- Consolidated Revenue grew 8% compared to prior year
- Distribution Gross Profit grew 10% on double-digit Revenue
growth
- Services Gross Profit grew 4% driven by 4% Organic Revenue
growth
Transcat, Inc. (Nasdaq: TRNS) (“Transcat” or the “Company”), a
leading provider of accredited calibration services, cost control
and optimization services, and distribution and rental of
value-added professional grade handheld test, measurement, and
control instrumentation, today reported financial results for its
second quarter ended September 28, 2024 (the “second quarter”) of
fiscal year 2025, which ends March 29, 2025 (“fiscal 2025”).
Results include the previously reported acquisitions of TIC-MS,
Inc. ("TIC-MS") effective March 27, 2023, SteriQual, Inc.
("SteriQual"), effective July 12, 2023, Axiom Test Equipment, Inc.
(“Axiom”), effective August 8, 2023 and Becnel Rental Tools, LLC
("Becnel") effective April 15, 2024.
“Consolidated revenue was up 8%. Consistent demand in our
Calibration Services business was supported by our differentiated
value proposition which resonates well in the highly regulated end
markets we serve, including life sciences,” commented Lee D. Rudow,
President and CEO. “Service Revenue grew 6% versus prior year, the
62nd consecutive quarter of growth. Service organic revenue growth
of 4% was below historical trends and was significantly impacted by
a decline in our Nexa cost control and optimization services
business. Excluding Nexa, we are pleased with service organic
growth of 9% versus prior year.”
“Though the magnitude of Nexa's slowdown was greater than what
we expected, we have identified the root causes and are committed
to returning the Nexa business to growth. This includes fully
integrating Nexa's sales and marketing into Transcat's dynamic
growth process and renaming the business Transcat Solutions, to
fully leverage our industry leading brand."
"Nexa has performed very well since acquisition in calendar
2021, and while collaborating on a regular basis to drive
calibration sales growth, we allowed that group to operate in a
more autonomous fashion and missed an opportunity to fully
integrate Nexa into the proven Transcat sales and marketing
processes. Integration is now well underway, and we have the power
of the Transcat leadership team focused on pipeline expansion,
which we believe will contribute to the return to high single digit
organic Services revenue growth in the first half of fiscal
2026.”
Mr. Rudow added, “Distribution Revenue grew 11% versus prior
year. However, Becnel revenue was negatively impacted by two
hurricanes in the Gulf of Mexico, which pressured second quarter
Distribution margins. Becnel is a well-run business that has
cultivated strong customer relationships with companies that highly
utilize Transcat’s core instrumentation and calibration services.
We fully expect Becnel to deliver sequential improvements in the
third and fourth quarters and expect Distribution Gross Margins to
return to levels consistent with the second half of fiscal
2024.”
“Transcat has a proven history of successfully identifying,
acquiring, and integrating dynamic companies that have expanded our
addressable markets, widened the breadth of offerings, and allowed
us to leverage existing infrastructure. In addition to strong
returns, the acquisitions present compelling cross-sell synergies
to drive organic revenue growth into these newly acquired customer
bases. Transcat’s acquisition pipeline remains robust and is
focused on all our strategic channels.”
Second Quarter Fiscal 2025 Review (Results are compared
with the second quarter of the fiscal year ended March 30, 2024
(“fiscal 2024”))
($ in thousands)
Change
FY25 Q2
FY24 Q2
$'s
%
Service Revenue
$
44,083
$
41,431
$
2,652
6.4
%
Distribution Revenue
23,743
21,373
2,370
11.1
%
Revenue
$
67,826
$
62,804
$
5,022
8.0
%
Gross Profit
$
21,206
$
20,125
$
1,081
5.4
%
Gross Margin
31.3
%
32.0
%
Operating Income
$
3,735
$
1,643
$
2,092
127.3
%
Operating Margin
5.5
%
2.6
%
Net Income
$
3,286
$
460
$
2,826
614.3
%
Net Margin
4.8
%
0.7
%
Adjusted EBITDA*
$
8,861
$
9,330
$
(469
)
(5.0
)%
Adjusted EBITDA* Margin
13.1
%
14.9
%
Diluted EPS
$
0.35
$
0.06
$
0.29
483.3
%
Adjusted Diluted EPS*
$
0.52
$
0.60
$
(0.08
)
(13.3
)%
*See Note 1 on page 5 for a description of
these non-GAAP financial measures and pages 10, 11 and 12 for the
reconciliation tables.
Consolidated revenue was $67.8 million, an increase of $5.0
million or 8.0%. Consolidated gross profit was $21.2 million, an
increase of $1.1 million, or 5.4%, while gross margin decreased 70
basis points primarily due to Nexa and Becnel Revenue softness.
Operating expenses were $17.5 million, a decrease of $1.0 million,
or 5.5%. The second quarter of fiscal year 2024 included a $2.8
million non-cash charge related to the Nexa earn-out agreement.
Adjusted EBITDA was $8.9 million which represented a decrease of
$0.5 million or 5.0%. Net income per diluted share was $0.35
compared to $0.06 last year. Adjusted diluted earnings per share
was $0.52 versus $0.60 last year.
Service segment second quarter results
Represents the accredited calibration, repair, inspection and
laboratory instrument services business (65.0% of total revenue for
the second quarter of fiscal 2025).
($ in thousand)
Change
FY25 Q2
FY24 Q2
$'s
%
Service Segment Revenue
$
44,083
$
41,431
$
2,652
6.4
%
Gross Profit
$
14,591
$
14,084
$
507
3.6
%
Gross Margin
33.1
%
34.0
%
Operating Income
$
3,704
$
742
$
2,962
399.2
%
Operating Margin
8.4
%
1.8
%
Adjusted EBITDA*
$
6,624
$
6,798
$
(174
)
(2.6
)%
Adjusted EBITDA* Margin
15.0
%
16.4
%
*See Note 1 on page 5 for a description of
this non-GAAP financial measure and pages 10 and 11 for the
Adjusted EBITDA Reconciliation tables.
Service segment revenue was $44.1 million, an increase of $2.7
million or 6.4%, and included $0.8 million of incremental revenue
from acquisitions. Organic revenue growth of 4.4% driven by
end-market demand and continued market share gains. The segment
gross margin was 33.1%, a decrease of 90 basis points from prior
year primarily due to lower revenue from Nexa.
Distribution segment second quarter results
Represents the sale and rental of new and used professional
grade handheld test, measurement and control instrumentation (35.0%
of total revenue for the second quarter of fiscal 2025).
($ in thousands)
Change
FY25 Q2
FY24 Q2
$'s
%
Distribution Segment Revenue
$
23,743
$
21,373
$
2,370
11.1
%
Gross Profit
$
6,615
$
6,041
$
574
9.5
%
Gross Margin
27.9
%
28.3
%
Operating Income
$
31
$
901
$
(870
)
(96.6
)%
Operating Margin
0.1
%
4.2
%
Adjusted EBITDA*
$
2,237
$
2,532
$
(295
)
(11.7
)%
Adjusted EBITDA* Margin
9.4
%
11.8
%
*See Note 1 on page 5 for a description of
this non-GAAP financial measure and pages 10 and 11 for the
Adjusted EBITDA Reconciliation tables.
Distribution revenue was $23.7 million, which represented an
increase of $2.4 million or 11.1%, driven by growth in the Rental
business including acquisitions. Distribution segment gross margin
was 27.9%, a decrease of 40 basis points due to Becnel revenue
impacted by the Gulf of Mexico hurricanes.
Six Month Review (Results are compared with the first six
months of fiscal 2024) Total revenue was $134.5 million, an
increase of $11.1 million or 9.01%. Consolidated gross profit was
up $5.0 million, or 12.9%, and gross margin expanded to 32.6% or
110 basis points. Consolidated operating expenses increased $2.5
million, or 7.6%, driven by incremental expenses from acquired
businesses, increased intangibles amortization expense and
investments in technology and our employee base to support future
growth, offset by the previously mentioned amended Nexa Earn-Out
agreement in the second quarter of fiscal year 2024. As a result,
consolidated operating income was $8.8 million compared with $6.3
million in last fiscal year’s period.
Adjusted EBITDA was $19.1 million which represented an increase
of $1.3 million or 7.1%. Net income per diluted share increased to
$0.83 from $0.43 and adjusted diluted earnings per share was $1.20
versus $1.12 last year. The effective tax rate was 13.9% compared
to 25.3% in the prior year, due to the timing of discrete benefits
related to share-based compensation items.
Balance Sheet and Cash Flow Overview
On September 28, 2024, the Company had $23.8 million in cash and
cash equivalents on hand and $80.0 million available for borrowing
under its secured revolving credit facility. Total debt was $3.0
million versus $4.2 million on March 30, 2024. The Company’s
leverage ratio, as defined in the credit agreement, was 0.08 on
September 28, 2024, compared with 0.10 on March 30, 2024.
Outlook
Mr. Rudow concluded, “We are very proud of the consistent
results the Transcat team has delivered year in and year out over
an extended period of time. That said, we are disappointed with the
Nexa-impacted aggregated results in fiscal Q2. We experienced short
term, isolated revenue challenges in the Nexa services channel in
the quarter but believe the swift actions our exceptional team is
already taking will rectify the situation in the near term, as we
continue to execute on our highly successful core growth
strategy.”
“We expect FY25 organic Service revenue growth in the mid-single
digits when normalized for the extra week in fiscal 2024 and gross
margin expansion. We anticipate a return to high single digit
organic growth by the first half of fiscal 2026.”
“Automation of our calibration processes and focus on
productivity remain key enablers of margin expansion. We have
demonstrated the ability to leverage these tools to improve our
operational efficiency, which has become visible in our financial
performance over time.”
“We continue to work our robust acquisition pipeline and are
pleased with the current flow of strategic opportunities.”
Transcat expects its income tax rate to range between 21% and
23% in fiscal 2025. This estimate includes Federal, various state,
Canadian and Irish income taxes and reflects the discrete tax
accounting associated with share-based payment awards.
Webcast and Conference Call
Transcat will host a conference call and webcast on Tuesday,
October 29, 2024 at 11:00 a.m. ET. Management will review the
financial and operating results for the first quarter, as well as
the Company’s strategy and outlook. A question and answer session
will follow the formal discussion. The review will be accompanied
by a slide presentation, which will be available at
www.transcat.com/investor-relations. The conference call can be
accessed by calling (201) 689-8471. Alternatively, the webcast can
be monitored at www.transcat.com/investor-relations.
A telephonic replay will be available from 2:00 p.m. ET on the
day of the call through Tuesday, November 5, 2024. To listen to the
archived call, dial (412) 317-6671 and enter conference ID number
13747789, access the webcast replay at
www.transcat.com/investor-relations, where a transcript will be
posted once available.
NOTE 1 – Non-GAAP Financial Measures
In addition to reporting net income, a U.S. generally accepted
accounting principle (“GAAP”) measure, we present Adjusted EBITDA
(earnings before interest, income taxes, depreciation and
amortization, non-cash stock compensation expense, and acquisition
related transaction expenses, which is a non-GAAP measure. The
Company’s management believes Adjusted EBITDA is an important
measure of operating performance because it allows management,
investors and others to evaluate and compare the performance of its
core operations from period to period by removing the impact of the
capital structure (interest), tangible and intangible asset base
(depreciation and amortization), taxes, stock-based compensation
expense and other items, which is not always commensurate with the
reporting period in which it is included. As such, the Company uses
Adjusted EBITDA as a measure of performance when evaluating its
business segments and as a basis for planning and forecasting.
Adjusted EBITDA is not a measure of financial performance under
GAAP and is not calculated through the application of GAAP. As
such, it should not be considered as a substitute for the GAAP
measure of net income and, therefore, should not be used in
isolation of, but in conjunction with, the GAAP measure. Adjusted
EBITDA, as presented, may produce results that vary from the GAAP
measure and may not be comparable to a similarly defined non-GAAP
measure used by other companies. See pages 10 and 11 for the
Adjusted EBITDA Reconciliation tables.
In addition to reporting Diluted Earnings Per Share, a GAAP
measure, we present Adjusted Diluted Earnings Per Share (net income
plus acquisition related amortization expense, acquisition related
transaction expenses, acquisition related stock-based compensation,
and acquisition amortization of backlog; divided by the average
diluted shares outstanding during the period), which is a non-GAAP
measure. Our management believes Adjusted Diluted Earnings Per
Share is an important measure of our operating performance because
it provides a basis for comparison of our business operations
between current, past and future periods by excluding items that we
do not believe are indicative of our core operating performance.
Adjusted Diluted Earnings Per Share is not a measure of financial
performance under GAAP and is not calculated through the
application of GAAP. As such, it should not be considered as a
substitute or alternative for the GAAP measure of Diluted Earnings
Per Share and, therefore, should not be used in isolation of, but
in conjunction with, the GAAP measure. Adjusted Diluted Earnings
Per Share, as presented, may produce results that vary from the
GAAP measure and may not be comparable to a similarly defined
non-GAAP measure used by other companies. See page 12 for the
Adjusted Diluted EPS Reconciliation table.
ABOUT TRANSCAT
Transcat, Inc. is a leading provider of accredited calibration,
reliability, maintenance optimization, quality and compliance,
validation, Computerized Maintenance Management System (CMMS), and
pipette services. The Company is focused on providing best-in-class
services and products to highly regulated industries, particularly
the Life Science industry, which includes pharmaceutical,
biotechnology, medical device, and other FDA-regulated businesses,
as well as aerospace and defense, and energy and utilities.
Transcat provides periodic on-site services, mobile calibration
services, pickup and delivery, in-house services at its 29
Calibration Service Centers strategically located across the United
States, Puerto Rico, Canada, and Ireland. In addition, Transcat
operates calibration labs in 21 imbedded customer-site locations.
The breadth and depth of measurement parameters addressed by
Transcat’s ISO/IEC 17025 scopes of accreditation are believed to be
the best in the industry.
Transcat also operates as a leading value-added distributor that
markets, sells and rents new and used national and proprietary
brand instruments to customers primarily in North America. The
Company believes its combined Service and Distribution segment
offerings, experience, technical expertise, and integrity create a
unique and compelling value proposition for its customers.
Transcat’s strategy is to leverage its strong brand and unique
value proposition that includes its comprehensive instrument
service capabilities, enterprise asset management, and leading
distribution platform to drive organic sales growth. The Company
will also look to expand its addressable calibration market through
acquisitions and capability investments to further realize the
inherent leverage of its business model. More information about
Transcat can be found at: Transcat.com.
Safe Harbor Statement
This news release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are not statements of historical fact
and thus are subject to risks, uncertainties and assumptions.
Forward-looking statements relate to expectations, estimates,
beliefs, assumptions and predictions of future events and are
identified by words such as “aim,” “anticipates,” “believes,”
“can,” “could,” “designed,” “estimates,” “expects,” “focus,”
“goal,” “intends,” “may,” “plan,” “outlook,” “potential,” “seek,”
“strategy,” “strive,” “target,” “will,” “would,” and other similar
words. All statements addressing operating performance, events or
developments that Transcat expects or anticipates will occur in the
future, including but not limited to statements relating to
anticipated revenue, profit margins, the commercialization of
software projects, sales operations, capital expenditures, cash
flows, operating income, growth strategy, segment growth, potential
acquisitions, integration of acquired businesses, market position,
customer preferences, outlook and changes in market conditions in
the industries in which Transcat operates are forward-looking
statements. Forward-looking statements should be evaluated in light
of important risk factors and uncertainties. These risk factors and
uncertainties include those more fully described in Transcat’s
Annual Report and Quarterly Reports filed with the Securities and
Exchange Commission, including under the heading entitled “Risk
Factors.” Should one or more of these risks or uncertainties
materialize or should any of the Company’s underlying assumptions
prove incorrect, actual results may vary materially from those
currently anticipated. In addition, undue reliance should not be
placed on the Company’s forward-looking statements, which speak
only as of the date they are made. Except as required by law, the
Company disclaims any obligation to update, correct or publicly
announce any revisions to any of the forward-looking statements
contained in this news release, whether as the result of new
information, future events or otherwise.
FINANCIAL TABLES FOLLOW.
TRANSCAT, INC.
CONSOLIDATED STATEMENTS OF
INCOME
(In Thousands, Except Per Share
Amounts)
(Unaudited)
(Unaudited)
Second Quarter Ended
Six Months Ended
September 28,
September 23,
September 28,
September 23,
2024
2023
2024
2023
Service Revenue
$
44,083
$
41,431
$
87,861
$
81,284
Distribution Revenue
23,743
21,373
46,672
42,118
Total Revenue
67,826
62,804
134,533
123,402
Cost of Service Revenue
29,492
27,347
58,387
54,229
Cost of Distribution Revenue
17,128
15,332
32,285
30,338
Total Cost of Revenue
46,620
42,679
90,672
84,567
Gross Profit
21,206
20,125
43,861
38,835
Selling, Marketing and Warehouse
Expenses
8,181
6,856
15,982
13,325
General and Administrative Expenses
9,290
11,626
19,045
19,227
Total Operating Expenses
17,471
18,482
35,027
32,552
Operating Income
3,735
1,643
8,834
6,283
Interest Expense
76
890
128
1,704
Interest Income
(286
)
-
(598
)
-
Other Expense (Income)
232
(49
)
363
15
Total Interest and Other, net
22
841
(107
)
1,719
Income Before Provision For Income
Taxes
3,713
802
8,941
4,564
Provision for Income Taxes
427
342
1,247
1,155
Net Income
$
3,286
$
460
$
7,694
$
3,409
Basic Earnings Per Share
$
0.36
$
0.06
$
0.84
$
0.44
Average Shares Outstanding
9,159
7,819
9,107
7,732
Diluted Earnings Per Share
$
0.35
$
0.06
$
0.83
$
0.43
Average Shares Outstanding
9,282
7,948
9,222
7,840
TRANSCAT, INC.
CONSOLIDATED BALANCE
SHEETS
(In Thousands, Except Share and
Per Share Amounts)
(Unaudited)
(Audited)
September 28,
March 30,
2024
2024
ASSETS
Current Assets:
Cash and Cash Equivalents
$
23,815
$
19,646
Marketable Securities
-
$
15,533
Accounts Receivable, less allowance for
credit losses of $565 and $544 as of September 28, 2024 and March
30, 2024, respectively
48,933
47,779
Other Receivables
628
506
Inventory, net
15,549
17,418
Prepaid Expenses and Other Current
Assets
6,241
4,276
Total Current Assets
95,166
105,158
Property and Equipment, net
47,493
38,944
Goodwill
138,127
105,585
Intangible Assets, net
24,362
19,987
Right to Use Assets, net
17,309
16,823
Other Assets
1,096
1,055
Total Assets
$
323,553
$
287,552
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current Liabilities:
Accounts Payable
$
13,043
$
11,495
Accrued Compensation and Other Current
Liabilities
11,092
19,665
Current Portion of Long-Term Debt
2,386
2,339
Total Current Liabilities
26,521
33,499
Long-Term Debt
612
1,817
Deferred Tax Liabilities, net
9,297
9,291
Lease Liabilities
14,661
14,873
Other Liabilities
3,705
2,903
Total Liabilities
54,796
62,383
Shareholders' Equity:
Common Stock, par value $0.50 per share,
30,000,000 shares authorized; 9,199,277 and 8,839,299 shares issued
and outstanding as of September 28, 2024 and March 30, 2024,
respectively
4,600
4,420
Capital in Excess of Par Value
178,986
141,624
Accumulated Other Comprehensive Loss
(718
)
(949
)
Retained Earnings
85,889
80,074
Total Shareholders' Equity
268,757
225,169
Total Liabilities and Shareholders'
Equity
$
323,553
$
287,552
TRANSCAT, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In Thousands)
(Unaudited)
Six Months Ended
September 28,
September 23,
2024
2023
Cash Flows from Operating
Activities:
Net Income
$
7,694
$
3,409
Adjustments to Reconcile Net Income to Net
Cash Provided by Operating Activities:
Net Loss on Disposal of Property and
Equipment
43
11
Deferred Income Taxes
6
23
Depreciation and Amortization
8,513
6,078
Provision for Accounts Receivable and
Inventory Reserves
108
347
Stock-Based Compensation Expense
1,623
2,171
Changes in Assets and Liabilities, net of
acquisitions:
Accounts Receivable and Other
Receivables
1,746
2,384
Inventory
2,597
3,376
Prepaid Expenses and Other Current
Assets
(1,918
)
465
Accounts Payable
1,525
(3,969
)
Accrued Compensation and Other Current
Liabilities
(3,248
)
1,677
Income Taxes Payable
(2,930
)
-
Net Cash Provided by Operating
Activities
15,759
15,972
Cash Flows from Investing
Activities:
Purchase of Property and Equipment
(7,633
)
(5,444
)
Business Acquisitions, net of cash
acquired
(15,858
)
(12,882
)
Sales of Marketable Securities
15,533
-
Net Cash Used in Investing Activities
(7,958
)
(18,326
)
Cash Flows from Financing
Activities:
Repayment of Revolving Credit Facility,
net
-
5,288
Repayments of Term Loan
(1,158
)
(1,112
)
Issuance of Common Stock, net of direct
costs
838
384
Repurchase of Common Stock
(3,026
)
(2,247
)
Net Cash (Used in)/Provided by Financing
Activities
(3,346
)
2,313
Effect of Exchange Rate Changes on Cash
and Cash Equivalents
(286
)
(244
)
Net Increase/(Decrease) in Cash and Cash
Equivalents
4,169
(285
)
Cash and Cash Equivalents at Beginning of
Period
19,646
1,531
Cash and Cash Equivalents at End of
Period
$
23,815
$
1,246
TRANSCAT, INC.
Adjusted EBITDA Reconciliation
Table
(In thousands)
(Unaudited)
Fiscal 2025
Q1
Q2
Q3
Q4
YTD
Net Income
$
4,408
$
3,286
$
7,694
+ Interest Income
(260
)
(210
)
(470
)
+ Other Expense
131
232
363
+ Tax Provision
820
427
1,247
Operating Income
$
5,099
$
3,735
$
8,834
+ Depreciation & Amortization
4,113
4,399
8,512
+ Transaction Expenses
434
33
467
+ Other Expense
(131
)
(232
)
(363
)
+ Non-cash Stock Compensation
697
926
1,623
Adjusted EBITDA
$
10,212
$
8,861
$
19,073
Segment
Breakdown
Service Operating Income
$
4,091
$
3,704
$
7,795
+ Depreciation & Amortization
2,402
2,455
4,857
+ Transaction Expenses
146
-
146
+ Other Expense
(96
)
(164
)
(260
)
+ Non-cash Stock Compensation
421
629
1,050
Service Adjusted EBITDA
$
6,964
$
6,624
$
13,588
Distribution Operating Income
$
1,008
$
31
$
1,039
+ Depreciation & Amortization
1,711
1,944
3,655
+ Transaction Expenses
288
32
320
+ Other Expense
(35
)
(67
)
(102
)
+ Non-cash Stock Compensation
276
297
573
Distribution Adjusted EBITDA
$
3,248
$
2,237
$
5,485
TRANSCAT, INC.
Adjusted EBITDA Reconciliation
Table
(In thousands)
(Unaudited)
Fiscal 2024
Q1
Q2
Q3
Q4
YTD
Net Income
$
2,949
$
460
$
3,348
$
6,890
$
13,647
+ Interest Expense / (Income)
814
890
(266
)
(411
)
1,027
+ Other Expense / (Income)
64
(49
)
289
11
315
+ Tax Provision
813
342
923
2,714
4,792
Operating Income
$
4,640
$
1,643
$
4,294
$
9,204
$
19,781
+ Depreciation & Amortization
2,790
3,269
3,783
3,635
13,477
+ Transaction Expenses
185
328
78
37
628
+ Acquisition Earn-Out Adjustment
-
2,800
87
(2,357
)
530
+ Other (Expense) / Income
(64
)
49
(289
)
(11
)
(315
)
+ Non-cash Stock Compensation
930
1,241
1,167
1,174
4,512
Adjusted EBITDA
$
8,481
$
9,330
$
9,120
$
11,682
$
38,613
Segment
Breakdown
Service Operating Income
$
3,192
$
742
$
2,966
$
8,144
$
15,044
+ Depreciation & Amortization
2,226
2,325
2,362
2,280
9,193
+ Transaction Expenses
185
76
30
(44
)
247
+ Acquisition Earn-Out Adjustment
-
2,800
87
(2,357
)
530
+ Other (Expense) / Income
(47
)
29
(203
)
(18
)
(239
)
+ Non-cash Stock Compensation
676
826
737
736
2,975
Service Adjusted EBITDA
$
6,232
$
6,798
$
5,979
$
8,741
$
27,750
Distribution Operating Income
$
1,448
$
901
$
1,328
$
1,060
$
4,737
+ Depreciation & Amortization
564
944
1,421
1,355
4,284
+ Transaction Expenses
-
252
48
81
381
+ Other (Expense) / Income
(17
)
20
(86
)
7
(76
)
+ Non-cash Stock Compensation
254
415
430
438
1,537
Distribution Adjusted EBITDA
$
2,249
$
2,532
$
3,141
$
2,941
$
10,863
TRANSCAT, INC.
Adjusted Diluted EPS
Reconciliation Table
(In Thousands, Except Per Share
Amounts)
(Unaudited)
Fiscal 2025
Q1
Q2
Q3
Q4
YTD
Net Income
$
4,408
$
3,286
$
7,694
+ Amortization of Intangible Assets
1,749
1,888
3,637
+ Acquisition Amortization of Backlog
24
4
28
+ Acquisition Deal Costs
434
33
467
+ Acquisition Stock Expense
234
130
364
+ Income Tax Effect at 25%
(610
)
(514
)
(1,124
)
Adjusted Net Income
$
6,239
$
4,827
$
-
$
-
$
11,066
Average Diluted Shares Outstanding
9,196
9,282
9,222
Diluted Earnings Per Share
$
0.48
$
0.35
$
-
$
-
$
0.83
Adjusted Diluted Earnings Per Share
$
0.68
$
0.52
$
-
$
-
$
1.20
Fiscal 2024
Q1
Q2
Q3
Q4
YTD
Net Income
$
2,949
$
460
$
3,348
$
6,890
$
13,647
+ Amortization of Intangible Assets
1,093
1,416
1,674
1,447
5,630
+ Acquisition Amortization of Backlog
-
19
24
24
67
+ Acquisition Deal Costs
185
328
78
81
672
+ Acquisition Stock Expense
182
274
265
258
979
+ Income Tax Effect at 25%
(365
)
(509
)
(532
)
(431
)
(1,837
)
+ Acquisition Earn-Out Adjustment
-
2,800
87
(2,358
)
529
Adjusted Net Income
$
4,044
$
4,788
$
4,944
$
5,911
$
19,687
Average Diluted Shares Outstanding
7,762
7,948
8,752
8,972
8,352
Diluted Earnings Per Share
$
0.38
$
0.06
$
0.38
$
0.77
$
1.63
Adjusted Diluted Earnings Per Share
$
0.52
$
0.60
$
0.56
$
0.66
$
2.36
TRANSCAT, INC.
Additional Information -
Business Segment Data
(Dollars in thousands)
(Unaudited)
Change
SERVICE
FY 2025 Q2
FY 2024 Q2
$'s
%
Service Revenue
$
44,083
$
41,431
$
2,652
6.4
%
Cost of Revenue
29,492
27,347
2,145
7.8
%
Gross Profit
$
14,591
$
14,084
$
507
3.6
%
Gross Margin
33.1
%
34.0
%
Selling, Marketing & Warehouse
Expenses
$
4,586
$
4,143
$
443
10.7
%
General and Administrative Expenses
6,301
9,199
(2,898
)
(31.5
)%
Operating Income
$
3,704
$
742
$
2,962
399.2
%
% of Revenue
8.4
%
1.8
%
Change
DISTRIBUTION
FY 2025 Q2
FY 2024 Q2
$'s
%
Distribution Revenue
$
23,743
$
21,373
$
2,370
11.1
%
Cost of Revenue
17,128
15,332
1,796
11.7
%
Gross Profit
$
6,615
$
6,041
$
574
9.5
%
Gross Margin
27.9
%
28.3
%
Selling, Marketing & Warehouse
Expenses
$
3,595
$
2,713
$
882
32.5
%
General and Administrative Expenses
2,989
2,427
562
23.2
%
Operating Income
$
31
$
901
$
(870
)
(96.6
)%
% of Sales
0.1
%
4.2
%
Change
TOTAL
FY 2025 Q2
FY 2024 Q2
$'s
%
Total Revenue
$
67,826
$
62,804
$
5,022
8.0
%
Total Cost of Revenue
46,620
42,679
3,941
9.2
%
Gross Profit
$
21,206
$
20,125
$
1,081
5.4
%
Gross Margin
31.3
%
32.0
%
Selling, Marketing & Warehouse
Expenses
$
8,181
$
6,856
$
1,325
19.3
%
General and Administrative Expenses
9,290
11,626
(2,336
)
(20.1
)%
Operating Income
$
3,735
$
1,643
$
2,092
127.3
%
% of Revenue
5.5
%
2.6
%
TRANSCAT, INC.
Additional Information -
Business Segment Data
(Dollars in thousands)
(Unaudited)
Change
FY 2025
FY 2024
SERVICE
YTD
YTD
$'s
%
Service Revenue
$
87,861
$
81,284
$
6,577
8.1
%
Cost of Revenue
58,387
54,229
4,158
7.7
%
Gross Profit
$
29,474
$
27,055
$
2,419
8.9
%
Gross Margin
33.5
%
33.3
%
Selling, Marketing & Warehouse
Expenses
$
8,890
$
8,250
$
640
7.8
%
General and Administrative Expenses
12,790
14,871
(2,081
)
(14.0
)%
Operating Income
$
7,794
$
3,934
$
3,860
98.1
%
% of Revenue
8.9
%
4.8
%
Change
FY 2025
FY 2024
DISTRIBUTION
YTD
YTD
$'s
%
Distribution Revenue
$
46,672
$
42,118
$
4,554
10.8
%
Cost of Revenue
32,285
30,338
1,947
6.4
%
Gross Profit
$
14,387
$
11,780
$
2,607
22.1
%
Gross Margin
30.8
%
28.0
%
Selling, Marketing & Warehouse
Expenses
$
7,093
$
5,075
$
2,018
39.8
%
General and Administrative Expenses
6,254
4,356
1,898
43.6
%
Operating Income
$
1,040
$
2,349
$
(1,309
)
(55.7
)%
% of Sales
2.2
%
5.6
%
Change
FY 2025
FY 2024
TOTAL
YTD
YTD
$'s
%
Total Revenue
$
134,533
$
123,402
$
11,131
9.0
%
Total Cost of Revenue
90,672
84,567
6,105
7.2
%
Gross Profit
$
43,861
$
38,835
$
5,026
12.9
%
Gross Margin
32.6
%
31.5
%
Selling, Marketing & Warehouse
Expenses
$
15,983
$
13,325
$
2,658
19.9
%
General and Administrative Expenses
19,044
19,227
(183
)
(1.0
)%
Operating Income
$
8,834
$
6,283
$
2,551
40.6
%
% of Revenue
6.6
%
5.1
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241028914815/en/
For more information contact:
Tom Barbato Phone: (585) 505-6530 Email:
Thomas.Barbato@transcat.com
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