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Shares of Optex Systems Holdings, Inc. OPXS have declined 5.1% since the company reported its earnings for the fiscal year ended Sept. 29, 2024. In comparison, the S&P 500 index experienced a 1% change over the same period. Over the past month, Optex stock has dropped 4.4%, contrasting with the S&P 500’s modest decline of 0.4%.
For the fiscal year ended Sept. 29, 2024, Optex Systems reported earnings per share (EPS) of 55 cents, up from 34 cents in fiscal 2023, reflecting a 61.8% increase.
Total revenues of $34 million denoted a robust increase of 32.5% from $25.7 million in fiscal 2023. This growth was driven by higher customer demand for military products across its operating segments, with revenues at the Optex Richardson segment rising $6.1 million and the Applied Optics Center segment contributing an additional $2.2 million.
Gross profit improved by 44% year over year to $9.5 million, with gross margins increasing by 220 basis points to 28%. Net income surged 66.5% year over year to $3.8 million.
Operating income rose significantly by 73% to $4.8 million, reflecting stronger revenue and better absorption of fixed costs. Adjusted EBITDA, a non-GAAP measure, jumped 69.7% year over year to $5.7 million.
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Optex Systems Holdings, Inc. Price
Optex Systems Holdings Inc. price | Optex Systems Holdings Inc. Quote
Backlog and Orders Signal Strong Demand
Optex's backlog reached $44.2 million as of Sept. 29, 2024, a 5.7% increase from $41.8 million at the beginning of the fiscal year. The company booked $36.4 million in new orders during the fiscal year, a 5.2% rise compared to $34.6 million in fiscal 2023. The order book includes $23.5 million from the Optex Richardson segment and $12.9 million from the Applied Optics Center segment.
Management Commentary Highlights Operational Efficiencies
CEO Danny Schoening emphasized the company's ability to secure multi-year contracts across key product platforms, including laser-protected periscopes, laser filter units, and M22 binoculars. Schoening credited these contracts, along with supplier support and targeted internal capacity expansions, for driving operational efficiencies and favorable factory leverage. Management remains optimistic about sustaining these trends into fiscal 2025.
Factors Driving Headline Numbers
Revenue growth was primarily attributed to strong demand for military optical products, which offset reduced orders for optical assemblies at the Applied Optics Center. Gross margins benefited from higher revenue levels and improved fixed-cost absorption. Increased general and administrative expenses partially offset these gains, reflecting investments in operational capacity and employee-related costs.