Lakeland Industries Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Gerry Sweeney - Roth MKM - Analyst : Good afternoon, Jim and Roger, thanks for taking my call.

Question: Gerry Sweeney - Roth MKM - Analyst : So first question, it's probably going to be a little bit longer winded in depth, but I think you'll understand where I'm going with this. So we have the US rebounding. Jolly and Eagle are starting to get the lags underneath them. But then we also have your guidance, $165 million of revenue and $18 million of EBITDA. Obviously, I think there's confidence going into the fourth quarter, everything is going in the right direction. But it appears that either your revenue guidance of $165 million will have to be far exceeded or margins will have to jump up significantly in the fourth quarter to get that $18 million of EBITDA. And I know there's this step-up in basis of inventory, et cetera. So could you give us a little bit more maybe granularity as to how we achieve this guidance with all these operations and everything accelerating into year end?

Question: Gerry Sweeney - Roth MKM - Analyst : Got it. And this is fair to say, all this inventory adjustments and releases, this is pure accounting because of the acquisitions you made, correct? So what I'm really trying to say is on an apples-to-apples basis by the time you get all this released, we should see a cleaner, clearer margin. It's just being reallocated to different quarters. Is that a fair --? James Jenkins - Lakeland Industries Inc - Executive Chairman of the Board, Acting President and Chief Executive Officer Yeah. I mean, Gerry, there's -- as you know, when you do these acquisitions, there's a lot of financial white noise that's sort of there for a while. And then once you clear yourself through that -- I had this experience at Transcat, you sort of clear yourself through some of this stuff and then there's a level of normalcy that returns. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 9:30PM, LAKE.OQ - Q3 2025 Lakeland Industries Inc Earnings Call

Question: Gerry Sweeney - Roth MKM - Analyst : Got it. That's fair. And then one more question, and I'll jump in line. Obviously, fire turnout gear, big opportunity, US, I believe, the biggest market. I know you're looking at getting bigger in the US. Any thoughts on that or stay tuned? James Jenkins - Lakeland Industries Inc - Executive Chairman of the Board, Acting President and Chief Executive Officer Yeah. We have -- I think we've said this before, we're actively pursuing opportunities in the United States. We continue to run that out, Gerry.

Question: Matthew Galinko - Maxim Group - Analyst : Hey, thanks for taking my questions. Maybe firstly, can you just give us a little bit more color around the multiyear backlog from the acquired name? Is it something that you think you could flush through predominantly this year? Is it something that you're working through well into next year? And I know we talked about this last quarter, but how much of it is still addressable to you?

Question: Matthew Galinko - Maxim Group - Analyst : Got it. And my follow-up is, I guess, on the opportunity around services and bringing that into more of the -- more of your geographic reach. Is that something that you can see sort of being comprehensive with in the next fiscal year? Or is it going to take a little bit longer to work your way through those opportunities? James Jenkins - Lakeland Industries Inc - Executive Chairman of the Board, Acting President and Chief Executive Officer So Matt, I think it -- so we've already begun to look at -- I think I said this on the last call, sort of greenfielding or purchasing folks in that -- that are in that space. I know that in LATAM, for example, our LATAM leader is putting together a business case to run out a decontamination services business in that market. She's been interacting -- actually had a visit to Australia to meet with the Australian LHD people. So I think we will start seeing incremental gains in the service area for us. I can't really tell you at this point how much or how significant that's going to be in fiscal '26. But I can tell you that it's rapidly becoming a priority because to be a leader in this space because it is the future of this business, making sure that folks that are running into harm's way, both just in the fire environment, but also are getting those contaminants on their protective gear need to be protected. And there's -- I can tell you, in Europe, and in Germany, in particular, what I'm learning is that doing that correctly is important because there's actually criminal liability associated with brigade commanders in Germany who don't do this correctly, don't have it done correctly. So it's a growth area for us, and we're trying to seize on those opportunities. I just can't give you a number or it would be a pure guesstimate at this point, but I know that, that is something we are -- it's an imperative to us for next year to start running out.