Napco Security Technologies Inc. reported Monday that its net income fell 8.8 percent for the most recent quarter despite rising revenue, as a new product launch increased selling expenses.
The Amityville-based company, which makes electronic security, fire alarm and “connected home” devices for homes, businesses and schools, had net income of $952,000 for the three months ending March 31, compared with $1,044,000 a year earlier.
Net sales rose 5 percent compared with the year-earlier period, to $20.8 million. Napco reported that its subscription-based recurring revenue jumped by 68 percent compared with a year earlier.
The company’s selling, general and administrative expenses for the quarter were $5.5 million, or 26.6 percent of sales. A year earlier, the company’s expenses were $4.9 million, or 24.7 percent of sales.
The company reported diluted earnings per share of 5 cents for the quarter, down from 6 cents a year earlier.
Napco’s stock price fell 45 cents, or 4.3 percent, to close at $10 Monday on the Nasdaq Stock Market. The shares have risen 74 percent in the past 12 months.
Richard Soloway, Napco’s chairman and president, said in a statement that the company’s “investments in our future” position it for “optimal sales growth.”
The most recent quarter included the “massive launch” of the StarLink Connect Series of Universal Alarm Communicators with Connected Home Services, which counts as one of the biggest product introductions in the company’s history, Soloway said.
The launch increased selling expenses, he said, but “we feel it is an important investment in our future.”