True to its name, Stamford’s Revolution Lighting Technologies Inc. is in the midst of changing how the country’s offices, schools and military approach the issue of illumination.
The company designs, engineers and manufactures an extensive line of interior and exterior LED lamps and fixtures, including signage and control systems, and offers full service lighting solutions through its Energy Source, Value Lighting, Tri-State LED, E-Lighting, All-Around Lighting and TNT Energy divisions. Its solutions can transform lighting into a source of superior energy savings, quality light and, according to Chairman, CEO and President Robert V. LaPenta, well-being.
“LEDs provide optimal light output, which impacts our well-being by creating an environment for better productivity, ensuring proper visual acuity and reducing eye strain,” LaPenta, speaking at his 177 Broad St. office, said.
He added that such lighting is generated with significantly greater efficiency than other lighting technologies, releasing only 10 percent of the total energy used as heat. In comparison, incandescent bulbs release 90 percent, and CFLs (compact fluorescent lamps) release about 80 percent of the total energy as heat in order to produce light, LaPenta said.
LaPenta started the company, which is publicly traded as RVLT, five years ago and has grown it from a $5 million firm to one that is on pace to be worth $200 million by year’s end, he said. Through organic growth and “some select acquisitions,” he said he expects it to grow to $400-500 million over the next couple of years.
While LaPenta said he didn’t expect any such acquisitions over the next 18 months – “there’s one company we’re looking at, but there’s nothing definitive – we’re probably not close” – it has been on something of a spree over the past few years.
In 2012 it acquired Simi Valley-based LED solutions provider Seesmart for $20 million, and in 2014 it picked up Value Lighting Inc., a lighting supplier headquartered in Marietta, Georgia. The latter deal was done for $10.5 million in cash and $28.1 million in common stock at a price of about $3.32 per share for more than 8.4 million shares.
In 2015 RVLT acquired Providence, R.I. energy service company Energy Source for $30 million, and last year it added TNT Energy of Raynham, Massachusetts, in a deal comprised of $8 million in cash and $2 million in the form of promissory notes together with a two-year earn-out based on TNT revenue and adjusted EBITDA.
In September 2016, Revolution announced that its TNT Energy and Tri-State LED divisions were named program contractors within Eversource’s Small Business Energy Advantage program. As part of the Energize Connecticut initiative, the program is designed to help small businesses with a peak energy demand of less than 200kW per month save money in part by identifying and offering cost-effective energy efficiency solutions.
As program contractors, TNT Energy and Tri-State LED collectively cover the entire state, supporting Connecticut’s 331,000 small businesses with high-efficiency LED lighting retrofit opportunities. Tri-State LED supports the southwestern Connecticut region, consisting of 10 municipalities: Darien, Greenwich, New Canaan, Norwalk, Redding, Ridgefield, Stamford, Weston, Westport, and Wilton; TNT Energy covers all other Connecticut municipalities.
On Oct. 24, Tri-State LED announced that it had surpassed $50 million in total cumulative sales since its founding in 2010. The company has now completed more than 2,000 LED projects in categories including commercial, industrial, educational, municipal, medical and religious.
LaPenta, who has served as a member of Revolution’s board of directors and as chairman since September 2012, was named CEO in 2013 and president in July 2015. His background includes founding Aston, a private investment company specializing in investments in secure military communication companies and companies with green technologies. He served on the board of Leap Wireless International Inc. from 2005 until its acquisition by AT&T Corp. in March 2014. From August 2006 to August 2011, LaPenta was chairman, president and CEO of L-1 Identity Solutions Inc., a provider of technology solutions for protecting and securing personal identities and assets. Before that he was president, CEO and a director of L-3 Communications Holding, which he cofounded in 1997.
LaPenta said he took L-3 – the other two “L”s standing for cofounder Frank Lanza and partner Lehman Brothers – from $500 million to $8 billion over five years; as of last year the company, now L3 Technologies, had nearly $11.9 billion in assets.
The executive’s background in aerospace, defense and green technology helped lead him to RVLT, he said – especially with its focus on LED technology.
LED lighting is approximately 60 percent more efficient and lasts three times longer than fluorescent lighting, he said; a boon for small businesses and building owners, who on average spend 22 percent of their annual energy costs on lighting.
Today the company employs about 300 at its 16,500-square-foot facility.
Revolution “is not really interested in just growing revenue,” LaPenta said, “but in filling a hole” in what companies need to survive in an ever-more-greening world. “Our technology and broad product line help us to be a key differentiator in this space.”
Indeed, since the opening of its Simi Valley production and warehouse facility in 2017 it has produced more than 205,000 LED tubes which comply with the Buy American Act and Trade Agreements Act for use in federal and military lighting projects.
Recent contract wins include projects with the U.S. Army, Air Force and the Department of Defense and Marine Corps facilities, including the Parris Island base in South Carolina, the primary location for Marine Corps recruit training. There, the firm’s LED tubes are replacing existing fluorescent lighting within the Marine barracks on base. The lighting retrofit portion of the project is expected to achieve a payback of less than two years, according to LaPenta.
In addition, RVLT has won contracts exceeding $8 million in the public education market, including retrofitting all of Stamford’s public schools as well as schools in other Connecticut municipalities and several in New Jersey, Rhode Island, Massachusetts and Florida. All together, the company has won more than $28 million in public education work since the start of 2016.
Most recently, the company was one of 20 Fairfield County firms cited on the annual 2017 Marcum Tech Top 40, which recognizes Connecticut technology leaders in six industry sectors; to qualify, companies must have at least $3 million in annual revenue and a demonstrated record of revenue growth in each of the preceding four years.
“Anytime you can start a company from scratch and be considered a successful growth company is an accomplishment,” LaPenta remarked.
Last month, due to the recent hurricane activity in Texas and the southeast, Revolution revised its third-quarter revenue from $52-55 million to $42-44 million and its full-year guidance of $195-205 million to $180-185 million.
LaPenta noted that its Value Lighting division in Houston was particularly hard hit, not so much by physical damage as by the fact that “everything pretty much stopped” there in the wake of Hurricane Harvey, which caused approximately $70 million in damage. He said that the company believes the negative impact will be short term, and that he expects a recovery in the fourth quarter and into 2018.
He added that the company is in talks with various state and local governments to provide assistance to those areas affected by Harvey, Irma and Maria.