The LGL Group (LGL) Sidoti September Small-Cap Virtual Conference summary

Company overview and financial position

• Operates as a NYSE American-listed micro-cap with a 100-year heritage and a strong value creation track record.

• Holds $41 million in cash, no debt, and a book value of $40.9 million, trading at a 15%-20% discount to book value.

• 5.37 million shares outstanding, with publicly traded warrants expiring November 2025.

• Principal operating business is Precise Time and Frequency (PTF), acquired in 2016.

• Mtron Industries was spun off in October 2022, now trading independently.

Business strategy and M&A focus

• Focused on acquiring platform companies and growing them organically and inorganically.

• Targeting M&A deals with $2 million-$15 million EBITDA, favoring cash-generative or turnaround opportunities.

• Interested in entrepreneurial, family-owned businesses, management buyouts, distressed assets, and corporate divestitures.

• Willing to use leverage (2x-3x EBITDA) and create SPVs with domain partners for acquisitions.

• Primarily U.S.-centric in acquisition focus, but open to select European opportunities.

PTF business and growth opportunities

• PTF develops high-performance frequency and time reference instruments for sectors like satcom, telecom, transportation, and financial markets.

• Operates in a fragmented $700 million TAM, with revenues of $1.8 million and 9.4% growth in the first half of the year.

• Backlog increased to $737,000, reflecting improved sales and marketing.

• Recent wins include projects in rural broadband, spectrum monitoring, and radar system upgrades.

• Competitive advantage lies in engineering agility and ability to quickly meet customer needs.