or decreased as if it had been invested in Shares on the date of the valuation using the NASDAQ closing price for the Shares om such date.

ARTICLE VIII.     PLAN BENEFITS

8.1 Vesting. A Participant’s rights to the Participant’s Deferred Compensation Account (as adjusted for earnings and losses) shall be fully vested and nonforfeitable at all times.

8.2 Distribution of Benefit.

(a) At the time an Executive makes the first deferral election under Article II, the Executive shall also elect to have the amounts represented by the Executive’s Deferred Compensation Account paid in one of the following two forms commencing as soon as administratively feasible upon the Executive’s Separation from Service but in all events within 90 days following the date of such Separation from Service:

(1) a single lump sum payment, or

(2) approximately equal annual installments to last not more than 10 years.

If installment payments are in effect, the Participant’s Deferred Compensation Account shall continue to be credited with earnings (or losses) under Article VII until payment of the final installment.

(b)         A Participant may change the election referred to in (a) above only in accordance with this Paragraph 8.2(b). A Participant may make a one-time election on a form provided by the Employer to change the form of payment of his Deferred Compensation Account to a form otherwise permitted under Section 8.2(a) of the Plan (a “Subsequent Payment Election”).  The Subsequent Payment Election shall become irrevocable upon acceptance by the Employer and shall be made in accordance with the following rules: 

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(1)      The Subsequent Payment Election may not take effect until at least 12 months after the date on which it is accepted by the Employer.

(2)      Except in the event of the death or unforeseeable emergency (within the meaning of Section 8.4 hereof) of the Participant, the payment of such Deferred Compensation Account will be delayed until the 5th anniversary of the date that the Deferred Compensation Account would otherwise have been paid under the Plan if such Subsequent Payment Election had not been made (or, in the case of installment payments, which are treated as a single payment for purposes of this Section, on the 5th anniversary of the date that the first installment payment was scheduled to be made).

(c)         If a Participant has no election concerning the form of benefit payment under this Paragraph 8.2 in effect at the time of the Participant’s Separation from Service, payment shall be made in a single lump sum payment.

(d)         Elections shall be made in writing, on a form provided by the Committee, and shall be made in accordance with the rules established by the Committee.

(e)         Notwithstanding the Participant’s payment election under this Paragraph 8.2 for a Participant who is a “specified employee” as defined in Code Section 409A and the rules and regulations promulgated thereunder, a distribution may not be made before the date which is 6 months after the date of the Participant’s Separation from Service (or if earlier, the date of death of the Participant).

8.3 Distribution of Shares. Participants shall receive benefit payments in the form of whole shares of Shares. Any fractional shares shall be paid in cash. Any expenses attributable to such payment may be deducted from the Participant’s Deferred Compensation Account. The issuance of Shares under the Plan must be pursuant to a Shareholder approved plan.

8.4 Hardship Distribution. Subject to the approval of the Committee, a Participant may withdraw all or a portion of the Participant’s Deferred Compensation Account in the event of a hardship. The distribution shall be made in the form of whole Shares. Any fractional shares shall be paid in cash. A hardship distribution shall only be made in the event of an unforeseeable emergency that would result in severe financial hardship to the Participant if hardship distributions were not permitted. Withdrawals of amounts because of an unforeseeable emergency shall only be permitted to the extent reasonably needed to satisfy the emergency need. An unforeseeable emergency is defined as severe financial hardship to the Participant resulting from a sudden and unexpected illness or accident of the Participant, the Participant’s spouse, the Participant’s Beneficiary, or the Participant’s dependent (as defined in Code Section 152, without regard to Code Section 152(b)(1), (b)(2) and (d)(1)(B)), loss of the Participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The circumstances that will constitute an unforeseeable emergency will depend upon the facts of each case, but, in any case, payment may not be made to the extent such hardship is or may be relieved (1) through reimbursement or compensation by insurance or otherwise (2) liquidation of the Participant’s assets (to the extent the liquidation of such assets would not cause severe financial hardship, or (3) by cessation of deferrals under the Plan. In the event of an unforeseeable emergency (regardless of whether a hardship distribution is made), a Participant’s deferral election under Paragraph 2.1 shall terminate and no further deferrals shall be made for such Participant for the remainder of the Plan Year or calendar year.

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8.5 Change in Control. For deferrals of Compensation related to deferral elections that first become irrevocable on or after December 31, 2019, notwithstanding any payment election or Plan provision to the contrary, upon the occurrence of a Change in Control, the remaining amount of the Participant’s Deferred Compensation Account attributable to such deferrals shall be paid to the Participant or his Beneficiary in a single lump sum within 30 days following such Change in Control, or such later date as may be required under Section 8.2(e) hereof.

ARTICLE IX.     DEATH

Upon the death of a Participant prior to commencement of payment under Article VIII, the amounts represented by the Participant’s Deferred Compensation Account, increased by any amounts due to be credited but not yet credited under Article II, Article III or Article IV shall be payable to the Participant’s Beneficiary as soon as administratively feasible following the date of the Participant’s death but in all events within 90 days following such date in the form of distribution elected by the Participant pursuant to Paragraph 8.2(a). If the Participant has already commenced receiving the amounts represented by the Participant’s Deferred Compensation Account in the installment payment form, the installment payments shall continue to be paid to the Participant’s Beneficiary. The Beneficiary shall receive any benefit payments in the form of whole shares of Shares.

ARTICLE X.     NON‑ASSIGNABLE/NON‑ATTACHMENT

Except as required by law, no right of the Participant or designated Beneficiary to receive payments under this Plan shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation or to execution, attachment, levy or similar process or assignment by operation of law and any attempt, voluntary or involuntary, to effect any such action shall be null and void and of no effect. An Employer may not assign its obligations hereunder.

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ARTICLE XI.     CONSTRUCTION

This Plan shall be construed under the laws of the Code and to the extent not preempted by federal law, according to the laws of the State of Ohio. Article headings are for convenience only and shall not be considered as part of the terms and provisions of the Plan. The Committee shall have full power and authority to interpret, construe and administer this Plan.

ARTICLE XII.     AMENDMENT OR TERMINATION OF PLAN

The Plan may be terminated at any time or amended in whole or in part from time to time by LSI Industries Inc. provided that no such termination or amendment may directly or indirectly reduce a Participant’s Deferred Compensation Account (other than through a distribution thereof to the Participant (or his Beneficiary in the event of his death)); and any such amendment shall be binding on each Employer, Participant and designated Beneficiary.

ARTICLE XIII.     MISCELLANEOUS

13.1 Neither this Plan, nor any action of LSI Industries Inc., an Employer or the Committee, nor any election to defer Compensation hereunder shall be held or construed to confer on any person any legal right to be continued as an employee of LSI Industries Inc. or any Employer.

13.2 LSI Industries Inc. and the Participant’s Employer shall have the right to deduct from all payments and amounts credited hereunder any taxes required by law to be withheld with respect to any benefits under this Plan.

13.3 The Committee hereby delegates to the Company’s General Counsel the administrative activities under the Plan (including, but not limited to, the preparation and distribution of enrollment materials) until such time as the Committee withdraws such delegation. The General Counsel shall report to the Committee on plan enrollment and such others matters conducted by the General Counsel on behalf of the Committee.

IN WITNESS WHEREOF, LSI Industries Inc. and each Employer, with the consent of LSI Industries Inc., have caused this amended and restated Plan to be executed as of this 17^th day of August, 2022

LSI INDUSTRIES INC.

By: /s/ James A. Clark, Chief Executive Officer

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EX-31.1

EXHIBIT 31.1

Certification of Principal Executive Officer

Pursuant to Rule 13a-14(a)

I, James A. Clark, certify that:

1.           I have reviewed this quarterly report on Form 10-Q of LSI Industries Inc.;

2.           Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.           Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.           The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)           Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)           Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)           Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)          Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.           The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

(a)           All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)           Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  November 4, 2022	/s/ James A. Clark
	Principal Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Principal Financial Officer

Pursuant to Rule 13a-14(a)

I, James E. Galeese, certify that:

1.          I have reviewed this quarterly report on Form 10-Q of LSI Industries Inc.;

2.           Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.           Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.           The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)           Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)         Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)           Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)          Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.           The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

(a)           All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)           Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  November 4, 2022	/s/ James E. Galeese
	Principal Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF JAMES A. CLARK

Pursuant to Section 1350 of Chapter 63 of the

United States Code and Rule 13a-14b

In connection with the filing with the Securities and Exchange Commission of the Quarterly Report of LSI Industries Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2022 (the “Report”), I, James A. Clark, Principal Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ James A. Clark

James A. Clark

Chief Executive Officer and

President

Date: November 4, 2022

A signed original of this written statement required by Section 906 has been provided to LSI Industries Inc. and will be retained by LSI Industries Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

EXHIBIT 32.2

CERTIFICATION OF JAMES E. GALEESE

Pursuant to Section 1350 of Chapter 63 of the

United States Code and Rule 13a-14b

In connection with the filing with the Securities and Exchange Commission of the Quarterly Report of LSI Industries Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2022 (the “Report”), I, James E. Galeese, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ James E. Galeese

James E. Galeese

Executive Vice President and Chief

Financial Officer

Date:  November 4, 2022

A signed original of this written statement required by Section 906 has been provided to LSI Industries Inc. and will be retained by LSI Industries Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - shares	3 Months Ended
	Sep. 30, 2022	Oct. 28, 2022
Document Information [Line Items]
Entity Central Index Key	0000763532
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	0-13375
Entity Registrant Name	LSI Industries Inc.
Entity Incorporation, State or Country Code	OH
Entity Tax Identification Number	31-0888951
Entity Address, Address Line One	10000 Alliance Road
Entity Address, City or Town	Cincinnati
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	45242
City Area Code	513
Local Phone Number	793-3200
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	LYTS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		27,777,410

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Net Sales	$ 127,069	$ 106,397
Cost of products and services sold	92,319	81,887
Restructuring costs	12	0
Gross profit	34,738	24,510
Selling and administrative expenses	24,717	20,066
Operating income	10,021	4,444
Interest expense	788	234
Other expense	(213)	(79)
Income before income taxes	9,020	4,131
Income tax expense	2,758	998
Net income	$ 6,262	$ 3,133
Earnings per common share (see Note 4)
Earnings Per Share, Basic, Total (in dollars per share)	$ 0.23	$ 0.12
Diluted (in dollars per share)	$ 0.22	$ 0.11
Weighted average common shares outstanding
Basic (in shares)	27,641	26,996
Diluted (in shares)	28,664	27,743

XML

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Net Income	$ 6,262	$ 3,133
Foreign currency translation adjustment	7	(44)
Comprehensive Income	$ 6,269	$ 3,089

XML

Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
LIABILITIES & SHAREHOLDERS' EQUITY
Cash and cash equivalents	$ 9,028	$ 2,462
Current maturities of long-term debt	3,571	3,571
Accounts receivable, less allowance for credit losses of $508 and $499, respectively	75,449	77,750
Accounts payable	41,133	34,783
Inventories	80,457	74,421
Accrued expenses	35,231	36,264
Refundable income taxes	1,118	1,041
Total current liabilities	79,935	74,618
Other current assets	4,355	3,243
Long-term debt	73,975	76,025
Total current assets	170,407	158,917
Finance lease liabilities	1,174	1,246
Operating lease liabilities	7,381	8,240
Other long-term liabilities	3,307	3,182
Commitments and contingencies (Note 12)
Property, Plant and Equipment, at cost
Operating lease liabilities	7,381	8,240
Land	4,010	4,010
Other long-term liabilities	3,307	3,182
Buildings	24,469	24,495
Commitments and contingencies (Note 12)
Machinery and equipment	67,115	66,762
Shareholders' Equity
Buildings under finance leases	2,033	2,033
Preferred shares, without par value; Authorized 1,000,000 shares, none issued	0	0
Construction in progress	563	618
Common shares, without par value; Authorized 40,000,000 shares; Outstanding 27,777,410 and 27,484,514 shares, respectively	140,599	139,500
Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, before Accumulated Depreciation and Amortization	98,190	97,918
Treasury shares, without par value	(6,439)	(5,927)
Less accumulated depreciation	(71,913)	(70,760)
Deferred compensation plan	6,439	5,927
Net property, plant and equipment	26,277	27,158
Retained Earnings (Accumulated Deficit), Total	13,078	8,224
Goodwill	45,030	45,030
Accumulated other comprehensive income	52	45
Other intangible assets, net	66,774	67,964
Total shareholders' equity	153,729	147,769
Operating lease right-of-use assets	7,826	8,664
Total liabilities & shareholders' equity	319,501	311,080
Other long-term assets, net	3,187	3,347
Total assets	$ 319,501	$ 311,080

XML

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ / shares in Thousands, $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Accounts Receivable, Allowance for Credit Loss, Current	$ 508	$ 499
Preferred Stock, No Par Value (in dollars per share)	$ 0	$ 0
Preferred Stock, Shares Authorized (in shares)	1,000,000	1,000,000
Preferred Stock, Shares Issued (in shares)	0	0
Common Stock, No Par Value (in dollars per share)		$ 0
Common Stock, Shares Authorized (in shares)	40,000,000	40,000,000
Common Stock, Shares, Outstanding, Ending Balance (in shares)	27,777,410	27,484,514

XML

Condensed Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($)	Common Stock Including Additional Paid in Capital [Member]	Treasury Stock [Member]	Key Executive Deferred Compensation [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Jun. 30, 2021	26,863	(346)
Balance at Jun. 30, 2021	$ 132,526,000	$ (2,450,000)	$ 2,450,000	$ 49,000	$ (1,405,000)	$ 131,170,000
Net Income	0	0	0	0	3,133,000	3,133,000
Other comprehensive income	$ 0	$ 0	0	(44,000)	0	(44,000)
Stock compensation awards (in shares)	10	0
Stock compensation awards	$ 75,000	$ 0	0	0	0	75,000
Restricted stock units issued, net of shares withheld for tax withholdings (in shares)	79	0
Restricted stock units issued, net of shares withheld for tax withholdings	$ (247,000)	$ 0	0	0	0	(247,000)
Shares issued for deferred compensation (in shares)	263	0
Shares issued for deferred compensation	$ 2,042,000	$ 0	0	0	0	2,042,000
Activity of treasury shares, net (in shares)		(261)
Activity of treasury shares, net	0	$ (2,021,000)	0	0	0	(2,021,000)
Deferred stock compensation	0	0	2,021,000	0	0	2,021,000
Stock compensation expense	$ 556,000	0	0	0	0	556,000
Stock options exercised, net (in shares)	3
Stock options exercised, net	$ 16,000	0	0	0	0	16,000
Dividends	$ 0	$ 0	0	0	(1,328,000)	(1,328,000)
Balance (in shares) at Sep. 30, 2021	27,218	(607)
Balance at Sep. 30, 2021	$ 134,968,000	$ (4,471,000)	4,471,000	5,000	400,000	135,373,000
Balance (in shares) at Jun. 30, 2022	27,484,000	(822,000)
Balance at Jun. 30, 2022	$ 139,500,000	$ (5,927,000)	5,927,000	45,000	8,224,000	147,769,000
Net Income	0	0	0	0	6,262,000	6,262,000
Other comprehensive income	$ 0	$ 0	0	7,000	0	7,000
Stock compensation awards (in shares)	12,000	0
Stock compensation awards	$ 75,000	$ 0	0	0	0	75,000
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings (in shares)	201	0
Restricted Stock, Value, Shares Issued Net of Tax Withholdings	$ (66)	$ 0	0	0	0	(66,000)
Shares issued for deferred compensation (in shares)	80,000	0
Shares issued for deferred compensation	$ 539,000	$ 0	0	0	0	539,000
Activity of treasury shares, net (in shares)	0	(77,000)
Activity of treasury shares, net	$ 0	$ (512,000)	0	0	0	(512,000)
Deferred stock compensation	0	0	512,000	0	0	512,000
Stock compensation expense	551,000	0	0	0	0	551,000
Stock options exercised, net	0	0	0	0	0	0
Dividends	$ 0	$ 0	0	0	(1,408,000)	(1,408,000)
Balance (in shares) at Sep. 30, 2022	27,777,000	(899,000)
Balance at Sep. 30, 2022	$ 140,599,000	$ (6,439,000)	$ 6,439,000	$ 52,000	$ 13,078,000	$ 153,729,000

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Condensed Consolidated Statements of Shareholders' Equity (Unaudited) (Parentheticals) - $ / shares	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Common Stock, Dividends, Per Share, Cash Paid (in dollars per share)	$ 0.20	$ 0.20

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash Flows from Operating Activities
Net Income	$ 6,262	$ 3,133
Non-cash items included in net income
Depreciation and amortization	2,421	2,563
Deferred income taxes	350	(13)
Deferred compensation plan	539	2,042
Stock compensation expense	551	556
Issuance of common shares as compensation	75	75
Loss on disposition of fixed assets	2	14
Allowance for doubtful accounts	8	10
Inventory obsolescence reserve	250	572
Changes in certain assets and liabilities
Accounts receivable	2,293	(6,260)
Inventories	(6,286)	(9,578)
Refundable income taxes	(77)	138
Accounts payable	6,350	8,359
Accrued expenses and other	(1,943)	(6,663)
Customer prepayments	(212)	(2,837)
Net cash flows provided by (used in) operating activities	10,583	(7,889)
Cash Flows from Investing Activities
Purchases of property, plant and equipment	(434)	(297)
Net cash flows (used in) investing activities	(434)	(297)
Cash Flows from Financing Activities
Payments of long-term debt	(47,123)	(42,533)
Borrowings of long-term debt	45,073	52,659
Cash dividends paid	(1,408)	(1,326)
Shares withheld for employees' taxes	(66)	(247)
Payments on financing lease obligations	(66)	(64)
Proceeds from stock option exercises	0	16
Net cash flows (used in) provided by financing activities	(3,590)	8,505
Change related to foreign currency	7	(31)
Increase in cash and cash equivalents	6,566	288
Cash and cash equivalents at beginning of period	2,462	2,282
Cash and cash equivalents at end of period	$ 9,028	$ 2,570

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Note 1 - Interim Condensed Consolidated Financial Statements

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Condensed Financial Statements [Text Block]

NOTE 1 - INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The interim condensed consolidated financial statements are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information, and rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the interim financial statements include all normal adjustments and disclosures necessary to present fairly the Company’s financial position as of September 30, 2022, the results of its operations for the three-month periods ended September 30, 2022, and 2021, and its cash flows for the three-month periods ended September 30, 2022, and 2021. These statements should be read in conjunction with the financial statements and footnotes included in the fiscal 2022 Annual Report on Form 10-K. Financial information as of June 30, 2022, has been derived from the Company’s audited consolidated financial statements.

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Note 2 - Summary of Significant Accounting Policies

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Significant Accounting Policies [Text Block]

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation:

A summary of the Company’s significant accounting policies is included in Note 1 to the audited consolidated financial statements of the Company’s fiscal 2022 Annual Report on Form 10-K.

Revenue Recognition:

The Company recognizes revenue when it satisfies the performance obligation in its customer contracts or purchase orders. Most of the Company’s products have a single performance obligation which is satisfied at a point in time when control is transferred to the customer. Control is generally transferred at time of shipment when title and risk of ownership passes to the customer. For customer contracts with multiple performance obligations, the Company allocates the transaction price and any discounts to each performance obligation based on relative standalone selling prices. Payment terms are typically within 30 to 90 days from the shipping date, depending on the terms with the customer. The Company offers standard warranties that do not represent separate performance obligations.

Installation is a separate performance obligation, except for the Company’s digital signage products. For digital signage products, installation is not a separate performance obligation as the product and installation is the combined item promised in digital signage contracts. The Company is not always responsible for installation of products it sells and has no post-installation responsibilities other than standard warranties.

A number of the Company's display solutions and select lighting products are customized for specific customers. As a result, these customized products do not have an alternative use. For these products, the Company has a legal right to payment for performance to date and generally does not accept returns on these items. The measurement of performance is based upon cost plus a reasonable profit margin for work completed. Because there is no alternative use and there is a legal right to payment, the Company transfers control of the item as the item is being produced and therefore, recognizes revenue over time. The customized product types are as follows:

● Customer specific branded print graphics

● Electrical components based on customer specifications

● Digital signage and related media content

The Company also offers installation services for its display solutions elements and select lighting products. Installation revenue is recognized over time as the customer simultaneously receives and consumes the benefits provided through the installation process.

For these customized products and installation services, revenue is recognized using a cost-based input method: recognizing revenue and gross profit as work is performed based on the relationship between the actual cost incurred and the total estimated cost for the performance obligation.

On occasion, the Company enters into bill-and-hold arrangements on a limited basis. Each bill-and-hold arrangement is reviewed and revenue is recognized only when certain criteria have been met: (1) the customer has requested delayed delivery and storage of the products by the Company because the customer wants to secure a supply of the products but lacks storage space; (ii) the risk of ownership has passed to the customer; (iii) the products are segregated from the Company’s other inventory items held for sale; (iv) the products are ready for shipment to the customer; and (v) the Company does not have the ability to use the products or direct them to another customer.

Disaggregation of Revenue

The Company disaggregates the revenue from contracts with customers by the timing of revenue recognition because the Company believes it best depicts the nature, amount, and timing of its revenue and cash flows. The table below presents a reconciliation of the disaggregation by reportable segments:

	Three Months Ended
(In thousands)	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Timing of revenue recognition
Products and services transferred at a point in time	$	58,077	$	47,489	$	44,582	$	37,431
Products and services transferred over time		9,456		12,047		6,678		17,706
	$	67,533	$	59,536	$	51,260	$	55,137

	Three Months Ended
	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Type of Product and Services
LED lighting, digital signage solutions, electronic circuit boards	$	55,535	$	7,175	$	41,879	$	12,428
Poles, other display solution elements		11,129		41,471		8,966		33,302
Project management, installation services, shipping and handling		869		10,890		415		9,407
	$	67,533	$	59,536	$	51,260	$	55,137

Practical Expedients and Exemptions

● The Company’s contracts with customers have an expected duration of one year or less, as such, the Company applies the practical expedient to expense sales commissions as incurred and has omitted disclosures on the amount of remaining performance obligations.

● Shipping costs that are not material in context of the delivery of products are expensed as incurred.

● The Company’s accounts receivable balance represents the Company’s unconditional right to receive payment from its customers with contracts. Payments are generally due within 30 to 90 days of completion of the performance obligation and invoicing; therefore, payments do not contain significant financing components.

● The Company collects sales tax and other taxes concurrent with revenue-producing activities which are excluded from revenue. Shipping and handling costs are treated as fulfillment activities and included in cost of products and services sold on the Consolidated Statements of Operations.

New Accounting Pronouncements:

In October 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” creating an exception to the recognition and measurement principles in ASC 805. The amendment requires that entities apply ASC 606, “Revenue from Contracts with Customers,” rather than using fair value, to recognize and measure contracts assets and contract liabilities from contracts with customers acquired in a business combination. The ASU is effective for fiscal years beginning after December 15, 2022, and interim periods therein. Early adoption is permitted, including adoption in an interim period, regardless of whether a business combination occurs in that period. The guidance should be applied prospectively; however, an entity that elects to early adopt in an interim period should apply the amendments to all business combinations that occurred during the fiscal year that includes that interim period. The Company is evaluating the impact this guidance may have on its consolidated financial statements and related disclosures.

In December 2019, the Financial Accounting Standards Board ("FASB") issued ASU 2019-12, "Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740)." This guidance removes certain exceptions to the general principles in ASC 740 such as recognizing deferred taxes for equity investments, the incremental approach to performing intra-period tax allocation and calculating income taxes in interim periods. The standard also simplifies accounting for income taxes under U.S. GAAP by clarifying and amending existing guidance, including the recognition of deferred taxes for goodwill, the allocation of taxes to members of a consolidated group and requiring that an entity reflect the effect of enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The Company adopted ASC 2019-12 effective July 1, 2021, which did not have a material impact on its consolidated financial statements or disclosures.

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Note 3 - Segment Reporting Information

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

NOTE 3 - SEGMENT REPORTING INFORMATION

The accounting guidance on Segment Reporting establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in financial statements. Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision maker (the Company’s Chief Executive Officer or “CODM”) in making decisions on how to allocate resources and assess performance. The Company’s two operating segments are Lighting and Display Solutions (formerly known as the Graphics Segment), with one executive team under the organizational structure reporting directly to the CODM with responsibilities for managing each segment. Corporate and Eliminations, which captures the Company’s corporate administrative activities, is also reported in the segment information.

The Lighting Segment includes non-residential outdoor and indoor lighting fixtures utilizing LED light sources that have been fabricated and assembled for the Company’s markets, primarily the refueling and convenience store markets, parking lot and garage markets, quick-service restaurant market, retail and grocery store markets, the automotive market, the warehouse market, and the sports court and field market. The Company also offers a variety of lighting controls to complement its lighting fixtures which include sensors, photocontrols, dimmers, motion detection and Bluetooth systems. The Company also services lighting product customers through the commercial and industrial project, stock and flow, and renovation channels. The Lighting Segment also includes the design, engineering and manufacturing of electronic circuit boards, assemblies and sub-assemblies which are sold directly to customers.

The Display Solutions Segment manufactures, sells and installs exterior and interior visual image and display elements, including printed graphics, structural graphics, digital signage, menu board systems, display fixtures, refrigerated displays, and custom display elements. These products are used in visual image programs in several markets including the refueling and convenience store markets, parking lot and garage markets, quick-service restaurant market, retail and grocery store markets, the automotive market, the warehouse market, and the sports court and field market. The Display Solutions Segment also provides a variety of project management services to complement our display elements, such as installation management, site surveys, permitting, and content management which are offered to our customers to support our digital signage.

The Company’s corporate administration activities are reported in the Corporate and Eliminations line item. These activities primarily include intercompany profit in inventory eliminations, expense related to certain corporate officers and support staff, the Company’s internal audit staff, expense related to the Company’s Board of Directors, equity compensation expense for various equity awards granted to corporate administration employees, certain consulting expenses, investor relations activities, and a portion of the Company’s legal, auditing, and professional fee expenses. Corporate identifiable assets primarily consist of cash, invested cash (if any), refundable income taxes (if any), and deferred income taxes.

There were no customers or customer programs representing a concentration of 10% or more of the Company’s consolidated net sales in the three months ended September 30, 2022. One customer program in the Display Solutions Segment represents $12.3 million or 12% of the Company’s net sales in the three months ended September 30, 2021. One customer in the Display Solutions represents $8.5 million or 11% of accounts receivable at September 30, 2022. There was no concentration of accounts receivable at September 30, 2021.

Summarized financial information for the Company’s operating segments is provided for the indicated periods and as of September 30, 2022, and September 30, 2021:

	Three Months Ended
(In thousands)	September 30
	2022			2021
Net Sales:
Lighting Segment	$	67,533		$	51,260
Display Solutions Segment		59,536			55,137
	$	127,069		$	106,397
Operating Income (Loss):
Lighting Segment	$	9,158		$	4,339
Display Solutions Segment		6,496			3,749
Corporate and Eliminations		(5,633	)		(3,644	)
	$	10,021		$	4,444
Capital Expenditures:
Lighting Segment	$	249		$	180
Display Solutions Segment		162			221
Corporate and Eliminations		23			(104	)
	$	434		$	297
Depreciation and Amortization:
Lighting Segment	$	1,387		$	1,461
Display Solutions Segment		974			1,031
Corporate and Eliminations		60			71
	$	2,421		$	2,563

	September 30, 2022		June 30, 2022
Total Assets:
Lighting Segment	$	151,856	$	152,431
Display Solutions Segment		160,099		152,302
Corporate and Eliminations		7,546		6,347
	$	319,501	$	311,080

The segment net sales reported above represent sales to external customers. Segment operating income, which is used in management’s evaluation of segment performance, represents net sales less all operating expenses. Identifiable assets are those assets used by each segment in its operations.

The Company records a 10% mark-up on intersegment revenues. Any intersegment profit in inventory is eliminated in consolidation. Intersegment revenues were eliminated in consolidation as follows:

Inter-segment sales

	Three Months Ended
(In thousands)	September 30
	2022		2021
Lighting Segment inter-segment net sales	$	6,143	$	10,457
Display Solutions Segment inter-segment net sales	$	66	$	163

The Company’s operations are located solely within North America. As a result, the geographic distribution of the Company’s net sales and long-lived assets originate within North America.

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Note 4 - Earnings Per Common Share

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Earnings Per Share [Text Block]

NOTE 4 - EARNINGS PER COMMON SHARE

The following table presents the amounts used to compute basic and diluted earnings per common share, as well as the effect of dilutive potential common shares on weighted average shares outstanding (in thousands, except per share data):

	Three Months Ended
	September 30
	2022		2021
BASIC EARNINGS PER SHARE
Net income	$	6,262	$	3,133
Weighted average shares outstanding during the period, net of treasury shares		26,730		26,553
Weighted average vested restricted stock units outstanding		46		17
Weighted average shares outstanding in the Deferred Compensation Plan during the period		865		426
Weighted average shares outstanding		27,641		26,996
Basic earnings per common share	$	0.23	$	0.12
DILUTED EARNINGS PER SHARE
Net income	$	6,262	$	3,133
Weighted average shares outstanding:
Basic		27,641		26,996
Effect of dilutive securities (a):
Impact of common shares to be issued under stock option plans, and contingently issuable shares, if any		1,023		747
Weighted average shares outstanding		28,664		27,743
Diluted earnings per common share	$	0.22	$	0.11
Anti-dilutive securities (b)		213		989

(a) Calculated using the “Treasury Stock” method as if dilutive securities were exercised and the funds were used to purchase common shares at the average market price during the period.

(b) Anti-dilutive securities were excluded from the computation of diluted net income per share for the three months ended September 30, 2022, and September 30, 2021, because the exercise price was greater than the average fair market price of the common shares or because the assumed proceeds from the award’s exercise or vesting was greater than the average fair market price of the common shares.

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Note 5 - Inventories, Net

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Inventory Disclosure [Text Block]

NOTE 5 – INVENTORIES, NET

The following information is provided as of the dates indicated:

	September 30,		June 30,
(In thousands)	2022		2022
Inventories:
Raw materials	$	53,962	$	51,637
Work-in-progress		6,156		3,029
Finished goods		20,339		19,755
Total Inventories	$	80,457	$	74,421

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Note 6 - Accrued Expenses

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block]

NOTE 6 - ACCRUED EXPENSES

The following information is provided as of the dates indicated:

	September 30,		June 30,
(In thousands)	2022		2022
Accrued Expenses:
Customer prepayments	$	6,204	$	6,416
Compensation and benefits		8,752		9,611
Accrued warranty		4,319		4,491
Operating lease liabilities		1,187		1,274
Accrued sales commissions		2,506		4,783
Accrued Freight		4,139		3,680
Accrued FICA		1,161		1,122
Finance lease liabilities		280		275
Accrued income tax		1,835		109
Other accrued expenses		4,848		4,503
Total Accrued Expenses	$	35,231	$	36,264

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Note 7 - Goodwill and Other Intangible Assets

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 7 - GOODWILL AND OTHER INTANGIBLE ASSETS

The carrying values of goodwill and other intangible assets with indefinite lives are reviewed at least annually for possible impairment. The Company may first assess qualitative factors in order to determine if goodwill and indefinite-lived intangible assets are impaired. If through the qualitative assessment it is determined that it is more likely than not that goodwill and indefinite-lived assets are not impaired, no further testing is required. If it is determined more likely than not that goodwill and indefinite-lived assets are impaired, or if the Company elects not to first assess qualitative factors, the Company’s impairment testing continues with the estimation of the fair value of the reporting unit using a combination of a market approach and an income (discounted cash flow) approach, at the reporting unit level. The estimation of the fair value of reporting unit requires significant management judgment with respect to revenue and expense growth rates, changes in working capital and the selection and use of an appropriate discount rate. The estimates of the fair value of reporting units are based on the best information available as of the date of the assessment. The use of different assumptions would increase or decrease estimated discounted future operating cash flows and could increase or decrease an impairment charge. Company management uses its judgment in assessing whether assets may have become impaired between annual impairment tests. Indicators such as adverse business conditions, economic factors and technological change or competitive activities may signal that an asset has become impaired.

The Company identified its reporting units in conjunction with its annual goodwill impairment testing. The Company has a total of three reporting units that contain goodwill. One reporting unit is within the Lighting Segment and two reporting units are within the Display Solutions Segment. The tradename intangible assets have an indefinite life and are also tested separately on an annual basis. The Company relies upon a number of factors, judgments and estimates when conducting its impairment testing including, but not limited to, the Company’s stock price, operating results, forecasts, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and judgments in applying them to the analysis of goodwill impairment.

The following table presents information about the Company's goodwill on the dates or for the periods indicated:

Goodwill
(In thousands)				Display
	Lighting			Solutions
	Segment			Segment			Total
Balance as of September 30, 2022
Goodwill	$	70,971		$	63,347		$	134,318
Accumulated impairment losses		(61,763	)		(27,525	)		(89,288	)
Goodwill, net as of September 30, 2022	$	9,208		$	35,822		$	45,030
Balance as of June 30, 2022
Goodwill	$	70,971		$	63,347		$	134,318
Accumulated impairment losses		(61,763	)		(27,525	)		(89,288	)
Goodwill, net as of June 30, 2022	$	9,208		$	35,822		$	45,030

The gross carrying amount and accumulated amortization by each major intangible asset class is as follows:

Other Intangible Assets
	September 30, 2022
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	62,083	$	15,254	$	46,829
Patents		268		268		-
LED technology firmware, software		20,966		14,895		6,071
Trade name		2,658		1,075		1,583
Non-compete		260		71		189
Total Amortized Intangible Assets		86,235		31,563		54,672
Indefinite-lived Intangible Assets
Trademarks and trade names		12,102		-		12,102
Total indefinite-lived Intangible Assets		12,102		-		12,102
Total Other Intangible Assets	$	98,337	$	31,563	$	66,774

Other Intangible Assets
	June 30, 2022
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	62,083	$	14,400	$	47,683
Patents		268		268		-
LED technology firmware, software		20,966		14,598		6,368
Trade name		2,658		1,049		1,609
Non-compete		260		58		202
Total Amortized Intangible Assets		86,235		30,373		55,862
Indefinite-lived Intangible Assets
Trademarks and trade names		12,102		-		12,102
Total indefinite-lived Intangible Assets		12,102		-		12,102
Total Other Intangible Assets	$	98,337	$	30,373	$	67,964

	Three Months Ended
	September 30
(In thousands)	2022		2021
Amortization Expense of Other Intangible Assets	$	1,190	$	1,215

The Company expects to record annual amortization expense as follows:

(In thousands)
2023	$	3,618
2024		4,760
2025		4,760
2026		4,760
2027		4,754
After 2027		32,020

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Note 8 - Debt

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Debt Disclosure [Text Block]

NOTE 8 - DEBT

The Company’s long-term debt as of September 30, 2022, and June 30, 2022, consisted of the following:

	September 30,		June 30,
(In thousands)	2022		2022
Secured line of credit	$	56,144	$	57,275
Term loan, net of debt issuance costs of $26 and $30, respectively		21,402		22,321
Total debt		77,546		79,596
Less: amounts due within one year		3,571		3,571
Total amounts due after one year, net	$	73,975	$	76,025

In September 2021, the Company amended its existing $100 million secured line of credit, to a $25 million term loan and $75 million remaining as a secured revolving line of credit. Both facilities expire in the third quarter of fiscal 2026. The principal of the term loan is repaid annually in the amount of $3.6 million over a five-year period with a balloon payment of the remaining balance due on the last month. Interest on both the revolving line of credit and the term loan is charged based upon an increment over the LIBOR rate or a base rate, at the Company’s option. The base rate is calculated as the highest of (a) the Prime rate, (b) the sum of the Overnight Funding Rate plus 50 basis points and (c) the sum of the Daily LIBOR Rate plus 100 basis points as long as a Daily LIBOR rate is offered, ascertainable and not unlawful. The increment over the LIBOR borrowing rate fluctuates between 100 and 225 basis points, and the increment over the Base Rate fluctuates between 0 and 125 basis points, both of which depend upon the ratio of indebtedness to earnings before interest, taxes, depreciation, and amortization (“EBITDA”), as defined in the line of credit agreement. As of September 30, 2022, the Company’s borrowing rate against its revolving line of credit was 4.8%. The increment over LIBOR borrowing rate will be 175 basis points for the second quarter of fiscal 2023. The fee on the unused balance of the $75 million committed line of credit fluctuates between 15 and 25 basis points. Under the terms of this line of credit, the Company has agreed to a negative pledge of real estate assets and is required to comply with financial covenants that limit the ratio of indebtedness to EBITDA and require a minimum fixed charge ratio. As of September 30, 2022, there was $18.9 million available for borrowing under the $75 million line of credit.

The Company is in compliance with all of its loan covenants as of September 30, 2022.

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Note 9 - Cash Dividends

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE 9 - CASH DIVIDENDS

The Company paid cash dividends of $1.4 million and $1.3 million in both the three months ended September 30, 2022, and September 30, 2021, respectively. Dividends on restricted stock units in the amount of $0.2 million and $0.1 million were accrued as of both September 30, 2022, and 2021, respectively. These dividends will be paid upon the vesting of the restricted stock and performance stock units when shares are issued to the award recipients. In November 2022, the Board of Directors declared a regular quarterly cash dividend of $0.05 per share payable November 22, 2022, to shareholders of record as of November 14, 2022. The indicated annual cash dividend rate is $0.20 per share.

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Note 10 - Equity Compensation

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

NOTE 10 – EQUITY COMPENSATION

In November 2022, the Company’s shareholders approved an amendment to the 2019 Omnibus Award Plan (“2019 Omnibus Plan”) which increased the number of shares authorized for issuance under the plan by 2,350,000 and to remove the Plan’s fungible share counting feature. The purpose of the 2019 Omnibus Plan is to provide a means through which the Company may attract and retain key personnel and to provide a means by which directors, officers, and employees can acquire and maintain an equity interest in the Company. The number of shares that remain reserved for issuance under the 2019 Omnibus Plan prior to the amendment of the Plan equates to 1,253,908 as of September 30, 2022. The 2019 Omnibus Plan allows for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance stock units (“PSUs”) and other stock-based awards.

In the three months ended September 30, 2022, the Company granted 164,348 PSU’s and 196,522 RSU’s, both with a weighted average market value of $6.90. Stock compensation expense was $0.6 million for both the three months ended September 30, 2022, and 2021.

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Note 11 - Supplemental Cash Flow Information

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Cash Flow, Supplemental Disclosures [Text Block]

NOTE 11 - SUPPLEMENTAL CASH FLOW INFORMATION

	Three Months Ended
(In thousands)	September 30
	2022		2021
Cash Payments:
Interest	$	679	$	203
Income taxes	$	664	$	1,183
Non-cash investing and financing activities
Issuance of common shares as compensation	$	75	$	75
Issuance of common shares to fund deferred compensation plan	$	539	$	2,042

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Note 12 - Commitments and Contingencies

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company is party to various negotiations, customer bankruptcies, and legal proceedings arising in the normal course of business. The Company provides reserves for these matters when a loss is probable and reasonably estimable. The Company does not disclose a range of potential loss because the likelihood of such a loss is remote. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position, results of operations, cash flows or liquidity.

The Company may occasionally issue a standby letter of credit in favor of third parties. As of September 30, 2022, there were no such standby letters of credit issued.

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Note 13 - Leases

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Lessee, Leases [Text Block]

NOTE 13 - LEASES

The Company leases certain manufacturing facilities along with a small office space, several forklifts, several small tooling items, and various items of office equipment. The Company also acquired buildings, machinery, and forklift leases with the acquisition of JSI, as well as one sublease. All but two of the Company’s leases are operating leases. Leases have a remaining term of one to seven years some of which have an option to renew. The Company does not assume renewals in determining the lease term unless the renewals are deemed reasonably certain. The lease agreements do not contain any material residual guarantees or material variable lease payments.

The Company has periodically entered into short-term operating leases with an initial term of twelve months or less. The Company elected not to record these leases on the balance sheet. For the three months ended September 30, 2022, and 2021, the rent expense for these leases is immaterial.

The Company has certain leases that contain lease and non-lease components and has elected to utilize the practical expedient to account for these components together as a single lease component.

Lease expense is recognized on a straight-line basis over the lease term. The Company used its incremental borrowing rate when determining the present value of lease payments.

	Three Months Ended
	September 30
(In thousands)	2022			2021
Operating lease cost	$	863		$	879
Financing lease cost:
Amortization of right of use assets		74			74
Interest on lease liabilities		18			21
Variable lease cost		22			22
Sublease income		(116	)		(94	)
Total lease cost	$	861		$	902

Supplemental Cash Flow Information:
	Three Months Ended
	September 30
(In thousands)	2022		2021
Cash flows from operating leases
Fixed payments - operating cash flows	$	885	$	887
Liability reduction - operating cash flows	$	779	$	744
Cash flows from finance leases
Interest - operating cash flows	$	18	$	21
Repayments of principal portion - financing cash flows	$	66	$	64

Operating Leases:	September 30,			June 30,
	2022			2022
Total operating right-of-use assets	$	7,826		$	8,664
Accrued expenses (Current liabilities)	$	1,187		$	1,274
Long-term operating lease liability		7,381			8,240
Total operating lease liabilities	$	8,568		$	9,514
Weighted Average remaining Lease Term (in years)		2.83			3.05
Weighted Average Discount Rate		4.82	%		4.81	%

Finance Leases:	September 30,			June 30,
	2022			2022
Buildings under finance leases	$	2,033		$	2,033
Equipment under finance leases		30			30
Accumulated depreciation		(719	)		(634	)
Total finance lease assets, net	$	1,344		$	1,429
Accrued expenses (Current liabilities)	$	280		$	275
Long-term finance lease liability		1,174			1,246
Total finance lease liabilities	$	1,454		$	1,521
Weighted Average remaining Lease Term (in years)		4.54			4.80
Weighted Average Discount Rate		4.86	%		4.86	%

Maturities of Lease Liability:	Operating Lease Liabilities			Finance Lease Liabilities			Operating Subleases		Net Lease Commitments
2023	$	2,792		$	275		$	377	$	3,444
2024		3,285			337			377		3,999
2025		2,136			362			31		2,529
2026		835			362			-		1,197
2027		215			303			-		518
Thereafter		4			-			-		4
Total lease payments	$	9,267		$	1,639		$	785	$	11,691
Less: Interest		(699	)		(185	)				(884	)
Present Value of Lease Liabilities	$	8,568		$	1,454				$	10,807

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Note 16 - Income Taxes

3 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Income Tax Disclosure [Text Block]

NOTE 16 – INCOME TAXES

The Company's effective income tax rate is based on expected income, statutory rates and tax planning opportunities available in the various jurisdictions in which it operates. For interim financial reporting, the Company estimates the annual income tax rate based on projected taxable income for the full year and records a quarterly income tax provision or benefit in accordance with the anticipated annual rate. The Company refines the estimates of the year's taxable income as new information becomes available, including actual year-to-date financial results. This continual estimation process often results in a change to the expected effective income tax rate for the year. When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected income tax rate. Significant judgment is required in determining the effective tax rate and in evaluating tax positions.

	Three Months Ended
	September 30
	2022			2021
Reconciliation of effective tax rate:
Provision for income taxes at the anticipated annual tax rate		26.20	%		24.2	%
Uncertain tax positions		1.0			0.8
Deferred Income Tax Adjustment		1.6			-
Share-based compensation		1.8			(0.8	)
Effective tax rate		30.6	%		24.2	%

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Significant Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Consolidation:A summary of the Company’s significant accounting policies is included in Note 1 to the audited consolidated financial statements of the Company’s fiscal 2022 Annual Report on Form 10-K.

Revenue [Policy Text Block]

Revenue Recognition: The Company recognizes revenue when it satisfies the performance obligation in its customer contracts or purchase orders. Most of the Company’s products have a single performance obligation which is satisfied at a point in time when control is transferred to the customer. Control is generally transferred at time of shipment when title and risk of ownership passes to the customer. For customer contracts with multiple performance obligations, the Company allocates the transaction price and any discounts to each performance obligation based on relative standalone selling prices. Payment terms are typically within 30 to 90 days from the shipping date, depending on the terms with the customer. The Company offers standard warranties that do not represent separate performance obligations.Installation is a separate performance obligation, except for the Company’s digital signage products. For digital signage products, installation is not a separate performance obligation as the product and installation is the combined item promised in digital signage contracts. The Company is not always responsible for installation of products it sells and has no post-installation responsibilities other than standard warranties.A number of the Company's display solutions and select lighting products are customized for specific customers. As a result, these customized products do not have an alternative use. For these products, the Company has a legal right to payment for performance to date and generally does not accept returns on these items. The measurement of performance is based upon cost plus a reasonable profit margin for work completed. Because there is no alternative use and there is a legal right to payment, the Company transfers control of the item as the item is being produced and therefore, recognizes revenue over time. The customized product types are as follows:

● Customer specific branded print graphics

● Electrical components based on customer specifications

● Digital signage and related media content

The Company also offers installation services for its display solutions elements and select lighting products. Installation revenue is recognized over time as the customer simultaneously receives and consumes the benefits provided through the installation process.For these customized products and installation services, revenue is recognized using a cost-based input method: recognizing revenue and gross profit as work is performed based on the relationship between the actual cost incurred and the total estimated cost for the performance obligation.On occasion, the Company enters into bill-and-hold arrangements on a limited basis. Each bill-and-hold arrangement is reviewed and revenue is recognized only when certain criteria have been met: (1) the customer has requested delayed delivery and storage of the products by the Company because the customer wants to secure a supply of the products but lacks storage space; (ii) the risk of ownership has passed to the customer; (iii) the products are segregated from the Company’s other inventory items held for sale; (iv) the products are ready for shipment to the customer; and (v) the Company does not have the ability to use the products or direct them to another customer.Disaggregation of RevenueThe Company disaggregates the revenue from contracts with customers by the timing of revenue recognition because the Company believes it best depicts the nature, amount, and timing of its revenue and cash flows. The table below presents a reconciliation of the disaggregation by reportable segments:

	Three Months Ended
(In thousands)	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Timing of revenue recognition
Products and services transferred at a point in time	$	58,077	$	47,489	$	44,582	$	37,431
Products and services transferred over time		9,456		12,047		6,678		17,706
	$	67,533	$	59,536	$	51,260	$	55,137

	Three Months Ended
	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Type of Product and Services
LED lighting, digital signage solutions, electronic circuit boards	$	55,535	$	7,175	$	41,879	$	12,428
Poles, other display solution elements		11,129		41,471		8,966		33,302
Project management, installation services, shipping and handling		869		10,890		415		9,407
	$	67,533	$	59,536	$	51,260	$	55,137

Practical Expedients and Exemptions

New Accounting Pronouncements, Policy [Policy Text Block]

New Accounting Pronouncements:In October 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” creating an exception to the recognition and measurement principles in ASC 805. The amendment requires that entities apply ASC 606, “Revenue from Contracts with Customers,” rather than using fair value, to recognize and measure contracts assets and contract liabilities from contracts with customers acquired in a business combination. The ASU is effective for fiscal years beginning after December 15, 2022, and interim periods therein. Early adoption is permitted, including adoption in an interim period, regardless of whether a business combination occurs in that period. The guidance should be applied prospectively; however, an entity that elects to early adopt in an interim period should apply the amendments to all business combinations that occurred during the fiscal year that includes that interim period. The Company is evaluating the impact this guidance may have on its consolidated financial statements and related disclosures.In December 2019, the Financial Accounting Standards Board ("FASB") issued ASU 2019-12, "Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740)." This guidance removes certain exceptions to the general principles in ASC 740 such as recognizing deferred taxes for equity investments, the incremental approach to performing intra-period tax allocation and calculating income taxes in interim periods. The standard also simplifies accounting for income taxes under U.S. GAAP by clarifying and amending existing guidance, including the recognition of deferred taxes for goodwill, the allocation of taxes to members of a consolidated group and requiring that an entity reflect the effect of enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The Company adopted ASC 2019-12 effective July 1, 2021, which did not have a material impact on its consolidated financial statements or disclosures.

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Note 2 - Summary of Significant Accounting Policies (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Disaggregation of Revenue [Table Text Block]

	Three Months Ended
(In thousands)	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Timing of revenue recognition
Products and services transferred at a point in time	$	58,077	$	47,489	$	44,582	$	37,431
Products and services transferred over time		9,456		12,047		6,678		17,706
	$	67,533	$	59,536	$	51,260	$	55,137

	Three Months Ended
	September 30, 2022				September 30, 2021
	Lighting Segment		Display Solutions Segment		Lighting Segment		Display Solutions Segment
Type of Product and Services
LED lighting, digital signage solutions, electronic circuit boards	$	55,535	$	7,175	$	41,879	$	12,428
Poles, other display solution elements		11,129		41,471		8,966		33,302
Project management, installation services, shipping and handling		869		10,890		415		9,407
	$	67,533	$	59,536	$	51,260	$	55,137

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Note 3 - Segment Reporting Information (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	Three Months Ended
(In thousands)	September 30
	2022			2021
Net Sales:
Lighting Segment	$	67,533		$	51,260
Display Solutions Segment		59,536			55,137
	$	127,069		$	106,397
Operating Income (Loss):
Lighting Segment	$	9,158		$	4,339
Display Solutions Segment		6,496			3,749
Corporate and Eliminations		(5,633	)		(3,644	)
	$	10,021		$	4,444
Capital Expenditures:
Lighting Segment	$	249		$	180
Display Solutions Segment		162			221
Corporate and Eliminations		23			(104	)
	$	434		$	297
Depreciation and Amortization:
Lighting Segment	$	1,387		$	1,461
Display Solutions Segment		974			1,031
Corporate and Eliminations		60			71
	$	2,421		$	2,563

Reconciliation of Assets from Segment to Consolidated [Table Text Block]

	September 30, 2022		June 30, 2022
Total Assets:
Lighting Segment	$	151,856	$	152,431
Display Solutions Segment		160,099		152,302
Corporate and Eliminations		7,546		6,347
	$	319,501	$	311,080

Reconciliation of Revenue from Segments to Consolidated [Table Text Block]

	Three Months Ended
(In thousands)	September 30
	2022		2021
Lighting Segment inter-segment net sales	$	6,143	$	10,457
Display Solutions Segment inter-segment net sales	$	66	$	163

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Note 4 - Earnings Per Common Share (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	Three Months Ended
	September 30
	2022		2021
BASIC EARNINGS PER SHARE
Net income	$	6,262	$	3,133
Weighted average shares outstanding during the period, net of treasury shares		26,730		26,553
Weighted average vested restricted stock units outstanding		46		17
Weighted average shares outstanding in the Deferred Compensation Plan during the period		865		426
Weighted average shares outstanding		27,641		26,996
Basic earnings per common share	$	0.23	$	0.12
DILUTED EARNINGS PER SHARE
Net income	$	6,262	$	3,133
Weighted average shares outstanding:
Basic		27,641		26,996
Effect of dilutive securities (a):
Impact of common shares to be issued under stock option plans, and contingently issuable shares, if any		1,023		747
Weighted average shares outstanding		28,664		27,743
Diluted earnings per common share	$	0.22	$	0.11
Anti-dilutive securities (b)		213		989

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Note 5 - Inventories, Net (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Inventory, Current [Table Text Block]

	September 30,		June 30,
(In thousands)	2022		2022
Inventories:
Raw materials	$	53,962	$	51,637
Work-in-progress		6,156		3,029
Finished goods		20,339		19,755
Total Inventories	$	80,457	$	74,421

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Note 6 - Accrued Expenses (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Accrued Liabilities [Table Text Block]

	September 30,		June 30,
(In thousands)	2022		2022
Accrued Expenses:
Customer prepayments	$	6,204	$	6,416
Compensation and benefits		8,752		9,611
Accrued warranty		4,319		4,491
Operating lease liabilities		1,187		1,274
Accrued sales commissions		2,506		4,783
Accrued Freight		4,139		3,680
Accrued FICA		1,161		1,122
Finance lease liabilities		280		275
Accrued income tax		1,835		109
Other accrued expenses		4,848		4,503
Total Accrued Expenses	$	35,231	$	36,264

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Note 7 - Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Goodwill [Table Text Block]

Goodwill
(In thousands)				Display
	Lighting			Solutions
	Segment			Segment			Total
Balance as of September 30, 2022
Goodwill	$	70,971		$	63,347		$	134,318
Accumulated impairment losses		(61,763	)		(27,525	)		(89,288	)
Goodwill, net as of September 30, 2022	$	9,208		$	35,822		$	45,030
Balance as of June 30, 2022
Goodwill	$	70,971		$	63,347		$	134,318
Accumulated impairment losses		(61,763	)		(27,525	)		(89,288	)
Goodwill, net as of June 30, 2022	$	9,208		$	35,822		$	45,030

Schedule of Intangible Assets and Goodwill [Table Text Block]

Other Intangible Assets
	September 30, 2022
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	62,083	$	15,254	$	46,829
Patents		268		268		-
LED technology firmware, software		20,966		14,895		6,071
Trade name		2,658		1,075		1,583
Non-compete		260		71		189
Total Amortized Intangible Assets		86,235		31,563		54,672
Indefinite-lived Intangible Assets
Trademarks and trade names		12,102		-		12,102
Total indefinite-lived Intangible Assets		12,102		-		12,102
Total Other Intangible Assets	$	98,337	$	31,563	$	66,774

Other Intangible Assets
	June 30, 2022
(In thousands)	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
Amortized Intangible Assets
Customer relationships	$	62,083	$	14,400	$	47,683
Patents		268		268		-
LED technology firmware, software		20,966		14,598		6,368
Trade name		2,658		1,049		1,609
Non-compete		260		58		202
Total Amortized Intangible Assets		86,235		30,373		55,862
Indefinite-lived Intangible Assets
Trademarks and trade names		12,102		-		12,102
Total indefinite-lived Intangible Assets		12,102		-		12,102
Total Other Intangible Assets	$	98,337	$	30,373	$	67,964

Finite-Lived Intangible Assets Amortization Expense [Table Text Block]

	Three Months Ended
	September 30
(In thousands)	2022		2021
Amortization Expense of Other Intangible Assets	$	1,190	$	1,215

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

(In thousands)
2023	$	3,618
2024		4,760
2025		4,760
2026		4,760
2027		4,754
After 2027		32,020

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Note 8 - Debt (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Debt [Table Text Block]

	September 30,		June 30,
(In thousands)	2022		2022
Secured line of credit	$	56,144	$	57,275
Term loan, net of debt issuance costs of $26 and $30, respectively		21,402		22,321
Total debt		77,546		79,596
Less: amounts due within one year		3,571		3,571
Total amounts due after one year, net	$	73,975	$	76,025

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Note 11 - Supplemental Cash Flow Information (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Cash Flow, Supplemental Disclosures [Table Text Block]

	Three Months Ended
(In thousands)	September 30
	2022		2021
Cash Payments:
Interest	$	679	$	203
Income taxes	$	664	$	1,183
Non-cash investing and financing activities
Issuance of common shares as compensation	$	75	$	75
Issuance of common shares to fund deferred compensation plan	$	539	$	2,042

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Note 13 - Leases (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Lease, Cost [Table Text Block]

	Three Months Ended
	September 30
(In thousands)	2022			2021
Operating lease cost	$	863		$	879
Financing lease cost:
Amortization of right of use assets		74			74
Interest on lease liabilities		18			21
Variable lease cost		22			22
Sublease income		(116	)		(94	)
Total lease cost	$	861		$	902

Supplemental Cash Flow Information:
	Three Months Ended
	September 30
(In thousands)	2022		2021
Cash flows from operating leases
Fixed payments - operating cash flows	$	885	$	887
Liability reduction - operating cash flows	$	779	$	744
Cash flows from finance leases
Interest - operating cash flows	$	18	$	21
Repayments of principal portion - financing cash flows	$	66	$	64

Operating Leases:	September 30,			June 30,
	2022			2022
Total operating right-of-use assets	$	7,826		$	8,664
Accrued expenses (Current liabilities)	$	1,187		$	1,274
Long-term operating lease liability		7,381			8,240
Total operating lease liabilities	$	8,568		$	9,514
Weighted Average remaining Lease Term (in years)		2.83			3.05
Weighted Average Discount Rate		4.82	%		4.81	%

Finance Leases:	September 30,			June 30,
	2022			2022
Buildings under finance leases	$	2,033		$	2,033
Equipment under finance leases		30			30
Accumulated depreciation		(719	)		(634	)
Total finance lease assets, net	$	1,344		$	1,429
Accrued expenses (Current liabilities)	$	280		$	275
Long-term finance lease liability		1,174			1,246
Total finance lease liabilities	$	1,454		$	1,521
Weighted Average remaining Lease Term (in years)		4.54			4.80
Weighted Average Discount Rate		4.86	%		4.86	%

Lessee, Leases, Liability, Maturity [Table Text Block]

Maturities of Lease Liability:	Operating Lease Liabilities			Finance Lease Liabilities			Operating Subleases		Net Lease Commitments
2023	$	2,792		$	275		$	377	$	3,444
2024		3,285			337			377		3,999
2025		2,136			362			31		2,529
2026		835			362			-		1,197
2027		215			303			-		518
Thereafter		4			-			-		4
Total lease payments	$	9,267		$	1,639		$	785	$	11,691
Less: Interest		(699	)		(185	)				(884	)
Present Value of Lease Liabilities	$	8,568		$	1,454				$	10,807

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Note 16 - Income Taxes (Tables)

3 Months Ended

Sep. 30, 2022

Notes Tables

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	Three Months Ended
	September 30
	2022			2021
Reconciliation of effective tax rate:
Provision for income taxes at the anticipated annual tax rate		26.20	%		24.2	%
Uncertain tax positions		1.0			0.8
Deferred Income Tax Adjustment		1.6			-
Share-based compensation		1.8			(0.8	)
Effective tax rate		30.6	%		24.2	%

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Note 2 - Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Revenue	$ 127,069	$ 106,397
Lighting Segment [Member]
Revenue	67,533	51,260
Lighting Segment [Member] | LED Lighting, Digital Signage, Electronic Circuit Boards [Member]
Revenue	55,535	41,879
Lighting Segment [Member] | Poles, Other Display Solution Elements [Member]
Revenue	11,129	8,966
Lighting Segment [Member] | Project Management, Installation Services, Shipping and Handling [Member]
Revenue	869	415
Display Solutions Segment [Member]
Revenue	59,536	55,137
Display Solutions Segment [Member] | LED Lighting, Digital Signage, Electronic Circuit Boards [Member]
Revenue	7,175	12,428
Display Solutions Segment [Member] | Poles, Other Display Solution Elements [Member]
Revenue	41,471	33,302
Display Solutions Segment [Member] | Project Management, Installation Services, Shipping and Handling [Member]
Revenue	10,890	9,407
Transferred at Point in Time [Member] | Lighting Segment [Member]
Revenue	58,077	44,582
Transferred at Point in Time [Member] | Display Solutions Segment [Member]
Revenue	47,489	37,431
Transferred over Time [Member] | Lighting Segment [Member]
Revenue	9,456	6,678
Transferred over Time [Member] | Display Solutions Segment [Member]
Revenue	$ 12,047	$ 17,706

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Note 3 - Segment Reporting Information (Details Textual) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2021
Number of Operating Segments	2
Revenue from Contract with Customer, Including Assessed Tax	$ 127,069	$ 106,397
Intersegment Revenue Markup Percentage	10.00%
Display Solutions Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax	$ 59,536	$ 55,137
Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Number of Major Customers	0
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Display Solutions Segment [Member] | One Customer [Member]
Number of Major Customers		1
Revenue from Contract with Customer, Including Assessed Tax		$ 12,300
Concentration Risk, Percentage		12.00%
Accounts Receivable [Member] | Customer Concentration Risk [Member]
Number of Major Customers			0
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Display Solutions Segment [Member] | One Customer [Member]
Number of Major Customers	1
Concentration Risk, Percentage	11.00%
Accounts Receivable, after Allowance for Credit Loss, Total	$ 8,500

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Note 3 - Segment Reporting Information - Summarized Financial Information by Operating Segments (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Net Sales	$ 127,069	$ 106,397
Operating income loss	10,021	4,444
Capital expenditures	434	297
Depreciation and amortization	2,421	2,563
Corporate and Eliminations [Member]
Operating income loss	(5,633)	(3,644)
Capital expenditures	23	(104)
Depreciation and amortization	60	71
Lighting Segment [Member]
Net Sales	67,533	51,260
Lighting Segment [Member] | Operating Segments [Member]
Operating income loss	9,158	4,339
Capital expenditures	249	180
Depreciation and amortization	1,387	1,461
Display Solutions Segment [Member]
Net Sales	59,536	55,137
Display Solutions Segment [Member] | Operating Segments [Member]
Operating income loss	6,496	3,749
Capital expenditures	162	221
Depreciation and amortization	$ 974	$ 1,031

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Note 3 - Segment Reporting Information - Identifiable Assets by Segment (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Identifiable assets	$ 319,501	$ 311,080
Corporate and Eliminations [Member]
Identifiable assets	7,546	6,347
Lighting Segment [Member] | Operating Segments [Member]
Identifiable assets	151,856	152,431
Display Solutions Segment [Member] | Operating Segments [Member]
Identifiable assets	$ 160,099	$ 152,302

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Note 3 - Segment Reporting Information - Intersegment Revenues (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Revenue from Contract with Customer, Including Assessed Tax	$ 127,069	$ 106,397
Lighting Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax	67,533	51,260
Display Solutions Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax	59,536	55,137
Intersegment Eliminations [Member] | Lighting Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax	6,143	10,457
Intersegment Eliminations [Member] | Display Solutions Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax	$ 66	$ 163

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Note 4 - Earnings per Common Share - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended
		Sep. 30, 2022	Sep. 30, 2021
Net Income		$ 6,262	$ 3,133
Weighted average shares outstanding during the period, net of treasury shares (in shares)		26,730	26,553
Weighted average vested restricted stock units outstanding (in shares)		865	426
Weighted average shares outstanding (in shares)		27,641	26,996
Basic earnings per common share (in dollars per share)		$ 0.23	$ 0.12
Basic (in shares)		27,641	26,996
Impact of common shares to be issued under stock option plans, and contingently issuable shares, if any (in shares)	[1]	1,023	747
Weighted average shares outstanding (in shares)		28,664	27,743
Diluted earnings per common share (in dollars per share)		$ 0.22	$ 0.11
Anti-dilutive securities (b) (in shares)	[2]	213	989
Restricted Stock Units (RSUs) [Member]
Weighted average vested restricted stock units outstanding (in shares)		46	17

[1] Calculated using the “Treasury Stock” method as if dilutive securities were exercised and the funds were used to purchase common shares at the average market price during the period.

[2] Anti-dilutive securities were excluded from the computation of diluted net income per share for the three months ended September 30, 2022, and September 30, 2021, because the exercise price was greater than the average fair market price of the common shares or because the assumed proceeds from the award’s exercise or vesting was greater than the average fair market price of the common shares.

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Note 5 - Inventories, Net - Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Raw materials	$ 53,962	$ 51,637
Work-in-progress	6,156	3,029
Finished goods	20,339	19,755
Total Inventories	$ 80,457	$ 74,421

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Note 6 - Accrued Expenses - Accrued Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Customer prepayments	$ 6,204	$ 6,416
Compensation and benefits	8,752	9,611
Accrued warranty	4,319	4,491
Operating lease liabilities	1,187	1,274
Accrued sales commissions	2,506	4,783
Accrued Freight	4,139	3,680
Accrued FICA	1,161	1,122
Finance lease liabilities	280	275
Accrued income tax	1,835	109
Other accrued expenses	4,848	4,503
Total Accrued Expenses	$ 35,231	$ 36,264

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Note 7 - Goodwill and Other Intangible Assets (Details Textual)	3 Months Ended
	Sep. 30, 2022
Number of Reporting Units	3
Lighting Segment [Member]
Number of Reporting Units	1
Display Solutions Segment [Member]
Number of Reporting Units	2

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Note 7 - Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Goodwill, gross	$ 134,318	$ 134,318
Accumulated impairment losses	(89,288)	(89,288)
Goodwill	45,030	45,030
Goodwill	45,030	45,030
Lighting Segment [Member]
Goodwill, gross	70,971	70,971
Accumulated impairment losses	(61,763)	(61,763)
Goodwill	9,208	9,208
Goodwill	9,208	9,208
Display Solutions Segment [Member]
Goodwill, gross	63,347	63,347
Accumulated impairment losses	(27,525)	(27,525)
Goodwill	35,822	35,822
Goodwill	$ 35,822	$ 35,822

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Note 7 - Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Gross carrying value	$ 86,235	$ 86,235
Accumulated amortization, finite	31,563	30,373
Net amount	54,672	55,862
Gross carrying value	12,102	12,102
Trademarks and trade names	12,102	12,102
Total Other Intangible Assets, gross	98,337	98,337
Other intangible assets, net	66,774	67,964
Trademarks and Trade Names [Member]
Gross carrying value	12,102	12,102
Trademarks and trade names	12,102	12,102
Customer Relationships [Member]
Gross carrying value	62,083	62,083
Accumulated amortization, finite	15,254	14,400
Net amount	46,829	47,683
Patents [Member]
Gross carrying value	268	268
Accumulated amortization, finite	268	268
Net amount	0	0
LED Technology Firmware Software [Member]
Gross carrying value		20,966
Accumulated amortization, finite		14,598
Net amount		6,368
Trade Names [Member]
Gross carrying value	2,658	2,658
Accumulated amortization, finite	1,075	1,049
Net amount	1,583	1,609
Technology-Based Intangible Assets [Member]
Gross carrying value	20,966
Accumulated amortization, finite	14,895
Net amount	6,071
Noncompete Agreements [Member]
Gross carrying value	260	260
Accumulated amortization, finite	71	58
Net amount	$ 189	$ 202

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Note 7 - Goodwill and Other Intangible Assets - Amortization Expense of Other Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Amortization Expense of Other Intangible Assets	$ 1,190	$ 1,215

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Note 7 - Goodwill and Other Intangible Assets - Future Amortization Expense (Details) $ in Thousands	Sep. 30, 2022 USD ($)
2023	$ 3,618
2024	4,760
2025	4,760
2026	4,760
2027	4,754
After 2027	$ 32,020

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Note 8 - Debt (Details Textual) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	Sep. 30, 2021	Dec. 31, 2022	Sep. 30, 2022
Line of Credit Facility, Maximum Borrowing Capacity	$ 100.0
Minimum [Member]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage			0.15%
Maximum [Member]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage			0.25%
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]
Debt Instrument, Basis Spread on Variable Rate	0.50%
London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate	1.00%
London Interbank Offered Rate (LIBOR) [Member] | Forecast [Member]
Debt Instrument, Basis Spread on Variable Rate		1.75%
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]
Debt Instrument, Basis Spread on Variable Rate	1.00%
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]
Debt Instrument, Basis Spread on Variable Rate	2.25%
Base Rate [Member] | Minimum [Member]
Debt Instrument, Basis Spread on Variable Rate	0.00%
Base Rate [Member] | Maximum [Member]
Debt Instrument, Basis Spread on Variable Rate	1.25%
Revolving Credit Facility [Member]
Line of Credit Facility, Maximum Borrowing Capacity	$ 75.0		$ 75.0
Debt Instrument, Basis Spread on Variable Rate			4.80%
Line of Credit Facility, Remaining Borrowing Capacity			$ 18.9
Term Loan [Member]
Debt Instrument, Face Amount	25.0
Debt Instrument, Annual Principal Payment	$ 3.6
Debt Instrument, Term	5 years

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Note 8 - Debt - Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Secured line of credit	$ 56,144	$ 57,275
Total debt	77,546	79,596
Less: amounts due within one year	3,571	3,571
Total amounts due after one year, net	$ 73,975	$ 76,025

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Note 8 - Debt - Debt-parentheticals (Details) (Parentheticals) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Term Loan [Member]
Debt Issuance Costs, Net, Total	$ 26	$ 30

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Note 9 - Cash Dividends (Details Textual) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Nov. 30, 2022
Payments of Dividends, Total	$ 1.4	$ 1.3
Dividends Accrued	$ 0.2	$ 0.1
Annual Indicated per Share Dividend Rate	$ 0.20
Subsequent Event [Member]
Quarterly Indicated Per Share Dividend Rate			$ 0.05

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Note 10 - Equity Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended	3 Months Ended
	Nov. 30, 2022	Sep. 30, 2022	Sep. 30, 2021
Share-Based Payment Arrangement, Expense		$ 0.6	$ 0.6
The 2019 Omnibus Award Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant		1,253,908
The 2019 Omnibus Award Plan [Member] | Performance Shares [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period		164,348
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 6.90
The 2019 Omnibus Award Plan [Member] | Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period		196,522
Subsequent Event [Member] | The 2019 Omnibus Award Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized (in shares)	2,350,000

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Note 11 - Supplemental Cash Flow Information - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Interest	$ 679	$ 203
Income taxes	664	1,183
Issuance of common shares as compensation	75	75
Issuance of common shares to fund deferred compensation plan	$ 539	$ 2,042

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Note 13 - Leases (Details Textual)	3 Months Ended
	Sep. 30, 2022
Minimum [Member]
Lessee, Leases, Remaining Term	1 year
Maximum [Member]
Lessee, Leases, Remaining Term	7 years

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Note 13 - Leases - Operating Lease Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Jun. 30, 2022
Operating lease cost	$ 863	$ 879
Total operating right-of-use assets	7,826		$ 8,664
Buildings under finance leases	2,033		2,033
Fixed payments - operating cash flows	885	887
Accrued expenses (Current liabilities)	1,187		1,274
Amortization of right of use assets	74	74
Liability reduction - operating cash flows	779	744
Operating lease liabilities	7,381		8,240
Accumulated depreciation	(719)		(634)
Interest on lease liabilities	18	21
Interest - operating cash flows	18	21
Total operating lease liabilities	8,568		9,514
Total finance lease assets, net	1,344		$ 1,429
Variable lease cost	22	22
Repayments of principal portion - financing cash flows	$ 66	64
Weighted Average remaining Lease Term (in years) (Year)	2 years 9 months 29 days		3 years 18 days
Finance lease liabilities	$ 280		$ 275
Sublease income	$ (116)	(94)
Weighted Average Discount Rate	4.82%		4.81%
Finance lease liabilities	$ 1,174		$ 1,246
Total lease cost	861	$ 902
Total finance lease liabilities	$ 1,454		$ 1,521
Weighted Average remaining Lease Term (in years) (Year)	4 years 6 months 14 days		4 years 9 months 18 days
Weighted Average Discount Rate	4.86%		4.86%
Accrued Expenses [Member]
Accrued expenses (Current liabilities)	$ 1,187		$ 1,274
Buildings Under Finance Leases [Member]
Buildings under finance leases	2,033		2,033
Equipment Under Finance Leases [Member]
Buildings under finance leases	$ 30		$ 30

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Note 13 - Leases - Maturities of Lease Liability (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022
Lessee, Operating Lease, Liability, to be Paid, Remainder of Fiscal Year	$ 2,792
Finance Lease, Liability, to be Paid, Remainder of Fiscal Year	275
Lessee, Operating Sublease, Payment to be Received, Remainder of Fiscal Year	(377)
Lessee, Net Lease Commitments, Liability, to be Paid, Reaminder of Fiscal Year	3,444
Lessee, Operating Lease, Liability, to be Paid, Year One	3,285
Finance Lease, Liability, to be Paid, Year One	337
Lessee, Operating Sublease, Payment to be Received, Year One	(377)
Lessee, Net Lease Commitments, Liability, to be Paid, Year One	3,999
Lessee, Operating Lease, Liability, to be Paid, Year Two	2,136
Finance Lease, Liability, to be Paid, Year Two	362
Lessee, Operating Sublease, Payment to be Received, Year Two	(31)
Lessee, Net Lease Commitments, Liability, to be Paid, Year Two	2,529
Lessee, Operating Lease, Liability, to be Paid, Year Three	835
Finance Lease, Liability, to be Paid, Year Three	362
Lessee, Operating Sublease, Payment to be Received, Year Three	0
Lessee, Net Lease Commitments, Liability, to be Paid, Year Three	1,197
Lessee, Operating Lease, Liability, to be Paid, Year Four	215
Finance Lease, Liability, to be Paid, Year Four	303
Lessee, Operating Sublease, Payment to be Received, Year Four	0
Lessee, Net Lease Commitments, Liability, to be Paid, Year Four	518
Thereafter	4
Thereafter	0
Thereafter	0
Thereafter	4
Total lease payments	9,267
Total lease payments	1,639
Total lease payments	(785)
Total lease payments	11,691
Less: Interest	(699)
Less: Interest	(185)
Less: Interest	(884)
Present Value of Lease Liabilities	8,568	$ 9,514
Present Value of Lease Liabilities	1,454	$ 1,521
Present Value of Lease Liabilities	$ 10,807

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Note 16 - Income Taxes - Reconciliation of Income Tax Rate (Details)	3 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Provision for income taxes at the anticipated annual tax rate	26.20%	24.20%
Uncertain tax positions	1.00%	0.80%
Tax rate changes		0.00%
Share-based compensation	(1.80%)	0.80%
Effective tax rate	30.60%	24.20%