Exhibit 99.1
 |
NEWS RELEASE |
Transcat, Inc. • 35 Vantage Point Drive • Rochester, NY 14624 • 585-352-7777
IMMEDIATE RELEASE
Transcat Reports Operating Income Up 14% on Record Revenue
for Fiscal 2018
| ● | Record fourth quarter and full fiscal year revenue of $42.5 million and $155.1 million, respectively |
| ● | Consolidated operating margin expanded 160 basis points to 8.3% in the fourth quarter and 30 basis points to 5.8% for the full fiscal year |
| ● | Achieved record net income of $5.9 million or $0.81 per diluted share in fiscal 2018 |
| ● | Reduced debt $4.5 million to $22.9 million at year-end as a result of strong operations and cash flows |
ROCHESTER, NY, May 22, 2018 – Transcat, Inc. (NASDAQ: TRNS) (“Transcat” or the “Company”), a leading provider of accredited calibration, repair, inspection and laboratory instrument services and value-added distributor of professional grade handheld test, measurement and control instrumentation, today reported financial results for its fourth quarter and fiscal year ended March 31, 2018 (“fiscal 2018”). Transcat operates on a 52/53 week fiscal year, ending the last Saturday in March. In a 52-week fiscal year, each of the four quarters is a 13-week period. In a 53-week fiscal year (which occurs once every five or six years), the last quarter is a 14-week period. Fiscal 2018 consisted of 53 weeks while the fiscal year ended March 25, 2017 (“fiscal 2017”) consisted of 52 weeks.
“Our fiscal 2018 results demonstrated solid performance in both of our segments as we achieved new records with more than $155 million in revenue and $5.9 million in net income. We are particularly pleased that we now have had 36 straight quarters, or nine years, of quarter-over-quarter growth in our Service segment revenue,” commented Lee D. Rudow, President and CEO. “We saw healthy demand in both segments. Strong execution in our Service segment helped us continue to take market share, especially in the targeted life science space, while our Distribution segment had growth across all channels.”
“While we didn’t see the desired improvement in reported Service gross margin, key Service performance indicators continued to move in the right direction. On a consolidated basis, we generated higher operating income, operating margin and strong cash flow, reduced debt and funded longer-term productivity enhancement investments.”
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 2 of 12
Fourth Quarter Fiscal 2018 Review (Results compared with the fourth quarter of fiscal 2017)
| ($ in thousands) | Change | |||||||||||||
| FY18 Q4 | FY17 Q4 | $'s | % | |||||||||||
| Service Revenue | $ | 21,955 | $ | 19,526 | $ | 2,429 | 12.4 | % | ||||||
| Distribution Sales | 20,497 | 18,927 | 1,570 | 8.3 | % | |||||||||
| Revenue | $ | 42,452 | $ | 38,453 | $ | 3,999 | 10.4 | % | ||||||
| Gross Profit | $ | 10,895 | $ | 9,782 | $ | 1,113 | 11.4 | % | ||||||
| Gross Margin | 25.7 | % | 25.4 | % | ||||||||||
| Operating Income | $ | 3,503 | $ | 2,565 | $ | 938 | 36.6 | % | ||||||
| Operating Margin | 8.3 | % | 6.7 | % | ||||||||||
| Net Income | $ | 2,454 | $ | 1,429 | $ | 1,025 | 71.7 | % | ||||||
| Net Margin | 5.8 | % | 3.7 | % | ||||||||||
| Adjusted EBITDA* | $ | 5,310 | $ | 4,214 | $ | 1,096 | 26.0 | % | ||||||
| Adjusted EBITDA* Margin | 12.5 | % | 11.0 | % | ||||||||||
*See Note 1 on page 5 for a description of this non-GAAP financial measure and page 10 for the Adjusted EBITDA Reconciliation table.
Transcat achieved record quarterly revenue of $42.5 million, which includes the 53rd week in fiscal 2018. Consolidated gross profit improved $1.1 million and gross margin increased 30 basis points. Total operating expenses were up only $0.2 million, or 2.4%. As a result, operating income increased nearly 37%, and operating margin expanded 160 basis points to 8.3%.
On December 22, 2017, the Tax Cuts and Jobs Act (H.R. 1) (the "Tax Act") was signed into law. The Tax Act includes numerous changes in existing tax law, including a permanent reduction in the federal corporate income tax rate from 35% to 21%. The Tax Act contains other provisions that are not expected to materially impact the Company. As a result of the reduction in the federal income tax rates, the effective tax rate for the fourth quarter of fiscal 2018 was 25.2% compared with 39.0% in the prior-year period. Fourth quarter diluted earnings per share increased $0.13 to $0.33, of which $0.06 of the increase was due to the Tax Act.
Service segment continues to deliver organic growth
Represents the accredited calibration, repair, inspection and laboratory instrument services business (52% of total revenue for the fourth quarter of fiscal 2018).
| ($ in thousands) | Change | |||||||||||||
| FY18 Q4 | FY17 Q4 | $'s | % | |||||||||||
| Service Segment Revenue | $ | 21,955 | $ | 19,526 | $ | 2,429 | 12.4 | % | ||||||
| Gross Profit | $ | 6,267 | $ | 5,864 | $ | 403 | 6.9 | % | ||||||
| Gross Margin | 28.5 | % | 30.0 | % | ||||||||||
| Operating Income | $ | 2,420 | $ | 1,993 | $ | 427 | 21.4 | % | ||||||
| Operating Margin | 11.0 | % | 10.2 | % | ||||||||||
| Adjusted EBITDA* | $ | 3,637 | $ | 3,170 | $ | 467 | 14.7 | % | ||||||
| Adjusted EBITDA* Margin | 16.6 | % | 16.2 | % | ||||||||||
*See Note 1 on page 5 for a description of this non-GAAP financial measure and page 10 for the Adjusted EBITDA Reconciliation table.
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 3 of 12
Service revenue increased on all organic growth, and was comprised of new business from the life science market and growth in general industrial manufacturing, which includes both the defense and aerospace market. When normalizing for the extra days from fiscal 2018’s 53 weeks, the Company estimates that its fourth quarter Service revenue growth was approximately 6%.
The segment gross margin was negatively impacted by the mix of services performed during the quarter and some lab closures due to March snow storms in the Northeast. Segment operating expenses were down as a percent of segment revenue, which helped drive an 80 basis point improvement in operating margin.
Strong sales and margins throughout the Distribution segment
Represents the sale and rental of new and used professional grade handheld test, measurement and control instrumentation (48% of total revenue for the fourth quarter of fiscal 2018).
| ($ in thousands) | Change | |||||||||||||
| FY18 Q4 | FY17 Q4 | $'s | % | |||||||||||
| Distribution Segment Sales | $ | 20,497 | $ | 18,927 | $ | 1,570 | 8.3 | % | ||||||
| Gross Profit | $ | 4,628 | $ | 3,918 | $ | 710 | 18.1 | % | ||||||
| Gross Margin | 22.6 | % | 20.7 | % | ||||||||||
| Operating Income | $ | 1,083 | $ | 572 | $ | 511 | 89.3 | % | ||||||
| Operating Margin | 5.3 | % | 3.0 | % | ||||||||||
| Adjusted EBITDA* | $ | 1,673 | $ | 1,044 | $ | 629 | 60.2 | % | ||||||
| Adjusted EBITDA* Margin | 8.2 | % | 5.5 | % | ||||||||||
*See Note 1 on page 5 for a description of this non-GAAP financial measure and page 10 for the Adjusted EBITDA Reconciliation table.
The Distribution sales increase reflects higher rental revenue, which was up 67% to $1.0 million, and the additional week in the fourth quarter of fiscal 2018. The segment gross profit improved due to a mix of higher margin new product sales and increased rentals which have a higher margin profile. Segment operating expenses were down as a percent of segment sales, which combined with gross profit expansion helped drive a 230 basis point improvement in operating margin.
Full-Year Fiscal 2018 Review (Results compared with fiscal 2017)
| ($ in thousands) | Change | |||||||||||||
| FY18 | FY17 | $'s | % | |||||||||||
| Service Revenue | $ | 77,445 | $ | 71,103 | $ | 6,342 | 8.9 | % | ||||||
| Distribution Sales | 77,696 | 72,795 | 4,901 | 6.7 | % | |||||||||
| Revenue | $ | 155,141 | $ | 143,898 | $ | 11,243 | 7.8 | % | ||||||
| Gross Profit | $ | 37,441 | $ | 34,970 | $ | 2,471 | 7.1 | % | ||||||
| Gross Margin | 24.1 | % | 24.3 | % | ||||||||||
| Operating Income | $ | 9,026 | $ | 7,934 | $ | 1,092 | 13.8 | % | ||||||
| Operating Margin | 5.8 | % | 5.5 | % | ||||||||||
| Net Income | $ | 5,922 | $ | 4,522 | $ | 1,400 | 31.0 | % | ||||||
| Net Margin | 3.8 | % | 3.1 | % | ||||||||||
| Adjusted EBITDA* | $ | 16,368 | $ | 14,520 | $ | 1,848 | 12.7 | % | ||||||
| Adjusted EBITDA* Margin | 10.6 | % | 10.1 | % | ||||||||||
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 4 of 12
*See Note 1 on page 5 for a description of this non-GAAP financial measure and page 10 for the Adjusted EBITDA Reconciliation table.
Total revenue increased to a record $155.1 million on all organic growth. When normalizing for the extra days from fiscal 2018’s 53 weeks, the Company estimates that its full year Service revenue growth was approximately 7%. The Distribution sales increase reflected $1.2 million more in rental revenue and increased demand from industrial customers.
As a percentage of total revenue, consolidated operating expenses were 18.3%, down 50 basis points. As a result, operating income increased $1.1 million, or 13.8%, to $9.0 million, or 5.8% of revenue.
Transcat achieved record net income of $5.9 million and diluted earnings per share of $0.81, up $0.17, or 26.6%. Adjusted EBITDA improved 12.7% to $16.4 million and as a percent of total revenue was up 50 basis points to 10.6%. See Note 1 on page 5 for a description of this non-GAAP financial measure and page 10 for the Adjusted EBITDA Reconciliation table.
Balance Sheet and Cash Flow Overview
Net cash provided by operating activities was $9.9 million, up $2.3 million, or 30.9%. Capital expenditures were $5.9 million for fiscal 2018. Investments were primarily for assets for customer-driven expansion of Service segment capabilities, including mobile calibration fleet investments and RF/electronics assets for the aerospace/defense and life science markets, and purchases of rental business assets.
At March 31, 2018, the Company had total debt of $22.9 million, with $21.3 million available under its secured revolving credit facility. Total debt at year-end was down $4.5 million from the prior year end. The Company’s leverage ratio, as defined in its credit agreement, was 1.40 at March 31, 2018, compared with 1.88 at fiscal 2017 year-end.
Outlook
Mr. Rudow concluded, “We are pleased with the results we delivered for fiscal 2018. We continue to expect mid to high single-digit organic growth in our Service segment and believe we will continue to take market share, particularly within the life science space. Our pipeline of acquisition opportunities is strong, and continues to be an important element of our long-term growth strategy. We are building our business for the long term with investments in operational excellence and technology, both of which are designed to improve infrastructure to expand margins incrementally over time.
“We think we have a great leadership team in place, are confident in our direction, and believe we have positioned Transcat to be successful for our shareholders.”
Transcat expects its income tax rate to range between 25% and 27% in fiscal 2019. This rate includes Federal, various state, and Canadian income taxes.
The Company anticipates total capital expenditures to be approximately $7.0 million to $7.5 million in fiscal 2019, with the majority of the incremental capital expenditures in excess of fiscal 2018 spend levels planned for IT infrastructure investments to drive operational excellence and for growth-oriented opportunities within both of its operating segments. Maintenance/existing asset replacements are expected to be consistent with fiscal 2018 at approximately $1.0 million to $1.5 million.
Webcast and Conference Call
Transcat will host a conference call and webcast on Wednesday, May 23, 2018 at 11:00 a.m. Eastern Time. Management will review the financial and operating results for the fourth quarter and full fiscal year, as well as the Company’s strategy and outlook. A question and answer session will follow the
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 5 of 12
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. Eastern Time on the day of the call through Wednesday, May 30, 2018. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13678786, or 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, and non-cash stock compensation expense), 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, and stock-based compensation expense, 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 the attached Adjusted EBITDA Reconciliation table on page 10.
ABOUT TRANSCAT
Transcat, Inc. is a leading provider of accredited calibration, repair, inspection and laboratory instrument services. The Company is focused on
providing best-in-class services and products to highly regulated industries, including life science, aerospace and defense, pharmaceutical, medical device manufacturing and biotechnology. Transcat provides permanent and periodic on-site services, mobile
calibration services and in-house services through 22 Calibration Service Centers strategically located across the United States, Puerto Rico and Canada. 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 the complementary nature of its two operating segments, its comprehensive service capabilities, strong brand, enhanced e-commerce capabilities 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 are identified by words
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 6 of 12
such as “expects,” “estimates,” “projects,” “anticipates,” “believes,” “could,” and other similar words. All statements addressing operating performance, events or developments that Transcat, Inc. expects or anticipates will occur in the future, including but not limited to statements relating to anticipated revenue, profit margins, 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 are 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. 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.
For more information contact:
| Michael J. Tschiderer | Deborah K. Pawlowski |
| Chief Financial Officer | Investor Relations |
| Phone: (585) 352-7777 | Phone: (716) 843-3908 |
| Email: mtschiderer@transcat.com | Email: dpawlowski@keiadvisors.com |
FINANCIAL TABLES FOLLOW.
The Company plans on timely filing its Annual Report on Form 10-K before the required filing date.
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 7 of 12
TRANSCAT, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Share Amounts)
| Fourth Quarter Ended | Fiscal Year Ended | |||||||||||
| (Unaudited) | (Unaudited) | (Audited) | ||||||||||
| March 31, | March 25, | March 31, | March 25, | |||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||
| Service Revenue | $ | 21,955 | $ | 19,526 | $ | 77,445 | $ | 71,103 | ||||
| Distribution Sales | 20,497 | 18,927 | 77,696 | 72,795 | ||||||||
| Total Revenue | 42,452 | 38,453 | 155,141 | 143,898 | ||||||||
| Cost of Service Revenue | 15,688 | 13,662 | 57,523 | 52,064 | ||||||||
| Cost of Distribution Sales | 15,869 | 15,009 | 60,177 | 56,864 | ||||||||
| Total Cost of Revenue | 31,557 | 28,671 | 117,700 | 108,928 | ||||||||
| Gross Profit | 10,895 | 9,782 | 37,441 | 34,970 | ||||||||
| Selling, Marketing and Warehouse | ||||||||||||
| Expenses | 4,317 | 3,942 | 16,564 | 16,554 | ||||||||
| Administrative Expenses | 3,075 | 3,275 | 11,851 | 10,482 | ||||||||
| Total Operating Expenses | 7,392 | 7,217 | 28,415 | 27,036 | ||||||||
| Operating Income | 3,503 | 2,565 | 9,026 | 7,934 | ||||||||
| Interest and Other Expense, net | 224 | 223 | 1,078 | 770 | ||||||||
| Income Before Income Taxes | 3,279 | 2,342 | 7,948 | 7,164 | ||||||||
| Provision for Income Taxes | 825 | 913 | 2,026 | 2,642 | ||||||||
| Net Income | $ | 2,454 | $ | 1,429 | $ | 5,922 | $ | 4,522 | ||||
| Basic Earnings Per Share | $ | 0.34 | $ | 0.20 | $ | 0.83 | $ | 0.65 | ||||
| Average Shares Outstanding | 7,152 | 7,024 | 7,124 | 6,994 | ||||||||
| Diluted Earnings Per Share | $ | 0.33 | $ | 0.20 | $ | 0.81 | $ | 0.64 | ||||
| Average Shares Outstanding | 7,376 | 7,189 | 7,303 | 7,111 | ||||||||
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 8 of 12
TRANSCAT, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share and Per Share Amounts)
| (Unaudited) | (Audited) | |||||||
| March 31, | March 25, | |||||||
| 2018 | 2017 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 577 | $ | 842 | ||||
| Accounts Receivable, less allowance for doubtful accounts of $296 and $210 as of March 31, 2018 and March 25, 2017, respectively | 24,684 | 22,049 | ||||||
| Other Receivables | 1,361 | 1,227 | ||||||
| Inventory, net | 12,651 | 10,278 | ||||||
| Prepaid Expenses and Other Current Assets | 1,240 | 1,193 | ||||||
| Total Current Assets | 40,513 | 35,589 | ||||||
| Property and Equipment, net | 17,091 | 15,568 | ||||||
| Goodwill | 32,740 | 32,520 | ||||||
| Intangible Assets, net | 5,505 | 7,519 | ||||||
| Other Assets | 973 | 901 | ||||||
| Total Assets | $ | 96,822 | $ | 92,097 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts Payable | $ | 13,535 | $ | 11,615 | ||||
| Accrued Compensation and Other Liabilities | 5,240 | 5,907 | ||||||
| Income Taxes Payable | 232 | 805 | ||||||
| Current Portion of Long-Term Debt | 2,143 | 1,429 | ||||||
| Total Current Liabilities | 21,150 | 19,756 | ||||||
| Long-Term Debt | 20,707 | 25,883 | ||||||
| Deferred Tax Liability | 1,709 | 1,134 | ||||||
| Other Liabilities | 1,908 | 1,923 | ||||||
| Total Liabilities | 45,474 | 48,696 | ||||||
| Shareholders' Equity: | ||||||||
| Common Stock, par value $0.50 per share, 30,000,000 shares authorized; 7,155,050 and 7,043,754 shares issued and outstanding as of March 31, 2018 and March 25, 2017, respectively | 3,578 | 3,522 | ||||||
| Capital in Excess of Par Value | 14,965 | 12,996 | ||||||
| Accumulated Other Comprehensive (Loss) | (281 | ) | (414 | ) | ||||
| Retained Earnings | 33,086 | 27,297 | ||||||
| Total Shareholders' Equity | 51,348 | 43,401 | ||||||
| Total Liabilities and Shareholders' Equity | $ | 96,822 | $ | 92,097 | ||||
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 9 of 12
TRANSCAT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
| For the Fiscal Year Ended | ||||||||
| (Unaudited) | (Audited) | |||||||
| March 31, | March 25, | |||||||
| 2018 | 2017 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net Income | $ | 5,922 | $ | 4,522 | ||||
| Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: | ||||||||
| Loss/(Gain) on Sale of Property and Equipment | 133 | (4 | ) | |||||
| Deferred Income Taxes | 765 | 63 | ||||||
| Depreciation and Amortization | 5,991 | 6,184 | ||||||
| Provision for Accounts Receivable and Inventory Reserves | 92 | 376 | ||||||
| Stock-Based Compensation | 1,411 | 453 | ||||||
| Changes in Assets and Liabilities: | ||||||||
| Accounts Receivable and Other Receivables | (2,952 | ) | (4,728 | ) | ||||
| Inventory | (1,674 | ) | (3,425 | ) | ||||
| Prepaid Expenses and Other Assets | (259 | ) | (224 | ) | ||||
| Accounts Payable | 1,920 | 3,107 | ||||||
| Accrued Compensation and Other Liabilities | (686 | ) | 405 | |||||
| Income Taxes Payable | (789 | ) | 815 | |||||
| Net Cash Provided by Operating Activities | 9,874 | 7,544 | ||||||
| Cash Flows from Investing Activities: | ||||||||
| Purchase of Property and Equipment | (5,882 | ) | (5,250 | ) | ||||
| Proceeds from Sale of Property and Equipment | 11 | 59 | ||||||
| Business Acquisitions, net of cash acquired | - | (6,977 | ) | |||||
| Net Cash Used in Investing Activities | (5,871 | ) | (12,168 | ) | ||||
| Cash Flows from Financing Activities: | ||||||||
| Repayment of Revolving Credit Facility, net | (9,878 | ) | (452 | ) | ||||
| Proceeds from Term Loan | 7,143 | 10,000 | ||||||
| Repayments of Term Loan | (1,726 | ) | (1,310 | ) | ||||
| Issuance of Common Stock | 931 | 635 | ||||||
| Repurchase of Common Stock | (360 | ) | (98 | ) | ||||
| Stock Option Redemption | (90 | ) | (966 | ) | ||||
| Payment of Contingent Consideration & Holdbacks Related to | ||||||||
| Business Acquisition | - | (3,041 | ) | |||||
| Net Cash (Used in) Provided by Financing Activities | (3,980 | ) | 4,768 | |||||
| Effect of Exchange Rate Changes on Cash | (288 | ) | 57 | |||||
| Net (Decrease) Increase in Cash | (265 | ) | 201 | |||||
| Cash at Beginning of Period | 842 | 641 | ||||||
| Cash at End of Period | $ | 577 | $ | 842 | ||||
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 10 of 12
TRANSCAT, INC.
Adjusted EBITDA Reconciliation Table
(Dollars in thousands)
(Unaudited)
| FY 2018 | ||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | YTD | ||||||||||||||||
| Net Income | $ | 856 | $ | 781 | $ | 1,831 | $ | 2,454 | $ | 5,922 | ||||||||||
| + Interest Expense | 236 | 281 | 250 | 251 | 1,018 | |||||||||||||||
| + Other Expense / (Income) | 36 | (10 | ) | 61 | (27 | ) | 60 | |||||||||||||
| + Tax Provision | 283 | 406 | 512 | 825 | 2,026 | |||||||||||||||
| Operating Income | $ | 1,411 | $ | 1,458 | $ | 2,654 | $ | 3,503 | $ | 9,026 | ||||||||||
| + Depreciation & Amortization | 1,487 | 1,497 | 1,543 | 1,464 | 5,991 | |||||||||||||||
| + Other (Expense) / Income | (36 | ) | 10 | (61 | ) | 27 | (60 | ) | ||||||||||||
| + Noncash Stock Compensation | 499 | 332 | 264 | 316 | 1,411 | |||||||||||||||
| Adjusted EBITDA | $ | 3,361 | $ | 3,297 | $ | 4,400 | $ | 5,310 | $ | 16,368 | ||||||||||
| Segment Breakdown | ||||||||||||||||||||
| Service Operating Income | $ | 885 | $ | 790 | $ | 1,063 | $ | 2,420 | $ | 5,158 | ||||||||||
| + Depreciation & Amortization | 1,110 | 1,107 | 1,126 | 1,054 | 4,397 | |||||||||||||||
| + Other (Expense) / Income | (28 | ) | 4 | (45 | ) | 8 | (61 | ) | ||||||||||||
| + Noncash Stock Compensation | 249 | 168 | 134 | 155 | 706 | |||||||||||||||
| Service Adjusted EBITDA | $ | 2,216 | $ | 2,069 | $ | 2,278 | $ | 3,637 | $ | 10,200 | ||||||||||
| Distribution Operating Income | $ | 526 | $ | 668 | $ | 1,591 | $ | 1,083 | $ | 3,868 | ||||||||||
| + Depreciation & Amortization | 377 | 390 | 417 | 410 | 1,594 | |||||||||||||||
| + Other (Expense) / Income | (8 | ) | 6 | (16 | ) | 19 | 1 | |||||||||||||
| + Noncash Stock Compensation | 250 | 164 | 130 | 161 | 705 | |||||||||||||||
| Distribution Adjusted EBITDA | $ | 1,145 | $ | 1,228 | $ | 2,122 | $ | 1,673 | $ | 6,168 | ||||||||||
| FY 2017 | ||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | YTD | ||||||||||||||||
| Net Income | $ | 906 | $ | 917 | $ | 1,270 | $ | 1,429 | $ | 4,522 | ||||||||||
| + Interest Expense | 137 | 180 | 184 | 218 | 719 | |||||||||||||||
| + Other Expense / (Income) | 31 | 11 | 4 | 5 | 51 | |||||||||||||||
| + Tax Provision | 364 | 470 | 895 | 913 | 2,642 | |||||||||||||||
| Operating Income | $ | 1,438 | $ | 1,578 | $ | 2,353 | $ | 2,565 | $ | 7,934 | ||||||||||
| + Depreciation & Amortization | 1,549 | 1,556 | 1,562 | 1,517 | 6,184 | |||||||||||||||
| + Other (Expense) / Income | (31 | ) | (11 | ) | (4 | ) | (5 | ) | (51 | ) | ||||||||||
| + Noncash Stock Compensation | 149 | 177 | (10 | ) | 137 | 453 | ||||||||||||||
| Adjusted EBITDA | $ | 3,105 | $ | 3,300 | $ | 3,901 | $ | 4,214 | $ | 14,520 | ||||||||||
| Segment Breakdown | ||||||||||||||||||||
| Service Operating Income | $ | 1,044 | $ | 791 | $ | 941 | $ | 1,993 | $ | 4,769 | ||||||||||
| + Depreciation & Amortization | 1,247 | 1,137 | 1,158 | 1,118 | 4,660 | |||||||||||||||
| + Other (Expense) / Income | (27 | ) | (12 | ) | (7 | ) | (9 | ) | (55 | ) | ||||||||||
| + Noncash Stock Compensation | 80 | 94 | (25 | ) | 68 | 217 | ||||||||||||||
| Service Adjusted EBITDA | $ | 2,344 | $ | 2,010 | $ | 2,067 | $ | 3,170 | $ | 9,591 | ||||||||||
| Distribution Operating Income | $ | 394 | $ | 787 | $ | 1,412 | $ | 572 | $ | 3,165 | ||||||||||
| + Depreciation & Amortization | 302 | 419 | 404 | 399 | 1,524 | |||||||||||||||
| + Other (Expense) / Income | (4 | ) | 1 | 3 | 4 | 4 | ||||||||||||||
| + Noncash Stock Compensation | 69 | 83 | 15 | 69 | 236 | |||||||||||||||
| Distribution Adjusted EBITDA | $ | 761 | $ | 1,290 | $ | 1,834 | $ | 1,044 | $ | 4,929 | ||||||||||
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 11 of 12
TRANSCAT, INC.
Additional Information - Business Segment Data
(Dollars in thousands)
(Unaudited)
| Change | |||||||||||||||
| FY 2018 | FY 2017 | ||||||||||||||
| SERVICE | Q4 | Q4 | $'s | % | |||||||||||
| Service Revenue | $ | 21,955 | $ | 19,526 | $ | 2,429 | 12.4 | % | |||||||
| Cost of Revenue | 15,688 | 13,662 | 2,026 | 14.8 | % | ||||||||||
| Gross Profit | $ | 6,267 | $ | 5,864 | $ | 403 | 6.9 | % | |||||||
| Gross Margin | 28.5 | % | 30.0 | % | |||||||||||
| Selling, Marketing & Warehouse | $ | 2,207 | $ | 2,024 | $ | 183 | 9.0 | % | |||||||
| General & Administrative Expenses | 1,640 | 1,847 | (207 | ) | (11.2 | )% | |||||||||
| Operating Income | $ | 2,420 | $ | 1,993 | $ | 427 | 21.4 | % | |||||||
| % of Revenue | 11.0 | % | 10.2 | % | |||||||||||
| Change | |||||||||||||||
| DISTRIBUTION | FY 2018 | FY 2017 | |||||||||||||
| Q4 | Q4 | $'s | % | ||||||||||||
| Distribution Sales | $ | 20,497 | $ | 18,927 | $ | 1,570 | 8.3 | % | |||||||
| Cost of Sales | 15,869 | 15,009 | 860 | 5.7 | % | ||||||||||
| Gross Profit | $ | 4,628 | $ | 3,918 | $ | 710 | 18.1 | % | |||||||
| Gross Margin | 22.6 | % | 20.7 | % | |||||||||||
| Selling, Marketing & Warehouse | $ | 2,110 | $ | 1,918 | $ | 192 | 10.0 | % | |||||||
| General & Administrative Expenses | 1,435 | 1,428 | 7 | 0.5 | % | ||||||||||
| Operating Income | $ | 1,083 | $ | 572 | $ | 511 | 89.3 | % | |||||||
| % of Sales | 5.3 | % | 3.0 | % | |||||||||||
| Change | |||||||||||||||
| TOTAL | FY 2018 | FY 2017 | |||||||||||||
| Q4 | Q4 | $'s | % | ||||||||||||
| Total Revenue | $ | 42,452 | $ | 38,453 | $ | 3,999 | 10.4 | % | |||||||
| Total Cost of Revenue | 31,557 | 28,671 | 2,886 | 10.1 | % | ||||||||||
| Gross Profit | $ | 10,895 | $ | 9,782 | $ | 1,113 | 11.4 | % | |||||||
| Gross Margin | 25.7 | % | 25.4 | % | |||||||||||
| Selling, Marketing & Warehouse | $ | 4,317 | $ | 3,942 | $ | 375 | 9.5 | % | |||||||
| General & Administrative Expenses | 3,075 | 3,275 | (200 | ) | (6.1 | )% | |||||||||
| Operating Income | $ | 3,503 | $ | 2,565 | $ | 938 | 36.6 | % | |||||||
| % of Revenue | 8.3 | % | 6.7 | % | |||||||||||
Transcat Reports Operating Income Up 14% on Record Revenue for Fiscal 2018
May 22, 2018
Page 12 of 12
TRANSCAT, INC.
Additional Information - Business Segment Data
(Dollars in thousands)
(Unaudited)
| Change | |||||||||||||||
| SERVICE | FY 2018 | FY 2017 | $'s | % | |||||||||||
| Service Revenue | $ | 77,445 | $ | 71,103 | $ | 6,342 | 8.9 | % | |||||||
| Cost of Revenue | 57,523 | 52,064 | 5,459 | 10.5 | % | ||||||||||
| Gross Profit | $ | 19,922 | $ | 19,039 | $ | 883 | 4.6 | % | |||||||
| Gross Margin | 25.7 | % | 26.8 | % | |||||||||||
| Selling, Marketing & Warehouse | $ | 8,517 | $ | 8,839 | $ | (322 | ) | (3.6 | )% | ||||||
| General & Administrative Expenses | 6,247 | 5,431 | 816 | 15.0 | % | ||||||||||
| Operating Income | $ | 5,158 | $ | 4,769 | $ | 389 | 8.2 | % | |||||||
| % of Revenue | 6.7 | % | 6.7 | % | |||||||||||
| Change | |||||||||||||||
| DISTRIBUTION | FY 2018 | FY 2017 | $'s | % | |||||||||||
| Distribution Sales | $ | 77,696 | $ | 72,795 | $ | 4,901 | 6.7 | % | |||||||
| Cost of Sales | 60,177 | 56,864 | 3,313 | 5.8 | % | ||||||||||
| Gross Profit | $ | 17,519 | $ | 15,931 | $ | 1,588 | 10.0 | % | |||||||
| Gross Margin | 22.5 | % | 21.9 | % | |||||||||||
| Selling, Marketing & Warehouse | $ | 8,047 | $ | 7,715 | $ | 332 | 4.3 | % | |||||||
| General & Administrative Expenses | 5,604 | 5,051 | 553 | 10.9 | % | ||||||||||
| Operating Income | $ | 3,868 | $ | 3,165 | $ | 703 | 22.2 | % | |||||||
| % of Sales | 5.0 | % | 4.3 | % | |||||||||||
| Change | |||||||||||||||
| TOTAL | FY 2018 | FY 2017 | $'s | % | |||||||||||
| Total Revenue | $ | 155,141 | $ | 143,898 | $ | 11,243 | 7.8 | % | |||||||
| Total Cost of Revenue | 117,700 | 108,928 | 8,772 | 8.1 | % | ||||||||||
| Gross Profit | $ | 37,441 | $ | 34,970 | $ | 2,471 | 7.1 | % | |||||||
| Gross Margin | 24.1 | % | 24.3 | % | |||||||||||
| Selling, Marketing & Warehouse | $ | 16,564 | $ | 16,554 | $ | 10 | 0.1 | % | |||||||
| General & Administrative Expenses | 11,851 | 10,482 | 1,369 | 13.1 | % | ||||||||||
| Operating Income | $ | 9,026 | $ | 7,934 | $ | 1,092 | 13.8 | % | |||||||
| % of Revenue | 5.8 | % | 5.5 | % | |||||||||||
